When are the initial franchise fees due to Auntie Annes under the MUA Franchise Agreements?

According to Auntie Annes' 2024 Franchise Disclosure Document, the initial franchise fees under the MUA (Multi-Unit Addendum) Franchise Agreements are due in a lump sum upon the execution of the MUA Franchise Agreements. This means that a franchisee must pay the entire initial franchise fee at the time they sign the agreement to develop multiple Auntie Annes locations.

This policy has significant financial implications for franchisees pursuing multi-unit development. Unlike single-unit agreements where fees might be staggered, Auntie Annes requires the full payment upfront. This could represent a substantial capital outlay early in the relationship. The FDD states that Auntie Annes has no obligation to refund any portion of the Initial Franchise Fees, even if the Addendum or any of the MUA Franchise Agreements are terminated and/or the franchisee fails to develop one or more of the MUA Businesses.

It is important for prospective franchisees to fully understand this non-refundable policy and carefully assess their ability to meet the development schedule outlined in Appendix B of the MUA Franchise Agreements. If a franchisee anticipates potential difficulties in meeting deadlines, they should be aware that Auntie Annes may grant extensions, but can require a $2,500 extension fee for each extended deadline. The franchisor is not obligated to extend any deadlines. This policy underscores the importance of thorough due diligence and financial planning before entering into a multi-unit agreement with Auntie Annes.