When must an Auntie Annes lessee prepay the first two months' rental fee for the SRU?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
The Maximum Monthly Rental Fee (as defined below) for the first two months of the SRU operation must be prepaid by Lessee to Lessor ("Prepayment") upon the execution of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, a lessee is required to prepay the maximum monthly rental fee for the first two months of SRU (Satellite Retail Unit) operation. This prepayment is due upon the execution of the SRU lease agreement with the lessor.
This condition means that a new Auntie Annes franchisee leasing an SRU must have sufficient capital to cover these initial rental fees upfront, before the SRU even begins operation. This is in addition to other initial fees such as the security deposit ($1,000) and set-up fee ($500) that are also due upon execution of the agreement.
Unlike most other fees associated with the SRU, such as ongoing monthly rental fees, the prepayment is not subject to the standard ten-day payment window after invoicing. This up-front payment requirement highlights the importance of careful financial planning and budgeting for prospective Auntie Annes SRU franchisees.