Is attendance at national conventions required for Annex Brands franchisees?

's expense.

Franchisor may require Franchisee, previously trained and experienced managers, and/or new managers or personnel, to attend periodic training courses online or at locations designated by Franchisor. Franchisor may offer national conventions and/or regional meetings at various times in the future for additional training in marketing, advertising, equipment technology, business management and in other areas, and may offer optional training programs. Franchisor may charge Franchisee a registration or other fee for any refresher training course, national convention, regional meeting or optional training program. Franchisee and/or Franchisee's designated personnel must attend the full program of, and must stay at the designated hotel of, each national convention held by the Franchisor, Franchisee and/or Franchisee's designated personnel must attend any regional meeting held in Franchisee's geographical area.

Beginning after Franchisee (i) opens the Center, (ii) assumes the operation of an existing Center by transfer, or (iii) converts an existing business to a Center, Franchisor will collect from Franchisee as national convention participation deposits the sum of $25 per week each Tuesday after the close of business, for the previous week ending Saturday, by automatic draft from Franchisee's designated bank account. The amount, frequency, date and method of collection of the national convention participation deposits are subject to change in Franchisor's sole discretion, after at least 15 days' prior notice to Franchisee. National convention participation deposits will be applied to the per-person national convention registration fee and the national convention hotel fee for 1 room for the next scheduled national convention. If Franchisee's accrued national convention participation deposits are not sufficient to cover these fees, Franchisor has the right to debit Franchisee's bank account for the difference. If Franchisee and/or Franchisee's designated personnel attend the full program of, and stay at the designated hotel of, a national convention, any unused national convention participation deposits will remain with Franchisor as a credit toward the registration fee and the hotel fee for the next national convention unless, subject to Franchisor's approval in its sole discretion, the unused national convention participation deposits are applied towards or reimbursed for Franchisee's other expenses associated with the national convention,

including travel expenses, incidental expenses and additional lodging expenses. If Franchisee and/or Franchisee's designated personnel fail to attend the full program of, or fail to stay at the designated hotel of, a national convention, these accrued deposits will be forfeited and retained by Franchisor as of the closing date of the national convention. If Franchisee transfers the Franchise, the Center or this Agreement, or any interest in the Franchise, the Center, this Agreement or Franchisee, as specified and in accordance with Section 13 of this Agreement, Franchisor will transfer any of Franchisee's accrued national convention participation deposits to the transferee as the transfer closing date. Franchisee may negotiate with the transferee that the amount be reimbursed to Franchisee by transferee through the Escrow Agent (as defined in Subsection 13.C.9 of this Agreement) at the closing as an adjustment to the sales price. Any accrued national convention participation deposits will be forfeited and retained by Franchisor on expiration, termination or non-renewal of the Franchise, and/or closure of the Center.

Any expenses, including lodging, room, board, travel, salaries, and incidental expenses incurred by Franchisee or Franchisee's personnel in connection with attending training, meetings, seminars, or national conventions are the responsibility of Franchisee.

B. GUIDANCE. Franchisor, or its regional licensees or agents, may periodically advise Franchisee on operating issues disclosed by reports on the Center submitted to Franchisor or inspections of the Center made by Franchisor.

Source: Item 22 — Contracts (FDD pages 109–110)