FEES**

Initial Fee

You must pay us an initial fee equal to the sum of (a) $17,500 plus (b) the product of $150 times the number of Guest Rooms in excess of 50 (the "Initial Fee") when you sign the Franchise Agreement. The Initial Fee is fully earned and non-refundable and must be paid before we will countersign the Franchise Agreement, unless we have agreed to permit you to make installment payments, in which case you will sign a promissory note and make payments as provided under the promissory note. During the 2024 fiscal year, we offered qualified franchisees financing up to $20,000 for the Initial Fee. See Item 10 for additional details relating to initial fee installment payments. During the 2024 fiscal year, we charged discounted Initial Fees ranging from $7,500 (for an ABVI Hotel with 40 Guest Rooms) to $17,500 (for an ABVI Hotel with 135 Guest Rooms).

"Guest Rooms" means transient hotel rooms located at the Hotel and is not dependent upon occupancy of the hotel rooms. By way of example, if your Hotel has 70 Guest Rooms, the Initial Fee will be $20,500 ($17,500 plus $150 times 20).

If you are a new franchisee that is acquiring an existing ABVI Hotel from a current franchisee of the Brand, that particular franchisee's franchise agreement may provide for a particular transfer fee to be paid as part of the transfer, which is calculated pursuant to our current "application fee". As shown above, we now call the "application fee" the "Initial Fee," and as such, any references to "application fee" in existing franchise agreements of the Brand are referred to, and calculated, as the Initial Fee, as described above. During the 2024 fiscal year, we charged discounted transfer fees ranging from $0 to $12,000.

Other Initial Fees

You will pay us an onboarding administration fee of $1,000 for the onboarding services we provide to you in connection with the opening of your Hotel under the Brand. This fee is nonrefundable and is due during or immediately after the onboarding process. During the 2024 fiscal year, we charged discounted onboarding administration fees ranging from $0 to $1,000.

You will be required to pay a property management system ("PMS") Interface and Tokenization Set Up Fee, which is charged by our third-party central reservation system ("CRS") provider, for setting up an interface with your PMS. You must pay the base fee in the amount of $650, which includes CRS tokenization and 2-way PMS integration. Additional optional features and services are available for additional fees, including 2-way RMS integration for $295 and/or 2 way enhanced reservation push for $800. We will collect this PMS Interface and Tokenization Set Up Fee from you and remit it to our CRS provider. This fee will be due when billed and is non-refundable.

You will also be required to pay us a $400 revenue management system ("RMS") installation fee. This fee will be due when billed and is non-refundable.

If you are converting an existing hotel into an ABVI Hotel, we may issue you a Property Improvement Plan ("PIP") to which you must agree as a condition of approval that sets forth a list of items you must perform to conform your Hotel to the Brand Standards prior to your Opening Date (or within such timeframe as may be stated in the PIP). If we issue you a PIP, we may require you to pay us a non-refundable fee of up to $5,000, before we approve you as a Franchisee, to cover the cost of preparing or verifying completion of the PIP (the "PIP Fee"). "Opening Date" means the date your Hotel opens for business under the Brand. If we are required to reinspect your Hotel to ensure you have complied with the PIP, you must pay us a PIP reinspection fee of up to $5,000. These fees will be due when billed and are non-refundable.

If you require assistance from us to configure and install certain components of your Hotel's IT system and property management system, you will be required to pay us a services fee. The components you implement for your Hotel will depend upon the complexity of your Hotel, such as the size and location, and the existing systems in your Hotel. The IT implementation services fee is up to $10,000. This fee is due when billed and is non-refundable.

You will pay us a fee in the amount of $1,500 for the initial brand training we provide to you. The initial brand training fee is due when you sign the Franchise Agreement and is nonrefundable. In the event the initial brand training is conducted in-person rather than virtually, you must also reimburse us for our personnel's travel, meals, and lodging expenses, which we estimate to be up to $2,500. These costs are due when billed and are non-refundable.

Source: Item 5 — INITIAL FEES (FDD pages 22–24)