What events trigger the Indemnity obligation for a Best Brains franchisee?

Question

Accepted Answer

| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
|  | Add-on Programs incur a monthly royalty of 7% of Gross Add-on Program Sales. |  |  |
| Technology Fee | $40 per month for 0-100 students $60 per month for 101- 200 students $80 per month for 200+ students | Payable monthly | The Company may require the Franchisee to utilize a computer system, including without limitation a cloud-based portal for day-to-day operations of the franchise. FA Secs. 2(C) and 5(S). |
| Brand Development Fund | $1 per subject per student up to $3, subject to a $250 per month minimum | Payable the 19th of each month | FA Sec. 2(D). |
| Interest | 2% per month, or the maximum amount allowed by law, whichever is less | Owed on past due amounts | You must pay interest on any amounts owed to us from the date due until fully paid. FA Sec. 2(E). |
| Late Fee | $100 per incident | As incurred | Applies to each NSF check, late payment, or failure to timely provide reports and financial statements. FA Sec. 2(F). |
| Renewal Fee | 10% of the then current initial franchise fee. | At time of renewal | FA Secs. 2(G) and 6(B). |
| Subject Material Fee | $5-$8 per month per subject | Monthly | For the availability and distribution of e-learning material.FA Sec. 2(I). |
| bbSupport Fee | $1 per subject (Math or English) per student monthly | Monthly | This fee is for app support from certified teachers (hired by Corporate) to any Best Brains students enrolled in Math or English |
| Placement Test Review | $1,500 per Placement | Upon submission of |  |
| Fee | Test | placement test |  |
| Certification Fee | $50 per attempt | As incurred | You must get training/operations manual certified every 3 years and upon renewal. FA Sec. 2(J). |
| Additional Assistance | Currently $500 per day plus costs. | As incurred | At your request, we will provide additional assistance beyond our standard support, based on our then current fee for the respective |
| Type of Fee | Amount | Due Date | Remarks |
| Annual Conference Fee | $500 per year | $125 per month in January – May of each year | You shall attend annual training conferences and seminars as we specify. You agree that we can charge you this fee. If you attend our annual conference, we will refund this amount to you in full. FA Sec. 5(P). |
| Regional Advisory Franchisee Council | None Currently. | As incurred | The Regional Advisory Council would choose its own assessments. FA Sec. 5(Q). |
| Management Fee | To be determined under circumstances. Currently $500 per day, plus reasonable expenses. | As incurred | Payable during period that our appointed manager manages the Franchised Business upon your default, death, or disability. FA Sec. 7(D). |
| Indemnity | Actual amount of loss or expense incurred. | At time incurred | You agree to reimburse us if we are held liable for certain claims. FA Secs. 7(D), 8(E)., and 10(O). |

Source: Item 6 — OTHER FEES (FDD pages 11–15)

What events trigger the Indemnity obligation for a Best Brains franchisee?

Answer from 2025 FDD Document

What This Means (2025 FDD)

Type of Fee	Amount	Due Date	Remarks
	Add-on Programs incur a monthly royalty of 7% of Gross Add-on Program Sales.
Technology Fee	$40 per month for 0-100 students $60 per month for 101- 200 students $80 per month for 200+ students	Payable monthly	The Company may require the Franchisee to utilize a computer system, including without limitation a cloud-based portal for day-to-day operations of the franchise. FA Secs. 2(C) and 5(S).
Brand Development Fund	$1 per subject per student up to $3, subject to a $250 per month minimum	Payable the 19th of each month	FA Sec. 2(D).
Interest	2% per month, or the maximum amount allowed by law, whichever is less	Owed on past due amounts	You must pay interest on any amounts owed to us from the date due until fully paid. FA Sec. 2(E).
Late Fee	$100 per incident	As incurred	Applies to each NSF check, late payment, or failure to timely provide reports and financial statements. FA Sec. 2(F).
Renewal Fee	10% of the then current initial franchise fee.	At time of renewal	FA Secs. 2(G) and 6(B).
Subject Material Fee	$5-$8 per month per subject	Monthly	For the availability and distribution of e-learning material.FA Sec. 2(I).
bbSupport Fee	$1 per subject (Math or English) per student monthly	Monthly	This fee is for app support from certified teachers (hired by Corporate) to any Best Brains students enrolled in Math or English
Placement Test Review	$1,500 per Placement	Upon submission of
Fee	Test	placement test
Certification Fee	$50 per attempt	As incurred	You must get training/operations manual certified every 3 years and upon renewal. FA Sec. 2(J).
Additional Assistance	Currently $500 per day plus costs.	As incurred	At your request, we will provide additional assistance beyond our standard support, based on our then current fee for the respective
Type of Fee	Amount	Due Date	Remarks
Annual Conference Fee	$500 per year	$125 per month in January – May of each year	You shall attend annual training conferences and seminars as we specify. You agree that we can charge you this fee. If you attend our annual conference, we will refund this amount to you in full. FA Sec. 5(P).
Regional Advisory Franchisee Council	None Currently.	As incurred	The Regional Advisory Council would choose its own assessments. FA Sec. 5(Q).
Management Fee	To be determined under circumstances. Currently $500 per day, plus reasonable expenses.	As incurred	Payable during period that our appointed manager manages the Franchised Business upon your default, death, or disability. FA Sec. 7(D).
Indemnity	Actual amount of loss or expense incurred.	At time incurred	You agree to reimburse us if we are held liable for certain claims. FA Secs. 7(D), 8(E)., and 10(O).