Camp_Margaritaville 2025 Franchise FAQ - FDD Ninja

Question 1

What factors, besides competitors' size and resources, influence Camp Margaritaville's competitiveness in the RV resort market?

Accepted Answer

The RV resort market is well-established and highly competitive. Camp Margaritaville Resorts compete with other national Camp Margaritaville Systems and with regional and local RV resorts that offer comparable lodging products. Camp Margaritaville Resorts will target leisure travelers. Some competitors of Camp Margaritaville Resorts may be larger, may operate more RV resorts and may have greater resources than we do. Other competitive factors include site rates, rental rates, quality of accommodations, name recognition, service levels, availability of Amenities, geographic area, site location, general economic conditions, and your management capabilities.

Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 9–14)

Question 2

What was the total number of Camp Margaritaville outlets at the end of 2024?

Accepted Answer

| Outlet Type | Outlet Type Year | Outlets at the Start of the Year | Outlets at the End of the Year | Net Change |
|---|---|---|---|---| 
| Franchised | 2022 | 2 | 4 | 2 |
|  | 2023 | 4 | 5 | 1 |
|  | 2024 | 5 | 5 | 0 |
| Company-Owned | 2022 | 0 | 0 | 0 |
|  | 2023 | 0 | 0 | 0 |
|  | 2024 | 0 | 0 | 0 |

Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 69–71)

Question 3

How do the accounts payable and accrued expenses for Camp Margaritaville compare between 2022 and 2023?

Accepted Answer

| 4,594,556 | 4,199,315 |  |  |
| Other revenue | 15,010,443 | 7,108,803 |  |  |
| Total revenues | 104,634,176 | 92,488,263 |  |  |
|  |  |  |  |  |
| Operating expenses |  |  |  |  |
| Cost of restaurant and retail merchandise sales | 1,710,201 | 1,814,546 |  |  |
| Selling, general, and administrative | 68,220,301 | 65,463,612 |  |  |
| Depreciation | 1,447,387 | 1,433,243 |  |  |
| Total operating expenses | 71,377,889 | 68,711,401 |  |  |
|  |  |  |  |  |
| Income from operations | 33,256,287 | 23,776,862 |  |  |
| Other income (expenses) |  |  |  |  |
| Net loss from investments in unconsolidated entities | – | (2,000,000) |  |  |
| Net loss on sale of venues | – | (1,902,027) |  |  |
| Net gain on insurance proceeds | – | 20,088,815 |  |  |
| Interest income | 837,525 | 808,337 |  |  |
| Interest expense | (13,423,323) | (12,330,510) |  |  |
| Net income before income taxes | 20,670,489 | 28,441,477 |  |  |
| Income taxes | 779,144 | 656,806 |  |  |
| Net income from continuing operations | \$ 19,891,345 | \$ 27,784,671 |  |  |
See accompanying notes.

# Consolidated Statements of Changes in Partners Deficit

| Balance at December 31, 2022                    | \$ (108,194,511 ) |
|-------------------------------------------------|-------------------------|
| Contributions                                   | –                       |
| Redemptions/distributions paid                  | (32,078,955)            |
| Equity issuance transaction costs               | –                       |
| Class B and C interest                          | 11,474,320              |
| Net income for the year ended December 31, 2023 | 27,784,671              |
| Balance at December 31, 2023                    | (101,014,475)           |
| Contributions                                   | –                       |
| Redemptions/distributions paid                  | (35,630,167)            |
| Equity issuance transaction costs               | –                       |
| Class B and C interest                          | 3,308,993               |
| Net income for the year ended December 31, 2024 | 19,891,345              |
| Balance at December 31, 2024                    | \$ (113,444,304)        |

See accompanying notes.

# Consolidated Statements of Cash Flows

|                                                             | Year Ended December 31 2023 2024 |              |    |              |
|-------------------------------------------------------------|----------------------------------------|--------------|----|--------------|
| Operating activities                                        |                                        |              |    |              |
| Net income                                                  | \$                                     | 19,891,345   | \$ | 27,784,671   |
| Adjustments to reconcile net income to net cash provided by |                                        |              |    |              |
| operating activities:                                       |                                        |              |    |              |
| Depreciation                                                |                                        | 1,447,387    |    | 1,433,243    |
| Other noncash operating expenses                            |                                        | 763,317      |    | –            |

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 4

How does the amortization of debt issue costs for Camp Margaritaville compare between 2022 and 2023?

Accepted Answer

023. No life insurance proceeds were received in 2022. The Company made additional principal payments against the term loan of \$787,500 in 2023 and \$5,905,000 in 2022; and additional principal payments against the delayed draw of \$180,000 in 2023.

The debt facility includes subordinated debt associated with related-party entities. The balance of the related-party note payable was \$9,805,332 as of December 31, 2023 and 2022. The subordinated note is owned by s

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 5

How does the Application Fee calculation for Camp Margaritaville in Item 5 relate to the number of overnight accommodation sites mentioned in Item 6 regarding PMS operation expenses?

Accepted Answer

you will pay us or our affiliates fees ranging from \$141,850 - \$267,850.

### **Application Fee**

You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execution of the Franchise Agreement. The Application Fee is not refundable under any circumstances.

### **Property Improvement Plan**

If you want to convert or adapt an existing RV resort to a Camp Margaritaville Resort, we charge an additional non-refundable fee ranging from \$0 to \$5,000 to prepare the property improvement plan ("**PIP**") for the resort. If we prepare a PIP for your Resort, you must pay the PIP fee before we schedule the PIP inspection. In some circumstances, we may waive the PIP fee or apply the PIP fee towards the payment of your Application Fee, but we are not obligated to do so.

Question 6

How does the Application Fee for Camp Margaritaville in Item 5 compare to the ongoing fees listed in Item 6, considering the total estimated initial investment in Item 7?

Accepted Answer

[Item 5: INITIAL FEES] ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from $141,850 - $267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying $500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is $75,000. The Application Fee is due upon execution of the Franchise Agreement. The Application Fee is not refundable under any circumstances. ### **Property Improvement Plan** If you want to convert or adapt an existing RV resort to a Camp Margaritaville Resort, we charge an additional non-refundable fee ranging from $0 to $5,000 to prepare the property improvement plan ("**PIP**") for the resort. If we prepare a PIP for your Resort, you must pay the PIP fee before we schedule the PIP inspection. In some circumstances, we may waive the PIP fee or apply the PIP fee towards the payment of your Application Fee, but we are not obligated to do so. Factors that may influence our decision to waive the PIP fee include whether the adaptation or change is one that we have previously experienced limiting our administrative costs and the number of PIPs you have previously submitted. If you pay us a PIP fee, it will not be refundable. ### **Technology Improvement Plan** --- [Item 6: OTHER FEES] In 2024, we allowed certain franchisees to retain, for a limited period, an advertising assistance allowance for their Resorts, consisting of a portion of the Gross Revenue that would otherwise have been payable as part of the Royalty Fee. No such reduction or advertising assistance is guaranteed or required. When determining whether to reduce the Royalty Fee, we might consider things like the Resort's location and market, its size and amenities, the economic and financial environment generally and in the Resort's market, your experience and willingness to develop multiple Margaritaville-affiliated resorts, and other relevant factors. - 3. Marketing Fee. The marketing fee (the "**Marketing Fee**") provides for our marketing services and support. Marketing services will be used to promote public awareness and usage of Camp Margaritaville Resorts facilities by implementing advertising, promotion, publicity, market research, and other marketing programs, training programs and related activities, and the production and distribution of Camp Margaritaville Resorts-related publications and directories ("**Marketing Program**"). We may periodically increase or decrease the amount of the Marketing Fee, but it shall not exceed 3% of Gross Revenue during the initial term of the Franchise Agreement. In no event shall we increase the Marketing Fee by more than 0.5% of Gross Revenue per year of the term of the Franchise Agreement. We will provide you with 60 days' advance written notice of any change to the Marketing Fee amount. - 4. CRS Fees. We have implemented a CRS through which guests may make reservations at Camp Margaritaville Resorts, which you are required to use. Ongoing fees for the CRS are as follows: --- [Item 7: ESTIMATED INITIAL INVESTMENT] | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |---------------------|------------------|----------------------|------------------------------------------|-------------------------------------| | Application Fee (1) | $75,000 | Lump sum | Upon executing Franchise Agreement | Us | | PIP fee (2) | $0 - $5,000 | As agreed | When designing Resort | Us | | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |----------------------------------------------------------------------------------------------|------------------------------|----------------------|---------------------------------------------------------------------------|---------------------------------------------------------------------------| | TIP fee (3) | $0 - $10,000 | As agreed | When designing Pad | Us | | Professional services fees (architect, design, market study, engineering, etc.) (4) | $100,000 - $800,000 | As agreed | When designing Resort | Us, architects, engineers, designers, and other professionals | | Insurance and Permits, licenses, deposits, and related fees (5) | $50,000 - $150,000 | Lump Sum | Before construction begins and before Resort begins operation | Government authorities and utility companies | | Training expenses, vendor and brand training (6) | $25,000 - $100,000 | As agreed | Before and during training | Us and third parties | | Construction, improvements, remodeling, and decorating costs (7) | $1,000,000- $50,000,000 | Installments | Before and during construction | General contractor, suppliers and us | | Technology (8) | $750,000- $1,250,000 | As agreed | Before and during construction | Suppliers and us | | Website Set-Up | $8,750 - $38,750 | As agreed | Before opening | Us | | CRS Set-Up (9) | $4,000 | As agreed | Before opening | Us | | CRM Set-Up (10) | $3,000 | As agreed | Before opening | Us | | Loyalty Program Set | $3,000 | As agreed | Before opening | Suppliers | | Up (11) | | | | | | Furniture, fixtures, other fixed assets, and equipment (FF&E) (12) | $500,000- $3,000,000 | As agreed | Before and during construction | Suppliers | | Operational Supplies and Equipment (OSE) (13) | $250,000 - $500,000 | As agreed | Before opening | Suppliers | | Exterior signs | $300,000 - $400,000 | As agreed | As incurred | Suppliers | | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |-------------------------------------------------------------------------------------------------------------------|----------------------------------|----------------------|----------------|-------------------------------------| | Financial, tax, and legal | $600,000 - | As agreed | As incurred | Suppliers | | costs (14) | $750,000 | | | | | Preopening Sales and | $125,000 - | As agreed | As incurred | Suppliers and us | | Marketing (15) | $225,000 | | | | | Photography and | $45,000 - | As agreed | As incurred | Suppliers and us | | Videography | $125,000 | | | | | Medallia Set-Up (16) | $2,500 | As agreed | Before opening | Us | | Group Sales Referral | $300 | As agreed | Before opening | Suppliers and us | | Platform (17) | | | | | | Financial Reporting | $10,000 - | As agreed | As incurred | Suppliers and us | | System Set-Up (18) | $16,000 | | | | | Gift Card Program Set | $3,000 - | As agreed | As incurred | Suppliers | | Up (19) | $10,000 | | | | | Day Pass Reservation | $300 | As agreed | As incurred | Suppliers and us | | System Set-Up | | | | | | Contingency (20) | $350,000 - $500,000 | As agreed | As incurred | See Explanatory Note | | Additional Funds – 3 Months (21) | $300,000 - $500,000 | As needed | As incurred | See Explanatory Notes | | TOTAL ESTIMATED INITIAL INVESTMENT (excluding real estate costs and site work (21) premiums) | $4,504,850 - $58,467,850 | | | |

Question 7

How does the Application Fee for Camp Margaritaville in Item 5 compare to the ongoing fees listed in Item 6, considering the total estimated initial investment in Item 7, the lack of financing options in Item 10, and the territory granted in Item 12?

Accepted Answer

you will pay us or our affiliates fees ranging from \$141,850 - \$267,850.

### **Application Fee**

You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execu

Question 8

How does the Application Fee for Camp Margaritaville in Item 5 compare to the PIP fee in Item 7 regarding payment method and timing?

Accepted Answer

d in connection with such transitions. ### **ITEM 7. ESTIMATED INITIAL INVESTMENT** ### **YOUR ESTIMATED INITIAL INVESTMENT** | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |---------------------|------------------|----------------------|------------------------------------------|-------------------------------------| | Appl

Question 9

How does the Application Fee for Camp Margaritaville in Item 5 relate to the number of overnight accommodation sites mentioned in Item 6 regarding PMS operation expenses, considering the total estimated initial investment in Item 7?

Accepted Answer

equired to be disclosed in this Item. ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from \$141,850 - \$267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execu

Question 10

How does the Application Fee for Camp Margaritaville in Item 5 relate to the number of overnight accommodation sites mentioned in Item 6 regarding PMS operation expenses, considering the total estimated initial investment in Item 7, the lack of financing options in Item 10, the territory granted in Item 12, and the System Standards?

Accepted Answer

UPTCY** No bankruptcy is required to be disclosed in this Item. ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from \$141,850 - \$267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execution of the Franchise Agreement.

Question 11

How does the Application Fee for Camp Margaritaville in Item 5 relate to the number of overnight accommodation sites mentioned in Item 6 regarding PMS operation expenses, considering the total estimated initial investment in Item 7, the lack of financing options in Item 10, the territory granted in Item 12, the System Standards, the franchisor's assistance in Item 11, the litigation involving Margaritaville Enterprises, the definition of 'you', the obligations of the franchisee in Item 9, the restrictions on sources of products and services in Item 8, and the use of trademarks in Item 13?

Accepted Answer

equired to be disclosed in this Item. ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from \$141,850 - \$267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execution of the Franchise Agreement. The Application Fee is not refundable under any circumstances. ### **Property Improvement Plan** If you want to convert or adapt an existing RV resort to a Camp Margaritaville Resort, we charge an additional non-refundable fee ranging from \$0 to \$5,000 to prepare the property improvement plan ("**PIP**") for the resort. If we prepare a PIP for your Resort, you must pay the PIP fee before we schedule the PIP inspection. In some circumstances, we may waive the PIP fee or apply the PIP fee towards the payment of your Application Fee, but we are not obligated to do so. Factors that may influence our decision to waive the PIP fee include whether the adaptation or change is one that we have previously experienced limiting our administrative costs and the number of PIPs you have previou

Question 12

How does the Application Fee for Camp Margaritaville in Item 5 relate to the number of overnight accommodation sites mentioned in Item 6 regarding PMS operation expenses, considering the total estimated initial investment in Item 7, the lack of financing options in Item 10, the territory granted in Item 12, the System Standards, the franchisor's assistance in Item 11, the litigation involving Margaritaville Enterprises, the definition of 'you', the obligations of the franchisee in Item 9, the restrictions on sources of products and services in Item 8, the use of trademarks in Item 13, and the role of John Cohlan in Item 2, and Dan Leonard?

Accepted Answer

UPTCY** No bankruptcy is required to be disclosed in this Item. ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from \$141,850 - \$267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying \$500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is \$75,000. The Application Fee is due upon execu

Question 13

How does the Application Fee for Camp Margaritaville in Item 5 relate to the total estimated initial investment in Item 7, considering the lack of financing options in Item 10?

Accepted Answer

d in connection with such transitions. ### **ITEM 7. ESTIMATED INITIAL INVESTMENT** ### **YOUR ESTIMATED INITIAL INVESTMENT** | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |---------------------|------------------|----------------------|------------------------------------------|-------------------------------------| | Application Fee (1) | \$75,000 | Lump sum | Upon executing Franchise Agreement | Us | | PIP fee (2) | \$0 - \$5,000 | As agreed | When designing Resort | Us | | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |----------------------------------------------------------------------------------------------|------------------------------|----------------------|---------------------------------------------------------------------------|---------------------------------------------------------------------------| | TIP fee (3) | \$0 - \$10,000 | As agreed | When designing Pad | Us | | Professional services fees (architect, design, market study, engineering, etc.) (4) | \$100,000 - \$800,000 | As agreed | When designing Resort | Us, architects, engineers, designers, and other professionals | | Insurance and Permits, licenses, deposits, and related fees (5) | \$50,000 - \$150,000 | Lump Sum | Before construction begins and before Resort begins operation | Government authorities and utility companies | | Training expenses, vendor and brand training (6) | \$25,000 - \$100,000 | As agreed | Before and during training | Us and third parties | | Construction, improvements, remodeling, and decorating costs (7) | \$1,000,000- \$50,000,000 | Installments | Before and during construction | General contractor, suppliers and us | | Technology (8) | \$750,000- \$1,250,000 | As agreed | Before and during construction | Suppliers and us | | Website Set-Up | \$8,750 - \$38,750 | As agreed | Before opening | Us | | CRS Set-Up (9) | \$4,000 | As agreed | Before opening | Us | | CRM Set-Up (10) | \$3,000 | As agreed | Before opening | Us | | Loyalty Program Set | \$3,000 | As agreed | Before opening | Suppliers | | Up (11) | | | | | | Furniture, fixtures, other fixed assets, and equipment (FF&E) (12) | \$500,000- \$3,000,000 | As agreed | Before and during construction | Suppliers | | Operational Supplies and Equipment (OSE) (13) | \$250,000 - \$500,000 | As agreed | Before opening | Suppliers | | Exterior signs | \$300,000 - \$400,000 | As agreed | As incurred | Suppliers | | Type of expenditure | Amount | Method of Payment | When due | To whom payment is to be made | |-------------------------------------------------------------------------------------------------------------------|----------------------------------|----------------------|----------------|-------------------------------------| | Financial, tax, and legal | \$600,000 - | As agreed | As incurred | Suppliers | | costs (14) | \$750,000 | | | | | Preopening Sales and | \$125,000 - | As agreed | As incurred | Suppliers and us | | Marketing (15) | \$225,000 | | | | | Photography and | \$45,000 - | As agreed | As incurred | Suppliers and us | | Videography | \$125,000 | | | | | Medallia Set-Up (16) | \$2,500 | As agreed | Before opening | Us | | Group Sales Referral | \$300 | As agreed | Before opening | Suppliers and us | | Platform (17) | | | | | | Financial Reporting | \$10,000 - | As agreed | As incurred | Suppliers and us | | System Set-Up (18) | \$16,000 | | | | | Gift Card Program Set | \$3,000 - | As agreed | As incurred | Suppliers | | Up (19) | \$10,000 | | | | | Day Pass Reservation | \$300 | As agreed | As incurred | Suppliers and us | | System Set-Up | | | | | | Contingency (20) | \$350,000 - \$500,000 | As agreed | As incurred | See Explanatory Note | | Additional Funds – 3 Months (21) | \$300,000 - \$500,000 | As needed | As incurred | Se

Question 14

As of December 31, 2024, how many franchised COMPASS by Margaritaville hotels were operating in the United States, and how does this compare to Camp Margaritaville's presence?

Accepted Answer

cipal business address is the same as our address. As of December 31, 2024, there were 4 franchised COMPASS by Margaritaville hotels operating in the United States.
- 4.

Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 9–14)

Question 15

What is the difference between a Severity Level 1 and Severity Level 2 issue at Camp Margaritaville?

Accepted Answer

### **Severity Level 2 – Significant Business Impact**

Important product features are unavailable with no acceptable workaround.

Major applications or mission critical systems are functioning with limited capabilities or are unstable with periodic interruptions. The software may be operating but is severely restricted.

Severity Level 2 problems could have the following characteristics:

- **Product error or failure forcing a restart or recovery**
- **Severe degraded performance**
- **Functionality unavailable but the system is able to operate in restricted fashion.**

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 16

How does the equity compensation for Class B and C shares for Camp Margaritaville compare between 2022 and 2023?

Accepted Answer

The Class B shares are fully vested. The Class C shares have a service-based component for vesting, vesting monthly on a straight-line basis over five years. The Class B and C shares entitle recipients to receive a share of future profits and appreciation in the Company that accrue above a Hurdle Amount upon a Company Transaction. A Company Transaction is defined in the MEIPs as the sale of the Company, a liquidity event, a qualified IPO, or the dissolution of the Company. In 2023, the Hurdle Amounts for all holders of Class B and C shares were lowered, resulting in a revaluation of the shares and incremental compensation costs. Concurrent with the 2023 change in Hurdle Amounts, the Company paid distributions to Class B and C holders in the amount of $1,080,880 and $1,225,157 respectively. The compensation costs arising from this modification are reflected in the tables below. Compensation costs associated with the Class B and C shares are included in selling, general, and administrative expenses on the accompanying consolidated statements of operations.

In 2023, the Hurdle Amounts for all holders of Class B and C shares who did not partake in the distribution were lowered. The change in hurdle rates was the catalyst for modification accounting, resulting in a revaluation of the shares and incremental compensation costs incurred. Incremental compensation cost resulting from the modification was as follows:

Compensation costs associated with the Class B and C shares are included in selling, general, and administrative expenses on the accompanying consolidated statements of operations.

| Balance at December 31, 2021                    | $ (106,130,260) |
|-------------------------------------------------|------------------|
| ASC 842 opening equity adjustment               | 68,036           |
| Contributions                                   | 155,455,945      |
| Redemptions/distributions paid                  | (158,034,914)    |
| Equity issuance transaction costs               | (8,503,316)      |
| Class C interest                                | 1,706,166        |
| Net income for the year ended December 31, 2022 | 7,243,832        |
| Balance at December 31, 2022                    | (108,194,511)    |
| Contributions                                   |                  |
| Redemptions/distributions paid                  | (32,078,955)     |
| Equity issuance transaction costs               | –                |
| Class B and C interest                          | 11,474,320       |
| Net income for the year ended December 31, 2023 | 27,784,671       |
| Balance at December 31, 2023                    | $ (101,014,475) |

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 17

Can other Camp Margaritaville franchisees be required to pay a different Marketing Fee than me?

Accepted Answer

We currently do not, and are not required to, maintain the Marketing Fee in a separate account from our other money. We are not required to expend any specific funds from the Marketing Fee on the area or territory for your Resort. Other franchisees may not be required to pay the Marketing Fee, may be required to pay a different Marketing Fee, or may be required to contribute to a different advertising fund. We have no obligation to make expenditures from the Marketing Fee that are equivalent or proportionate to your Marketing Fee, ensure that you benefit directly or proportionately or in any amount from the placement of advertising, or ensure that any advertising impacts or penetrates your area. In the calendar year ended December 31, 2024, 18.36% of the Marketing Fees were used for digital media promotion, including websites, social, email marketing, and digital ads; 2.30% for creative services and content development, including graphic design, video production and podcast; 38.58% for events, including sweepstakes and contests, charitable events, and pickleball tournaments; 5.10% for public relations, 20.97% for resort performance support, including photoshoots, customer service email support, 13.53% for media support from Radio Margaritaville, and 1.15% for administration. The foregoing figures have been rounded to the second decimal place. If we do not spend all of the Marketing Fee in the calendar year which it accrues, then those funds will roll over to be expended in the following year. We may have the collections and expenditures audited, with the expenses of the audit being paid for out of the Marketing Fee, by an independent certified public accountant we select. We will provide you with an unaudited statement of the operations of Marketing Fee expenditures within 30 days of your written request. Any amounts that we or our affiliates contribute to the Marketing Fee will be considered a loan and we and/or our affiliates will have the right to be reimbursed from the Marketing Fee in any amounts that we advance to the Marketing Program. There are no advertising councils composed of franchisees. However, we may form these advertising councils. You are not required to participate in an advertising cooperative.

Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 46–55)

Question 18

How does the loss on extinguishment of debt for Camp Margaritaville compare between 2022 and 2023?

Accepted Answer

|  | Year Ended December 31 |  |
|---|---|---|
| 2023 | 2022 |  |
| Revenues |  |  |
| Restaurant and retail merchandise sales | $      6,784,532 | $      6,487,545 |
| Restaurant royalties | 10,166,895 | 9,033,781 |
| Resort royalties | 29,097,964 | 26,963,473 |
| Residential and timeshare royalties | 35,130,754 | 21,691,627 |
| Consumer products royalties | 4,199,315 | 4,705,602 |
| Other revenue | 7,108,803 | 5,978,600 |
| Total revenues | 92,488,263 | 74,860,628 |
| Operating expenses |  |  |
| Cost of restaurant and retail merchandise sales | 1,814,546 | 1,740,415 |
| Selling, general, and administrative | 65,463,612 | 47,750,487 |
| Depreciation | 1,433,243 | 1,420,259 |
| Total operating expenses | 68,711,401 | 50,911,161 |
| Income from operations | 23,776,862 | 23,949,467 |
| Other income (expenses) |  |  |
| Net (loss) gain from investments in unconsolidated entities | ( 2,000,000) | 375,000 |
| Net loss on sale of venues | ( 1,902,027) | ( 3,171,426) |
| Net gain on insurance proceeds | 20,088,815 | – |
| Net loss on extinguishment of debt | – | ( 4,336,839) |
| Interest income | 808,337 | 208,929 |
| Interest expense | ( 9,421,558) |  |
| ( 12,330,510) |  |  |
| Net income before income taxes | 28,441,477 | 7,603,573 |
| Income taxes | 656,806 | 359,741 |
| Net income from continuing operations | $    27,784,671 | $      7,243,832 |

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 19

Has Margaritaville Restaurants, LLC ever offered franchises in any other line of business besides bars and restaurants, and how does this specialization compare to Camp Margaritaville?

Accepted Answer

Margaritaville Restaurants, LLC ("**MR**"), which is wholly owned by Margaritaville Enterprises, began offering franchises for bars and restaurants operating in the United States and internationally under the trademark Air Margaritaville® in April 2019 and under the trademark LandShark Bar & Grill® in November 2019.

Prior to offering franchises, other entities wholly owned and controlled by Margaritaville Enterprises, entered into trademark license agreements for Air Margaritaville®, LandShark Bar & Grill®, and other branded restaurants.

Margaritaville Restaurants has never offered franchises in any other line of business.

Margaritaville Restaurants' principal business address is the same as our address.

As of December 31, 2024, there were 22 licensed LandShark Bar & Grill® Restaurants operating in the United States.

In 2014, Margaritaville Enterprises offered a franchise for a Margaritaville® restaurant located in Chicago, Illinois.

Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 9–14)

Question 20

What are the ongoing fees for Camp Margaritaville franchisees as listed in Item 6, and how do they relate to the initial fees paid as described in Item 5?

Accepted Answer

[Item 6: OTHER FEES] Except as described above, all fees are imposed and collected by and payable to us. All fees are nonrefundable. All estimates above are based on 150 pads. In some cases, we might negotiate some of the fees that some franchisees will pay, such as franchisees agreeing to develop multiple Camp Margaritaville Resorts or acquiring existing Camp Margaritaville Resorts. Otherwise, except as described in this Item 6, all fees are uniform. There currently are no franchisee advertising cooperatives in the Camp Margaritaville Resort network. ### **Explanatory Notes**: - 1. Gross Revenue. "**Gross Revenue**" means, for each calendar month following the opening date of the Resort (or any component thereof or prorated portion thereof), all revenue, income and proceeds derived from the operation and management of the Resort. These amounts include: (a) all revenue, income and proceeds derived from the operation and management of the Resort; (b) "**Gross Food and Beverage Revenue**" which includes all revenue from any Margaritaville branded restaurants and any other food and beverage services at the Resort; and any and all room service, banquet and catering revenues; (c) revenue from all Merchandise sales; (d) resort fees, destination fees, and mandatory surcharges for facilities; (e) revenue from any Amenities; and (f) any other revenue arising from use of the Camp Margaritaville Intellectual Property pursuant to this Agreement. --- [Item 6: OTHER FEES] In 2024, we allowed certain franchisees to retain, for a limited period, an advertising assistance allowance for their Resorts, consisting of a portion of the Gross Revenue that would otherwise have been payable as part of the Royalty Fee. No such reduction or advertising assistance is guaranteed or required. When determining whether to reduce the Royalty Fee, we might consider things like the Resort's location and market, its size and amenities, the economic and financial environment generally and in the Resort's market, your experience and willingness to develop multiple Margaritaville-affiliated resorts, and other relevant factors. - 3. Marketing Fee. The marketing fee (the "**Marketing Fee**") provides for our marketing services and support. Marketing services will be used to promote public awareness and usage of Camp Margaritaville Resorts facilities by implementing advertising, promotion, publicity, market research, and other marketing programs, training programs and related activities, and the production and distribution of Camp Margaritaville Resorts-related publications and directories ("**Marketing Program**"). We may periodically increase or decrease the amount of the Marketing Fee, but it shall not exceed 3% of Gross Revenue during the initial term of the Franchise Agreement. In no event shall we increase the Marketing Fee by more than 0.5% of Gross Revenue per year of the term of the Franchise Agreement. We will provide you with 60 days' advance written notice of any change to the Marketing Fee amount. - 4. CRS Fees. We have implemented a CRS through which guests may make reservations at Camp Margaritaville Resorts, which you are required to use. Ongoing fees for the CRS are as follows: --- [Item 5: INITIAL FEES] ### **ITEM 5. INITIAL FEES** The estimates below are based on a Resort with 150 pads. Before your Resort opens, you will pay us or our affiliates fees ranging from $141,850 - $267,850. ### **Application Fee** You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying $500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is $75,000. The Application Fee is due upon execution of the Franchise Agreement. The Application Fee is not refundable under any circumstances. ### **Property Improvement Plan** If you want to convert or adapt an existing RV resort to a Camp Margaritaville Resort, we charge an additional non-refundable fee ranging from $0 to $5,000 to prepare the property improvement plan ("**PIP**") for the resort. If we prepare a PIP for your Resort, you must pay the PIP fee before we schedule the PIP inspection. In some circumstances, we may waive the PIP fee or apply the PIP fee towards the payment of your Application Fee, but we are not obligated to do so. Factors that may influence our decision to waive the PIP fee include whether the adaptation or change is one that we have previously experienced limiting our administrative costs and the number of PIPs you have previously submitted. If you pay us a PIP fee, it will not be refundable. ### **Technology Improvement Plan**

Question 21

What is the range of the Application Fee for a Camp Margaritaville Resort as described in Item 5, and how does it relate to the total estimated initial investment in Item 7?

Accepted Answer

| Type of expenditure | Amount           | Method of Payment | When due                                 | To whom payment is to be made |
|---------------------|------------------|----------------------|------------------------------------------|-------------------------------------|
| Application Fee (1) | $75,000 | Lump sum | Upon executing Franchise Agreement | Us |

### **Application Fee**

You must complete our Franchise Application, to help us evaluate your qualifications to become a franchisee. The Application Fee is calculated by multiplying $500 by the total number of overnight accommodation sites at the Resort, including RV sites, RV suites and cabin rentals. For a Resort with 150 overnight accommodations, the Application Fee is $75,000. The Application Fee is due upon execution of the Franchise Agreement. The Application Fee is not refundable under any circumstances.

Question 22

What action will Camp Margaritaville take if service level agreements (SLAs) are not reached for twelve consecutive months?

Accepted Answer

Customer understands and acknowledges that variations in service levels may exist from time to time. Should SLAs not be reached for period of twelve (12) consecutive months, Margaritaville shall conduct a root cause analysis and the parties agree to work together to review the SLAs and find a resolution to mitigate any revenue losses proven to be a result of missed SLA targets.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 23

For a Camp Margaritaville franchise, when does the initial training occur?

Accepted Answer

| Total | 7 | 33 | | ^\* The above chart assumes full food and beverage operations. For Resorts with very limited F&B (no food, or only bar) BOH procedures may be reduced by 8 hours. ### **Task Force Training** For the final part of our required initial training program, we will provide to you a task force to assist in onsite pre-opening training for the Resort to occur approximately 30 days prior to opening. That task force may include personnel employed directly by us or personnel from existing Camp Margaritaville Resorts or other Margaritaville-branded venues. We will be responsible for any costs associated with our personnel, while you will be responsible for any other costs relating to the task force, including costs related to personnel from existing Camp Margaritaville Resorts or other Margaritaville-branded venues. The task force takes place on dates and times mutually agreed upon by you and us. The task force training typically lasts between 10 to 14 days, although we may (at our option) conduct this training on more than one visit. There is no fee for the training by the task force, but you will cover the expenses for our personnel to provide the training. Further, if you are not able to demonstrate compliance with our System Standards, as determined in our sole discretion, after 14 days of training at your Resort, then our trainers may stay longer until you are able to demonstrate compliance with our System Standards, as determined in our sole discretion. In such event, you will be required to pay \$500 per day per trainer for each additional day they remain until you become compliant with System Standards, in addition to the task force's additional expenses associated with their extended stay. There is no set outline for this on-the-job training. The task force will generally focus on training personnel on the System Standards and service consistent with the Camp Margaritaville System. ### **Other Initial Training Programs** We also currently offer additional initial training for various members of your Resort's staff after the Resort opens. These additional training opportunities may include personnel employed directly by us or personnel from existing Camp Margaritaville Resorts or other Margaritaville-branded venues providing training to your personnel onsite. You will be responsible for all costs related to this additional training, including lodging and per diem for the training personnel. We estimate that these costs will typically be between \$1,000 to \$5,000 per instance, but could be more depending on breadth of support that you require. If any member of the Resort's Key Personnel ceases to hold that position, you (or the approved management company) must have his or her replacement attend and successfully complete the applicable brand standard training programs that we reasonably specify, some of which we describe above, within 90 days (or a longer period we periodically designate) after assuming his or her position. We may charge fees for this training, and you must pay all travel and living expenses. If we determine that any Resort personnel have failed to satisfactorily complete any training program, you (or the approved management company) must immediately hire a substitute and promptly arrange for that person to complete training to our satisfaction. Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 46–55)

Question 24

Is the $75 per month fee for the Flip.to marketing platform for Camp Margaritaville subject to change?

Accepted Answer

, per month.    |

These fees shall be updated from time-to-time based on increases in the underlying charges that we pay for the CRM System.

- 6. Database Acquisition and Social Dispersion Tool (Flip.to). You must participate in Flip.to, a marketing platform to reach, inspire and win over travelers, tracked to reservations. The goal is to increase profitability by converting audiences across the entire traveler journey, from pre-stay booking to post-stay experiences. The cost of

Source: Item 6 — OTHER FEES (FDD pages 20–34)

Question 25

According to the Camp Margaritaville agreement, what happens if third-party claims are based on the licensee's breach of the agreement?

Accepted Answer

With respect to infringement claims by third parties against Licensee asserting that the License or Sublicense of the Margaritaville Intellectual Property infringes their rights, Licensee shall give prompt notice thereof to Licensor and Licensor shall have the sole right to direct and control the defense and settlement of such claims at Licensor's sole expense, unless such claims are based on the breach of this Agreement

by Licensee, in which case such costs shall be borne exclusively by Licensee. Such rights shall not be exercised in an arbitrary or capricious manner.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 26

According to the Camp Margaritaville FDD, what is the dependency for the full guest go-live of the universal day pass reservation platform?

Accepted Answer

2. Provide Customer with a universal day pass reservation platform environment containing Customer-specific information provided above, on a customer-specific URL, within 30 Days. This environment will be available to the Customer administrators, managers and staff provided by Customer. This environment can be used exclusively by Customer staff for inputting booking data prior to full guest go-live. The timeline of full guest go-live will be decided by Customer and is dependent on Customer communicating availability to their guests and setting up required infrastructure for deployment.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 27

According to the FDD, can the languages used by Camp Margaritaville's call center agents be changed?

Accepted Answer

The Parties may agree to add languages, toll free numbers and/or Properties as mutually agreed to by the parties. Any such change shall be agreed to in good faith between the Parties and shall be made by amendment to Attachment 1.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 28

According to the FDD, does Camp Margaritaville protect a franchisee's right to use trademarks and indemnify them from losses arising from claims regarding the use of the name in all states, or only in Minnesota?

Accepted Answer

Item 13 is amended to state that we will protect your right to use the trademarks, service marks, trade names, logotypes or other commercial symbols or indemnify you from any loss, costs or expenses arising out of any claim, suit or demand regarding the use of the name.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 29

According to the FTC's Franchise Rule, is Camp Margaritaville permitted to provide information about actual financial performance?

Accepted Answer

The FTC's Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if there is a reasonable basis for the information, and if the information is included in the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if: (1) a franchisor provides the actual records of an existing outlet you are considering buying; or (2) a franchisor supplements the information provided in this Item 19, for example, by providing information about possible performance at a particular location under particular circumstances.

We do not make any financial performance representations. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting Kristen Fancher, Chief Legal Officer and General Counsel at 3715 Northside Parkway, Suite 4-475, Atlanta, Georgia 30327, (470) 698-2246, the Federal Trade Commission, and the appropriate state regulatory agencies.

Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD page 69)

Question 30

According to the FTC's Franchise Rule, is Camp Margaritaville permitted to provide information about potential financial performance?

Accepted Answer

The FTC's Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if there is a reasonable basis for the information, and if the information is included in the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if: (1) a franchisor provides the actual records of an existing outlet you are considering buying; or (2) a franchisor supplements the information provided in this Item 19, for example, by providing information about possible performance at a particular location under particular circumstances.

We do not make any financial performance representations. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting Kristen Fancher, Chief Legal Officer and General Counsel at 3715 Northside Parkway, Suite 4-475, Atlanta, Georgia 30327, (470) 698-2246, the Federal Trade Commission, and the appropriate state regulatory agencies.

Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD page 69)

Question 31

According to Statement of Work No. 1, under what conditions will the SOW for Camp Margaritaville be terminated early?

Accepted Answer

h Confidential Information to any person, except to the Receiving Party's Representatives who need to know the Confidential Information to assist the Receiving Party, or act on its behalf, to exercise itsrights or perform its obligations underthis Agreement. TheReceiving Party shall be responsible for any breach of this Section 6.3 caused by any of its Representatives.
- 6.4 On the expiration or earlier termination of this Agreement, at the Disclosing Party's written request, the Receiving Party and its Representatives shall, promptly return all Confidential Information and copies thereof that it has received under this Agreement, except that Receiving Party may retain such Confidential Information for itsfiles, together with such communications and other records as Receiving Party is required to retain by applicable law, internal audit or compliance policy, or any automatic IT archiving or backup storage of data procedures.

### 7. Term and Termination.

- 7.1 Agreement. This Agreement shall commence on the Effective Date and shall remain in effect for a period of one year, and shall automatically renew for subsequent periods of one year each, unless Margaritaville gives Company written notice of termination at least (30) days prior to expiration of the then-current term.
- 7.2 Statement of Work. Each Statement of Work will remain in effect until the Services thereunder are completed or the Statement of Work is terminated earlier as provided therein or herein.

- 7.3 Termination of Marketing Provider Agreement.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 32

What additional documents might MVE require from a Camp Margaritaville customer, and why?

Accepted Answer

- **8.10 Further Documents.** Customer acknowledges and agrees that additional Order Documents may be required by MVE from time to time, pursuant to updates to the Technology Standards as described in the Branding Agreement. Customer shall execute and deliver, upon the request of MVE, such further instruments, papers or documents as may be necessary or appropriate to consummate the transactions contemplated hereby and to take such other action MVE may commercially reasonably request to effectuate the purposes of this Agreement and the Branding Agreement.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 33

What agreements have state-specific riders that may affect my Camp Margaritaville franchise?

Accepted Answer

### **ADDENDUM TO FRANCHISE DISCLOSURE DOCUMENT FOR MARGARITAVILLE RV RESORTS, LLC STATE OF MARYLAND**

**THIS ADDENDUM** (the "**Addendum**") amends the Franchise Disclosure Document of **MARGARITAVILLE RV RESORTS, LLC** for its Camp Margaritaville Franchise.

The following is added to Item 5:

The Maryland Attorney General's Office has imposed a deferral condition on us sue to Franchisor's financial condition; therefore, no fees are payable by you to us until all of our pre-opening obligations are completed and your business has opened.

Sections (c) and (l) of Item 17 are amended by adding the following language:

Pursuant to COMAR 02.02.08.16L, the general release required as a condition of renewal,

Source: Item 22 — CONTRACTS (FDD pages 71–72)

Question 34

Is Camp Margaritaville authorized to provide financial performance information that differs from Item 19?

Accepted Answer

- (c) any information Franchisee has acquired from other Camp Margaritaville Resort owners, including information regarding their sales, profits, or cash flows, is not information obtained from Franchisor, and Franchisor makes no representation about that information's accuracy; **Section 4.21 Operational Information**. Beginning on the Opening Date, within 10 days after the end of each calendar month of the Term, Franchisee shall report to Franchisor all Operational Information for the immediately preceding month, year to date, and/or year (as applicable). To help facilitate such reporting, Franchisee shall participate in a financial reporting system required by Franchisor ("**Reporting System**") pursuant to terms negotiated by Franchisor for Camp Margaritaville Resorts. Franchisee shall pay a onetime set-up fee (to include amounts due to both the Reporting System provider and Franchisor's installation consultant), as well as annual fees that include a fixed fee and a fee per user of the Reporting System. Such fees may be increased from time-to-time by the provider of the Reporting System. Operational Information shall be transmitted to Franchisor through the Reporting System and/or delivered directly to Franchisor, at Franchisor's option. Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD page 69)

Question 35

Can the Availability Uptime percentage for Camp Margaritaville's CRS Services be modified, and if so, under what conditions?

Accepted Answer

The CRS Supplier agrees to provide the Services with an Availability Uptime of 99.95% or as may be modified by the CRS Supplier in its commercially reasonable discretion. "Availability Uptime" means the ability for the Customer to receive the Services.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 36

Besides the standard support, is additional support available for Camp Margaritaville franchisees, and if so, is there an additional fee?

Accepted Answer

Standards, as determined in Franchisor's sole discretion. In such event, Franchisee will be required to pay \$500 per day per trainer for each additional day the Task Force remains until Franchisee becomes compliant with System Standards, in addition to the Task Force's additional expenses associated with their extended stay. - (c) Annual Margaritaville Revenue & Marketing Summit. Franchisor hosts the Annual Margaritaville Revenue and Marketing Summit (the "**Marketing Summit**") at a Margaritaville-branded hotel or resort of Franchisor's choice. Franchisee's marketing leaders, sales leaders and revenue leaders are required to attend the Marketing Summit. The Marketing Summit currently costs \$399 per person, plus all costs associated with travel and lodging expenses while at the Marketing Summit. The Marketing summit costs per person may increase over time if Franchisor's underlying costs to host the Marketing Summit increase. - (d) Additional Training. At various times throughout the Term, including prior to Opening Date, Franchisor may conduct conferences, programs, webinars, teleconferences, regional or national conventions or meetings, onsite training by experienced personnel of other Camp Margaritaville Resorts or other Margaritaville-branded venues, or additional or refresher training sessions on matters related to the Camp Margaritaville System. Franchisor will determine the duration, curriculum, and location of such additional training programs, which may take the form of web-based training modules, webinars, seminars, in-person training, or on-site training. Franchisee's Key Personnel, Owners and other Resort personnel that Franchisor designates must attend additional training. Franchisor may also, at its option, provide other optional training programs from time to time during the term. Any such training will be provided at Franchisor's expense. - (e) Optional Training. Franchisee may request additional training be provided to Resort personnel. Franchisor, in its discretion, may provide such requested training at Franchisee's expense. Any specific training, guidance or assistance that Franchisor provides does not create an obligation (whether by course of dealing or otherwise) to continue providing that specific training, guidance or assistance, all of which Franchisor may periodically modify. - (f) Training Fees. Franchisee must pay Franchisor's then-current fees for any onsite or offsite training that the Resort's personnel attend, including, but not limited to, the Training Program. Franchisee shall also be responsible for all costs associated with Resort personnel related to the Training Program or other training as required pursuant to this Section 3.01, including without limitation, wages, salaries, housing, travel-related expenses and per diem charges incurred by the trainees, subject to a mutually agreed budget. Except as otherwise specified herein, if the training is conducted onsite at the Resort, then Franchisee must cover the costs of lodging and living expenses for all persons conducting such training, including, but not limited to Franchisor personnel. **Section 3.02 System Standards Manual**. Franchisor shall provide Franchisee access to the electronic media and/or written materials reflecting the then-current System Standards (the "**Manual**") during the Term. Franchisee must comply with the terms of the Manual and any Supplements to the Manual (defined below), as Franchisor periodically modifies it. The Manual and any Supplements to the Manual may include electronic media and/or written materials and Franchisee agrees to monitor and access any updates to the Manual, System Standards, or other aspects of the Camp Margaritaville System. Subject to Section 4.19, Franchisor may make additions to, deletions from, and modifications to the Manual and the System Standards ("**Supplements**") from time to time and in any form or fashion, including: (a) altering the products, accounting and computer systems, forms, policies, and procedures of the Camp Margaritaville System; - (b) adding, modifying, or substituting the equipment, signs, trade dress, and other Resort characteristics that Franchisee is required to use or display (subject to the limitations set forth in this Agreement); - (c) implementing new programs and policies, which may require Franchisee to incur additional expenses, purchase new equipment or supplies, or pay additional reasonable fees; and - (d) changing, improving or modifying the Camp Margaritaville Intellectual Property. Franchisor will communicate all Supplements in writing or electronically to Franchisee, as Franchisor deems appropriate. Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 37

Does the Branding Agreement affect the notice period required for termination of the Camp Margaritaville Terms of Use due to property sale?

Accepted Answer

Customer may terminate these Terms of Use, without liability of any kind or nature, in the event that the Property is sold to an unrelated third party as and if permitted by the Branding Agreement.

Customer shall give Margaritaville at least ninety (90) days advance written notice (unless a shorter notice period is allowed by the Branding Agreement) and shall ensure that all invoices for services for such Property have been paid through the termination date.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 38

What are the conditions under which a Camp Margaritaville franchisee's termination will NOT occur, even if an owner is convicted of a felony?

Accepted Answer

- (d) Franchisee or any of its Owners or Guarantors is, or is discovered to have been, convicted of a felony or a crime involving fraud, or enters or is discovered to have entered a plea of no contest to a felony or a crime involving fraud; unless (i) the owner does not have Control over the Franchisee; (ii) the conviction, plea or crime is not likely, in Franchisor's reasonable opinion, to reflect materially adversely upon Franchisor, its Affiliates or the Camp Margaritaville Intellectual Property, whether on a local, regional or national scale; and (iii) the owner divests all of such owner's direct and indirect ownership interests in Franchisee within 60 days after the date of the conviction or plea;

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 39

Can the customer add languages, toll-free numbers, and/or properties to the Call Center Services agreement with Camp Margaritaville?

Accepted Answer

- 3. Customer agrees that, during the Term, Margaritaville (including any Third-Party Call Center Provider) will serve as exclusive third-party provider of call center reservation services for the Customer's Property. The Parties may agree to add languages, toll free numbers and/or Properties as mutually agreed to by the parties. Any such change shall be agreed to in good faith between the Parties and shall be made by amendment to Attachment 1.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 40

What is the deadline for a Camp Margaritaville franchisee to register to sell dwellings and rent vacation rentals in compliance with applicable law, including the Interstate Land Sales Full Disclosure Act, to satisfy the condition precedent?

Accepted Answer

- **3.2** Condition Precedent. All rights granted by Franchisor to Franchisee under this Rider are subject to the condition precedent that, within ninety (90) days after the Effective Date, Franchisee registers to sell the Dwellings and rent the Vacation Rentals in compliance with Applicable Law, including the Interstate Land Sales Full Disclosure Act, in Franchisor's commercially reasonable judgment. If such condition precedent does not occur within the specified time frame, Franchisor may terminate this Rider immediately upon notice to Franchisee at the time of such failure. If terminated pursuant to the foregoing, this Rider shall be null and void and neither Franchisor nor Franchisee shall have any claims against each other under the terms of this Rider.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 41

What is the deadline for obtaining a non-disturbance certificate from HPS Investment Partners, LLC for a Camp Margaritaville franchise?

Accepted Answer

The only lien or encumbrance against the Camp Margaritaville Intellectual Property is a security interest granted to HPS Investment Partners, LLC, pursuant to a security agreement dated as of June 17, 2022. Within 30 days of the signing of any Franchise Agreement, we will obtain from HPS Investment Partners, LLC, and deliver to you, a non-disturbance certificate in the form of Exhibit G to the Franchise Agreement. No other agreement significantly limits our rights to use or license the Camp Margaritaville Intellectual Property in a manner material to the franchise.

Source: Item 13 — TRADEMARKS (FDD pages 57–59)

Question 42

What is the dependency between disclosing confidential information and obtaining written consent for Camp Margaritaville?

Accepted Answer

(i) Margaritaville and Customer shall each retain in confidence all information transmitted to it by or under authorization of the other party pursuant to or in connection with these CRM Terms of Use in which the disclosing party identifies as being proprietary or confidential or that, by the nature of the circumstances surrounding the disclosure, would in good faith be treated as proprietary and/or confidential ("Confidential Information"). Neither party will make use of the other's party's Confidential Information except pursuant to the terms of these CRM Terms of Use. By way of example, but not limitation the following information is considered Confidential Information: (a) these CRM Terms of Use and its terms, (b) the technology, ideas, formulae, knowhow, documentation, procedures, algorithms and trade secrets embodied in the CRM Services and/or Connection Platform, technical documentation, solution methodology, end user manuals, Documentation and Deliverables, (c) Customer Data, end user ID's and passwords; and/or (d) any other information, in any form identified in writing as confidential. If Customer obtains information relating to Margaritaville or CRM from third parties to whom it is directed by Margaritaville, then Customer shall treat such information as Margaritaville's Confidential Information

under these CRM Terms of Use. Customer agrees, without limitation, that Customer Data is part of the Customer's Confidential Information.

(ii) The receiving party shall not disclose Confidential Information or use it in any manner not expressly authorized by these CRM Terms of Use. Unless written authorization is received from the disclosing party, the receiving party shall not: (a) disclose the disclosing party's Confidential Information or allow it or cause it to be disclosed to any third parties; (b) destroy any disclosing party Confidential Information or cause it to be inaccessible to the disclosing party (other than in accordance with its standard document retention policy); or (c) use the disclosing party's Confidential Information or allow it to be used for purposes other than in furtherance of these CRM Terms of Use.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 43

What is the dependency of obtaining a liquor license for Camp Margaritaville?

Accepted Answer

Any liquor license obtained must include beer, wine, and full spirits, as allowable under Applicable Law in the Resort's jurisdiction.

These costs include fees for all licensing and permits required to comply with federal, state, and local laws, including, without limitation, those laws set forth in Item 1 as applicable to the Resort.

Such costs, include, but are not limited to, permit fees, liquor license, utility deposits and startup requirements, impact fees (one-time charges that the government levies to offset service costs relating to the new development), tap fees (charges for connecting to existing water or sewer lines), and various business licenses.

| Type of expenditure | Amount           | Method of Payment | When due                                 | To whom payment is to be made |
|---------------------|------------------|----------------------|------------------------------------------|-------------------------------------|
| Insurance and Permits, licenses, deposits, and related fees (5) | $50,000 - $150,000 | Lump Sum | Before construction begins and before Resort begins operation | Government authorities and utility companies |

Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 34–40)

Question 44

In the event of a conflict between the Franchise Agreement and the Lodge Rider for Camp Margaritaville, which document's terms will control?

Accepted Answer

**7. Effect**

**7.1** The terms of this Rider are expressly made subject to and are governed by the Agreement. Except as specifically set forth in this Rider, the Franchise Agreement shall continue in full force and effect. In the event of a conflict between the terms of the Agreement and this Rider, this Rider shall control.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 45

What factors might be considered when determining whether to reduce the Royalty Fee for a Camp Margaritaville?

Accepted Answer

at would otherwise have been payable as part of the Royalty Fee. No such reduction or advertising assistance is guaranteed or required. When determining whether to reduce the Royalty Fee, we might consider things like the Resort's location and market, its size and amenities, the economic and financial environment generally and in the Resort's market, your experience and willingness to develop multiple Margaritaville-affiliated resorts, and other relevant factors.

- 3. Marketing Fee. The marketing fee (the "**Marketing Fee**") provides for our marketing services and support.

Source: Item 6 — OTHER FEES (FDD pages 20–34)

Question 46

How is the Financial Reporting System fee for Camp Margaritaville subject to change?

Accepted Answer

rcumstances                                                                                                                                                                                                                                                                          | As incurred                                                                                                                | You must indemnify us for certain losses and expenses under the Dwellings Rider. Applies only if we                                                   |

| Type of Fee                            | Amount                                                                                 | Due Date                                                       | Remarks                                                                                                                                                                                                                                                                                 |
|----------------------------------------|----------------------------------------------------------------------------------------|----------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  |  | provide our approval for Dwellings and if you sign a Dwellings Rider. |
| Lodge Royalty (13) | 5% of Gross Revenue | Within 30 days following the end of each calendar month. | All sales from the Lodge shall be included in the calculation of Gross Revenue as provided in the Agreement. Applies only if we provide our approved for a Lodge and if you sign a Lodge Rider. |
| FBR Royalty (FBR Rider) | 5% of Gross Revenue | Within 30 days following the end of each calendar month. | All sales from an FBR Unit (including all Merchandise sales) shall be included in the calculation of Gross Revenue as provided in the Agreement. Applies only if we provide our approval for FBR Unit and if you sign an FBR Rider. |
| Amenities Royalty (Amenities Rider) | 5% of Gross Revenue | Within 30 days following the end of each calendar month. | All sales and money gained from any services provided from the Amenities shall be included in the calculation of Gross Revenue as provided in the Agreement. Applies only if we provide our approval for Amenities and if you sign an Amenities Rider. |
| Financial Reporting System | \$4,500 fixed fee, plus \$2,000 per user in Year 1, \$600 per user thereafter | Annually | These fees shall be updated from time-to time based on increases in the underlying charges that we pay for the financial reporting system. |
| Type of Fee                                                                | Amount                                                                                                                                                                                                        | Due Date                                                       | Remarks                                                                                                                                                                                                                                                      |
|----------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Gift Car

Source: Item 6 — OTHER FEES (FDD pages 20–34)

Question 47

Does the Camp Margaritaville Franchise Agreement always include a Property Improvement Plan (PIP) as described in Exhibit C-1?

Accepted Answer

**Section 2.04 Conversion Resorts**. If Franchisee converts an existing RV park to a Camp Margaritaville Resort franchise, Franchisee must: (i) renovate the Resort in accordance with the adaptive reuse Property Improvement Plan ("**PIP**"), as agreed between the Parties and attached as Exhibit C-1, and (ii) the Design Plans must comply with the PIP.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 48

Does the Camp Margaritaville franchise agreement grant franchisees the right to use Non-Buffett Works, and if so, under what conditions?

Accepted Answer

he Camp Margaritaville Intellectual Property are approved, any such approved components shall be addressed pursuant to a separate agreement or mutually agreed addendum to this Agreement. - (b) Non-Branded Components. The Parties agree that the Resort may contain components that do not contain or compete with the Camp Margaritaville Intellectual Property, subject to Franchisor's approval in its sole discretion. **Section 8.04 Restrictions on Buffett IP Rights**. The rights granted pursuant to this Agreement expressly exclude the right to use the Non-Buffett Works. To the extent that Buffett has the legal right to do so, Buffett has granted to Licensor (pursuant to the Buffett Agreement), and Licensor has sub-licensed to Franchisor (pursuant to the License Agreement), the right to further sub-license to Franchisee, a nonexclusive license to exploit the Non-Buffett Works in connection with this Agreement, subject to Section 8.05 hereof. **Section 8.05 Music Clearances**. Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 49

For a Camp Margaritaville franchise, what conditions trigger a 'Change of Control'?

Accepted Answer

rmation. ### **ARTICLE XII. ASSIGNMENT, TRANSFERS, AND ENCUMBRANCES** **Section 12.01 Assignment by Franchisor**. Franchisor may assign its rights or delegate its obligations under this Agreement to: (a) any Affiliate; (b) any secured lender; or (c) any Person that can otherwise comply alone or in combination with Franchisor and its Affiliates with all requirements as set forth in this Agreement. ### **Section 12.02 Assignment or Transfer by Franchisee; Change of Control.** - (a) Transfer. In the event that Franchisee desires to effect a Change of Control or assign, sublicense or transfer its rights and/or obligations under this Agreement (each, a "**Transfer**"), Franchisee shall provide Franchisor notice of such anticipated Transfer as soon as reasonably practicable but in no event less than 30 days before the Transfer is to occur. Accompanying such notice, the transferee shall submit a copy of the then-current franchise application and the then-current application fee. Franchisor shall determine whether to approve the Transfer within 15 calendar days, which will not be unreasonably withheld if the following conditions are met: - (i) the Transfer is not to a Competing Brand; - (ii) the Transfer would not materially or detrimentally harm the Franchisor or its Affiliates; - (iii) the transferee and each of its direct or indirect owners (if the transferee is a legal entity) has, in Franchisor's sole discretion, the necessary business experience, aptitude, and financial resources to operate the Resort and meets Franchisor's thencurrent standards for Camp Margaritaville Resorts franchisees; - (iv) Franchisee has paid all amounts due to Franchisor and undisputed amounts due to third-party vendors related to the Resort and is in substantial compliance with this Agreement during the 60-day period prior to requesting Transfer and during the period after the request was made but before the Transfer is effective; - (v) the transferee's proposed Management Company, if different from the current Management Company, meets Franchisor's then-current standards for Management Companies and completes the Training Program and any other training required of Management Companies at the time; - (vi) the transferee and its ow Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 50

For a Camp Margaritaville franchise in Hawaii, when is the initial franchise fee due?

Accepted Answer

### **HAWAII RIDER TO MARGARITAVILLE RV RESORTS, LLC FRANCHISE AGREEMENT**

THIS RIDER (the "Rider") is effective as of, 20 (the "Agreement Date"), and amends the Franchise Agreement dated, 20 (the "Agreement"), between MARGARITAVILLE RV RESORTS, LLC (the "Franchisor") and (the "Franchisee"). 1. Precedence and Defined Terms. This Rider is an integral part of, and is incorporated into, the Agreement. Nevertheless, this Rider supersedes any inconsistent or conflicting provisions of the Agreement. Terms not otherwise defined in this Rider have the meanings as defined in the Agreement. 2. Initial Franchise Fee. The payment of the initial franchise fee is deferred until all of our pre-opening obligations to you are completed and your business has opened.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 51

When does a Camp Margaritaville franchisee become liable for all fees and charges for the CRS Services?

Accepted Answer

of terminating these CRS Terms of Use upon the lesser of: (a) sixty (60) days prior written notice; or (b) the termination period provided under the CRS Supplier Agreement (which shall not be less than 30 days). Margaritaville will give Customer prompt written notice if Margaritaville gives or receives a termination notice for the CRS Supplier Agreement. No termination fee will be owed by Customer if these CRS Terms of Use are terminated as provided in this Section 2.
- **4. Exclusivity**. Customer agrees that the Property shall exclusively use the CR System for booking all reservations through the channels listed on Attachment A. In any event, Customer shall ensure that all reservation systems for the Property are synchronized to the fullest extent practicable through Customer's PMS and that the CR System interface connects with such PMS and the call center.
- **5. Fees and Fee Increases.** Fees for the CRS Services shall be as detailed in Attachment A, attached

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 52

Can a Camp Margaritaville franchisee combine the marketing of other brands with the marketing of the Resort?

Accepted Answer

n Improvement Program takes place over nine (9) months and consists of additional training on System Standards, inperson meetings and webinars, and audits. The Guest Satisfaction Improvement program occurs primarily at the Resort but may also include travel to other similar properties to benchmark best practices. - **Section 4.17 Cross-Promotion**. If Franchisee receives a request at the Resort for reservations or accommodations in any area where a Camp Margaritaville Resort is located, Franchisee will promptly refer such request to such location or to the CRS. Franchisee must refer guests and customers, wherever reasonably possible, only to Camp Margaritaville Resorts or other Margaritaville-branded lodging properties, not use the Resort or the Camp Margaritaville System to promote a competing business or other lodging facility, and not divert business from the Resort to a competing business. - **Section 4.18 Loyalty Program**. Franchisor has established a loyalty program to allow members to redeem awards for stays at Camp Margaritaville Resorts or otherwise enjoy Margaritaville-branded products and services ("**Loyalty Program**"). Franchisee agrees to participate in any such Loyalty Program pursuant to the Loyalty Program Terms of Use incorporated by reference into the Technology Agreement, which includes payment by Franchisee of a one-time set-up fee, as well as ongoing fees loyalty fees, calculated generally on a "Per Overnight Accommodation" basis. Such fees shall be updated from time-totime based on increases in the underlying charges paid by Franchisor for the Loyalty Program. Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 53

What must a Camp Margaritaville franchisee do if they believe Franchisor instructions regarding Guest Profile Data would violate Applicable Law?

Accepted Answer

Franchisee agrees that it will inform Franchisor if it believes that any Franchisor instructions made in the context of an audit or inquiry regarding the processing of Guest Profile Data pursuant to this Agreement would violate Applicable Law.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 54

What must a Camp Margaritaville franchisee do if they are required to disclose Confidential Information by Applicable Law?

Accepted Answer

Confidential Information does not include: (i) information in the public domain, provided that it did not fall into the public domain by your unauthorized use; (ii) information that was in your possession prior to disclosure or was disclosed by a third party who had no confidentiality obligations to us; (iii) information that is required to be disclosed by Applicable Law, but only to the extent required and upon prior written notice to us; and (iv) information you may be required to disclose to enforce your rights under a duly executed Franchise Agreement with us.

Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 59–62)

Question 55

Is a Camp Margaritaville franchisee required to sign a contract with potentially different terms and conditions when renewing their franchise agreement?

Accepted Answer

agreements. You should read these provisions in the agreements attached to this disclosure document.

\* For purposes of the table below: "LR" refers to the Lodge Rider and "DR" refers to the Dwellings Rider

### **THE FRANCHISE RELATIONSHIP**

|    | Provision                                         | Section in franchise or other agreement | Summary                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|----|---------------------------------------------------|--------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| a. | Length of the franchise term | Section 1.02 | Initial term is twenty (20) years |
| b. | Renewal or extension of the term | Section 1.03 | If you are in good standing and satisfy certain conditions (as described in 17.c. below) are met, then you are entitled an automatic renewal of your franchise rights for one additional ten (10) year term |
| c. | Requirements for franchisee to renew or extend | Section 1.03 | Your renewal right permits you to remain as a franchisee after the initial term of your Franchise Agreement expires. However, to remain a franchisee, you must meet all required conditions to renewal. When renewing, you may be asked to sign a contract with materially different terms and conditions than your original Franchise Agreement. Franchisee must pay a \$50,000 renewal fee and comply with the conditions precedent to renewal, including: written notice of intent 12-18 months prior to expiration; not be in default; franchisee still has ownership of site; franchisee agrees |
|    | Provision                                  | Section in franchise or other agreement | Summary                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|----|--------------------------------------------|--------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  |  | to remodel to the Resort's then |
|  |  |  | current standards; execution of

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 64–68)

Question 56

Can a Camp Margaritaville franchisee use Guest Profile Data for purposes other than marketing to and providing services to guests?

Accepted Answer

request to review and retrieve Guest Profile Data. Franchisor grants Franchisee a limited, revocable, non-transferrable right and license to use the Guest Profile Data in Franchisee's possession during the Term solely as necessary and allowed by Applicable Law to market to and provide services to the Resort's guests and prospective guests. Unless Franchisor (in its sole discretion) has approved in writing and in advance or as otherwise required by Applicable Law, and, only to the extent required by Applicable Law, the Guest Profile Data shall not be: (a) used by or on behalf of Franchisee for any other purpose; (b) disclosed, sold, shared, assigned, leased or otherwise provided to third parties by or on behalf of Franchisee; or (c) commercially exploited by or on behalf of Franchisee. Franchisee shall not use Guest Profile Data to market other brands and shall not combine the sales, marketing, promotion and/or advertising of any other brand with the sales, marketing, promotion and/or advertising of the Resort unless specifically approved by Franchisor. Franchisee shall not create, engage in, or promote any separate additional applications, loyalty or rewards programs or any kind other than those approved by Franchisor. Franchisee shall not manually upload or edit Guest Profile Data or data lists of any kind into the system without the express written consent of Franchisor. Franchisee is not permitted to purchase or sell data lists, or make third-party data sharing agreements for use in connection with the Resort.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 57

For Camp Margaritaville franchisees in North Dakota, when are franchise fees due?

Accepted Answer

- 1. Item 5 of the disclosure document is modified to reflect that franchise fees are deferred until we fulfill our initial obligations to you and you have commenced doing business.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 58

Are Camp Margaritaville franchisees required to participate in food safety and sanitation audits, and if so, how often and at whose expense?

Accepted Answer

- (v) *Food Safety and Sanitation Audits*. In addition to or as a part of a Quality Assurance Audit, Franchisee may also be required, on a quarterly basis at Franchisee's expense, to participate in food safety and sanitation audits conducted by Franchisor or its designated agent.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 59

Are Camp Margaritaville franchisees required to provide food and drink free of charge to Franchisor representatives during Quality Assurance Audits, and if so, under what conditions?

Accepted Answer

The menus offered through the Food and Beverage Service shall be approved by Franchisor on a commercially reasonable basis, based on brand consistency and the specific kitchen facilities. Franchisee shall be responsible for ensuring that menus comply with all Applicable Law. ### **Section 4.16 Quality Assurance.** - (a) Quality Assurance Audits. - (i) *Right to Inspect*. During normal business hours and without any prior notice, Franchisor, its representatives, or Affiliates may: - (1) inspect all public and non-public areas of the Resort at any time except for occupied Overnight Accommodations; - (2) be served food and drink during regular hours of service, which, when consumed in public areas of any Food and Beverage Service, shall be free of charge; - (3) interview management and staff, provided such interviews shall not interfere with the performance of the duties of the management and staff; and - (4) inspect records (including, without limitation, letters or notes regarding customer complaints), to ensure compliance with System Standards. - (b) The foregoing items (1)-(4) shall be referred to as the "**Quality Assurance Audit**". - (i) *Standards for Passage*. The score required to pass any Quality Assurance Audit shall be set from time to time by Franchisor and communicated in the Manual. - (ii) *Timing*. Franchisor may conduct such audits as frequently as Franchisor determines in its sole discretion. - (iii) *Costs*. Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 60

For Camp Margaritaville franchises in California, what happens if the Franchise Agreement contains a provision inconsistent with California Business and Professions Code Sections 20000 through 20043?

Accepted Answer

The following paragraphs are added at the end of Item 17 of the disclosure document pursuant to regulations promulgated under the California Franchise Investment Law:

**California Law Regarding Termination and Nonrenewal**. California Business and Professions Code Sections 20000 through 20043 provide rights to franchisees concerning termination, transfer, or nonrenewal of a franchise. If the Franchise Agreement contains a provision that is inconsistent with the law, the law will control.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 61

For Camp Margaritaville franchises in Illinois, under what condition will the payment of the Application Fee be deferred?

Accepted Answer

Payment of the Application Fee will be deferred until we have met our pre-opening obligations to you, and you have commenced doing business. The Illinois Attorney General's Office imposed this deferral requirement due to our financial condition. No statement, questionnaire, or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 62

For Camp Margaritaville franchises in Maryland, when is the initial franchise fee due?

Accepted Answer

The following is added to Item 5:

The Maryland Attorney General's Office has imposed a deferral condition on us sue to Franchisor's financial condition; therefore, no fees are payable by you to us until all of our pre-opening obligations are completed and your business has opened.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 63

For Camp Margaritaville franchises in North Dakota, when are franchise fees due?

Accepted Answer

Item 5 of the disclosure document is modified to reflect that franchise fees are deferred until we fulfill our initial obligations to you and you have commenced doing business.

Source: Item 23 — RECEIPTS (FDD pages 72–406)

Question 64

Can the Camp Margaritaville franchisor increase the Management Company transition fee, and if so, under what conditions?

Accepted Answer

n, covenants governing Franchisor's Confidential Information and non-competition covenants ("**Management Rider**"). Notwithstanding the foregoing, Franchisee acknowledges and agrees that compliance with the terms and obligations of this Agreement shall be Franchisee's responsibility even though Franchisee may retain a Management Company. If Franchisee changes the Management Company it is using to manage the Resort during the Term of this Agreement, then Franchisee shall pay a transition fee to Franchis

Source: Item 23 — RECEIPTS (FDD pages 72–406)

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