Initial FDD Questionnaire

FRANCHISE DISCLOSURE DOCUMENT QUESTIONNAIRE

Welcome to The Franchise Firm LLP. This Questionnaire is designed to gather the information that we will need in order to prepare the Franchise Disclosure Document (or "FDD") for your franchise program in accordance with the Federal Trade Commission's ("FTC") amended Franchise Rule and applicable state law. While the Questionnaire is lengthy, it is important for you to provide as much relevant and responsive information as possible. Your completion of the Questionnaire will assist us in preparing your FDD quickly and efficiently. Please feel free to contact us if you are not sure how to answer a particular question or would like to discuss a particular response in detail. (The franchising company is referred to in the Questionnaire as the "Franchisor," "you" or “your.”)

ITEM 1

THE FRANCHISOR, AND ANY PARENT, PREDECESSORS, AND AFFILIATES

1. What is the name of the entity that will serve as the Franchisor? What was the state in which the entity was formed? What date was the entity formed?

Name of the entity

State

Date

If the Franchisor entity has not been formed, please advise.

2. What is the Franchisor's general business email address?

3. What is the Franchisor’s address and telephone number?

Address

Telephone

4. What is the Franchisor's primary website?

5. Please send us a JPEG of your primary logo that franchisees will use which will be included in the FDD.

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6. Does the Franchisor have a parent company? A "parent" is an entity that controls the Franchisor directly, or indirectly through one or more subsidiaries.

Yes

Please include name of parent company, state of formation, and principal business address of the parent company :

Name of Parent Company

State of Formation

Principal Business Address

7. Did the Franchisor have a predecessor company? A "predecessor" is a person or entity from whom the Franchisor acquired, directly or indirectly, the major portion of its assets.

Yes

Please include :

Name of the Predecessor

Date of Asset Purchase

Please skip to Question #14.

9. Did the predecessor company conduct a business of the type to be operated by the franchisee?

Yes

Disclose the time period (month and year) during which the predecessor conducted the business :

10. Did the predecessor company offer franchises for the same type of business as that to be operated by the franchisee?

Yes

Disclose the time period (month and year) during which the predecessor offered such franchises :

11. Did the predecessor company offer franchises in other lines of business?

Yes

Describe such other lines of business :

12. How many franchised units were sold by the predecessor company?

13. What was the length of time the predecessor company offered these franchises?

14. Name each of the Franchisor's affiliate companies which is “affiliate” is defined as a company controlled by, controlling or under common control with the Franchisor. For each affiliate, please provide the information below :

Name of Affiliate Company	State of Incorporation	Principal Place of Business Address

15. Does any affiliate company own a location/corporate unit of the Franchisor?

Yes

please provide each affiliate company’s name, state of incorporation, address of the location/corporate unit owned, and date (month and year) the location/corporate unit opened.

Name of Affiliate Company	State of Incorporation	Address of Location/Corporate Unit Owned	Date the Location/Corporate Unit Opened

16. Will the Franchisor or any affiliate be providing products or services to franchisees?

Yes

Please provide the name of the supplier affiliate and the specific products and services provided to franchisees.

17. Describe the general market for the product or service to be offered by the franchisee (e.g., is the market developed or developing, are goods or services provided primarily to a certain group of people, are sales seasonal, etc.) :

18. Are there any laws or regulations specific to the industry in which the franchisee will operate (other than laws that apply to businesses generally)?

Yes

Please describe :

ITEM 2

BUSINESS EXPERIENCE

19. In Item 2 of the FDD, you need to disclose five years of business experience for each of the Franchisor’s directors, trustees, general partners, principal officers, and any other individuals who will have management responsibility relating to the sale or operation of franchises. Each of the individuals falling under one of these categories should complete a Management Questionnaire attached as Exhibit “A” to ensure disclosure of all information required to be included in Items 2.

Please upload the completed Management Questionnaire attached as Exhibit "A" to provide the required information for Item 2 of the FDD.

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ITEM 3

LITIGATION

20. In Item 3 of the FDD, you need to disclose certain litigation-related information for entities and individuals including the Franchisor, a parent of the Franchisor who guarantees the Franchisor’s performance or otherwise induces franchise sales, the Franchisor’s predecessors, an affiliate of the Franchisor, and any of the individuals listed in Item 2. Each of the entities or individuals falling under one of the above categories should complete Exhibit “A” to this Questionnaire to ensure disclosure of all information required to be included in Item 3.

Please upload Exhibit "A" of the Questionnaire to disclose the required litigation-related information for Item 3 of the FDD.

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ITEM 4

BANKRUPTCY

21. In Item 4 of the FDD, you need to disclose certain bankruptcy-related information for the Franchisor, any parent, predecessor, affiliate, officer, or general partner of the Franchisor, or any individual listed in Item 2. Each of the entities or individuals falling under one of these categories should complete Exhibit “A” to this Questionnaire to ensure disclosure of all information required to be included in Item 4.

Please upload Exhibit "A" of the Questionnaire to disclose the required bankruptcy-related information for Item 4 of the FDD.

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ITEM 5

INITIAL FEES

22. What will be the amount of the initial franchise fee charged to franchisees for a single franchised business?

23. Will the initial franchise fee be payable in a lump sum only or will you offer installment payments or other financing options to franchisees?

Lump Sum Only

Installment Payments

Other Financing Options

Please provide the payment terms including duration of financing, interest rate and other payment terms :

24. Will the initial franchise fee be refundable?

Yes

Under what circumstances?

25. Will you charge the same initial franchise fee to all franchisees?

Yes

Describe the method or formula by which the initial franchise fee will be determined :

26. Do you plan to offer a Multi-Unit Development Agreement in which a franchisee or developer buys the rights to develop more than one franchised business?

Yes

Your FDD will need to include a Multi-Unit Development Agreement, and we can discuss the differing way this offering can be structured. There will also be additional disclosures throughout the FDD that will need to be made, which we will discuss in detail.

27. Will Franchisor or any affiliate be acting as a supplier of goods or services to franchisees?

Yes

Please provide the following :

A. Who will be the supplier to franchisees?

B. What goods and/or services are being supplied to franchisees from Franchisor or its affiliates?

C. What is the initial cost for the goods and/or services purchased from Franchisor or its affiliates?

ITEM 6

OTHER FEES

28. Please disclose, by filling in the chart below, the other recurring or isolated fees or payments made by franchisee and paid to the Franchisor or its affiliates or will be collected by Franchisor or its affiliates on behalf of a third party. Please advise: (i) if the fee is a flat rate, percentage or other calculation; (ii) the amount of the fee; (iii) the date it will be due and collected by Franchisor or its affiliates; and (iv) any additional information you want us to know about the payment (please add any additional fees not included in the chart).

Name of Fee

Amount

Due Date

Remarks

Royalty Fee

Local Advertising Fee

Advertising Fund Fee

Additional Training

Refresher Training

Additional Assistance

Contractor's Fee or other Development Fee

Transfer Fee

Renewal Fee

Audit Fee

Interest

Late Fee

Operations Manual Replacement Cost

Management Fee

Maintenance Fee

Costs and Attorneys' Fees

Indemnification

Relocation Expenses

29. Will the Franchisor’s franchise system have any advertising or purchasing cooperatives?

Yes

Further discussion will be done during drafting the FDD.

30. Please complete the following chart on Franchisor’s best estimate of all the expenses expected to be incurred by a typical franchisee as to its initial investment in opening its franchised business. If there are any expenses not included in the chart below that are applicable to opening a franchised business, please add them. If a particular expense is not applicable, please mark "N/A." Please include (i) the estimated amount in a range from low to high; (ii) how franchisee will typically make payment (i.e. lump sum); (iii) when the amount would be due; and (iv) to who franchisee will pay for each item.

Type of Expenditure

Estimated Amount or Estimated LowHigh Range

Method of Payment

When Due

To Whom Payment is to be Made

Initial Franchise Fee

Leasehold Improvements

Furniture, Fixtures and Equipment

Signage

Rent Cost (for 3 months)

Security Deposits

Utility Deposits

Opening Inventory and Supplies

Computer Systems (POS System, computers, etc.)

Insurance Deposits and Premiums (for 3 months)

Business Licenses and Permits

Professional Fees (attorneys, architects, CPAs)

Grand Opening Advertising

Training Expenses (including travel)

Additional Funds (for 3 months)

TOTAL ESTIMATED INITIAL INVESTMENT

31. Are any of these payments in the Chart above refundable?

Yes

Please describe when a refund would be applicable :

32. Will any part of the franchisee's initial investment be financed by Franchisor, a person affiliated with the Franchisor or an affiliate?

Yes

Please advise:

A. What expenditure is to be financed?

B. The down payment required :

C. Duration of financing :

D. Interest rate :

ITEM 8

RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

33. Will Franchisor or any affiliate be acting as a supplier of goods or services to franchisees?

Yes

A. Who will be the supplier to franchisees?

B. What goods and/or services are being supplied to franchisees from Franchisor or its affiliates?

34. Will Franchisor or an affiliate be the exclusive supplier of any goods or services to franchisees?

Yes

Please describe the product or service that will be exclusively supplied to franchisees by Franchisor or an affiliate :

35. Provide the name of each officer of Franchisor that owns an interest in any supplier of goods or services to franchisees, including Franchisor’s affiliates.

36. How are suppliers evaluated, approved or disapproved by Franchisor (i.e., what criteria does the Franchisor consider in determining whether to approve the proposed supplier; and what information will or may the Franchisor request from the franchisee or proposed supplier to evaluate such proposed supplier)?

37. Are any fees payable to the Franchisor to secure the approval of proposed suppliers?

Yes

What is the fee?

38. What is the estimated percentage of the total initial investment franchisees will make to either Franchisor, its affiliates or the vendors that you specify and/or approve?

39. What is the estimated percentage of the ongoing operations cost to a franchisee that will ne made to Franchisor, its affiliates or the vendors that you specify and/or approve?

40. Will Franchisor or any affiliate make any revenue or other consideration due to franchisees purchases?

Yes

Please describe :

41. Will Franchisor or any affiliate obtain any discount, rebate, or other benefit in connection franchisees purchases from any supplier?

Yes

Please describe :

42. Will Franchisor or any affiliate be entering into purchasing or distribution arrangements with any suppliers?

Yes

Please describe :

ITEM 10

FINANCING

43. Will Franchisor or any affiliate offer financing to franchisee?

Yes

Please advise :

A. What financing is offered?

B. Required down payment?

C. Duration of financing :

D. Interest rate :

44. Are there any written arrangements between the Franchisor or its affiliates and a lender for the lender to offer financing to a franchisee?

Yes

Please describe :

45. Are there any arrangements in which the Franchisor or its affiliates receive a "benefit" (e.g., commission or finder's fee) from a lender for franchisee financing?

Yes

Please describe :

46. Does the Franchisor intend to guarantee any note, lease or other agreement executed by the franchisee?

Yes

Please describe :

ITEM 11

FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEM AND TRAINING

List Below

48. Identify the services Franchisor will provide to franchisees after opening the franchised business. These may include (check if applicable):

Providing refresher or continuing training

Providing other continuing management assistance (such as administrative, bookkeeping, accounting or inventory control services)

Promotional or advertising programs

Sales of goods or services

Establishing or suggesting pricing

Hiring and training employees

Helping franchisee with operating problems

Others

List Below

49. What is the estimated length of time between the signing of the franchise agreement and the opening of the franchisee's business?

50. Will the franchisees be making contributions towards an advertising fund?

Yes

Please advise the fee franchisees will contribute (percentage of sales, flat fee, etc.)

51. Will the Franchisor or affiliate owed locations contribute equally to the advertising fund?

Yes

52. Will the Franchisor use the advertising fund to directly solicit the sale of franchises?

Yes

53. Does the Franchisor require franchisees to buy or use any computer system in the operation of the franchised business including POS systems, CRMs, or other hardware or software?

Yes

Please describe the systems requirement generally including what hardware and software is required:

54. Does the Franchisor, an affiliate, or a third party have an obligation to provide maintenance, repairs, upgrades or updates to the franchisee’s computer system?

Yes

Please provide details:

55. What is the annual costs for optional or required maintenance and support contracts, upgrades and updates to the franchisee’s computer system (it can be an estimate or a range)?

56. Will the Franchisor have independent access to the franchisee’s computer system through a CRM, POS System or other means?

Yes

Please provide details:

57. You will be required to include the table of contents to the Franchisor’s operations manual as an exhibit to the FDD. It must include the number of pages in each section and the total number of pages in the operations manual. Please provide the table of contents to us when available.

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58. Describe the Franchisor's initial training program for franchisees, including:

A. Location :

B. How often training is expected to be conducted:

C. The person who will be in charge of training for the franchisees and their experience with the Franchisor and in the field (this can be more than one person):

59. Will the franchisee be charged a fee for training?

Yes

Describe the charges:

60. Who will be required to attend the initial training program?

61. Is there a maximum number of people that can attend training for the franchisee?

Yes

How many:

62. Please complete the following chart, which details the initial training program that the Franchisor will be providing to franchisees. Please provide: (i) the subject to be taught during training, (ii) the hours spent on that subject in the classroom or on the job; and (iii) the location of the training including whether remote, online or held at a corporate or affiliate location :

Subject	Hours of Classroom Training	Hours of On the Job Training	Location

ITEM 12

TERRITORY

63. Will the franchised business location be approved by the franchisor?

Yes

64. Will the franchisee have a protected territory around their franchise location or other protected area?

Yes

Please advise how you plan to determine the territory (i.e. radius around location, population etc.)

65. If a franchisee is given a protected territory, please provide the average or minimum territory that will be offered to franchisees.

Note : We will provide in the FDD and franchise agreement that a franchisor can determine the specific territory based on the location of the franchisee and that may vary depending on franchisee’s target area (i.e. a highly dense metropolitan area may have a smaller territory).

66. If a franchisee is given a protected territory, will there be any conditions to maintaining the territory (i.e. certain sales volume, market penetration, etc.)?

Yes

Please provide details :

ITEM 13

TRADEMARKS

67. Have you obtained registration or filed for registration on the USPTO for all primary trademarks, service marks, trade names, logotypes or other commercial symbols that will be used by the franchisee?

Yes

Please complete the table below for each trademark :

DESCRIPTION OF THE TRADEMARK	REGISTRATION OR APPLICATION NUMBER	OWNER OF THE TRADEMARK

Let’s discuss the trademarks that will be used and the process for registration.

ITEM 14

PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION

68. Does the Franchisor own any patent rights, or does the Franchisor have any pending patent applications, which are material to the franchise being sold?

Yes

Please provide the details as to each patent including the patent number, issuance date and duration, title and type (e.g., mechanical, process or design); also, please identify the subject matter of each patent application by serial number, filing date, title and type :

69. Are there any copyrights filed with the United States Register of Copyrights which are related to the franchise being offered?

Yes

Please provide the details about each copyright including subject matter of each copyright, the registration number and date :

ITEM 15

OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISED BUSINESS

70. Will the franchisee or operating principal of the franchisee be required to exercise onpremises supervision or to participate personally in the direct operation of the franchised business?

Yes

71. Will the franchisee be permitted to hire a manager(s) to supervise the franchised business?

Yes

ITEM 18

PUBLIC FIGURES

72. Are there any public figures who use the franchise's name or symbol or who will endorse or recommend the franchise to prospective franchisees? (A "public figure" is someone whose name or physical appearance is generally known to the public in the geographic area where the franchise will be located).

Yes

Please advise who and any compensation provided to the public figure including interest in the franchise :

ITEM 19

FINANCIAL PERFORMANCE REPRESENTATIONS

73. Item 19 to the FDD allows a Franchisor to make a "financial performance representation" which is information (whether oral, written or visual or in any other form) given to a prospective franchisee by, on behalf of or at the direction of the franchisor or its agent that states, expressly or by implication, a specific level or range of actual or potential sales, income or profit from franchised or non-franchised units. Providing this information to potential franchisees is strictly regulated by federal and state franchise law and Item 19 is the only optional disclosure in the FDD. If the Franchisor has any interest in providing this type of information, please advise us so that we can discuss what is involved in preparing a formal financial performance representation made within the FDD. We will also discuss what can and cannot be done during the sale process given the disclosure made or not made in Item 19.

Please advise :

ITEM 20

OUTLETS AND FRANCHISEE INFORMATION

74. Item 20 to the FDD requires that the Franchisor detail information about existing corporate, affiliate owed and franchise units. We will complete the required Item 20 information based on the information provided above. However, please provide your projected target area (state) and the amount of units you expect to open during this fiscal year in each state. We will also discuss certain requirements that will need to be done in some states based on your projected target area :

STATE	NUMBER OF FRANCHISED UNIT PROJECTED

ITEM 21

FINANCIAL STATEMENTS

75. The FDD must contain three years of financial statements for the Franchisor prepared in accordance with U.S. GAAP (or as permitted by the Securities Exchange Commission) and audited by a licensed, independent CPA using U.S. GAAS, and presented in tabular form that compares at least two fiscal years. You are allowed to phase in the three years of financial statements and depending on what states you wish to sell in during your first fiscal year, you will either be required to provide an opening balance sheet or audited financial statements.

Let’s discuss the financial statement requirement for your initial FDD and the ongoing requirement each year thereafter :

EXHIBIT A

FRANCHISE MANAGEMENT QUESTIONNAIRE

Each person who is a director, trustee, general partner, officer, or other person who will have management responsibility relating to the sale or the operation of the franchise system by the franchisor (the “Franchisor”) must provide certain information for the Franchisor's franchise disclosure document (“FDD”). Please be sure to sign the last page as requested to indicate your verification that all answers given in this questionnaire are complete, true and accurate.

This information should be updated as it changes from time to time and annually for the FDD update.

PLEASE RESPOND TO ALL QUESTIONS COMPLETELY.

I. HISTORY

A. Individual's full name :

B. Business address, telephone number and email address :

Business Address :

Phone :

Email :

Fax :

C. Current position with Franchisor (title) :

D. Beginning date of current position with Franchisor :

E. Provide your full work/employment and business history for the past five years, including with the Franchisor and its affiliates (including while a student or if not employed please state so) :

Title/ Position	Company	Type of Company	City/State	Start Date (month/year)	End Date (month/year)

II. LITIGATION, ADMINISTRATIVE ACTIONS AND ARBITRATIONS

A. Are you, at the present time :

1. A defendant (or defendant to a counterclaim) in a pending administrative, criminal or civil action against you which alleges:

(a) A violation of any franchise law?

Yes

(b) A violation of any antitrust law?

Yes

(d) Fraud?

Yes

(e) Unfair or deceptive practices?

Yes

(f) Or comparable allegations?

Yes

2. A defendant (or a defendant to a counterclaim) in any pending civil action considered material in the context of the number of franchisees and the size, nature or financial condition of the franchise system or business operations?

Yes

Note: For purposes of this questionnaire, an “action” includes a lawsuit, administrative action or an arbitration claim. A material action is an action that a prospective franchisee would consider important in deciding to do business with the Franchisor. If you are in doubt whether the action is material, please answer yes and describe the action as required by Paragraph F.(1) below.

3. A defendant in a pending criminal case?

Yes

B. During the ten (10) year period prior to the date of this questionnaire, have you :

1. Have you ever been convicted of a felony?

Yes

2. Have you ever pleaded nolo contendere (no contest) to a felony charge?

Yes

3. Been held liable in a civil action, including a lawsuit, administrative action or an arbitration, involving

(a) A violation of any franchise law?

Yes

(b) A violation of any antitrust law?

Yes

(d) Fraud?

Yes

(e) Unfair or deceptive practices?

Yes

(f) Or comparable allegations?

Yes

Note: For purposes of this question, "held liable" means a finding by final judgment in a judicial, binding arbitration or administrative proceeding. “Held liable” means that as a result of claims or counterclaims, the person must pay money or other consideration, must reduce an indebtedness by the amount of an award, cannot enforce its rights, or must take some action adverse to its interests. Held liable also includes civil, administrative or arbitration actions the person settled where the terms of settlement required the person to pay money or other consideration, forgive or reduce indebtedness, relinquish rights or take any action adverse to its interests.

C. Are you at the present time :

1. Subject to any currently effective injunctive or restrictive order or decree resulting from a pending or concluded action brought by a public agency and relating to the franchise or to a Federal, State, or Canadian franchise, securities, antitrust, trade regulation or trade practice law?

Yes

2. Subject to any currently effective order of any national securities association or national securities exchange suspending or expelling you from membership in such association or exchange?

Yes

Note: For purposes of these questions, "currently effective" means an injunctive or restrictive order or decree that has not been vacated or rescinded by a court or by an issuing public agency.

C. If the answer to any of the questions in II.A. through II.E. is yes, please provide the following information :

1. For litigation :

(a) Names of the parties

(b) Nature of the case (including claims and relief sought)

(d) Date of filing

(e) Docket number

(f) Relationship of party bringing the action to the defendant (i.e., former franchisee, supplier, etc.)

(g) Current status of pending actions

(h) Date of conviction or date judgment was entered

(i) Penalty, damages assessed and terms of settlement

2. For orders or decrees:

(a) Name of agency and court

(b) Summary of allegations or facts

Also include the name, telephone number and address of your counsel :

Name

Phone

Address

Please provide us with copies of all court pleadings :

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III. BANKRUPTCY

A. During the ten (10) year period immediately preceding the date of this questionnaire, have you :

1. Filed as a debtor (or had filed against you) a petition to start an action under the U.S. Bankruptcy Code or the bankruptcy laws of any foreign nations?

Yes

2. Obtained a discharge of your debts under the bankruptcy laws?

Yes

3. Or were you a principal officer of any company or a general partner in any partnership that either filed as a debtor (or had filed against it) a petition to start an action under the U.S. Bankruptcy Code or similar foreign laws or that obtained a discharge of its debts under the Bankruptcy Code during or within one (1) year after you left your position in such company or partnership?

Yes

B. If so, describe :

1. The name of the person or company that filed a petition (either voluntarily or involuntarily) or obtained a discharge of its debts under the Bankruptcy Code :

2. The party's relationship to the Franchisor, if any :

3. The court, case name and number and relevant dates :

4. Any material facts or circumstances relating to the proceeding. In the event of a discharge in bankruptcy, please state the discharge date and describe the reorganization plans, if applicable :

IV. CERTIFICATION *

I certify that the foregoing information is true, correct and complete as of this date.

Signature

Sign Here

Print Name :

Date :