Central Bark’s Initial Franchise Fee, Royalty Fee + 22 Other Fees

Detailed Information on Central Bark’s Initial Franchise Fee, Royalty Fee + 22 Other Fees (Items 5 and 6, 2021 FDD)

 1.  Initial Franchise Fee:  $20,000 to $45,000

• You must pay an initial franchise fee of $45,000. The initial franchise fee will be paid in a lump sum when you sign the Franchise Agreement.

• If, during the initial training program, the franchisor determines that you (or your Managing Owner, as defined in Item 11) are unable to complete the initial training program to its satisfaction, it may terminate your Franchise Agreement. In such event, the franchisor will refund $10,000 of your initial franchise fee. You must sign a general release in the form prescribed by the franchisor of any and all claims against it as a condition to receive this refund.

2.  Lease Review Fee:  up to $2,500

• It is your responsibility to obtain a fully executed lease assignment agreement in connection with executing the lease for the Central Bark facility.

• The franchisor’s approval of the lease is subject to its receipt of the lease assignment agreement without modification or negotiation, signed by you and the landlord.

• If you or the landlord request that the franchisor consider any modifications to the lease assignment agreement, and it agrees to do so, it may also require you to reimburse it all expenses that it incurs (including attorneys’ fees) in connection with the review.

• The franchisor may reject any request for modifications to the lease assignment agreement for any reason. The franchisor estimates this review may cost up to $2,500, depending on the extent of the changes to the lease assignment agreement requested.

3.  Royalty Fee:  6% of Gross Sales

• Due Date:  On the first business day after the 15th day of the following month.

• Transmitted via electronic funds transfer.

4.  Marketing Fund:  the greater of (i) 2% of Gross Sales or (ii) $500

• Due Date:  On the first business day after the 15th day of the following month.

• Transmitted via electronic funds transfer.

5.  National Convention Fee:  currently, $375 for you (or the Managing Owner) and $275 for an additional manager

• Due Date:  As billed by the franchisor.

• The franchisor will charge you a fee for attending the National Convention.

• You (or your Managing Owner) must attend the National Convention annually, and one additional manager of the Franchised Business may attend.

• You are responsible for all costs and expenses for travel, lodging, and meals for your attendees.

6.  Technology Fee:  currently, the franchisor does not charge this fee, but anticipates that it may charge a fee of $75 per month

• Due Date:  As incurred.

• The franchisor may charge you a technology fee for technology-related services, such as customer management system and intranet services and support.

• The fee charged may vary based on the services provided.

7.  Email Fee:  currently, a one-time fee of $60 per email address issued to you beyond the first 2 email addresses

• Due Date:  As incurred.

8.  Insurance:  will vary under the circumstances

• Due Date:  As incurred.

• If you fail to obtain or maintain the minimum required insurance, the franchisor may maintain the insurance on your behalf and you will be required to reimburse the franchisor for the cost of such insurance.

9.  Transfer:  $5,000 to 15,000

• Due Date:  Upon approval of assignment.

• If you sell your Central Bark facility to an existing franchisee of the franchisor, you will pay a transfer fee of $5,000.

• If you sell your Central Bark facility to a third-party who is not then the franchisor’s franchisee, you will pay a transfer fee of $15,000.

• Transfer fees are not refundable.

• If you transfer the Franchise Agreement to a wholly-owned corporation or limited liability company, the transfer fee will not apply but you must reimburse the franchisor for any direct costs it incurs in connection with the transfer, including reasonable legal fees.

10.  Local Advertising Cooperative (“LAC”) Contribution:  an amount determined by the members of the LAC

• Due Date:  On the first business day after the 15th day of the following month.

• If there is an LAC in your area, LAC contributions will be transmitted via electronic funds and credited to your Local Expenditures.

11.  Renewal:  25% of then-current initial franchise fee

• Due Date:  Upon signing of renewal Franchise Agreement.

12.  Training Fee:  currently, $5,000

• Due Date:  As billed by the franchisor.

• If franchisee is an entity and designates a new Managing Owner after the Franchised Business has commenced operation, the new Managing Owner will need to complete the initial training program to Central Bark’s satisfaction and you will be required to pay the training fee.

13.  Additional Training/On-Site Assistance:  $500 per day for the franchisor’s personnel, plus lodging and meals estimated at $100 to $200 per day

• Due Date:  After the Central Bark facility opens.

14.  Operating Procedure Review and Inspection:  $100 per hour

• Due Date:  Immediately upon demand.

• If you ask the franchisor to use any operating procedure that does not strictly comply with System Standards, the franchisor may, at your expense, review materials and/or inspect the Franchised Business.

15.  Supplier and Product Testing Fee:  application fee (currently $250)

• Due Date:  As incurred.

• The franchisor may charge you a fee for evaluating a new supplier or new products that you propose to use.

16.  Mystery Shopper Fee:  approximately $200, but subject to change

• Due Date:  Immediately upon demand.

• You must reimburse the franchisor for its costs and expenses associated with the inspections of third-party mystery shoppers who will pose as normal customers and perform specific tasks (such as make a purchase, ask questions, or seek customer service) and evaluate the services received at the Franchised Business.

17.  Unauthorized Advertising Fee:  currently $500, but subject to change

• Due Date:  Immediately upon demand.

• This fee is payable to the Marketing Fund if you use unapproved or disapproved advertising or promotional materials.

18.  Interest:  maximum by law or 1½% per month

• Due Date:  From date payment is due until paid in full.

19.  Indemnification:  maximum by law

• Due Date:  From date payment is due until paid in full.

• Indemnify and hold the franchisor harmless with respect to losses and expenses arising out of your act.

20.  Late Payments:  $250 for each financial report that is past due

• Due Date:  Immediately upon demand.

• Payable if you fail to submit financial reports when due.

21.  Audit:  actual cost of audit, plus interest on overdue amount

• Due Date:  Immediately upon demand.

22.  Costs and Attorneys’ Fees:  actual costs and fees

• Due Date:  Immediately upon demand.

• The prevailing party in any legal proceeding is entitled to reimbursement of costs and attorneys’ fees.

23.  Insurance:  will vary under the circumstances

• Due Date:  As incurred.

• If you fail to obtain or maintain the minimum required insurance, the franchisor may maintain the insurance on your behalf and you will be required to reimburse the franchisor for the cost of such insurance.

24.  Liquidated Damages:  will vary under the circumstances

• Due Date:  As incurred.

• If the Franchise Agreement is terminated because of your (or any of your owner’s) default or by you without cause, you will pay the franchisor the then net present value of Royalty Fees, Marketing Fund contributions, and LAC contributions that would have become due from the date of termination to the scheduled expiration date of the Franchise Agreement.