Under what conditions will Annex Brands not unreasonably withhold approval of a transfer?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee and its owners are in full compliance with this Agreement and all other agreements between Franchisee and Franchisor or any of its affiliates, Franchisor will not unreasonably withhold its approval of a requested transfer that meets all the applicable requirements of this Subsection 13.C.
The proposed transferee or its owners must be individuals of good moral character and otherwise meet Franchisor's then-applicable standards for franchisees.
If the transfer is of a controlling interest in Franchisee, or is one of a series of transfers that in the aggregate constitute the transfer of a controlling interest in Franchisee, all of the following conditions must be met prior to, or concurrently with, the effective date of the transfer:
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- The transferee, including all its officers, directors or partners will jointly and severally execute the then-current franchise agreement and other standard ancillary agreements thereby agreeing to be bound by all the terms and conditions of those agreement(s) (except that no additional initial franchise fee will be charged).
A transfer has the effect of superseding the previous franchise agreement, when a new franchise agreement is entered into with the transferee.
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, Annex Brands will not unreasonably withhold approval of a requested transfer if the franchisee and its owners are in full compliance with the Franchise Agreement and all other agreements between the franchisee and Annex Brands or its affiliates. Additionally, the proposed transferee or its owners must be individuals of good moral character and meet Annex Brands' then-applicable standards for franchisees.
If the transfer involves a controlling interest in the franchise, or is one of a series of transfers that in the aggregate constitute the transfer of a controlling interest, the transferee, including all its officers, directors, or partners, must jointly and severally execute the then-current franchise agreement and other standard ancillary agreements. By doing so, they agree to be bound by all the terms and conditions of those agreements, although no additional initial franchise fee will be charged.
This condition ensures that the new franchisee is fully committed to the Annex Brands system and meets the required standards. The execution of a new franchise agreement with the transferee supersedes the previous agreement, providing a fresh start under the current terms and conditions. This protects Annex Brands' interests and maintains consistency across its franchise network.