ANCHISE SYSTEM, LLC**

TABLE OF CONTENTS

Independent Auditor's Report

To the Members Baya Bar Franchise System, LLC Staten Island, New York

Report on the Audit of the Financial Statements

Opinion

We have audited the accompanying balance sheets of Baya Bar Franchise System, LLC as of December 31, 2023, and 2022 and the related statements of operations, members' equity and cash flows for the years ended December 31, 2023, 2022, and 2021, and the related notes to the financial statements.

In our opinion the financial statements referred to above present fairly, in all material respects, the financial position of Baya Bar Franchise System, LLC as of December 31, 2023, and 2022, and the results of their operations and their cash flows for the years ended December 31, 2023, 2022, and 2021, in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Baya Bar Franchise System, LLC and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Baya Bar Franchise System, LLC's ability to continue as a going concern for one year after the date that the financial statements are issued.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if

there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Baya Bar Franchise System, LLC's internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting\nestimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Baya Bar Franchise System, LLC's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control—related matters that we identified during the audit.

Ft. Collins, Colorado April 27, 2024

Reese CPALLC

BALANCE SHEETS BAYA BAR FRANCHISE SYSTEM, LLC

| 2023 | 2022 | |---|---| The accompanying notes are an integral part of this financial statement.

BAYA BAR FRANCHISE SYSTEM, LLC STATEMENTS OF OPERATIONS AND MEMBER'S EQUITY

| Deferred Non-refundable Franchise Fees: | | | |---|---|---| | Balance Beginning of year | $ 143,625 | $ 18,500 | | Deferral of non-refundable franchise fees | 45,000 | 140,000 | | Recognition of non-refundable franchise fees | (18,375) | (14,875) | | Balance at end of year | $ 170,250 | $ 143,625 | The accompanying notes are an integral part of these financial statements.

BAYA BAR FRANCHISE SYSTEM, LLC STATEMENTS OF CASH FLOWS

| with franchisees for the years ended December 31, 2023, 2022, and 2021 is as follows: | | | | | |---|---|---|---|---| | | 2023 | 2022 | 2021 | | | Performance obligations satisfied at a point | | | | | | in time | $ 728,128 | | $ 513,038 | $ 487,513 | | Performance obligations satisfied through | | | | | | the passage of time | 18,375 | 14,875 | 1,500 | | | Total revenues | $ 746,503 | | $ 527,913 | $ 489,013 | The accompanying notes are an integral part of these financial statements.

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Baya Bar Franchise System, LLC ('the Company') was formed as a limited liability company on March 14, 2018, in the State of Delaware .

The Company offers qualified purchasers the right to establish and operate a specialty acai retail and café business model operating under the trade name "Baya Bar." A Baya Bar franchise operates using the franchisor's proprietary products, recipes, formulae, techniques, trade dress, trademarks, and logos.

Related Parties:

The Company has seven related entities.

Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 55–56)