What agreements must be executed prior to the opening of a Dermani Medspa Franchised Business?

ed initial franchise fee equal to $35,000 for the second and each additional Franchised Business that is scheduled to be established under the Area Development Agreement. The Development Fee is in lieu of, not in addition to, initial franchise fees owed under each respective Franchise Agreement to be executed under this Agreement.

• 2.2. Non-Refundability. The Development Fee will be fully earned when received by us and will be non refundable in consideration of administrative and other expenses incurred by us and for the development opportunities lost or deferred as a result of the rights granted to you herein. Even if you fail to execute all Franchise Agreements, or open all required Franchised Businesses, the Development Fee is non-refundable.

3. DEVELOPMENT OBLIGATIONS

• 3.1. Exercise of Development Obligations; Franchise Agreements. You must execute a Franchise Agreement for each Franchised Business to be developed hereunder. You must execute the first (1st) Franchise Agreement required under this Agreement contemporaneously with the execution of this Agreement. Notwithstanding the foregoing, we, in our sole discretion, may permit one or more of such Franchise Agreements to be executed by entities other than you; provided that (a) you own a controlling ownership interest in the franchisee entity; (b) we approve the ownership structure of, and each owner of twenty-five percent (25%) or more of the equity in, the franchisee entity; and (c) you or your Operating Principal executes a guarantee, guaranteeing to us the timely payment and performance of the franchisee's obligations under the Franchise Agreement.
• 3.2. Franchise Agreements. Each dermani MEDSPA® must be located at a site approved by us in writing, within the Development Area, as provided in the Franchise Agreement (the "Premises"). The Franchise Agreement for the first (1st) Franchised Business developed hereunder will be in the form of the Franchise Agreement attached hereto as Exhibit D, and the Franchise Agreement for each additional Franchised Business developed hereunder will be the form of Franchise Agreement being offered generally by us at the time each such Franchise Agreement is executed.
• 3.3. Development Schedule. Recognizing that time is of the essence, you agree to satisfy each deadline set forth in the Development Schedule in Exhibit A of this Agreement.

Source: Item 23 — RECEIPTS (FDD pages 66–311)