F-7558

STATE OF MINNESOTA
DEPARTMENT OF COMMERCE
REGISTRATION DIVISION
(651) 539-1627

IN THE MATTER OF THE REGISTRATION OF:

CYCLEBAR F/A
By CYCLEBAR FRANCHISING LLC

ORDER OF
REGISTRATION

WHEREAS, an a p p l i c a t i o n has been f i l e d p u r s u a n t t o Minn.

Stat. §80C.04; and
WHEREAS, t h e a p p l i c a n t has c o m p l i e d w i t h t h e r e q u i r e m e n t s
of registration,
NOW, THEREFORE, IT IS ORDERED, t h a t t h e r e g i s t r a t i o n be
d e c l a r e d e f f e c t i v e as o f t h e d a t e s e t f o r t h below.

^m^t
MIKE ROTHMAN
Commissioner
Department of Commerce
85 7 t h P l a c e E a s t , S u i t e 500
St P a u l , MN 55101
Date: F e b r u a r y 10, 2015
dlw
 P - Us-Z
(
Form A - Uniform Franchise Registration Application

UNIFORM FRANCHISE REGISTRATION APPLICATION

File No.:
(Insert file number of immediately
preceding filing of Applicant)

State: Minnesota Fee: $400.00

APPLICATION FOR (Check only one):

X INITIAL REGISTRATION OF A N OFFER AND S A L E OF FRANCHISES

R E N E W A L APPLICATION OR ANNUAL R E P O R T j^mx,,,^

* iMvaae+m

PRE-EFFECTIVE A M E N D M E N T FEB 06 2015

POST-EFFECTIVE MATERIAL AMENDMENT *C*|. ^ QO

1. Full legal name of Franchisor:

CycleBar Franchising, L L C

2. Name of the franchise offering:

CycleBar '

3. Franchisor's principal business address:

7720 Montgomery Road, Suite 200
Cincinnati, Ohio 45236

4. Name and address of Franchisor's agent in this State authorized to receive service of
process:
Commissioner of Commerce
Department of Commerce p y
th
85 7 Place East, Suite 500
St. Paul, Minnesota 55101-2198 ^

5. The states in which this application is or will be shortly on file:

u<
California, Illinois, Indiana, Minnesota, New York, Rhode Island ' . , &)
K K
4>\ *

EASTA57517287.1
t
Form A (cont'd) - Uniform Franchise Registration Application

6. Name, address, telephone, and facsimile numbers, and e-mail address of person to
whom communications regarding this application should be directed:

CINDY SABO, SENIOR P A R A L E G A L

D L A PIPER L L P (US)
1201 WEST P E A C H T R E E STREET, SUITE 2800
A T L A N T A , GEORGIA 30309
(404) 736-7832 (telephone)
(404) 682-7832 (direct fax)
cindv.sabo@dlapiDer.com

Certification

I certify and swear under penalty of law that I have read and know the contents of this
application, including the Franchise Disclosure Document with an issuance date of January
6, 2015 attached as an exhibit, and that all material facts stated in all those documents are
accurate and those documents do not contain any material omissions. I further certify that
I am duly authorized to make this certification on behalf of the Franchisor and that I do so
upon my personal knowledge.
th
Signed at Cincinnati, Ohio, on February 4 , 2015.

Franchisor:

C Y C L E B A R FRANCHISING, L L C

By: A^L.x-
Name: Kristian Higgs

Title: General Counsel

STATE OF OHIO )
) SS.:
COUNTY OF H A M I L T O N 1
th
Personally appeared before me this 4 dav of February , 2015, the above-
named Kristian Higgs to me known to be the person who executed the foregoing
application as General Counsel of the above-named applicant and being first duly sworn,
stated upon oath that said application, and all exhibits submitted herewith, are true and
correct.

JOWHKMM
MMyftUi
CT)^^ /V?^^-^
N^tprfS ign ature
NOWYMUC-SWEOFOMO
(NO 1
% 147.03 RC. Joseph Roda
Notary's Name (Type or Print)

EAS'n57517287.1
p DLA PIPER
LDLA F
DLA Piper LLP (US)
1201 West Peachtree Street, Suite 2800
/

Atlanta, Georgia 30309-3450

T 404.736.7800
F 404.682.7800
Wwww.dlapiper.com

CINDY SABO
SENIOR PARALEGAL
cindy.sabo@dlapiper.com
T 404.736.7832 F 404.682.7832
February 5,2015

VIA UPS NEXT DAY D E L I V E R Y

Ms. Bette Peterson

Minnesota Department of Commerce
Registration Division
th
85 7 Place East, Suite 500
St. Paul, Minnesota 55101-2198

Re: CycleBar Franchising, L L C

Initial Franchise Registration

Dear Ms. Peterson:

This law firm represents CycleBar Franchising, LLC, a franchisor seeking registration to
offer and sell its CycleBar franchises under the Minnesota Franchise Act. The following
documents are enclosed regarding the initial franchise registration of the above-referenced
franchisor:

1. Uniform Franchise Registration Application Page (with Certification);

2. Franchisor's Costs and Sources of Funds;

3. Uniform Franchise Consent to Service of Process and Corporate Acknowledgment;

4. Franchise Seller Disclosure Forms;

5. Accountants Consent;

6. One copy ofthe 2015 CycleBar FDD; and

7. A check in the amount of $400.00 made payable to the Minnesota Department of

Commerce in payment of filing fees.

Please file stamp the extra copy of the Application Page enclosed and retum it to me in
the self-addressed, stamped envelope provided.

EAST\90644932.1
 rp DLA PIPER Ms. Bette Peterson
February 5, 2015
Page 2

If you have any questions or comments, or if we can provide you with any further
information, please do not hesitate to contact me directly at (404) 736-7832. As always, thank
you for your assistance and cooperation in these matters.

Best/Regards,

Cindy Sab
Senior Pai&legal

Enclosures

EAS7A90644932.]
Form B - Franchisor's Costs and Sources of Funds

FRANCHISOR'S COSTS AND SOURCE OF FUNDS

1. Disclose the Franchisor's total costs for performing its pre-opening obligations to
provide goods or services in connection with establishing each franchised business,
including real estate, improvements, equipment, inventory, training and other items stated
in the offering:

Category Costs

Real Estate $2,500

Improvements
Equipment
Inventory
Training $2,000
Other (describe)

Totals $4,500

2. State separately the sources of all required funds:

The Franchisor's approximate cost to perform its obligations in connections with

establishing each franchise is $4,500. The source of the funds needed by the Franchisor
to discharge its obligations is the Franchisor's working capital and initial franchise fees.

EAST\90641281.1
Form C - Uniform Franchise Consent to Service of Process

U N I F O R M FRANCHISE CONSENT TO SERVICE OF PROCESS

CycleBar Franchising, L L C , a limited liability company ,

organized under the laws of Ohio (the "Franchisor"), irrevocably appoints the officers of the States
designated below and their successors in those offices, its attorney in those States for service of
notice, process or pleading in an action or proceeding against it arising out of or in connection with
the sale of franchises, or a violation of the franchise laws of that State, and consents that an action
or proceeding against it may be commenced in a court of competent jurisdiction and proper venue
within that State by service of process upon this officer with the same effect as if the undersigned
was organized or created under the laws of that State and had lawfully been served with process in
that State. We have checked below each state in which this application is or will be shortly on file,
and provided a duplicate original bearing an original signature to each state.

X California: Commissioner of North Dakota: Securities

Business Oversight Commissioner

Hawaii: Commissioner of Securities X Rhode Island: Director, Department

of Business Regulation

X Illinois: Attorney General South Dakota: Director of the

Division ofSecurities

X Indiana: Secretary of State Virginia: Clerk, Virginia State

Corporation Commission

Maryland: Securities Commissioner Washington: Director ofFinancial

Institutions

X Minnesota: Commissioner of Wisconsin: Administrator, Division

Commerce of Securities, Department of
Financial Institutions
New York: Secretary of State

Please mail or send a copy ofany notice, process or pleading served under this consent to:

Norman Leon, Esq.

(Name and address)
D L A Piper L L P (US)
203 North LaSalle Street, Suite 1900
Chicago, Illinois 60601
th
Dated: February 4 ,2015
Franchisor:
C Y C L E B A R FRANCHISING, L L C

Name: Kristian Higgs

Title: General Counsel

EA$T\51517287.1
 CORPORATE A C K N O W L E D G M E N T

STATE OF OHIO
) SS.
COUNTY OF HAMILTON

th
On this 4 day of February , 2015, before me Joseph Roda
(Name of Notary)

the undersigned officer, personally appeared Kristian Higgs, known personally to me to be the

General Counsel of CycleBar Franchising, LLC and that he, as such officer, being authorized so

to do, executed the foregoing instrument for the purposes therein contained, by signing the name

of the company by himself as such officer.

IN WITNESS WHEREOF, I have hereunto set my hand and official seal.

Notaiy Signature
jWWVMUC«8WC<yowo
teurana
A L SEAL) Joseph Roda
Notary's Name (Type or Print)

My Commission Expires: does not expire

EAST\51517287.1
 Collins Heeb Miller & Co., Inc.
Certified Public Accountants

Edward R. Collins, CPA t 4903 VINE STREET • CINCINNATI, OHIO 45217

Donald F. Heeb, CPA tt TELEPHONE (513) 641-1900
Richard A. Miller, CPA t FAX (513) 641-1450

Matthew C. Roetting, CPA 1005 HARRISON AVENUE • HARRISON, OHIO 45030

John R. Showalter, CPA • TELEPHONE (513) 367-1818
J. Kevin McSweeney
www.chmcpa.com

CONSENT OF INDEPENDENT ACCOUNTANTS

Collins Heeb Miller & Co., Inc. consents to the use in the Franchise Disclosure
Document issued by CycleBar Franchising, LLC ("Franchisor") on January 6, 2015, as it
may be amended, of our report dated January 6, 2015, relating to the financial statements
ofFranchisor as of January 6,2015.

ecQllinsfachmcpa.com • dheeb@chmcpa.com • dm1lierfachmcpa.com • mroettingtachmcpa.com • kmcsweeney(achmcpa.com

Member EASTOOSSSSSS.I t Also Admitted In Indiana
tt Also Admitted In Kentucky
American Institute of Certified Public Accountants
 C Y C L E B A R TM

FRANCHISE DISCLOSURE DOCUMENT

CYCLEBAR FRANCHISING, LLC

Franchise Disclosure Document 01/15

EAST\87466944.6
 C Y C L E B A R ™

F R A N C H I S E D I S C L O S U R E DOCUMENT

Franchisor:
CycleBar Franchising, LLC
An Ohio limited liability company
7720 Montgomery Road, Suite 200
Cincinnati, Ohio 45236
513-322-1663
info@cyclebar.com
www.cyclebar.com

CycleBar Franchising, LLC ("CBF") offers franchises for the operation of a studio that
offers indoor cycling classes under the C Y C L E B A R mark (a "Studio"). The total investment
necessary to begin operation of a new Studio ranges from $255,650 to $599,300. This includes
$38,500 to $59,500 that must be paid to C B F or its affiliates.

This Disclosure Document summarizes certain provisions of your Franchise Agreement

and other information in plain English. Read this Disclosure Document and all accompanying
agreements carefully. You must receive this Disclosure Document at least 14 calendar days
before you sign a binding agreement with, or make any payment to, the franchisor or an affiliate
in connection with the proposed franchise sale. Note, however, that no governmental agency
has verified the information contained in this document.

You may wish to receive your Disclosure Document in another format that is more
convenient for you. To discuss the availability of disclosures in different formats, contact
Kristian Higgs at 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236 (Tel. 513-322-
1663) or at kit@cyclebar.com.

The terms of your contract will govern your franchise relationship. Don't rely on the
Disclosure Document alone to understand your contract. Read all of your contract carefully.
Show your contract and this Disclosure Document to an advisor, like a lawyer or an accountant.

Buying a franchise is a complex investment. The information in this Disclosure

Document can help you make up your mind. More information on franchising, such as "A
Consumer's Guide to Buying a Franchise," which can help you understand how to use this
Disclosure Document is available from the Federal Trade Commission. You can contact the
FTC at 1-877-FTC-HELP or by writing to the FTC at 600 Pennsylvania Avenue, NW.,
Washington, D.C. 20580. You can also visit the FTC's home page at www.ftc.gov for additional
information. Call your state agency or visit your public library for other sources of information on
franchising.

There may also be laws on franchising in your state. Ask your state agencies about
them. This Disclosure Document was issued on January 6, 2015.

0 1 / 1 5
Franchise Disclosure Document
EAST\87466944.6
 STATE CO^ER CAGE

Your may havea^anch^e law ^

state franohise administrator before offenngor 5011^ RE^iSTRATIONOFA
FRANCHISE B Y A S T A T E O O E S NOT MEAN THAT THE STATE RECOMMENDS T H ^
FRANCHISE OR HAS ^ERIFIEOTHE INFORMATION INTHIS OiSCLOSOREOCCOMENT

Call tbe state franchise administrator listed In Exhibit for I n f o r m a l

or about franchising in your state.

MANY FRANCHISE AGREEMENTS 0 0 NOT ALLOW YOO TO RENEW

UNCONDITIONALLY AFTER THE INITIAL TERM EMPIRES YOOMAYHA^ETCSI^NA
NEW AGREEMENT WITH DIFFERENT TERMS ANO CONDITIONS IN ORDER TO
CONTINUE TO OPERATE YOLIRROSINESS BEFORE YOU BUY,CONSIDER WHAT
R I ^ H T S Y O U H A ^ B E T O R E N E W Y O U R FRANCHISE, IF ANY^AND WHAT TERMS YOU
MI^HT HA^ETO ACCEPT INORDER TO RENEW

Please considerthe following RISKFACTORS before you buythis franchise:

1 THE FRANCHISEA^REEMENTREOUIRESYOUTO RESOLVE DISPUTESWITH US

RY LITIGATION INTHESTATEOFOHIO OUTOF STATE LITIGATION MAYFORCE
Y O O T O A C C E P T A L E S S FAVORABLE SETTLEMENT FOR DISPUTES IT MAY
ALSO COSTMORETOLITIOATEINOHIOTHAN IN YOUR HOME STATE

2 THE FRANCHISE AOREEMENT STATES THAT OHIO LAW OO^ERNS THE

AOREEMENT,ANDTHIS LAW MAYNOT PROVIDE THE SAME PROTECTIONAND
BENEFITSASLOCALLAW YOU MAYWANTTOCOMPARE THESE LAWS

3 THE FRANCHISOR MAY,IF IT CHOOSES, NEGOTIATE WITH YOU ABOUT ITEMS

COHERED IN THE PROSPECTUS HOWE^ER,THE FRANCHISOR CANNOT USE
THE NEOOTIATINOPROCESSTOACCEPTTERMSWHICHARE LESS FAVORABLE
THANTHOSESETFORTH INTHIS PROSPECTUS

4 THEREMAYBEOTHERRISKSCONCERNINO THIS FRANCHISE

We may use the services of one or more FRANCHISE BROKERS or referral sources to
assist us in selling our franchise. Afranchise broker or referral source represents us, not you.
We pay this personafee for selling our franchise or referring you to us You should make sure
to do you own investigation of the franchise.

See the next page for the effective date of this Disclosure Document in certain states.

^oohiseO^osoreOooument 0t/t5
E A S ^ ^ ^ ^
 STATE EFFECTIVE DATES

The following chart lists states that require the Disclosure Document to be registered or
filed with the state or to be exempt from registration in order to offer or sell franchises within the
state. In these states, the effective date of the Disclosure Document is as follows:

STATE EFFECTIVE DATE

California
Hawaii
Illinois
Indiana
Maryland
Michigan
Minnesota
New York
North Dakota
Rhode Island
South Dakota
Virginia
Washington
Wisconsin

In all other states, the effective date of this Disclosure Document is the issuance date of
January 6, 2015.

Some of the states listed above require that we give you additional disclosures. The
additional required disclosures for these states are in Exhibit I to this Disclosure Document.

Franchise Disclosure Document 01/15

EAST\87466944.6
 THE F O L L O W S P R O T O N S
THEM^H^NFRANCH^E^VESTMENTLAW
Pursuant to the provisioos of the MiohiganEranohise^^
et.se^CyoleEarEranohisio^ LLC provides the following n o ^
franchisees in the State of Michigan:
THESTATECEMICH^ANPRC^^
SCMETIMES^ERANCHISEOCCUMENTS. l E A N Y O E T H E E C L L C W ^ C ^ C V ^ C N S
A R E I N T H E S E ERANCHISE OCCUMENTS, THE PRC^SICNS ARE V C I O A ^ ^
REENECRCE0ACA1NSTYC0

(a) Aprohibition ofthe rightofafranchiseeto^oin an association of franchisees.

(b) A requirement that a franchisee assent to a release, assignment, novation,

waiver, or estoppel which deprivesafranchisee of rights and protections provided in this act.
This shall not precludeafranchisee, after entering intoafranchise agreement, from settling any
and all claims

(c) A provision that permits a franchisor to terminate a franchise prior to the

expirationof its termexcept for good cause Oood cause shallincludethefailure of the
franchisee tp comply with any lawful provision of the franchise agreement and to cure such
failure after being given written notice thereof andareasonable opportunity,which in no event
need be more than 30 days, to cure such failure

(d) Aprovision that permitsafranchisor to refuse to renewafranchise without fairly

compensating the franchisee by repurchase or other means for the fair market value at the time
of expiration of the franchisee's inventory, supplies, equipment, fixtures, and furnishings.
Personalized materials which have no value to the franchisor and inventory, supplies,
equipment, fixtures, and furnishingsnot reasonably requiredin the conductof thefranchise
business are not subject to compensation. This subsection applies only if: (^the term of the
franchise is less than5years^ and (ii) the franchisee is prohibited by the franchise or other
agreement from continuing to conduct substantially the same business under another
trademark, service mark, trade name, logotype, advertising, or other commercial symbol in the
same area subsequent to the expiration of the franchise or the franchisee does not receive at
least^months advance notice of franchisor's intent not to renew the franchise.

(e) Aprovision that permits the franchisor to refuse to renewafranchise on terms

generally available to other franchisees of the same class or type under similar circumstances.
This section does not requirearenewal provision.

(f) Aprovision requiringthatarbitrationorlitigation be conducted outside this state.

This shall not preclude the franchisee from entering into an agreement, at the time of arbitrate
to conductarbitrationatalocation outside this state.

(g) Aprovisionwhich permitsafranchisor to refuse to permitatransfer of ownership

of afranchise, except for good cause. This subdivision does not preventafranchisor from
exercisingaright of first refusal to purchase the franchise. Oood cause shall include, but is not
limitedto:

(i) The failure of the proposed transferee to meet the franchisor's then
current reasonable qualifications or standards.

Franchise Disclosure Document 01/15

EAST\87466944.6
 (^ The fact that the proposed trans^
subfranchisor.
^i) The unw^ingness of the proposed transferee to agree in w r i t ^
with alHawful obligations.
^ The failure of the franchisee or proposed transferee to pay any sums
owing to the franchisor or to cure any default In the franchise agreement existing at the time of
the proposed transfer.
(h) Aprovision that requires the franchisee to resell to the franchisor items that are
not uniquely identified with the franchisor This subdivision does not prohibitaprovision that
grants toafranchisoraright of first refusal to purchase the assets ofafranchisee on the same
terms and conditions a s a b o n a fide third party willing and able to purchase those assets, nor
does this subdivision prohibitaprovision that grants the franchisor the right to a c q u i r e d
assets ofafranchisee for the market or appraised value of such assets if the franchisee has
breached the lawful provisions of the franchise agreement and has failed to cure the breach in
the manner provided in subdivision (c)
(i) Aprovision which permits the franchisorto directly or indirectly convey,assign, or
otherwise transfer its obligations to fulfill contractual obligations to the franchisee unless
provision has been made for providing the required contractual services

THE FACT THERE ^ A N O T ^ E O E T H ^ O E E E R ^ G O N E ^ E ^ T H T H E

ATTORNEY GENERAL OOES NOT C O N S T ^ ^
ENDORSEMENT 8YTHEATTORNEY GENERAL

Any questions regarding this Notice shall be directed to the Department of Attorney
General, Consumer Protection Division, 670 Law Building, 525 West Ottawa Street, La
Michigan46^ (5^37^7117

0 1 / 1 5
Franchise Disclosure Document
EASTA87466944.6
 TABLE OF CONTENTS
PAGE
ITEM 1 THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS, AND
1
AFFILIATES
ITEM 2 BUSINESS EXPERIENCE 3
ITEM 3 LITIGATION 5
ITEM 4 BANKRUPTCY 5
ITEM 5 INITIAL FRANCHISE FEE 5
ITEM 6 OTHER FEES 6
ITEM 7 ESTIMATED INITIAL INVESTMENT 10
ITEM 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES 14
ITEM 9 FRANCHISEE'S OBLIGATIONS 16
1 7
ITEM 10 FINANCING
ITEM 11 FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER
SYSTEMS, AND TRAINING 18
ITEM 12 TERRITORY 27
ITEM 13 TRADEMARKS 30
ITEM 14 PATENTS, COPYRIGHTS, AND PROPRIETARY INFORMATION 32
ITEM 15 OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF
THE FRANCHISE BUSINESS 33
ITEM 16 RENEWAL, TERMINATION, TRANSFER, AND DISPUTE
RESOLUTION 33
ITEM 17 PUBLIC FIGURES 37
ITEM 18 FINANCIAL PERFORMANCE REPRESENTATIONS 39
ITEM 19 STUDIOS AND FRANCHISEE INFORMATION 39
ITEM 20 FINANCIAL STATEMENTS 47
ITEM 21 CONTRACTS , 47
ITEM 22 RECEIPT • 48
EXHIBITS
A. FRANCHISE AGREEMENT
B. DEVELOPMENT AGREEMENT
C. FINANCIAL STATEMENTS
D. STATE ADMINISTRATORS AND AGENT FOR SERVICE OF PROCESS
E. MANUALS' TABLES OF CONTENTS
F. CURRENT FRANCHISEES AND FORMER FRANCHISEES
G. FORM OF GENERAL RELEASE
H. FORM OF NONDISCLOSURE AND NONCOMPETITION AGREEMENT
I. ADDITIONAL STATE-REQUIRED DISCLOSURES AND RIDERS
J. COMPLIANCE QUESTIONNAIRE

Franchise Disclosure Document 01/15

r
EAS I\87466944.6
 ITEM 1 THE FRANCHISOR, AND ANY PARENTS,
PREDECESSORS, AND AFFILIATES

General. To simplify the language in this Disclosure Document, "CBF" or "we" means
CycleBar Franchising, LLC, the franchisor. "You" or "Franchisee" means the person or entity
who buys the franchise, including all equity owners of a corporation, general partnership, limited
partnership, limited liability, or any other type of entity (an "Entity"). If you are an Entity, each
individual with direct or indirect ownership interest shall be referred to as an "Owner."

CBF is an Ohio limited liability company that was organized on April 1, 2014. CBF's
principal business address is 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236. To
the extent that we have designated agents for service of process in other states, they are listed
in Exhibit G. We conduct business under the name CYCLEBAR. We began offering
CYCLEBAR franchises in January 2015 and have never offered any other franchises in any
other line of business. We do not conduct any other business activities other than selling and
supporting CYCLEBAR franchises. We do not have any predecessors or parents.

Our affiliate, CycleBar Hyde Park, LLC, an Ohio limited liability company with a principal
business address of 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236, has operated
one Studio in Cincinnati, Ohio similar to the franchise offered under this Disclosure Document
since September 2014. We refer to this affiliate-owned Studio as an "Affiliate-Owned Studio"
in this Disclosure Document.

Our affiliate, CB IP, LLC ("CB IP"), an Ohio limited liability company with a principal
business address of 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236, owns the
Marks, which it licenses to us pursuant to a license agreement.

Our affiliate, J3T Logistics, LLC ("J3T"), an Ohio limited liability company with a
principal business address of 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236,
provides marketing services to us and our franchisees, including website design, search engine
optimization, lead generation, new customer membership processing and fulfillment, and other
online marketing services.

Other than J3T, none of our affiliates will provide products or services to our
franchisees. None of our affiliates offer franchises in any line of business.

The Business and Franchises Offered. We are offering, under the terms of this
Disclosure Document, the opportunity to become a franchisee to develop and operate a Studio.
A Studio specializes in indoor cycling classes led by our trained instructors ("CycleStars") set
in a theatre with the capacity for up to 55 bikes ("CycleTheatre") with music from our
proprietary in-house and online music database ("CycleBeats"). Customers are encouraged to
keep track of their performance using our in-house and online customer performance database
("CycleStats"). A Studio typically will range in size from 1,000 to 3,500 square feet.

A Studio operates under the mark CYCLEBAR, and certain other trademarks, service
marks, trade names, signs, associated designs, artwork, and logos (collectively, the "Marks").
We may designate other trade names, service marks, and trademarks as Marks.

A Studio operates under a prescribed system of specifications and operating procedures

that we have developed and will continue to develop (the "System"). The distinguishing

Franchise Disclosure Document 01/15

EASm7466944.6
oharaoteo^cs of the System ino^de, but are net limited to, ourstudio designs (inoluding
CyoieTheatre), layouts, and identifioation sohemes (ooileotively, the "Trade Oress"), our
speoifioations for equipment, inventory,andaooessones^ our fitness programs and olasses^ou^
website or series of websites for the studios (the^SystemWe^s^e^ our r e l a ^
vendors^ our software and computer programs^ CyoieBeats^ CyoleStats^ our online olass
booking systems the accumulated experience reflected in our training program, operating
procedures, customer service standards methods, and marketing techniques^ and the
mandatory and suggested policies, procedures, standards, specifications, rules, and
requirements ("System Standards") set out in our operations manuals ("Manuals") and
otherwise in writing. We may change, improve, add to, and further develop the elements of the
System from time to time.

You may purchaseaCYCLEBAR franchise ("Franchise") to develop and operate one

Studioatamutuallyagreed upon site (the "Site") w ^ ^
wewill specify in the Franchise Agreement that we and you will execute (the "Franchise
Agreement"). Our current form of Franchise Agreement is included as Exhibit A to this
Disclosure Document. You will have no obligation, nor any right, to open any additional Studios.
Under theFranchiseAgreement,you havenorighttousetheMarksortheSystematany
location other than the Site or to use the Marks or the System in any wholesale, e commerce, or
other channel of distribution other than the operation of the Studio at the Site. Weandour
affiliates have the right to use, or license the use of, the Mark, or any other trademark or service
mark, in the designated area of responsibility. See Item 12.

You must designate an Owner with at l e a s t a l O ^ ownership interest in your Entity as

the "Operating Principal." The Operating Principal musthaveauthorityoverallbusiness
decisions related to your Studio and must have the power to bind you in all dealings with us In
addition,you must appointatrained manager (the "^ey Manager") to manage the dayto^day
business of your Studio, who may also be the Operating Principal.

Oevelopment Program. In addition, for qualified franchisees who desire the right to
developmultipleStudioswithinadesignated territory (the"OevelopmentArea")that meet
certain conditions,we also offer the opportunity to enter into an Oevelopment Agreement with
us (the "Oevelopment Agreement") to developamutually agreed upon number of Studios in
accordance with a development schedule specified in the Development Agreement (the
"Oevelopment Schedule"). Our current form of Oevelopment Agreement is included as
Exhibit 13 to this Disclosure Document.

As each Studio is opened, you will sign our then current form of Franchise Agreement
for each Studio. If you fail to open and continue to operate the required number of Studios in
accordance with the mutually agreed Oevelopment Schedule, we will have the right to terminate
the Oevelopment AgreemenL If the Oevelopment Agreement is terminated, you will lose all of
your rights to develop the Oevelopment Area and the initial fees paid for any Studios for which
Franchise Agreements have not been signed. However, theFranchise Agreement for each
Studio which has been opened will not be terminated solely by reason of the termination of the
Development Agreement.

Unless you signaOevelopmentAgreement,you have no obligation,nor any right,to

open any additional Studios.

Competition. The general market for exercise and fitness studios in general is
established and growing^ Indoor cycling has been well known as an effective workout for over

F r a n c ^ s e C l o s u r e Oooument -2- 0t^5

E A ^ t ^ ^ ^
twenty years, but dedicated studios are areiativeiy recent phenomenon with most growth
occurring within the past five years Studios provide unique features not typical in the iarge
multi purpose fitness centers where indoor cycling has historically been avaiiabie^ Competition
to CycleBar is primarily from the general physical fitness industry including health clubs,
gymnasiums, yoga and Pilates studios, and other fitness and workout programs There is some
competition, to a lesserdegree, from existing independentcycling studios, andfromafew
national chains that are company owned (not franchised) such as SoulCycle and FlyWheel The
marketforourservicesisyear round, but it will fluctuate to some degree depending on the time
of year The success of your Studio will depend in large measure on the demographics of the
residents of yourTerritory, the competition surrounding your Studio, local labor condit^^
wage rates,the local costs of advertising,the availability of suitable facilities'^
locations and at affordable rents, and your management, marketing, and selling skills and work
ethic.
IndustryDSpec^c Regulations You will have to comply with laws and regulations that
areapplicabletobusinessgenerally(suchasworkers'compensation,CSHA, and Americans
withOisabilities Act requirements) and laws applicable to fitness facilities and hea^^^
Federal, state and local governmental laws, ordinances and regulations periodically change It
will be your responsibility to ascertain and comply with all federal, state and local governmental
requirements. We do not assume any responsibility foradvising you on these regulatory
matters You should consult with your attorney about laws and regulations that may affect your
Studio

ITEM2 BUSINESS EXPERIENCE

Chiet Executive Cfticer^WilliamPrvor

Mr. Rryor has served as our Chief Executive Officer since our formation in April 2014
Mr Rryor currently telecommutes from Wellesley, Massachusetts Since February 2005, Mr
Fryor has also served as Owner and CoFounder of Spynergy,LLC("Spynergy"),the operator
of an indoor cycling studio in Wellesley,Massachusetts which has recently been rebranded a s a
CycleBar Studio In addition, since 2009 Mr Fryor has owned and operated Spynergy
Consulting,aproviderofbusinessconsulting services to cycling studio startups nationally an
internationally.

Chief Cycle Ofticer Lisa Hillman

Ms Rillman has served as our Chief Cycle Officersince our formation in April 2014 Ms
Rillman currently telecommutes from Royal Oak, Michigan As Chief Cycle Officer,MsRillman
is responsiblefor oversight and development of the CycleStar instructor platformD Since
October 2009, Ms Rillman has also served as Owner and Co Founder of Oo Cycle Studios
("OoCycle"),theoperatorofindoorcyclingstudios,includingastudioin Royal Oak, Michigan
that has recently been rebrandedasaCycleBar Studio.

ChiefTechnoloovOfficer^SteveRa^eooer

Mr Rabegger has served as our ChiefTechnology Officer since our formation in April
2014 Mr Flabegger has also served as Chief Information Officer of St Gregory Oevelopment
Group, LLC ("SL Gregory") since dune 2010, Chief Information Officer of Mama Mim^
Bake Pizza ("Mama Mimics") since April 2013, and Chief Information Officer of VBS

0 1 / 1 5
Franchise Disclosure Document -3-
EAS'I\87466944.6
Franchising, LLC since July 2010. From January 2006 to January 2010, Mr. Habegger was an
IT Developer for Integrity Information Technologies in Dayton, Ohio.

General Counsel - Kristian Higgs

Mr. Higgs has served as our General Counsel since our formation in April 2014 and as
Assistant General Counsel for St. Gregory since January 2012. Mr. Higgs has also served as
Chief Legal officer of Mama Mimi's since April 2013. From November 2010 to January 2012,
Mr. Higgs acted as an Assistant Prosecuting Attorney for the Hamilton County Prosecutor's
Office in Cincinnati, Ohio. From November 2007 to January 2012, Mr. Higgs was an attorney at
The Law Firm of Kristian Higgs, Esq. in Cincinnati, Ohio. From November 2010 to October
2011, Mr. Higgs also was the Campaign Manager for Wayne Lippert for Cincinnati City Council.
From June 2005 to November 2009, Mr. Higgs was the Deputy Campaign Manager for Chris
Bortz for Cincinnati City Council.

Executive Vice President Franchisee Relations - Alexandra Klemmer

Ms. Klemmer has served as our Executive Vice President Franchisee Relations since
our formation in April 2014. Ms. Klemmer currently telecommutes from Wellesley,
Massachusetts. Since February 2005, Ms. Klemmer has also served as Owner and Co-
Founder of Spynergy.

Executive Vice President Field Support - James Wilde

Mr. Wilde has served as our Executive Vice President Field Support since our formation
in April 2014. Mr. Wilde currently telecommutes from Royal Oak, Michigan. Since October
2009, Mr. Wilde has also served as Owner and Co-Founder of Go Cycle.

Executive Vice President Franchise Development - Lance Freeman

Mr. Freeman has served as our Executive Vice President Franchise Development since
our formation in April 2014 and as Senior Brand Manager for St. Gregory since January 2012.
From January 2009 to April 2013, Mr. Freeman was the Director of Franchise Development for
Wellbiz Brands, the parent company of the franchisors for Fitness Together and Elements
Therapeutic Massage, in Highlands Ranch, Colorado.

Director of Branding & Marketing - Gary De Jesus

Mr. De Jesus has served as our Director of Branding & Marketing since April 2014.
Since August 2013, Mr. De Jesus has also been a Professor of Brand Marketing at the Northern
Kentucky University Haile/US Bank College of Business in Highland Heights, Kentucky. Since
March 2013, Mr. DeJesus has also been a Marketing Consultant for Advengage Marketing in
Cincinnati, Ohio. From April 2011 to February 2013, Mr. De Jesus was the Senior Vice
President Corporate Development for MKTG INC. in Cincinnati, Ohio. From June 1993 to April
2011, Mr. De Jesus served in various marketing roles for Procter & Gamble in Cincinnati, Ohio,
including as Chief Marketing Officer for P&G's Tremor division (word of mouth marketing
division) from January 2004 to April 2011.

Director of Franchising & Training - Jeffrey Herr

Franchise Disclosure Document -4- 01/15

EAS'A87466944.6
 Mr Herr has served as oor O i r e ^
2014and as Presided and Chief E ^
s i o o e M a r o h ^ 3 Sinoe April 2013, Mr Herr has served as Vioe President of M a r n a M i ^
Sinoe duiy 2010, Mr Herr has also served as President and Chief Exeoufive Officer of
Franchising, I ^ C ^ V B S " ) , the f r a n c h i s o r
Prom July 2003 to doly 2010, Mr Herr was an Area Developer and Owner for d^N Holdings,
LLC in Cincinnati Ohio.
OirectorofPranch^eOeve^omeot^Todd^rhy

Mr Kirby has served as our Director of Pranchise Oevelopment since our formation in
April 2014,as Vice President of Sales for StOregory since July2010, as Vice President of d ^ ^
since March 2013, as Vice President of Mama Mimi's since April 2013, and as Vice President of
Sales of V 8 S since duly 2010 Prom January 2007 to duly 2010, Mr Kirby was an Area
Developer f o r J ^ O T a x Services in Cincinnati,Ohio.

OirectorofOoerationsDJamesJagers

M r . J a g e r s h a s s e r v e d a s o u r Director of Operations since our formation in April 2014,as

Chief Operating Officer and Chief Financial OfficerforStOregory since July 2010, and as Chief
Executive Officer and Chief Operating Officer of Mama Mimi's since April 2013 Mr Jagers has
also been ChiefOperatingOfficerand Chief Financial Officer for V 8 S since July 2010and for
J3T since March 2013 In addition,since April 2 0 0 7 , M r J a g e r s has also been the Owner of
ITS Area Oevelopment, L L C in Cincinnati, Ohio From October 2003 to May 2012, Mr Jagers
w a s t h e O w n e r o f J a g e r s ^ J a g e r s T a x S e r v i c e , LLC in Cincinnati,Ohio

Oirecfor of L e o a l ^ C o m ^ a n c e J o s e p h Roda

Mr. Roda has served as our Director of Legal^Compliance since our formation in April
2014, a s V i c e P r e s i d e n t a n d O e n e r a l C o u n s e l f o r S t Gregory since July 2010, as General
Counsel f o r V E S since July 2 0 1 0 , a s General Counsel f o r J 3 T s i n c e March 2013, and as
G e n e r a l C o u n s e l f o r M a m a M i m i ' s s i n c e A p r i l 2 0 1 3 Since Oecember 2009, Mr Roda has been
aPartnerwith the lawfirm of E r y a n t ^ R o d a , LLP in Cincinnati, Ohio From August 2007 toJuly
2010, Mr Roda served as General Counsel for ITS Financial, LLC in Cincinnati,Ohio^

ITEM3 LEGATION

There is no litigation that must be disclosed in this Disclosure Document

1TEM4 BANKRUPTCY

There are no bankruptcies that must be disclosed in this Disclosure Document.

1TEM5 INITIAL P R A N C R I S E P E E

The initial franchise fee (the "Eranchise Pee") forasingle Studio is $ 4 ^ ^

upon execution o f t h e Franchise Agreement. If wedeterminethat you arefinancially and
operationally qualified to develop multiple Studios, we may offer you the opportunity to ent^^
aOevelopmentAgreement,inwhich you will commit to developacertain number of Studios that
y o u a n d we determine tobeappropriate. If youenterintoaOevelopmentAgreement,the
Franchise Fee will vary based on the number of Studios that you commit to develop Ifyou

Franchise O^osureOooument -5- 01/15

8A5^74^^
 committode^op b e t w e e n ^
Studio. Ityou oommit to develop botweoosixa^^
$35,000 per Studio ifyou oommittodevelopteoormoreStudio5,theFranohi5e Fee willb^
$30,000 per Studio it you are ao honorably disoharge^
thatpurohasesaStudiothroughthe VetFran program,we will disoou^
your first Studio by $1,500
if you enter intoaOeveiopment Agreement, you must pay usadeveiopment fee equal to
the sum of the Franchise Fees due for each Studio that you agree to develop (the
"OevelopmenfFee") The Oevelopment Fee will be credited towards the initial Franchise Fee
for each Studio developed pursuant to the Oevelopment Agreement

In addition to the Franchise Fee, you must pay us an initial training fee of $10,000 (the
"Tracing Fee") upon execution of the Franchise Agreement for the cost of providing our initial
training program to you, your Operating Principal, and your Key Manager ( " R e a r e d
Trainees") TheTraining Fee includes the cost of up to three trainees attendingasingle
session. You are responsible for the travel and living expenses of your trainees and for training
fees incurred by subsequent trainees,replacement trainees, ortrainees that retake the program
The initial training program is described ingreaterdetail in Item 11. If youenter intoa
Oevelopment Agreement, you must pay us theTraining Fee for each Studio that you develop
pursuant to the Oevelopment Agreement at the time each Franchise Agreement is signed.

The Franchise Fee, Oevelopment Fee, andTraining Fee are not refundable under any
circumstances Fxceptasdescribedabove, the Franchise Fee, Oevelopment Fee, andTraining
Fee are uniform for all franchisees and must be paid inalumpsum

ITEM 6 OTHER FEES

OTHER FEES (Note 1)

Type of Fee Amount Due Date Remarks

Royalty Fees The greater of (i) 7% of
(2) your Gross Revenue of
products and services for
the preceding week or (ii)
$250 (subject to increase
annually based on a
change to the CPI)
Currently due Gross Revenue means all revenue that you
weekly within receive or otherwise derive from operating
live business the Studio, whether from cash, check, credit
days after the or debit card, gift card or gift certificate, or
end of each other credit transactions, and regardless of
calendar week collection or when you actually provide the
products or services in exchange for the
revenue.

Marketing Fee Up to 2% of Gross Currently due We may create a Marketing Fund and
Revenue; currently, 0% of weekly within require you to contribute the Marketing Fee.
your Gross Revenue five business
days after the
end of each
calendar week

Franchise Disclosure Document -6- 01/15

EAST\87466944.6
 TypeofFe^ Amoum OueOate Remarks

Technology Ourrently,$900 per month, Currently due TheTeohnology P e e o u ^ e ^ y i n c h e s fees

Poo but subject to change weekly within related feyeor access te and usage of
annually five business CycleStats, CycleBeats, cur reservation
days after the system, our intranet, any mobile
end of each applications we develop and the System
calendar month Website. We may add, delete, or otherwise
modify the products and services that are
included in theTechnology Pee.

Successor Pee $ 1 0 ^ 0 Upon execution

of successor
franchise
agreement

Transfer Pee $10,000 for any transfer $3,000 deposit NoTransfer Pee is due for transfers upon
resulting inachange of due with written death or incapacity.
control; $2,500 plus our notice of
administrative costs and proposed
expenses for non control transfer;
transfers and transfers to balance due at
entities for the closing
convenience of ownership
LafePeeand 1 8 ^ per annum or When amount Required wheneverapayment to us is
Interest maximum interest rate owed becomes made after its due date.
allowed by law (whichever past due
is less) from due date to
date of payment, plus
$100 for each week thata
payment is paid after the
due date forthe payment
specified

Opening $2,500 for each month (or Upon our Payable if you request our approval to open
Deadline portion ofamonth)for granting an your Studio more than 270 days afterthe
Extension Pee which the Opening extension effective date of the Pranchise Agreement
Deadline is extended (the "CpemogOeadlme") and we approve
your request
Relocation Pee $2,500 Upon demand Payable if you relocate your Studio from the
Site t o a n e w location

Franchise Disclosure Document -7- 01/15

EAST\87466944.6
 T^peofFee Amooot OoeOate ^ Remarks

^i^Training Currently^^OOOper WithinlOdays We w^ provide in^al gaining the System

Pee for trainee (subject to change) of receipt of an to three trainees at our oost We reserve
Additions or invoice the right to ohargeareasonabie fee for
Pep^oement training^more than three trainees,even if
Trainees they attend the same training session, (ii)
persons who are repeating the course or
repiaoingapersonwhodid not pass,and
(iii) subsequent Operating Rrinoipais, Key
Managers, or employees who attend the
course
Optional Varies based on program WithinlOdays We may charge youareasonabie fee for
Training of receipt of an optional training programs that we may
Programs invoice provide.
inPerson Currently,$400per Within 10days Payable if we provide requested consulting
Consulting employee or agent for of receipt of an services in person ataplaceotherthan our
Services each full or partial day, invoice offices We may change this fee from time
plus their travel and living to time.
expenses
Temporary Currently,$400per Within 10days Payable if we provideaKeyManagerto
Key Manager employee or agent for of receipt of an work at your Studio, afterthe departure of
each full or partial day, invoice your previous manager,untilanew Key
plus their travel and living Manager is hired and trained
expenses plus our actual
costs and expenses
Temporary Currently,$400per WithinlOdays Payable if we provideatemporary
CycleStar CycleStar instructorfor of receipt of an OycleStar instructor to teach your classes
Instructor each full or partial day, invoice
plustheirtravel and living
expenses
Temporary ^ o f the Studio's Gross WithinlOdays Payable if we exercise our right to manage
Management Revenue during the period of receipt of an your Studio afteradefault
of management, plus any invoice
direct out of pocket costs
and expenses
Conference Reasonable registration Prior to We may chargeareasonable registration
Pee fee attending the fee for you and your employees who attend
conference any conferences or meetings that we host.
You are responsible forthe travel and living
expenses of you and your employees.

F r a n c ^ e C l o s u r e Oocume^ 8 01/15
8 ^ ^ 7 4 ^ ^
 Type of Fee Amooof
Freduot, Our reasonable cost of the Upon demand
Service, inspection and our actual
Supplier, and cost of testing the
Service proposed product or
Provider evaluating the proposed
Review service or service provider,
including personnel and
travel costs
insurance Gost of the premium p l u s a
reasonable fee for our
services in procuring the
insurance
Grand Aminimum of $25,000 for
Gpening grand opening advertising
Advertising and promotion
Mystery Areasonablefeeas
Shopper defined in the Manuals
Program
Audit Our costs and expenses,
including costs for an
independent accountant
and attorneys'fees and
related travel and living
expenses
inspection Our reasonable expenses
incurred in inspecting your
business, including travel
and living expenses,
wages, and other
expenses for our
employees
Pemediai Our reasonable expenses
Expenses incurred in correcting your
operational deficiencies
indemnification Amount of our liabilities,
fines, losses, damages,
costs and expenses
(including reasonable
attorneys^fees)
^OCh^O^OSU^OoCUment
^ 5 ^ 7 ^ ^
OueOafe Remarks
Payable if you wish to offer products or use
any supplies, equipment, or services that we
have not approved or wish to purchase from
asupplierorservice provider that we have
not approved, whether or not we approve
the item,service, supplier,or service
provider.
Upon demand Payable only if you fail to maintain the
minimum insurance we require and we
choose to procure the required insurance for
you.
Between the In connection with the opening of the Studio,
four weeks prior youmustsubmitagrandopeningplantous
to opening the for our approval. We have the right to
Studio and the modify your grand opening plan, in our sole
four weeks after discretion, and may require you to u s e a
opening the public relations firm to assist with your grand
Studio opening
Upon demand We have the right to establishamystery
shopperDtypeprogramD Details of any
program will be included in the Manuals.
Within 10days Payable if audit or review shows an
of demand understatement of Gross Sales for the
audited or reviewed period o f ^ o r more.
Upon demand Payable if inspection is necessitated by your
repeated or continuing failure to comply with
any provision of the Pranchise Agreement.
Upon demand Payable if we correct deficiencies that we
haveidentifiedduringaSite inspection and
that you failed to correct witbinareasonable
time after notice from us.
Upon demand. Payable if we incur losses due to your
breach of the Pranchise Agreement or any
other action or inaction byyou or any other
person relating to your Studio
9 01^5
 Type of Fee Amount Due Date Remarks
Enforcement Our reasonable cost of de- Upon demand Payable if your Franchise Agreement
Expenses identifying your Studio expires or is terminated, you fail to de-
identify your Studio and we take steps to do
so.

NOTES:

1. All of the fees in the table above are imposed by us, payable to us, non-refundable, and
are uniformly imposed. You must use the payment methods we designate. You must
furnish us and your bank with any necessary authorizations to make payment by the
methods we require.
2. "Gross Revenue" means all revenue that you receive or otherwise derive from
operating the Studio, whether from cash, check, credit or debit card, gift card or gift
certificate, or other credit transactions, and regardless of collection or when you actually
provide the products or services in exchange for the revenue. If you receive any
proceeds from any business interruption insurance applicable to loss of revenue at the
Studio, there shall be added to Gross Revenue an amount equal to the imputed gross
revenue that the insurer used to calculate those proceeds. Gross Revenue does not
include (i) promotional allowances or rebates paid to you in connection with your
purchase of products or supplies, (ii) any bona fide returns and credits that are actually
provided to customers, and (iii) any sales or other taxes that you collect from customers
and pay directly to the appropriate taxing authority. You may not deduct payment
provider fees (i.e., bank or credit card company fees and gift card vendor fees) from your
Gross Revenue calculation.

ITEM 7 ESTIMATED INITIAL INVESTMENT

YOUR ESTIMATED INITIAL INVESTMENT

Low High Method of To Whom Payment Is

Type of Expenditure Estimate Estimate Payment When Due Made
When sign
Franchise
Franchise Fee (1) $28,500 $49,500 Lump sum Agreement Us
When sign
Franchise
Training Fee (2) $10,000 $10,000 Lump sum Agreement Us
Travel Expenses to Airlines, hotels, and
Training (3) $1,000 $2,500 As incurred As incurred restaurants
Site Selection Expenses (4) $0 $5,000 As incurred As incurred Third party vendors
Security Deposits for Landlord, utility
Lease and/or Utilities (5) $5,000 $12,000 As incurred As incurred company
Rent for 3 months (6) $0 $24,000 As incurred As incurred Landlord
Construction Management
(7) $0 $15,000 As incurred As incurred Third party vendors
Construction Due $0 $5,000 As incurred As incurred Third party vendors

Franchise Disclosure Document -10- 01/15

EAST\87466944.6
Diligence (8)
Design/ Architecture/
Engineering (9) $7,500 $15,000 As incurred As incurred Third party vendors
Construction Permits (10) $1,000 $5,000 As incurred As incurred Government agencies
Leasehold Improvements:
Materials & Labor (11) $75,000 $225,000 As incurred As incurred Third party vendors
Bike Equipment Lease for
3 months (12) $3,000 $9,000 As incurred As incurred Third party vendors
Additional Fitness
Equipment (13) $2,000 $3,500 As incurred As incurred Third party vendors
Furniture, Fixtures, and
Equipment (14) $40,000 $92,000 As incurred As incurred Third party vendors
Signage and Graphics (15) $12,500 $17,500 As incurred As incurred Third party vendors
Initial Inventory (16) $10,000 $18,000 As incurred As incurred Third party vendors
Studio Management and
Technology System (17) $21,000 $25,000 As incurred As incurred Third party vendors
Business Licenses (18) $500 $1,000 As incurred As incurred Government agencies
Office Supplies and
Cleaning Supplies (19) $500 $2,000 As incurred As incurred Third party vendors
Technology Fee for 3
months (20) $2,700 $2,700 As incurred As incurred Us
Insurance for 3 months Prior to Insurance agent or
(21) $450 $600 As incurred opening carrier
Grand Opening Marketing Third party vendors or
Budget (22) $25,000 $30,000 As incurred As incurred us
Employees, utilities,
Additional Funds, 3 suppliers and other
months (23) $10,000 $30,000 As incurred As incurred third parties, etc.
T O T A L (24) $255,650 $599,300

Notes:

1. The standard Franchise Fee for opening a single unit is $49,500. The low estimate would
be the initial Franchise Fee for your first unit if you are a veteran participating in the VetFran
program that commits to develop ten or more Studios. See Item 5.

2. The Training Fee includes the cost of providing our initial training program to your Required
Trainees.

3. This estimate is for the cost of three people to attend initial training in Ohio. You are
responsible for the travel and living expenses, wages, and other expenses incurred by your
trainees during initial training. The actual cost will depend on your point of origin, method of
travel, class of accommodations, and dining choices.

4. This estimate is for the cost of using our approved site selection company or a third party
vendor to identify your Site. The low estimate assumes that you locate the Site without the
assistance of a third party.

Franchise Disclosure Document -11- 01/15

EAST\87.466944.6
5 This^m^eino^desp^
o n u s e s required to open the Studio.These
the terms of your lease

6 The figures in the table reflect our e s ^

foot Studio Your rent will depend on the Site'ssize, condition, and location and demand for
the premises among prospective lessees However, rent can range from $10 per square
foot per year for suitable warehouse space to $50 per square foot per year for prime space
inamajor metropolitan area.

You maychoosetopurchase,ratherthan rent, real estate on whichabuilding suitable for

the Studio already is constructed or could be constructed. Real estate costs depend on
location, size,visibility, economic conditions, a c c e s s i b i l i t y , c o m p e t i ^
and the type of ownership interest you are buying Because of the numerous variables that
affect the value ofaparticular piece of real estate, this initialinvestment table does not
reflectthe potential purchase cost of real estate or the costs of constructingabuilding
suitable for the Studio.

7 Thisestimateincludesthecostofhiringathird party vendor to manage the construction of

your Studio The low estimate assumes that no construction manager is hired

8 This estimate includes an as built/conditions survey, site investigation report, space

planning LOI review, lease review, a n d a d u e diligence summary.

9. This estimate includes the cost of hiring designers, architects, and engineers to draft the
construction plans for your Studio.

10^Thisestimate includes t h e c o s t of acquiring construction permits. Yourcosts will vary

depending upon your Studio'slocation.

11 This estimate includes the cost of leasehold improvements to your Studio, including floor
covering, wall treatment, ceilings, painting, and electrical, carpentry, and similar w o ^ This
estimate includes both materials and the cost of labor. Actual costs depend on location, the
condition of the premises being remodeled, economic factors, and the Studio's size

12 This estimate includes the cost of leasing your bikes for the first three months of operation
We recommend that you lease your bikes from our designated suppliers The cost will vary
based on the number of bikes needed for your Studio which will range from 20 to 55 bikes,
your credit worthiness, and market conditions.

13 This estimate includes fitness equipment, other than the bikes, such as weight bars and bar
racks on the bikes and in the Studio.

1 4 T h i s estimate includesthefurniture, fixture, and equipment to be used in theStudio,

including cabinetry,retaildisplays,lockers,benches, audio equipment, lighting systems,
closed circuit camera equipment, telephones, office furniture, and appliances

15 This estimate includes the cost of outdoor identification on the Studio and displays and
signage throughout the Studio.

Franchise Disclosure Document -12- 01/15

EAS'n87466944.6
^B^se^m^io^^
of^r for sale to your o^omers Tho size of your inventory will depend on tho size of your
Studio and the products that you eieot to stook.
17This figure includes the cost of acquiring the hardware, software^othere
network connections that we specify in the Manuals necessary to operate the CycleStats
technology platform, the CycleBeats music system, the point of sale system, and the online
reservationsystem (the"Sfu^oManagemeof and Technology Systems Youmust
purchase these components from suppliers that we approve or designate and must execute
any related software licenses require by designated vendors

18 This estimate includes the cost of acquiring business licenses and permits Your costs will
vary depending upon your Studio's location.
f^ This estimate includes the cost of purchasing office supplies and cleaning supplies for your
Studio
20Thisfigureincludes payment of theTechnology F e e t o u s f o r your firsts months of
operation. The Technology Fee is described in Item6

21 This estimate is for your first three months of insurance coverage You will need to check
with your insurance carrier for actual premium quotes and costs, as well as for the actual
amount of the deposit The cost of coverage will vary based upon the area in which your
business will be located, your experience with the insurance carrier, the loss experience of
the carrier,the amount of deductibles and of coverage, and otherfactors beyond our control
You should also check with your insurance agent or broker regarding any additional
insurance that you may wish to carry above our required minimums.

22 You must spendaminimum of $25,000 for grand opening advertising and promotions in the
four weeks prior to opening your Studio and the four weeks after opening the Studio in
accordance withaplan that you must submit to us Your cost may be higher based on the
length of time you wish to run opening promotions We have the right to modify your grand
opening plan, in our sole discretion. You must provide us with supporting documentation
evidencing these expenditures upon our request Thisestimatedoes not includethe
Marketing Fees that you must pay us forthe Marketing Fund described in Item11

23 This is an estimate of the amount of additional operating capital that you may need during
the first three months after opening your business This estimate includes additional funds
you may need to pay employee salaries and wages, utilities, payroll taxes (including payroll
to cover the pre opening training period for your staff), Royalty Fees, Marketing Fees, legal
andaccountingfees, additional advertising, health and workers'compensation insurance,
bank charges, miscellaneous supplies and equipment, staff recruiting expenses, state tax
and license fees, deposits, prepaid expenses, and other miscellaneous items The
preceding list is by no means intended to be exhaustive of the extent of possible categories
of expenses The expenses you incur during the start up period will depend on factors such
as local economic and market conditions, your business experience, and the level of traffic
at your location We cannot guarantee that you will not incur additional expenses in starting
the business that may exceed this estimate or that you will not need additional funds after
your first three months of operation It is best to contact your accountant or financial advisor
for further guidance.

Franchise Disclosure Document -13- 01/15

EAST\87466944.6
24. This amount is b a s e d u p o n ^
Cincinnati, Ohio Your ^
limited to, the geographic area in whioh you open, iooai market conditions, an^
operatingabusiness. We strongly recommend that you use these categories and estimates
asaguidetodeveiopyourownbusinesspian and budget and investigate specific costs in
your area. Youshouldindependentiy investigatethe costs of openingapersonai fitness
studio in the geographic area in which you intend to openaStudio.You should also review
the figures carefully withabusiness advisor before making any decision to purchase the
Franchise.
We donot provide financing to franchisees either directly or indirectiy in connection with
their initial investment requirements. The availability and terms of financing obtained
third parties will depend upon such factors as the availability of financing, your credit
worthiness, collateral which you may make available, or policies of local lending institutions
with respect to the nature of the business.

ITEM8 RESTRICTIONSONSOURCES OF PROOUCTS ANO SERVICES

Except as set forth below, you are not required to purchase or lease goods, services,
supplies, fixtures, equipment, inventory, computer hardware or software, real estate, or
comparable items related to establish or operating the Studio from us, our designees, suppliers,
or service providers we approve, or under our specifications.

A u t h o r e d Froducfsand Serviced We have the rightto requirethatfurniture,

fixtures, signs, and equipment (the " O p e r a t e
that you purchase for resale or purchase or lease for use in your Studio: (i) meet specifications
that we establish from time to time; (ii)beaspecific brand, kind, or model; (iii) be purchased o
leased only from suppliers or service providers that we have expressly approved; and/or(iv) be
purchased or leased only fromasingle source that we designate (which may include us or our
affiliatesorabuying cooperative organized by us or our affiliates).
You may offer in the Studio to customers only the products and services that we have
approved in writing. In addition, you mustofferthespecific products and services that we
require in the Manuals or otherwise in writing We may change these specifications periodically,
and we may designate specific products or services as optional or mandatory. You must offer
all products or services that we designate as mandatory You may sell products only in the
varieties,forms,and packagesthatwehaveapproved.You must maintainasufficient supply of
requiredproducts tomeet the inventory standards we prescribe in the Manuals(ortomeet
reasonably anticipated customer demand, if we have not prescribed specific standards).

You must conduct all classes in accordance with the System and under the leadership of
atrained CycleStar instructor You must offer at the Studio any classes or programs that we
deem to be mandatory. Any classes that you or your CycleStar instructors develop must be
consistent with the System Standards that we specify from time to time You may use in the
classes only the music that we have approved and provided through CycleSeats, unless you
have received our written consent otherwise. If we disapprove of any class or program that you
offer,youmust immediately discontinue offering the class or modify the class in accordance
with our instructions.

Currently,wemay require you to purchase marketing services from our affiliate, J3T.
Exceptford^T, weandour otheraffiliates currently arenot approved suppliers,though we

F r a n o ^ s e C l o s u r e Oocumeot -14- 0t^5

E A ^ 8 7 4 ^ ^
r e s e ^ t h e n g ^ t o require you t o p u r c h a s e a d d ^ ^
future. Nooe of ouroffioers owns aoy interest io any supplier with whom you are required
reoommended to do business, except some of our officers own an interest in

Currentiy, we require you to iease the bikes and purchase the software, fitness
equipment, inventory, and most components of the Studio Management and Technoioqy
System fromasuppiier that we designate, but we may require you to purchase other items from
adesignated supplier in the future,which may include us or our affiliates.

Insurance. You must obtain before you begin construction and/or development of the
Studio and must maintainat all times thetypes of insurance and the minimumpolicy limits
specified in the Manuals. Currently we require (i)public liability insurance in the amount of
$1,000,000 per occurrence,^) workmen's compensation insurance, and (iii) general c a s u ^
insurance covering the full replacement cost of the Studio and inventory. However,you maybe
required to acquire additional insurance by the laws in your area. All of your insurance carriers
must berated A o r higher b y A M BestandCompany, Inc. (or such similar criteria as we
periodically specify) These insurance policies must be in effect on or before the deadlines we
specify. All coverage must be on an "occurrence" basis, except for the employment practices
liability insurance coverage,which is ona^claims made" basis^ All policies shall apply o n a
primary and non-contributory basis toanyotherinsurance or selfinsurancethatweorour
affiliatesmaintain Wemustbenamedasanadditionalinsuredundereachpolicythatwe
require. Upon our request or as specified in the Manuals, you must provide us with certificates
of insurance evidencing the required coverage. We may require additional types of coverage or
increase the required minimum amount of coverage upon 60 days^ notice to you.

Sfudio Management andTechnology System. You are required to purchase most of

the components of the Studio Management and Technology System thatwe specify from
suppliers that we approve or designate. If we require you to use any proprietary software or to
purchase any software from adesignated vendor, you must execute any software license
agreements that we or the licensor of the software require and any related software
maintenance agreements.

Approval Process. If you would like to offer products or use any supplies, Operating
Assets,or services thatwe have not approved or to purchase or lease fromasupplier or service
provider that we have not approved,you must submitawritten request for approval and provide
us with any information that we request. We have the right to inspect the proposed supplier's
facilities and test samples of the proposed products and to evaluatethe proposed service
provider and the proposed service offerings. You agreetopayusacharge notto exceed the
reasonable cost of the inspection and our actual cost of testing the proposed product or
evaluating the proposed service or service provider, including personnel and travel costs,
whether or not the item,service, supplier,or service provider is approved. We have the right to
grant, deny, orrevokeapprovalof products,services, suppliers, or service providersbased
solely on our judgment We will notify you in writing of our decision as soon as practicable
following our evaluation. If you do not receive our approval within 90 days after submitting all of
theinformation that we request,ourfailuretorespond will be deemedadisapproval of the
request. You acknowledge that the products and services that we approve for you to offer in
your Studio may differ from those that we permit or require to be offered in other Studios.

We reserve the right to re inspect the facilities and products of any approved supplier
and to reevaluate the services provided by any service provider at and to revoke approval of the
item,service,supplier,or service provider if any fail to meet any of our thencurrent criteh^^ If

Fraoc^seO^o^eOocument -15- 0t^5

E A ^ r ^ ^ ^
we revoke approve o f a p r e v i o ^
or servioe that you have been offering
the servioe and may continue to seli the p r o ^
days following our disapproval We have the right to shorten this period if, in our opinion, the
continued saie of theproduct wouid provedetrimentai toour reputation. After the^Oday
period, or such shorter period that wemaydesignate,you mustdispose of your remaining
formedy approved inventory as we direct

Issuance of Specifications and Standards. To the extent that we establish

specifications, require approval of suppliers or service providers, or designate specific suppl^^^^
orservice providers for particular items or services, we willpublishour requirements in the
Manuals We may, at any time, in our discretion, change, delete, or add to any of our
specifications or quality standards Such modifications, however, will generally be uniform for
all franchisees.

Proportion of Purchases Su^ect to Specifications. We estimate that the cost to

purchase and lease all equipment, inventory and other items and services that we require you to
obtain from us or our affiliates, from designated suppliers, or in accordance with our
specifications ranges from 8 0 ^ t o t O O ^ of the total cost to purchase and lease equipment,
inventory,and other items necessary to establishaStudio and 3 5 ^ to of the total cost to
purchase and lease equipment, inventory,and other items to operateaStudio.

Revenue from Purchases. We or our affiliates may receive revenues or profits or

other material consideration from the purchases you make from us, our affiliates, or from other
approved suppliers We intend to earn revenue from your purchase of apparel and
merchandise, furniture, fixtures, equipment, technology, signage and graphics, audio visual
equipment, and other items that we may specify from time to time. We may retain any rebates
or other payments we receives from suppliers.

As we have just begun franchising, we did not receive any revenue from the required
purchase of products and services by our franchisees. We have not yet established any
arrangements with suppliers which would require the supplier to make payments to us based on
our purchases, but we reserve the right to do so.

Cooperatives and Purchase Arrangements. We are not involved in any purchasing or

distribution cooperatives. We may, but are not obligated to, negotiate purchase arrangements
with suppliers for the benefit of franchisees. As of the issuance date of this Disclosure
Document, we have not negotiated any such arrangements.

Materiai Benefits. We do not provide any material benefits to franchisees (for example,
renewal or granting additional franchises) based upon their purchase of particular products or
services or use of particular suppliers

PRANCRISEESCB^GATiCNS

This tahie lists your principal obligations under the franchise agreement. It will
help you find more detailed information about your obligations in this agreement and in
other items of this disclosure document.

Franchise Disclosure Document -16- 01/15

EAS'I\87466944.6
 Section in Franchise : Disclosure
Obligation Document Item
Agreement
a. Site selection and acquisition/lease Sections 4.1, 4.2, and 4.4) Item 11
b. Pre-openinq purchases/leases Sections 4.4, 6.7, and 6.10 Items 6,7, 8 and 11
c. Site development and other pre- Sections 4.4 and 4.5 Items 7, 8 and 11
opening requirements
d. Initial and ongoing training Section 5 Items 6, 7 and 11
e. Opening Section 4.6 Items 6 and 11
f. Fees Sections 3, 4.6, 4.7, 5.1, 5.3, Items 5, 6, 7 and 11
5.4, 5.6, 6.2, 6.9(b), 6.10(a),
6.14, 7.2(a), 7.3, 8.4, 8.5, 8.6,
13.4, 13.5, 13.6, 13.8,
14.2(b)(viii), 15.1, 15.2, and 16.9
g- Compliance with standards and Sections 5.4, 5.5, 6.1, 6.2, 6.3, Items 7, 8, 11, 13,
policies/Operations Manual 6.4, 6.5, 6.6, 6.7, 6.10, 6.12, 7.3, 14, 15 and 16
8.4, 8.6, 10.3, and 13.4
h. Trademarks and proprietary Sections 9 and 10 Items 13, 14 and 17
information
i. Restrictions on products/services Sections 6.6, 6.7, and 6.8 Items 8 and 16
offered
J- Warranty and customer service Section 6.12 and 8.6 Items 8 and 16
reguirements
k. Territorial development and sales Not applicable Item 12
quotas
1. Ongoing product/service purchases Sections 6.7 and 6.8 Items 8 and 16
m. Maintenance, appearance and Sections 4.5, 6.4, and 6.5 Items 7, 8 and 11
remodeling reguirements
n. Insurance Section 6.14 Items 7 and 8
0 . Advertising Sections 3.3 and 7 Items 6, 7, 8 and 11
P- Indemnification Section 11 Item 6
q- Owner's participation/ Sections 1.4, 1.5, and 6.2 Items 11 and 15
management/staffing
r. Records and reports Section 8.1,8.2, and 8.3 Items 6 and 17
s. Inspections and audits Sections 8.4, 8.5, and 8.6 Items 6 and 11
t. Transfer Section 13 Items 6 and 17
u. Renewal Section 2.2 Item 17
v. Post-termination obligations Section 15 Item 17
w. Non-competition covenants Section 12 and 15.9 Item 17
X. Dispute resolution Section 16 Item 17

ITEM 10 FINANCING

We and our affiliates do not offer direct or indirect financing arrangements for any
purpose in establishing or operating your Studio. We and our affiliates do not guarantee your
promissory note, lease, or any other obligation you may make to others.

Franchise Disclosure Document -17- 01/15

EAS1\87466944.6
ITEMU FRANCH^OR^A^STANO^^^

TRA^NG

Ourp^opemngo^g^ons

Before you begin o p e n i n g your Studio:

L Oesignate Areas. We wiii designate your Site Seieotion Area. (Franohise
AgreementDSeotiontBi).

2. Site S e l e ^ o n Assistance. We wiii provide you with site seieotion guidelines,

counseling, and assistance t h a t w e consider necessary and appropriate, and such onsite
evaluation as we consider necessary and appropriate. W e m a y provideyou with a l i s t o f
recommended reaiestatebrokerstoassistyouiniocatingasite, but you are not required to use
our recommended providers, it is soleiyyour responsibility to locate and seiectasuitable site
tor the Studio. Before entering into any lease or purchase agreement for the site,youmust
submitasite proposal package describing details about the proposed site and provide any other
information that wereasonably require We willreview your proposed site and determine
whether to accept it. We will conduct such on site evaluation as we consider necessary and
appropriate as part of our evaluation In addition to certain demographic characteristics,we
also consider the following factors in acceptingaStudio location: site visibility,^
competition,neighboring tenants, accessibility,population density, and adjusted gros
If we accept the proposed site and you obtain it,we will insertadescription of the specific
location on S c h e d u l e t A p p e n d i x A t o the Franchise Agreement Our acceptance ofaproposed
site is notawarranty or representation of any kind as to the potential success or profitability of
your Studio. (Franchise Agreement S e c t i o n s 4 . f a n d 4 . ^ .

3. Approval of Site Lease. Beforeyoumakeabinding commitment to purchase,

lease, or sublease a site, we must approve in writing the proposed lease or purchase
agreement or any letter of intent between you and the third party seller or lessor. If you lease
the Site, unless we waive the requirement in writing, you must arrange for the execution of the
Lease Addendum in the form that is attached as A p p e n d i x O t o the Franchise Agreement in
ExhibitAofthisOisclosureOocument (Franchise Agreement S e c t i o n s

4. Plans. We will make available to you at no chargeaset of prototype plans and

specifications (not for construction) for the Studio and for the exterior and interior design and
layout. We will review your final plans, which we must approve prior to permitting and
construction (FranchiseAgreement Section45(a))

^ Approval o f O o n t r a c t o r s a n d O e s i g n e r s ^ Y o u must employ only architectural

and engineering firms and general contractors that we approve in writing to develop your Flans
and to assist with the construction of your Studio^ We may require you to use only firms that we
havepre approved. (Franchise Agreement Sections^.5(a) and4.5(c))

8. Initial TrainingD We will provide initial training in the System and our policies
and procedures to your RequiredTrainees. See"Training",below in this Item (Franchise
Agreement S e c t i o n s )

7. Manuals. We will provide you with electronic access to our Manuals, on loan for
as long asthisAgreementorasuccessorfranchiseagreementremains in effect. (Franchise
Agreement Section6BI(a))

1 5
F^o^seO^oso^Oocume^ -18- O^
E A 5 ^ 4 ^ ^
 8. Adv^e. Wew^adviseyou a s t o i o ^ o ^
dev^opmeot of olass sohodulos, and looal m a k i n g and netwod^g effo^s ^anohiso
Agrooment^Sootion^)

9. A p p r o v e O p e m o g . Wo w ^ a p p r o v o y o u r S t u d i o o p e n ^ provided that you

have mot aii of our requirements for opening i n o i u d i n ^ ^
oertifioateofoooupanoyandbuiid^
(Franohise Agreement 5 e o t i o n 4 ^ We estimate that the typioai length of time between
signingaFranohise Agreement and opening your Studio is approximateiy six months. Factors
affecting this length of time inoiude, among others: ability to s e i e c t a s i t e and negotiatea
satisfactory iease; hiring of the requisite employees; successful completion of initials
local ordinances or community requirements; delivery of fixtures, equipment, and signs;
issuance of all necessary licenses, permits and approvals; and procuring required insurance
You must open the Studio no later than 270 days after the effective date of the Franchise
Agreement and within180 days after possession of the Site is delivered to you by your landlord

OngomgAssisfance

Ouringthe operation of your Franchise:

L A d d ^ o o a l T r a m m g . We may periodically conduct advanced training programs

for yourRequired Trainees a n d / o r y o u r e m p l o y e e s a t o u r office or another location that we
designate. We may provide additional training in person or via recorded media, teleconference,
videoconference, the Internet, webinar, or any other means, as wedetermine. (Franchise
Agreement Section 5.3)

2. Adverfismg. We may from time to timeformulate, develop, produce, and

conduct, at our sole discretion, advertising or promotional programs in such form and media as
we determine to be most effective We may make available to you for you to purchase
approved advertising and promotional materials, including signs, posters, collaterals, et^^
we have prepared (Franchise Agreement^Section7BI)

3. Review A d v e r t i n g . We will review any advertising or promotional programs or

materials that you develop (Franchise Agreement Sections73(b))

4. Markefmg Fund Management We will manage the Marketing Fund as

described below in this Item, if we establish one We will prepare an unaudited statement of
contributions and expenditures for the Marketing Fund and make it available within 60 days after
the close of our fiscal year to franchisees who makeawritten request f o r a c o p y . (Franchise
Agreement Section72(a))

5. Requested Consuming Services We will provide to you additional consulting

services with respect to the operation of the Studio upon your reasonable request and subject to
the availability of our personnel atamutually convenient time. We will make available to you
information about new developments, techniques, and improvements in the areas of
merchandising, advertising, management, operations, and Studio design. We may provide such
additional consulting services through the distribution of printed or filmed m a t e r i a ^
other electronic forum, meetings or seminars, teleconferences, webinars, or in person. If such
services are rendered in person other than at our offices,youmust pay u s a f e e and our
expenses. (Franchise Agreement Section 5.6)

1
Franchise Disclosure Document -19- 01/ 5
EAS1\87466944.6
 6. Manual O p d ^ s . W e m a y a m e n ^ m o d ^ o r s u p ^
time, so long as suoh amendment mod^oatio^o^
benefit us and our existing and future franohiseos or w i l l o w You
must oompiy with revised standards and procedures within 30 days after we transmit the
updates. (Franchise Agreement-Seotion6Bi(a^

7. Temporary StafL We may provide, in our sole discretion and upon your
request, CycleStar instructors to teach classesat yourStudio on atemporary basisfor a
reasonable fee. If your Key Manager ceases to be employed by you at the Studio and you are
unable to immediately appoint and trainanew manager, we may, in our sole discretion and for
areasonablefee,provideaKey Manager to work at your Studio temporarily untilanew Key
Manager is appointed and trained.(Franchise Agreement-Sections 6.2(c) and 6.2(d^

8. Inspections. We may,in our sole discretion, inspect the operation,premises

and inventory of the Studio, and advise you of the results of each such inspection. (Franchise
Agreement S e c t i o n s )

9. RelocationReview. We will evaluate sites to which you propose to relocate

your Studio in accordance with the Site Selection Assistance provisions described above in this
Item. (FranchiseAgreement S e c t i o n s )

Advertising

Cur Marketing. We may from time to time formulate, develop, produce, and conduct,
atoursolediscretion, advertising or promotional programsin suchformand media as we
determine to be most effective. We may make available for you to purchase approved
advertising and promotional materials, including signs,posters,collaterals, etc.that we have
prepared.

We have not conducted media advertising for the CYCLFSAR concept. If we conduct
media advertising,we may use direct mail, print,radio,lnternet,or television,which may be
local, regional, or national inscope. Wemay producethemarketingmaterialsinhouse or
employalocal,regional,or national advertising agency. We are not obligated to conduct any
advertising or marketing programs within your market.

Locai Marketing. You must use your best efforts to promote the use of the Mark in your
market area You must spend at least $500 per month on local advertising and promotional
activities (the "Marketing Spending Requirement"). Your Marketing Spending Requirement is
in addition to your Marketing Fee. We have the right to designate in the Manuals the types of
expendituresthat will or will not count toward the Marketing SpendingRequirement. At our
request,youmust submit appropriate documentation to verify compliance with the Marketing
Spending Requirement. If you fail to spend (or prove that you spent) the Marketing Spending
Requirement in any month, then we may, in addition to and without limiting our other rights and
remedies, require you to pay us the shortfall as an additional Marketing Fee or to pay us the
shortfall for us to spend on local marketing for your Studio

You must participate in such advertising, promotional, and community outreach

programs that we may specify from time to time, at your own expense. Any media advertising
or direct mail marketing that you conduct must be predominantly focused within yourTerritory,
unless we and franchisees in neighboring territories agree otherwise You must ensure that all
of your advertising, marketing, promotional, customer relationship management, public relate

F ^ n c h ^ e O ^ o s u ^ Oooument -20 0t/t5

E A 5 ^ 7 4 ^ ^
and other brand
develop or im^omont relating t o ^
oornplles with all applicable laws and regulations and oontorms to the h ^
and the advertising and marketing policies that we periodically specie Moreover, you must
conduct alladvertising In adlgnltled mannerand In conformancewlth thestandardsand
requirements we specify In the Manuals.
You must submit to us In writing for our prior approval all sales promotion matehals and
advertising that have not been prepared by or previously approved by us If our written approval
Is not received within todays from the date we received the material, the material Is deemed
disapproved We will have the final decision on all creative development of advertising and
promotional messages. We reservethe right torequireyou to discontinuethe use of any
advertising or marketing materials.
Grand Openmg A d v e r t i n g . In connection with the opening of the Studio, you must
spendaminimum of $25,000 for grand opening advertising and promotion in the four weeks
priortoopeningtheStudioandthefourweeksafteropening theStudio in accordance witha
plan that you must submit to us We have the right to modify your grand opening plan, in our
solediscretion,and may require you to useapublic relations firm to assist with your grand
opening. No amount paid by you for your grand opening will be credited toward the Marketing
Spending Requirement. You must provide us with supporting documentation evidencing these
expenditures upon request.

MarketingFund. We may,but are not obligated to, establish the GycleSar Marketing
Fund, a segregated or independent fund into which all Marketing Fees will be paid (the
"MarketingFund") We may use monies in the Marketing Fund and any earnings on the
Marketing Fundaccount foranycosts associated withadvertising (media andproduction),
branding, marketing, public relations and/or promotional programs and materials, and any other
activities we believe would benefit the OycleRar brandortheStudiosgenerally, including
advertising campaigns in various media; creation, maintenance, and optimization of the System
Website or other websites; keyword or adword purchasing programs; conducting and managing
social media activities; direct mail advertising; market research, including, w^^^^
secretshoppersandcustomersatisfactionsurveys; branding studies;employing advertising
and/or public relations agencies; purchasing promotional items; conducting and administering
promotions, contests, giveaways, public relations events, and community involvement activity
and providing promotional and other marketing materials and services to our franchisees. We
have the right to direct all marketing programs, with the final decision over creative concepts,
materials, and media used in the programs and their placement We do not guarantee that you
will benefit from the Marketing Fund in proportion to your contributions to the Marketing Fund

Wewill make any salesand other materials produced with Marketing Fund monies
available to you without charge or atareasonable cost,and we will deposit the proceeds of
such sales into the Marketing Fund.
We will not use the Marketing Fund for anything whose sole purpose is the marketing of
franchises; however, the OycleSar website, public relations activities, community invol^^
activities, and other activities supported by the Marketing Fund may contain informa^^
franchising opportunities
We will not use any contributions to the Marketing Fund to defray our general operating
expenses, except for reasonable administrative costsand overhead we incur in activities

F^och^eOi^o^eOooome^ -2t-
E A ^ 7 ^ ^
^asonab^^^dto^ead^
Fund suppo^d program sanies of oor p e r s o n who
dovofofimofo M a r k e d Fond ao^fios and ^ Wo may
050 monies in fho Marking Fond t o ^
oiooffohavo^aodifed
In noovonfwi^wobodoomodafidooiarywifh respoot fo any Marketing Foes wo reooi^^
or administer We are not required to have an independent aodit of the Marketing Fond
oompieted. We wiii prepare an onaodited statement of oonfribotions and expenditures for the
MarketingFond and make it available within 60 days after fhe oiose of oor fisoai year to
franohiseeswhomakeawrittenreqoestforaoopy.

Ail franchisees and Stodios operated by os or oor affiliates will oontribote tothe
Marketing Fondaoniform percentage of their Gross Sales
AsofthedateofthisOisclosoreOocoment^we have not createdaMarketing Fond and,
accordingly, there were no Marketing Fond expenditores^ Any soms in the Marketing Fond at
the end of any year shall be applied toward the following years'expenditores

OigifalMarketmg. Wemay, inoor sole discretion, establish and operate websites,

social media accoonts (soch as Facebook,Twitter,lnstagram,Finterest, etc.), ap^^^^
keyword or adwordporchasing programs, accoonts with websites featoring gift certificates or
discoontedcoopons (soch as Groopon, Living Social, etc ), mobile applications, or other mea^^
of digital advertising on the Internet or any electronic commonications network (collec^^^
"Oigifa1Markefmg")thatareintended to promotetheMarks,yoorStodio,and the entire
network of Stodios We will have the sole right to control all aspects of any Oigital Marketing,
incloding those related to yoor Stodio.
As part of oor Oigital Marketing, we or oor affiliates have the right, bot not the obligation
to, offer daily deals or other discounted class promotions, coopons,voochers, or gift certificates
on third party websites or apps, soch as, withoot limitation, Groopon and Living Social, or o ^
similar promotions designed to drive new costomers to Stodios ("Oeals") If we or oor affiliates
offer any Oeals, we and oor affiliates have the right to collect and retain any revenoe from soch
Oeals,incloding any costomer payments to soch third parties, and to ose all such amoonts we
and they receive withoot restriction forany purposes. Yoo must provideclassesorother
prodocts or services to any costomers redeeming any voochers, gift certificates, or coupons
related to such Oeals in accordance with the standards and other terms that we periodically
specify. You will not be entitled to receive any payment or reimbursementfrom us, our a f f i ^
customers who purchase Oeals, or third parties for any classes, products, or services that you
provide to customers who purchase Oeals.
Onless we consent otherwise in writing, you and your employees may not, directly or
indirectly,conductorbeinvolved inany Oigital Marketing that use the Marks orthat relate t o ^
Studio or the network If we do permit you or your employees to conduct any Oigital Marketing,
you or your employees must comply with any policies, standards, guidelines, or content
reguirementsthatwe establish periodically and must immediately modify or delete any Oigi^^^
Marketing thatwe determine, in our solediscretion, is not compliant with such policies,
standards, guidelines, or reguirements. W e m a y withdrawour approval forany Oigital
Marketing at any time.

0 1 / 1 5
Franchise Disclosure Document -22-
EAST\87466944.6
 Youaronotao^onzedtoh^
to yoor Studio any t h i r d ^ ^
As partof oor OigitaiMarkoti^wo or ooo ot oor d o s i ^ o o s ^
CyoioBarwobsifo, whioh w^iooiodobasioioformatiooroiatodfothoSfod^^
oostomors to porohasooiassos at yoor Stodio^aodaooossfo tho Sfodio'srosorvafioo system

Promo^onal Programs Yoo most participate inaii io Stodiopro^

we otter to franchisees Yoo wiii foiiow oor goideiines conceming the acceptance and
reimborsement of gift certificates, gift cards, coopons, corporate discoonts, and other
promotionai programs as we set forth from time to time in the Manoais or otherwise in writing.
Yoo wiii not aiiow ose of gift certificates, gift cards, or coupons (inciodingGroopons and similar
discoonts)oniess approved or offered by os.

Adverfismg Cooperatives. We currently do not have any advertising cooperatives and

have no plans to form soch cooperatives in the immediate foture However, you must join and
actively participate in any organizations or associations of franchisees or advertising
cooperativesthat weestablishorthatareestablishedatourdirectionforthepurposeof
promoting, coordinating, and purchasing advertising in local, regional, or national areas where
there are multiple Studios.

Advertising Councils. We currently have no advertising council composed of

franchisees to advise us on our advertising policies. We may decide to implement an
advertising council in the future.

Computer System

You mustobtain, maintain, and use the Studio Management andTechnology System
that we specify periodically in the Manuals t o ^ e n t e r and track purchase orders and receipts,
classes and attendance,and customer information,^!) update inventory, (iii) enter and manage
your customer's contact information, (iv)generatesalesreportsandanalysisrelating tothe
Studio, and (iv) provide other services relating to the operation of the Studio

TheStudioManagementandTechnology System typically includes one server,two

computers, six tablets, one printer, equipment required to connect the bikes to the CycleStats
technology platform, two media boxes required to operate the CycleOeats music system, two
televisions, and related equipment. Components ofthe Studio Management andTechnology
System must be connected to the Internet viaahighspeed Internet connection TheStudio
Management andTechnology System will use thirdparty software from our approved vendors
Forany proprietary software or thirdparty softwarethat we require you to use,youmust
execute and be responsible for the fees associated with any software license agreements or
any related software maintenance agreements that we or the licensor of the software require.

We estimate that the Studio Management andTechnology System will cost between
$2t,000and$25,000, which includesthecostof thehardware,softwarelicenses, related
equipment, and network connections, including related installation costs Neither we nor our
affiliates currently act as vendors or soppliers of any components of the Stodio Management
andTechnology System,including the software used to operate CycleOeats and CycleStats, but
we and our affiliates reserve the right to do so in the future.

You must maintain the Studio Management andTechnology System at your expense
and must purchase any hardware or software maintenance or technical support programs that

^ano^seO^osoreOocomeot -23- 0t^5

8 A ^ 8 7 4 ^ ^
we r e q u i i Yeo must rep^ce, upgrade, or ^
Systemas we may requirefrom timeto time We wiii estab^hreasonabie deadlines tor
implementation ot any changes to our Studio Management and Technology System
reguirements, but there are no contractuallimitations on our right to require changes to the
Studio ManagementandTechnology System We currently do not require you to enter into any
maintenance, updating, upgrading, or support contracts related to the Studio Management and
Technology System Vendors may be able to offer optional maintenance, updating, upgrading,
or support contracts to you, but the charges would vary by vendor and cannot be reasonably
estimated by us
You, at all times, must give us unrestricted and independent electronic access (including
users 10s and passwords, if necessary) to the Studio Management andTechnology System for
the purposesof obtaining the information relating totheStudio You must permit us to
download and transfer data viaahighspeed Internet connection or such other connection that
we specify onarealtime basis. There are no contractual limitations on our right to access data
stored inthe Studio Management andTechnology System

You must dedicate your computer system for use as the Studio Management and
Technology System only and use the Studio Management and Technology System in
accordance with our policies and operational procedures. Your employees must complete any
and all training programs we reasonably require for the proper operation and use of the Studio
Management andTechnology System You may not use any other cash registers or computer
systems in your Studio.

Manuals

TheTable of Contents of theManualsisattachedasExhibit E t o t h i s Oisclosure

Oocument.The Manuals consist oft90 pages

Training

Initiai Training. Your Required Trainees must personally attend and satisfactorily
complete our initial training program ("initiai Training") before you op^^ Initial
Training currently consists of five consecutive days of training to be held at our offices and our
AffiliateOwnedStudioin Cincinnati, Chioat least^Odayspriortoyouropeningandfive
consecutive days of training to beheldon-siteinyour Studio at leastaweek prior to your
opening We reserve the right to modify the length and location of InitialTraining Wemay
waiveaportionof InitialTraining or alter thetrainingscheduleif we determine that your
RequiredTrainees have sufficient prior experience or training InitialTra^^
soon as practicable after you sign your Franchise Agreement.

We will provide instructors, f a c i l e

your representatives (including your RequiredTrainees) for the Training Fee provided
your trainees are trained during the same training session. If space is available, you may bring
more than three representatives to InitialTraining We reserve the right to chargeatraining fee
of $t,000, which we may increase upon 60 days'written notice to you, for (i) each person in
excessofthreetrainees,(ii)eachpersonwho is repeating the course or replacingaperson who
did not pass, and (iii) each subsequent Operating Frincipal, Key Manager, or employee who
attend the course. You are responsible for any travel and living expenses, wages, and other
expenses incurred byyourtrainees during InitialTraining or any other training programs.

Franchise Disclosure Document -24- 01/1.5

EAS'R87466944.6
 Our initial Training currently consists of the following:

TRAINING PROGRAM

FIRST WEEK

Hours of Hours of
Subject t: Classroom On-the-Job Location
Training Training

Brand Standards 1 1 Classroom

Training in
Studio Operations 1 4
Cincinnati, Ohio
Cycle Theatre Operations 0 1
On-the-job
CycleStats 0.5 1 training at our
CycleBeats 0.5 1 Affiliate-Owned
Studio in
CyceStar instructors 1 1 Cincinnati, Ohio
Technology/ IT/ A/V 2 2
Grand Opening 2 0
Unit Economics/Finance 2 0
Marketing, Branding & Promotion 2 0
Real Estate 1 0
Construction Management 1 0
Guest Support 2 1
Reporting & Metrics 2 0
CycleBar Mission & Vision 1 0
Human Resources 2 0
CycleBar User Experience 0 6
Atmosphere, Mood & Experience 1 0
TOTALS: 22 18

SECOND WEEK

Hours of Hours of
Subject Classroom On-the-Job Location
Training Training

Introduction to CycleBar 0 .5 Your Studio

Mission and Vision for the CycleBar .5 0
Brand
CycleStar instructors 4 12

Franchise Disclosure Document -25- 01/15

EASTO7466944.6
 Hours of Hours of
5 Subject ' ;
Classroom On-the-Jdb Location
Training Training
CycleBeats 0 1
CycleStats 0 1
CycleTheatre 0 1
Setting Up A CycleBar Location 0 1
Pricing, Products, and Services 0 1
Grand Opening 0 1
Human Resources 1 0
Studio Operations 1 5
Business Management Software & 1.5 1.5
Technology
Guest Relations 0 1
Class Schedule and Rides 0 .5
Cleaning and Maintenance 0 1
Safety 0.5 0.5
Marketing and Promotion 0 1
Reporting and Metrics 0.5 0.5
CycleBar Brand Standards 0 .5
CycleBar Retail 0 1
TOTALS: 9 31

We use manuals and Power Point presentations as instructional materials in our training
programs. The instructors for our initial training program all have experience working with us or
similar indoor cycling studios. The following individuals will be involved in our training programs:
(i) William Pryor, our CEO since our inception in 2014, who has operated indoor cycling studios
since 2005 and a cycling studio consulting business since 2009, (ii) Alexandra Klemmer, our
Executive Vice President Franchisee Relations since our inception in 2014, who has operated
an indoor cycling studios since 2005; (iii) Lisa Hillman, our Chief Cycle Officer since our
inception in 2014, who has operated indoor cycling studios since 2009; and (iv) James Wilde,
our Executive Vice President Field Support since our inception in 2014, who has operated
indoor cycling studios since 2009.

We will determine, in our discretion, what constitutes successful completion of the

program. If your Required Trainees are unable to successfully complete, in our sole discretion,
Initial Training for any reason, your Required Trainees must repeat Initial Training or you must
send replacement Required Trainees to complete Initial Training. Your Required Trainees must
successfully complete Initial Training at least ten days before the Opening Deadline. If your
Required Trainees fail to successfully complete Initial Training, we may terminate the Franchise
Agreement and we will not refund any initial fees paid by you.

Franchise Disclosure Document -26- 01/15

EAST\87466944.6
 Add^onal Trammg. We may penedica^y condoot mandatory or optional training
programsforyoorRoqoirodTrainoosan^^
that wo designate. There wiii be no oharge tor training programs that we require you or yoor
employees to attend,but we may ohargeyouareasonabie tee tor optional training programs.
We may provide additional training in person or via recorded media, teleoonterenoe,
videooonterenoe, the Internet, webinar, or any other means, as we determine. We may require
your RequiredTrainees or employees to satistaotorily complete any additional training programs
that we specify We may requireyourRequiredTraineesto participate in refresher or advanced
training each year
If, in our sole judgment, you fail to maintain the quality and service standards set forth in
the Manuals, we may, in addition to all of our other rights and remedies, assign trainers to the
Studio to retrain Studioemployees and restore service levelsand/orrequireyou or your
employeesto repeat InitialTraining orattend additional training programs a t a l o c a ^
designate. We may chargeareasonable fee for each trainer assigned to your Studio and any
remedial training.

Trammgby You. You and/or your OperatingPrincipal and your Key Managers are
responsible for training all of your other employees (and subsequent Key Managers) in
accordancewithour standards and training programs. If, inoursolejudgment, you fail to
properly trainyouremployeesin accordancewithour standards, wemay prohibit youfrom
training additional employees and either require them to attend training at our headquarters or
pay for our costs and expenses to send one of our representatives to train them at your Studio.

ITEM^ TERRITORY

Erancbise Program

Site. Yourfranchise is for the specific Sitethat we approve You must locate an
acceptablesitewithin the non exclusive Site Selection Area that we specify. The site will be
added to the Eranchise Agreement once we accept it and you secure it,usually within todays
after signing the Eranchise Agreement. Your Site Selection Area is not exclusive and is only
intended to give youageneral indication of the area within which you may locate the Site for the
Studio

Relocation of fbo Studio. If you would like to relocate your Studio, you must receive
our written consent. Ourapproval will not be unreasonably withheld, provided (i) the new
location for the Studio is satisfactory to us and within your Site Selection Area, (ii) your leased
any, forthe new location complies with our thencurrent requirements, (iii) you comply with our
then current requirements for constructing and furnishing the new location, (iv) the new location
will not, as determined in our sole discretion, materially and adversely affect the Gross Revenue
of any other Studio, (v) you havefully performed andcomplied with each provisionof the
Eranchise Agreement within the last three years prior to, and as of, the date we consent to such
relocation (the "Relocation Request Oate"),(vi) you are not in default, and no event exists
which with the giving of notice and/or passage of time would constituteadefault, exists as of the
Relocation RequestOate, and (vii) you have met all of our then current training requirements. If
you lose your lease, you must secure our approval of another site and enter intoalease for the
new approved site within 90 days after you lose your site lease. You must pay usarelocation
fee as specified in Item 6.

Franchise Disclosure Document -27- 01 /15

EAS'I\87466944.6
 T e ^ o r y . Once yoo have second the Site, we
have protected rights (the " T e ^ o r y " ) YourTerritory wiii typioaiiybeatwomiie radios aroond
yoor Stodio, ooiess yoor Stodio is iooatedinamajormetropoiitao downtown area or s i ^ ^
sitoated/popoiatedoentrai business d i s ^ if yoor Studio is
located inaCentrai8osinessOistrict,yoorTerritory may be limited toageograph^
comprised ot anywhere fromaradios of two blocks to two miles around yoor Studio,as we
deem appropriate in ourdisoretion. Thesizeof yourTerritory may vary from the territory
granted to other tranchisees based on the location and demographics surrounding your Studio.

Theboundariesof yourTerritory may be described in terms of Opcodes, streets,

landmarks (both natural and manmade) or coonty lines, or otherwise delineated onamapThe
soorces we use to determine the population within yourTerritory will be publicly available
population information (such as data published by the U S. Census Bureau or other
governmental agencies and commercial sources).

During the term of the Franchise Agreement, provided you are not in default under the
Franchise Agreement,we will not operate,or license others to operate,aStudio using the
Systemandthe Marks inside theTerritory. As long as you are in compliance with the Franchise
Agreement, your exclusive rights in theTerritory will not be modified for any reason,except by
mutualwrittenagreementsignedbyboth parties, and will not be dependent on achievinga
certain sales volume, market penetration, or other contingency.

Reserved Rigbts. Among otherthings, we and our affiliates havethe rightto (a)
establish or license franchises and/or company owned indoor cycling studios or other facilities
or businesses offering similar or identical products, services, and classes and using the System
or elements of the System (i) under the Marks anywhere outside of theTerritory or (ii)onder
names, symbols, or marks other than the Marks anywhere, incloding inside and ootside of the
Territory; (b) sell or offer, or license others to sell or offer, any prodocts, services, or classes
using the Marks or other marks through any alternative distribution channels, including, without
limitation,throughecommerce, in retail stores,via recorded media,via online videos, or
broadcast media, anywhere, including insideandoutside of theTerritory; (c)advertise,or
authorize others to advertise, using the Marks anywhere,includinginside and outside of the
Territory; and (d) acquire, be acquired by, or merge with other companies with existing fitness
facilities, fitness businesses, and/or Studios anywhere (including inside or outside of the
Territory) and, even if such businesses are located in the Territory, (i) convert the other
businesses to the CycleBar name, (ii) permit the other businesses to continue to operate under
another name, and/or (iii) permit the businesses to operate under another name and convert
existing Studios to such other name.

We will not compensate you for any of our activities in yourTerritory, even if they have
an impact on your Studio.

Resfricfion oo Rights. You do not have the right to open additional Studios nor do you
have any rights of first refusal on any other location. You do not have the right to use the Marks
or the System at any location other than the Site or in any wholesale, e commerce, or other
channel of distribution besides the retail operation of the Studio at the Site. Any media
advertising or direct mail marketing that you conduct must be predominantly focused within your
Territory, unless weagreeotherwise There are no territorial restrictions from accepting
business from customers that reside or work or are otherwise based outside of your
Territory if these customers contact you, but we reserve the right to implement additional rule^
and restrictions regarding soliciting such customers in the future in our Manuals.

F^c^eO^osoreOocumeot -28- 0^t5

E A 5 ^ ^ ^ ^
 We reserve the right to establish guideiioes oenoerning the aooeptanoe and
reimbursement ef gift certificates, gift cards, coupons, corporate discounts, and other
promotional programs as we set forth from time to time in the Manuals or otherwise in writing,
including policies related to the allocation of monies whenagift certificate is purchased at one
Studio and redeemed at another Studio We do not have these policies or procedures in place,
however,as ofthe date of this Oisclosure Oocument.

Oeveloomenf Program

OevelopmenfAreaD If you enter intoaOevelopment Agreement, you will have the right
to developamutually agreed upon number of Studios in the Oevelopment Area in accordance
with the Oevelopment Schedule The total number of Studios to be opened in your
OevelopmentArea,aswellasthesizeofthe Oevelopment Area,will be dependent upona
number of factors such a s ^ t h e number of Studios we grant you the right to open and operate;
and (ii) the location and demographics of thegeneral area where we mutually agreeyou
will be opening these locations. The boundaries of your Oevelopment Area may be
describedin terms of zip codes,streets, landmarks (both natural and manmade) orcounty
lines, or otherwise delineated onamap attached to the Oevelopment Agreement

You must executeaPranchise Agreement for each Studio that you develop pursuant toa
Oevelopment Agreement. We will designateaTerritory for the Studio as described above.

While the Oevelopment Agreement is in effect, provided that you open and operate the
Studios in accordance with the Oevelopment Schedule and the minimum number of Studios that
you have open and operating in the Oevelopment Area at any given time is not less than the
minimum required pursuanttothe Oevelopment Schedule,we will not operate, or license any
person other than you to operate, a Studio underthe Marks and theSystem within the
Oevelopment Area

You must comply with your development obligations under the Oevelopment Agreement,
including your Oevelopment Schedule, in order to maintainyourexclusive right to develop
Studios within the Oevelopment Area. Ifyou do not comply with your Oevelopment Schedule,
we may terminate your Oevelopment Agreement and any further development rights you have
under that agreement. Otherwise, we will not modify the size of your Oevelopment Area except
by mutual written agreement signed by both parties.

IfaStudio is destroyed or damaged by any cause beyond your control such that it may
no longer continue to be open for the operation of business ("Oesfrucfion Event"), you must
diligently work to repair and restore the Studio to our approved plans and specifications as soon
aspossibleatthesamelocationoratasubstitutesiteaccepted by us within the Oevelopment
Area Undersuchcircumstances, the Studiowillcontinuetobedeemeda^Studio in operations
for the purpose of this Agreement for up tot80 days after the occurrence IfaStudio (i) is
closed inamanner other than those described in the Oevelopment Agreement or as otherwise
agreed by us in writing or (ii) fails to reopen within t80 days afteraOestruction Event, then we
may terminate the Oevelopment Agreement and all ofyour exclusive territorial rights, if any, wil^
be eliminated.

The Oevelopment Agreement and your exclusive right to develop Studios in the
Oevelopment Area will expire on the last development deadline in the Oevelopment Schedule,
unless the Oevelopment Agreement is terminated sooner. Open the expiration or termination of
the Oevelopment Agreement, your right to develop Studios within the Oevelopment Area will

F ^ o c h ^ e 0 ^ 0 5 0 ^ Oocument -29- 0t^5

E A ^ 7 ^ ^
be terminated Heweve^Studios tbat yoo bave opened w^oeotinoe to operate under tbe
terms ot tbe appiioabieFranobise Agreements.

Reserved Rights Among otber tbings, we reserve tbe hgbt to: (a) establish or iioense
franobises and/or oompany owned indoor oyoling studios or otber taoilities or businesses
ottering similar or identioai products, services, and oiasses and using tbe System or elements ot
tbe System^under tbe Marks anywhere outside ot tbe Oevelopment Area or (ii) under names,
symbols, or marks other than the Marks anywhere, including inside and outside of the
Oevelopment Area; (b) sell or otter, or license others to sell or otter, any products, services, or
classes using the Marks or other marks through any alternative distribution channels, including,
withoutlimitation,throughecommerce, in retail stores,via recorded media, via online videos
viabroadcast media, anywhere, including insideand outside otthe Oevelopment Area; (c)
advertise, or authorize others to advertise anywhere, using the Marks; (d) acquire, be acquired
by,ormergewithothercompanieswith existing fitness facilities, fitnessbusinesses,and/or
studios anywhere (including inside or outsideof the Oevelopment Area) and, even if such
businesses are located in the Oevelopment Area, (i) convert the other businesses to the
CycleBar name, (ii) permit the otber businesses to continue to operate under another name,
and/or (iii) permit the businesses to operate under another name and convert existing Studios to
such other name; and (e) engage in any other activity, action or undertaking that we are not
expressly prohibited from taking under the Oevelopment Agreement. We will not compensate
you for any actions we take in your Oevelopment Area.

Add^onalOiscIosures

We have not established other franchises or company owned outlets or another

distributionchannel offering or selling similar products or services underadifferent trademark.
Neither we nor our affiliates have established, or presently intend to establish, other franchised
orcompanyownedbusinessesthatofferindoorcycling or similar products or services undera
different trade name or trademark, but we reserve the right to do so in the future without your
consent.

ITEM 13 TRADEMARKS

Wegrantyouthe right to operateabusiness specializing in the operation of personal

fitness studios under the CYCLEBAR mark and design that appears on the cover page of this
EOO, and other trademarks, service marks, associated designs, artwork, andlogosthatwe
specify from time to time. We may require you to use the Marks in conjunction with other words
or symbols or in an abbreviated form.

All of the Marks are owned by CB IR and licensed to us pursuant to a License

Agreement, dated as of January t, 20t5 (the "License Agreement"). In the License
Agreement, CB IR authorized us to use the Rrincipal Mark and other related Marks in
connection with the offer, sale,andsupportof franchised Studios. The License Agreement
does not contain any significant limitations on our right to use or license the Marks to you and is
perpetual in duration and may be terminated unilaterally by either party only uponamaterial
breach ofthe License AgreemenL Llpon termination ofthe License Agreement, we must
immediately discontinue the use of the Marks and assign to CB IR all of our franchise
agreements licensing the use otthe Marks, and CBIR has agreed to assume all obligations
under such agreements arising from and after their assignment.

Franchise Disclosure Document -30- 01/15

EAST\87466944.6
 C B IP has registered the following Mark with the Principal Register of the United States
Patent and Trademark Office (the " U S P T O " ) :

Mark | Registration No. Registration Date

C Y C L E BAR | 4,049,076 11/1/11

CB IP has applied to register the following Marks with the Principal Register of the
USPTO:

Mark Application No. Application Date

CYCLEBAR 86,410,523 9/30/14
86,413,102 10/2/14

(3
CYCLEBEATS
CYCLESTATS
86,446,489
86,446,741
11/6/14
11/6/14
CYCLESTAR 86,446,854 11/6/14
CYCLETHEATRE 86,446,949 11/6/14

Because we do not have a federal registration for these Marks, these Marks do not have
the legal benefits and rights of a federally registered trademark. If our right to use these Marks
are challenged, you may have to change to an alternative trademark, which may increase your
expenses.

There are no currently effective determinations of the USPTO, Trademark Trial and
Appeal Board, the Trademark Administrator of any state, or any court; nor is there any pending
infringement, opposition or cancellation proceedings, or material litigation, involving any of the
Marks. There are no currently effective agreements that significantly limit our rights to use or
license the use of the Marks listed above in a manner material to the franchise.

You may also use certain other Marks owned by or licensed to us in the operation of
your Studio. You must use the Marks only in strict accordance with the Franchise Agreement
and Operations Manual. You may not use any Mark (i) as part of any corporate or legal
business name, (ii) with any prefix, suffix or other modifying words, terms, designs or symbols
(other than logos we have licensed to you), (iii) in selling any unauthorized services or products,
(iv) as part of any domain name, electronic address, metatag, social media account, or
otherwise in connection with any website or other electronic medium without our consent, or (v)
in any other manner we have not expressly authorized in writing. You must display the Marks in
a manner that we specify on signage at the Studio and on forms, advertising, supplies,
employee uniforms, business cards, and other materials we designate. Upon receipt of notice
from us, you must discontinue, alter or substitute any of the Marks as we direct.

You must promptly notify us if any other person or Entity attempts to use any of the
Marks or any colorable imitation of any of the Marks. You must immediately notify us of any
infringement of or challenge to your use of any of the Marks. We will have the right to take any
action that we deem appropriate, but the Franchise Agreement does not require us to take any
action to protect your right to use any of the Marks or to participate in your defense and/or
indemnify you for expenses or damages if you are a party to an administrative or judicial
proceeding involving any of the Marks. We will have the right to control any administrative

Franchise Disclosure Document -31- 01/15

EAS1\87466944.6
proceeding or ^ g ^ o n r e ^ e d to the Marks. W e w ^ b e entitied to retain any and aii proceeds,
damages, and other sums, inciuding attorneys'tees, recovered or owed to us or our a t f i ^ ^
connection with any such action. You agree to execute aii documents and, render any other
assistance we may deem necessary toany such proceeding orany etfort to maintain the
continued validity and entorceabiiity otthe Marks

it we decide that you should modity or discontinue using any otthe Marks,or use one or
more additional or substitute service marks or trademarks, you must comply with our directions
in the time that we reasonably specity^and neither we nor any ot its attiliateswillhave any
obligation to reimburse you tor the cost of complying with our directions.

ITEM 14 PATENTS COPYRIGHTS ANO PROPRIETARY INFORMATION

We own no rights in, or licenses to, any patents or patent applications.

Except as provided below, we own no rights in, or licenses to, any copyrights. We have
not registeredany copyrights with the United States Copyright Office However, we claim
copyrights with respect to our advertising materials and Operations Manual, as well as other
materials we may periodically develop There are no determinations of the Copyright Office or
any court regarding any of our copyrights There are no agreements limiting the use of any
copyrights by us.

Any copyrights used by you in the Studio belong solely to us or our affiliates Youagree
to notify us in writing ofany suspected infringement ot our or our affiliates'copyrights. We and
our affiliates have exclusive rights to bring an action for infringement and retain any amounts
recovered with respect tosuchaction, andtocontrol any infringement proceeding whether
brought by or against us or you. We have no obligation to defend or otherwise protect you
against any claims involving any copyright, including without limitation any copyright
intringement claim, or to indemnity you for any losses you may incur as a result of our
copyrights infringing the rights of any other copyright owner If so requested by us, you will
discontinuetheuseotthesubjectmattercoveredbyanycopyright used in connection with the
Studio

Ouring the term of your Pranchise Agreement, we or our affiliates may disclose in
confidence toyou, either orally or in writing, certain tradesecrets, knowhow, and other
confidential information relating totheSystem, our business,our vendor relationships,our
classes, or the construction, management, operation, or promotion of the Studio (collectives
"Proprietary Informations. You may not, nor may you permit any person or Entity to, use or
disclose any Proprietary Information (including any portion of the Operations Manual) to any
other person, except to the extent necessary for your employees to perform their functions in
the operation of your Studio Youmust take reasonable precautions necessary to protect
Proprietary Information from unauthorized use or disclosure, including conducting orient^^^
and training programs for your employees to inform them ot your obligation to protect
Proprietary Information and their related responsibilities and obligations. If we or our affiliates
so request, you must obtain trom your officers, directors, Owners, Key Managers, and CycleStar
instructorsconfidentialityagreements inaform satisfactory to us or our affiliates. You will be
responsible for any unauthorized disclosure of Proprietary Information by any person to whom
you have disclosed Proprietary Information.

Franchise Disclosure Document -32- 01/15

EAS'n87466944.6
ITEM^ OB^GA^ONTOPART^PA^
FRANCH^EBO^NESS

A t ^ t i m e 5 ^ y O ^ S ^ O i 5 0pe0^b05^e55,itmu^^
premies supervision ot either yoo, yoor O p e r a s
attendant. Yoor Key Manager or another trained manager most be avaiiabie at aii tirnes the
Stodio is open tor bosiness Yoo or yoor OperatingPrinoipai and yoor Lead instrootor most
soooesstoiiy oompiete oor training program and any other training programs that we may
reqoire. Yoo may not permit yoor Stodio to be operated, managed, directed, or oontroiied by
any other person withoot oor prior written consent.
Yoor Operating Principal most have at i e a s t a t O ^ ownership interest in yoor Entity and
most have authority over aii business decisions related to yoor Stodio and most have the power
to bind yoo in ail dealings with os. In addition,yoo most appointaKey Manager to manage the
day to daybosinessot yoor Stodio, who may also be the Operating Principal Yoo most provide
os with written notice ot your Operating Principal and Key Manager at least 60 days prior to
openingandmaynotohange your OperatingPrincipal and Key Manager without oor prior
approval.

We may also require yoo to obtain trom yoor ofticers, directors, Key Managers,
OycleStarinstructors,your Owner's spouses,and other individuals that wemaydesignate
executed agreements containing nondisclosure and noncompete covenants in a torm
acceptable to us,sucb as the torm attached as Exhibits,which specitically identity os as having
the independent right to entorce them.

Each Owner,incloding the Operating Principal, most sign the Payment and Pertormance
Ooarantee (the "Ooarantee") attached to the Pranchise Agreement, assuming and agreeing to
discharge all obligationsot thefranchisee onderthe Pranchise Agreementand agreeing to
comply with the confidentiality, indemnification, covenant not to compete, and assignment
provisions otthe Pranchise Agreement. It yoo areapartytoaOevelopment Agreement, each
individoalwithadirectorindirectownership interest in yoor Entity most sign the Ooarantee
attached to the Oevelopment Agreement.

ITEM 16 RESTRICTIONS ONWHATTHEERANOHISEEMAYSELL

Yoo mayotter for saleintheStodio only theproducts and services that we have
approved in writing In addition,you must otter the specificproducts and services that we
require in the Manuals or otherwise in writing. We may designate specific prodocts or services
as optional or mandatory. You must offer all products or services that we designate as
mandatory. Yoomay sell products only in the varieties,forms, and packages that we have
approved. You must maintainasufficient supply otrequiredproductstomeet the inventory
standards we prescribe in the Manuals (or to meet reasonably anticipated customer demand, if
we have not prescribed specific standards).
We may, without limitation, change the types, amounts, or specifications of the goods or
servicesthatyou mayotter. Wemay, without limitationandinour sole discretion, revoke
approvaiofapreviouslyapprovedproductorservicethatyou havebeen selling,in which case,
yoo most immediately discontinoe ottering the service and may continoe to sell the product only
from yoor existing inventory for op to 30 days following oor disapproval. We have the right to
shorten this period if, in oor opinion, the continoed sale ot the prodoct would prove detrimental

Franchise Disclosure Document -33- 01/15

EAS'R87466944.6
 tooor^pu^o^ A^the^daypeno^^^
most dispose ot yoor remaining f o r m e ^ a p p r o ^

We impose no restriction on the retail oostomers that yoo may serve at yoor S t o ^
y o o m a y not make any saies otprodoots or services ootside otthe Stodio, oondoot classes
ootside otthe Stodio, or ose vendor relationships that yoo establish throogh yoor association
with os or the CycleBar brand tor any other porpose besides the operation otthe Stodio, onless
we consent in writing Yoo agree to porchase prodocts solely tor resale to retail costomers, and
not tor resale or redistribotion to any other party, incloding other CycleBar tranchisees Yoo
may not otter prodocts or services in connection with the Marks on any website on the Internet
or any other electronic commonication network onless we consent in writing. Any media
advertising or direct mail marketing that yoo condoct most be predominantly focosed within yoor
Territory,onless we agree otherwise While therearenoterritorial restrictions tromaccepting
bosiness trom costomers that r e s i d e o r w o r k or are otherwise based ootside of yoor
Territory it these costomers contact yoo, we reserve the right to implement roles and
restrictionsregarding solicitingsoch costomersin t h e f o t o r e i n o o r M a n o a l s o r o t h e r w i s e i n
writing.

ITEM 17 R E N E W A L T E R M I N A T E T R A N S F E R ANO DISPUTE RESCL0T1CN

THE E R A N C H I S E RELATIONSHIP

The table below lists certain important provisions of the Pranchise Agreement Yoo
shoold read these provisions in the form of Pranchise Agreement attached to this Oisclosore
Oocoment as Exhibit A.

Sections
Proton Franohise Summary
Agreement
a. L e n ^ d ^ e Seotion^t Ten years trom the effective date ofyour Franchise
Cochise term Agreement.
b Renews or Sections if you meet the conditions, you may enter into two successor
extension of the term tenyear terms.
0^ Requirements for Sections You have notified us ofyour intent to renew at ieast six
franchisee to renew months in advance but no more thant^months in advance;
or extend you have signed our then current torm of franchise
agreement, which may have materiaiiy different terms and
conditions than your original Franchise Agreement; you have
refurbished the Studio to ourthencurrent specifications; you
have executedagenerai release in favor of us and our
affiliates; you, your Operating Frincipai, and Key Manager
have completed ourthen currenttraining reguirements; you
have secured trom your landlord the rightto continue
operating at the Site; you have substantially complied with
the Franchise Agreement during the term; no Fvent of
Oetault (as detined in the Franchise Agreement) or event
which, with the giving of notice or passage of time or both,
would become an Fvent of Default, exists; and you have paid
us the Successor Fee.

Franchise Disclosure Document -34- 01/15

EAS'R87466944.6
 Section in
Provision Franchise Summary
Agreement
d Termination by Section 14.3 If we commit a material breach of the Franchise Agreement
franchisee and we fail to cure the breach or take reasonable steps to
begin curing the breach within 60 days after receiving notice
from you, you may terminate the Franchise Agreement.
e. Termination by us Not None.
without cause applicable
Termination by us Section 14.2 We can terminate only if you default (see (g) and (h) below).
with cause
"Cause" defined - Section 14.1 You have 10 days to cure the non-payment of any amounts
curable defaults owed to us or our affiliates or your failure to make sufficient
funds available to us; 24 hours to cure non-compliance with
any law, regulation or ordinance which results in a threat to
the public's health or safety; and 30 days to cure a failure to
comply with any other provision of the Franchise Agreement
not described above or in (h) below.
h. "Cause" d e f i n e d - Section 14.1 You make a material misrepresentation to us; your Required
non-curable defaults Trainees fail to satisfactorily complete initial training; you fail
to submit a site or fail to obtain our approval of a site or site
lease in the prescribed time; you fail to open on time; you fail
to timely refurbish your Studio; you fail to rebuild your Studio
after its destruction; you suspend operations of the Studio for
more than five days without our consent; you miss two or
more required meetings; you or any of your Owners or
officers or directors is convicted or pleads nolo contendere to
a crime involving moral turpitude or consumer fraud or any
other crime or offense or engages in any activities which
impairs the goodwill associated with the Marks; you misuse
the Marks; you disclose Proprietary Information; you or your
Owners make an improper transfer; you or your Owners
violate the noncompete covenants of the Franchise
Agreement; you become insolvent or bankrupt;
you fail to pay suppliers and trade creditors an amount
exceeding $2,000 for more than 60 days; you fail to pay your
taxes; you underreport Gross Sales by more than 2% twice in
a two-year period or by 5% in any period; you fail to permit us
to inspect or audit your books and records; you fail to timely
file reports three times in 12 months; you default under any
other agreement with us or our affiliates if such default would
permit the termination of that agreement; or you are in default
three or more times within any 18-month period.
Franchisee's Section 15 Pay all amounts due to us or our affiliates; discontinue use of
obligations on the Marks and the System; return Proprietary Information,
termination/non- customer data, and Manuals; close vendor accounts; cancel
renewal assumed name registration; cancel or transfer telephone
number, post office boxes, domain names, social media
accounts, and directory listings; complete de-identification of
the Site; reimburse customers; refrain from disclosing

Franchise Disclosure Document -35- 01/15

EAST\87466944.6
 Section in : <y % ^ - '
Provision Franchise Summary
Agreement
Proprietary information; and comply with noncompete
covenants (also see (o) and (r) below).
j- Assignment of Section 13.1 No restriction on our right to assign.
contract by us
k. "Transfer" by Section 13.2 Includes transfer of the Franchise Agreement, any interest in
franchisee - the Franchise Agreement, the license to use the System and
definition the Marks, the Studio or substantially all of the assets of the
Studio, or an interest in the ownership of the Studio (if you
are an Entity).
1. Our approval of Section 13.3 We have the right to approve all transfers.
transfer by
franchisee
m. Conditions for our Section 13.4 You pay us a non-refundable deposit to review the transfer;
approval of transfer you pay us the Transfer Fee; all of your monetary obligations
are satisfied; you are not in default; you and your Owners
sign a general release; you and your Owners remain liable
for obligations incurred or arising prior to transfer; you comply
with noncompetition and confidentiality provisions; your
landlord consents to the transfer of your lease; new
franchisee agrees to discharge all of your obligations; new
franchisee qualifies, meets training requirements, and signs
then-current franchise agreement; new franchisee upgrades
the Studio to our then-current specifications; new franchisee
covenants to continue to operate the Studio under the Marks;
new franchisee's owners execute our then-current form of
personal guarantee; and we determine purchase price
acceptable and financing arrangements are subordinate to
our interests.
n. Our right of first Section 13.9 We can match any offer for your Studio, the Studio's assets,
refusal to acquire or any ownership interest, except for certain transfers to
franchisee's business spouses, children, or existing Owners.
0. Our option to Section 15.6 For 30 days after the Franchise Agreement terminates or
purchase your expires, we can purchase any or all of the inventory,
business supplies, Operating Assets, and other assets related to the
operation of your Studio for the fair market value of the
assets, less any amounts then owing to us. We also may
assume your lease or sublease or eguipment leases.
p. Death or disability of Section 13.8 Executor or representative must transfer your interest to a
franchisee third party approved by us within 120 days.
q. Non-competition Section 12.1 You and your Owners may not: own, manage, engage in, be
covenants during the employed by, advise, make loans to, or have any other
term interest in (i) any business that offers indoor cycling classes,
(ii) any gymnasium, studio, athletic or fitness center, health
club, exercise, cycling, or aerobics facility, or similar facility or
business, or (iii) any entity that grants franchises or licenses
for any of these types of businesses (a "Competitive
Business") in the United States; divert or attempt to divert

Franchise Disclosure Document -36- 01/15

EAS'A87466944.6
 Section in
Provision Franchise Summary
ti' Agreement
any business or customer or potential business or customer
of the Studio to any Competitive Business, by direct or
indirect inducement or otherwise; perform, directly or
indirectly, any other act injurious or prejudicial to the goodwill
associated with the Marks and the System; use any vendor
relationship established through your association with us for
any purpose other than to purchase products or equipment
for use or retail sale in the Studio; or directly or indirectly
solicit for employment any person who at any time within the
immediate past 12 months has been employed by us, or our
affiliates, or by any of our franchisees.
r. Non-competition Section 12.2 For two years after the expiration of termination of your
covenants after the Franchise Agreement, you and your Owners may not be
Franchise Agreement involved in any Competitive Business that is (or is intended to
is terminated or be) located within a 10-mile radius of your former Studio or
expires any other Studio that is operating or under development at
that time and may not solicit for employment individuals
employed during the past 12 months by us, our affiliates, or
our franchisees.
s. Modification of the Section 17.2 Except for modifications to the Manuals, no modifications
agreement unless agreed to in writing by both parties.
t. Integration/merger Sections Only the terms of the Franchise Agreement are binding
clause 17.1 (subject to state law). Any other promises made outside of
this Disclosure Document or the Franchise Agreement may
not be enforceable.
u. Dispute resolution by Section 16.1 Prior to filing most proceedings, each party has the right to
arbitration or demand non-binding mediation.
mediation
V. Choice of forum Section 16.2 Subject to applicable state laws, you and your Owners must,
and we may, bring claims in federal or state courts located in
the state where our principal place of business is located
(currently, Ohio).
w. Choice of law Section 16.3 Subject to applicable state laws, Ohio law applies, without
regard to Ohio conflict-of-laws rules.

DEVELOPMENT AGREEMENT

The table below lists certain important provisions of the Development Agreement. You
should read these provisions in the form of Development Agreement attached to this Disclosure
Document as Exhibit B.

Section in
Provision Development Summary
Agreement
a. Length of the franchise Section 5 The term expires upon the deadline to open the last
term Studio to be opened pursuant to the Development
Schedule.

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EAST\87466944.6
 Secfionm
^
Prov^on Oevelopmenf Summary
Agreement
b Renews or extension of Not applicable Notap^ioab^
the term
0. Requirements for Not applicable Notapp^a^e
franchisee to renew or
extend
d Terminations Not applicable Notap^icab^
franchisee
e. Termination by us Not applicable Notap^icab^
without cause
f Termination by us with Section^t We oan ^ m i n a t e o ^ y it you defauh ( s e e ^ a n d ^
cause below).
g "Cause" defined^ None Not applicable.
curabie defaults
h "Cause" defined^non Section^t You tail to timely exeouteaFranobise Agreement or
curable defaults tail to pay any initiai tranobise tee owed tbereunder;
you tail to bave open and operating tbe minimum
number of Studios specitied in tbe Oevelopment
Scbeduie at any deadline; any Prancbise Agreement
is terminated asaresult of default; or you breacb or
otherwise tail to comply fully witb any provision of
tbe Oevelopment Agreement.
4 Your obligations on Sections You will lose your rigbt to develop additional
termination/non-renewal Studios.
^ Assignment of contract Sections No restriction on our rigbt to assign
by us
k ^Transfer" by y o u ^ Sections Includes transfer of tbe Oevelopment Agreement,
definition any interest in tbe Oevelopment Agreement, 04 it
you are an Entity,any interest in tbe Entity.
1 Cur approval of transfer Sections We bave tbe rigbt to approve or not approve all
by franchisee transfers in our sole discretion
m. Conditions for our Sections We bave sole discretion in setting conditions for our
approval of transfer approval otatransfer.
0. Cur right of first refusal Sections We bave tbe first rigbt of refusal on all transfers,
to acquire franchisee's exercisable witbin 30 days of receiving all
business documentation tbat we require.
0 Cur option to purchase Not applicable Not applicable
your business
P Oeath or disability of Not applicable We bave tbe rigbt to approve or disapprove any
franchisee transfer in our sole discretion.
q Noncompetition Section^t You and your Owners may not: be involved in any
covenants during the Competitive Business in tbe United States; divert
term customers or potential customers to any Competitive
Business; do acts injurious to our goodwill; use
vendor relationships established tbrougb your
associations with us tor any other purpose besides
the operation of your Studio; or solicit for
employment individuals employed during the pastt2

Franc^eO^osureOooume^ 33 0t/t5
EA^874^^
 Section in
Provision Development Summary
Agreement
months by us, our affiliates, or our franchisees.
r. Non-competition Section 8.2 For two years after the expiration of termination of
covenants after the your Franchise Agreement, you and your Owners
Development may not be involved in any Competitive Business
Agreement is terminated that is (or is intended to be) located within a 10-mile
or expires radius of your former Development Area or any
other Studio that is operating or under development
at that time and may not solicit for employment
individuals employed during the past 12 months by
us, our affiliates, or our franchisees.
s. Modification of the Section 10 No modifications unless agreed to in writing by both
agreement parties.
t. Integration/merger Section 10 Only the terms of the Development Agreement and
clause any Franchise Agreements are binding (subject to
state law). Any other promises outside this
Disclosure Document, the Development Agreement,
and the Franchise Agreement may not be
enforceable.
u. Dispute resolution by Section 9 Prior to filing most proceedings, each party has the
arbitration or mediation right to demand non-binding mediation.
V. Choice of forum Section 9 Subject to applicable state laws, you and your
Owners must, and we may, bring claims in federal or
state courts located in the state where our principal
place of business is located (currently, Ohio).
w. Choice of law Section 9 Subject to applicable state laws, Ohio law applies,
without regard to Ohio conflict-of-laws rules.

If you are required to execute an addendum to the Franchise Agreement or

Development Agreement, forms of which are included in Exhibits A and B to this Disclosure
Document, such addenda may aftect your rights under your Franchise Agreement and
Development Agreement, as described in the above charts.

ITEM 18 PUBLIC FIGURES

We do not use any public figure to promote our Franchises, but may do so in the future.

ITEM 19 FINANCIAL PERFORMANCE REPRESENTATIONS

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 or under
particular circumstances.

Franchise Disclosure Document -39- 01/15

EAS^87466944.6
 Some otthe individual o w n ^
studios (the ^ x i s t r n g Owner S t u d i o s ^ As ot this OisoiosureOooument's issuance date, our
owners operate Existing Owner Studios in Weiiesiey, Massachusetts (the " W e ^
Royai Oak, Michigan (the "Royal Oak S t u d ^ and Rochester H i i i s , M ^
R ^ s S t u d i o s We deveioped the System and System Standards based in part on the Existing
OwnerStudios,which have instructorstrained in methods similar to the OycieStar instructors,
teatureatheatresetup similar t o t h e OycieTheatre, and usemusic programs similar to the
OycleReats program Because of the operational, marketing, and other similarities between the
Existing Owner Studios and the OYOLERAR Studios that tranchisees will operate, we believe
thattheoperating results otthe Existing Owner Studios provideareasonable basis trom which
to prepareatinancial performance representation.

Of t h e ^ E x i s t i n g Owner Studios and the AffiliateOwnedStudio,onlytheWellesley

Studio and the Royal Oak Studio bave operated for at least t ^ f u l l months during the period
from January t , 2 0 t 4 to Oecember 3 t , 2 0 t 4 Because the AffiliateOwned Studio and the
Rochester Rills Studio were not in operation during the entire calendar year and do not havea
full year's worth of financial data, their financial results have not been included in this financial
performance representation In addition, the Rochester Rills Studio has not been included,
b e c a u s e t h e s t u d i o b a s not beenbuilt-out in the same manner as the other Existing Owner
Studios and is dissimilar to tbe OYOLEBAR Studios that franchisees will operate This financial
performance representation reflects the Oross Revenue, certain expenses, and EBITDA
(defined below) for the Wellesley S t u d i o s
Studios") for the period from d a n u a r y t , 2 0 t 4 t o Oecember 3t,2014

William Pryor,ourOhiet Executive Officer, and Alexandra Klemmer,our Executive Vice

President otEranchisee Relations, co own the Wellesley Studio That studio operated under
the ^Spynergy" name and recently changed branding to the OYOLEBAR name It operates in
the Boston O M A f r o m a s t r i p location and first opened in February 2005 Tbe Wellesley Studio
h a s t , 8 0 0 square feet and about 50 bikes.

Lisa Rillman, ourOhief OycleOfficer, c o o w n s t b e Royal OakStudio That studio

operated under the OoOycle name and recently changed branding to the OYOLEBAR name. It
operates in the Detroit O M A t r o m a f r e e s t a n d i n g location and first opened in April 20t0 The
Royal Oak Studio bas1,780 square feet and about 28 bikes

Both of the OoveredStudios face competitionin their markets tromhealth clubs and
similar operations Both o t t h e Covered Studios operate in higbincome areas within large
metropolitan OMAs, which is where we expect the first new OYOLEBAR Studios will operate

The following charts reflect tbe Oross Revenue, certain expenses, and EBITDA (defined
below) forthe Covered Studios during the 20t4calendar year:

Wellesley, M A (Boston DMA)

%of
Annual Monthly
Revenue
Gross Revenue $797,023 $66,419 100.00%

Expenses •• ir^j.

•
Merchant Services $17,040 $1,420 2.14%

Franchise Disclosure Document -40- 01/15

EAS1\87466944.6
 Payroll $115,949 $9,662 14.55%
Rent $77,516 $6,460 9.73%
Marketing $9,367 $781 1.18%
Insurance $1,604 $134 0.20%
Utilities $5,933 $494 0.74%
Bike Lease $28,106 $2,342 3.53%
Equipment $10,794 $899 1.35%
Website + Software $4,911 $409 0.62%
General Operations Expense $34,770 $2,897 4.36%

Total Expenses \ $305,989 $25,499 38.39%

EBIDTA before Royalty \ >, X ^ i i O ^ ; : $40,919 61.61%

Royalty at 7% $55,792 $4,649 7.00%

EBIDTA after Royalty $435,242 $36,270 54.61%

Royal Oak, Ml (Detroit DMA)

%of
Annual Monthly
Revenue
Gross Revenue $220,730 $18,394 100.00%

Expenses
Merchant Services $5,920 $493 2.68%
Payroll $22,927 $1,911 10.39%
Rent $30,000 $2,500 13.59%
Marketing $1,345 $112 0.61%
Insurance $2,420 $202 1.10%
Utilities $3,909 $326 1.77%
Bike Lease $ - $ - 0.00%
Equipment $ - $ - 0.00%
Website + Software $1,985 $165 0.90%
General Operations Expense $16,163 $1,347 7.32%

Total Expenses 1
$84,669 $7,056 38.36%

Franchise Disclosure Document -41- 01/15

EAST\87466944.6
 :
EBIDTA before Royalty :
$136,062 $11,338 61.64%

Royalty of 7% $15,451 $1,288 7.00%

EBIDTA after Royalty $120,611 $10,051 54.64%

Notes to the Financial Performance Representations

1. We calculated the figures in the tables above using information that the Covered
Studio owners provided. Prospective franchisees and sellers of franchises should be advised
that no certified public accountant has audited these figures or expressed his or her opinion
concerning their contents or form, nor have we sought to independently verify their accuracy.
Upon your reasonable request, we will provide written substantiation for this financial
performance representation.

2. "Gross Revenue" is calculated using a Gross Revenue definition identical to the

one in Item 6.

3. "Merchant Services" includes the processing and bank fees that the Covered
Studios pay for processing credit and debit card payments.

4. "Payroll" includes wages, other compensation, and related costs, including

payroll taxes, for all individuals working at the Covered Studio, including CycleStar instructors
and front desk personnel. The Payroll figures do not cover all employee-related costs which
you may incur in the operation of a Studio, such as payroll processing fees, health insurance or
workers' compensation insurance premiums, expenses for uniforms, employee benefits, or
meal, travel, and other expenses for employees.

The Wellesley Studio classified its CycleStar instructors as independent contractors

during the entire 2014 calendar year, and the Royal Oak Studio began classifying its CycleStar
instructors as independent contractors in November 2014. During the periods in which the
CycleStar instructors were classified as independent contractors, the Covered Studios did not
incur payroll taxes for them. During the months in which the CycleStar instructors at the Royal
Oak Studio were classified as employees, the Payroll category included payroll taxes related to
these instructors, in addition to their wages. We expect that your CycleStar instructors will be
categorized as employees and that you will incur payroll-related expenses, including payroll
taxes. You should consult your legal and tax advisors regarding these classifications and
related expenses.

The Payroll figures do not include any amounts paid to the owners of the Covered
Studios who act as managers for the Covered Studios. Because the Covered Studios do not
operate with managers other than the owners, the Payroll and other cost figures for the Covered
Studios do not reflect any costs for management employees. Though you may serve as both
Operating Principal and Key Manager and are not required to hire additional managers, we
anticipate that many of our franchisees will hire managers to assist in the operation of Studios,
which will result in additional payroll expenses.

Franchise Disclosure Document -42- 01/15

EAST\87466944.6
 A ^ t h e Covered Studios have
eftioienoiesthatarere^eotedinlowe^
achieve as they begin operate Compensation rates vary trom market to market, and you
aione wiii determine the terms and conditions of empioymenttoryour Studio

5. "Rent" retiects the amounts paid tor rent, common area maintenance charges,
andotheramounts paid tothe iandiordsunder the Covered Studio'siease. SothCovered
Studios operate under leases with unattiiiatediandiords The Rent figure for the Weiiesiey
Studio includes property taxes, insurance, and common area maintenance charges, because
those costs are included in the rent under the iease. Rowever,the rent in the RoyaiCak iease
does not include property taxes, insurance, or common area maintenance charges^ so the Rent
and other costs figures for the RoyaiCak Studio do not reflect any ot these costs. Lease costs
can vary widely depending on the size and location otthe premises.

6 "Marketing" includes amounts paid tor local advertising and marketing tor the
Covered Studio, including local advertising and marketing, content marketing, someprinted
materials and social media services. Tbis figure does not include costs tor website
maintenance. You mustimplementagrand opening advertising program of at least $30,000,
pay the Marketing Fee (it we implement it) of 2% ofyour Cross Revenues, and comply with the
Marketing Spending Reguirement and your other advertising and marketing obligations under
the Franchise Agreement, which require expenditures ot at least $t3,000 in your first year ot
operation and at least $t2,000 in subsequent years. The Covered Studios operated under the
Co Cycle and Spynergy names andincurred expenses when they opened to promote those
brands in their markets RecausetheCYCLERAR brand isanewbrand,you might need to
spend more than the minimum amount that the Franchise Agreement requires to promote the
brand in the market.

7. "Insurance" covers amounts paid to insurance carriers, excluding worker's

compensation insurance.

3. "Utilities" cover electric,water,gas, and internet services related to the Covered

Studios. Utilities for the Wellesley Studio also includes telephone services for tbe Studio.

9. "Rike Lease" covers the monthly payments tbat the Wellesley Studio pays to the
equipment lessor The Royal Cak Studio does not report any Sike Lease expenses because
that studio bought, rather than leased, the bikes We strongly recommend that you lease your
bikes. If you purchase, rather than lease, the bikes, you will pay these costs up front and might
finance these costs.

tO "Equipment" covers the expenses for repairing and replacing the fitness
equipment at the Covered Studio, including costs tor bike repair and maintenance when the
warranty period has lapsed. These amountstend tofluctuatedepending on tbe age and
condition of the equipment. This does not include any costs to acquire the initial equipment
package or any ongoing finance costs relating to purchased equipment. The Royal Cak Studio
does not report any Equipment expenses because that studio opened in April 20t0and did not
need to replace any equipment in the measured period.

tt "Website^Sottware" covers the ongoing expenses that the Covered Studios

incurred for maintainingawebsite and the software and hardware required to fulfill the
of the Studio Management andTecbnology System. You will not be authorized to maintaina
separate website for your Studio and will be required to use our System Website and Studio

F^c^seO^oso^Oocume^ -43- 0t^5

E A ^ 8 7 4 ^ ^
M a o a g e m e ^ ^ T e c h ^ o g y S y ^ e m You must pay o s ^ T e o h o o I o g y Fee, whioh is c u ^ ^ y
$10^00 per y e a ^ t o o o v e r a o o u a i e x p e o s e s r e i a t e d tothe S y s t e m W e b s i t e a n ^ t h e S t u ^ o
Management an^Teohooiogy System.

12 "Mi^oeiianeou^ General Operations Expenses" included oosts tor cleaning

supplies, cleaning expensed ottice supplies, business licenses an^ permits^ charitable
contributions, professional tees, bank tees (other than tees related to credit and debit
transactions^ repair5 and maintenance(other than titness equipment repairs and maintenances
andother miscellaneous costs. EortheWellesleyStudio^Miscellaneous General Operations
Expenses also includes costs related to laundry/towel services, wbiob was not ottered by the
Royal Oak Studio in 2014. Youwill be required to otteracomplimentary towel service to your
customers and will incur expenses tor such service For the Royal Oak Studio, Miscellaneous
GeneralOperationsExpensesalso includes subscriptions t o r a w e b b a s e d scheduling ser^ice^
which your Studio will not need to use

13 ^ERITOA" means earnings before interest, taxes, depreciation and amortization

We subtract the total expenses listed in tbe table trom Gross Revenue to calculate ERITOA tor
each Cohered Studio We do not include costs tor interest and other debt service costs, taxes,
depreciation or amortization because they vary considerably depending on the particular
organization and typically are excluded when calculating tbe tree cash flow tromaretail outlets
operation. The Cohered Studios do not pay any royalty to u s , s o we ha^eimputedaroyaltyot
7% ot Gross Revenue and calculated the ERITOA after royalty in the tables

^ ^ ^ ^ ^ ^ ^ ^ o t h e r costsand expensed tbat 0 Y 0 L E 8 A R Studios incurthat are

not included in the expense categories that this tinancialpertormance representation covers
Some ot these costs and expenses include, tor example, Marketing Fees^ training tees, legal
and other professional t e e ^ and interest and otber debt service costs, taxe^^ depreciation and
amortization. You should consider the^e and all other costs and expenses that you will incur
when creatingabusiness plan tor your OYOLERAR Studio

For these and otber reasons, we do not represent tbat you can expect to achieve these
levels ot Gross Revenues, costs or ERITOA. Your results will depend on many factors^ some ot
which include your (and your e m p l o y e e s experience, competition, overall economic conditions^
your skill in managingabusiness,and bow hard you are willing to work

Some outlets ha^e sold tbis amount. Your individual results may differ There is no
a^urance tbat you^ll sell as much.

Other than thepreceding tinancialpertormancerepresentation^ we d o n o t makeany

financial performance representations. We also do not authorize our employees or
^ ^ ^ ^ ^ ^ make any sucb representations either orally or in writing. If you are
purchasing anexi5tingoutlet, however, w e m a y provideyou witbtbeactualrecords of that
outlet. If you receive any other financial performance information or projections ofyour future
income,you should report it to the tranchi^oBs management by contacting Kristian Fliggs,7720
Montgomery Road, Suite 2CC,Oincinnati, Ohio 45236, the EederalTradeOommission, and the
appropriate state regulatory agencies.

ITEM 20 O U T L E T S ANO ERANORISEE INFORMATION

In tbe tables below, we do not own or operate any Studios. Our affiliate, OycleSarRyde
Fark, LLO, operates one Affiliate-Owned Studio. In additions though we have ju5t begun

F^noh^O^o^eOocome^ ^44^ 01/15

E A 5 ^ ^ ^ ^
franchising, we have granted licenses to the Covered Studios to convert their studios, which
were models for our concept, to Studios that use the System and the Marks. These Studios
operate under license agreements that are substantially similar to the Franchise Agreements,
except for the financial terms of the agreement. As a result, we consider these two Studios to be
Franchised Studios in the following tables.

Our fiscal year ends on December 31st of each year.

Table No. 1
Systemwide Studio Summary
For years 2012 to 2014

Studios at Studios at
Studio Type Year the Start of the End of : Net Change
the Year the Year
Franchised 2012 0 0 0
2013 0 0 0
2014 0 2 +2
Affiliate-Owned 2012 0 0 0
2013 0 0 0
2014 0 1 +1
Total Studios 2012 0 0 0
2013 0 0 0
2014 0 3 +3

Table No. 2
Transfers of Studios from Franchisees to New Owners (other than CBF)
For years 2012 to 2014

1 State Year Number of Transfers

=—-—
Total 2012 0
2013 0
2014 0 |

Table No. 3
Status of Franchised Studios
For years 2012 to 2014

Ceased
Studios Reacquired Studios
Studios Non- Operations
State Year at Start Terminations by at End of
Opened Renewals -Other
of Year Franchisor the Year
Reasons

MA(1) 2012 0 0 0 0 0 0 0
2013 0 0 0 0 0 0 0
2014 0 1 0 0 0 0 1

Franchise Disclosure Document -45- 01/15

EAST\87466944.6
 Ceased
Studios Reacquired Studios
Studios Non- Operations
State Year at Start Terminations by at End of
Opened Renewals -Other
of Year Franchisor the Year
Reasons
Ml (2) 2012 0 0 0 0 0 0 0
2013 0 0 0 0 0 0 0
2014 0 1 0 0 0 0 1
Totals 2012 0 0 0 0 0 0 0
2013 0 0 0 0 0 0 0
2014 0 2 0 0 0 0 2

Notes:

1. The Franchised Studio in Wellesley, Massachusetts has been open since 2005, but
converted to the Marks and the System in 2014.

2. The Franchised Studio in Royal Oak, Michigan has been open since 2010, but converted to
the Marks and the System in 2014.

Table No. 4
Status of Affiliate-Owned Studios
For years 2012 to 2014

Studios
Studios at Studios Sold Studios at
Studios Reacquired Studios
State Year Start of to End of the
Opened From Closed
• Year Franchisee Year
Franchisee
Ohio 2012 0 0 0 0 0 0
2013 0 0 0 0 0 0
2014 0 1 0 0 0 1
Totals 2012 0 0 0 0 0 0
2013 0 0 0 0 0 0
2014 0 1 0 0 0 1

Table No. 5
Projected Openings as of December 31, 2014
For following 12 month period

Franchise Projected New Projected New

OtotA
Agreements Signed Franchised Studios Affiliate-Owned
oiaie But Studio Not in the Next Fiscal Studios in the Next
Opened Year Fiscal Year
Florida 0 1 0
Massachusetts 0 1 0

Franchise Disclosure Document -46- 01/15

EAST\87466944.6
 Franchise Projected New Projected New
Agreements Signed Franchised Studios Affiliate-Owned
State But Studio Not in the Next Fiscal Studios in the Next
Opened Year Fiscal Year
Michigan 0 1 0
Ohio 0 1 0
Texas 0 1 0
Total 0 5 0

Current and Former Franchisees. Set forth on Exhibit F are (i) the names of all
current franchisees and the address and telephone number of each of their Studios, and (ii) the
names, city and state, and the current business telephone number, or, if unknown, the last
known home telephone number of every franchisee who had an Studio terminated, cancelled,
not renewed, or otherwise voluntarily or involuntarily ceased to do business under any
Franchise Agreement during the most recently completed fiscal year or who has not
communicated with us within 10 weeks of this Disclosure Document's issuance date.

If you buy this Franchise, your contact information may be disclosed to other buyers
when you leave the franchise system.
Confidentiality Agreements. We have not signed any confidentiality clauses since our
formation.
Trademark-Specific Franchisee Organizations. As of the date of this Disclosure
Document, there are no trademark-specific franchisee organizations associated with
ourfranchise system.
ITEM 21 FINANCIAL STATEMENTS

Attached as Exhibit B to this Disclosure Document is our audited opening balance sheet
as of January 6, 2015. The audited financial statements have been prepared in accordance
with generally accepted United States accounting principles. Our fiscal year ends on December
31.

ITEM 22 CONTRACTS

The following agreements are attached as exhibits to this Disclosure Document:

Franchise Agreement Exhibit A

Payment and Performance Guarantee Appendix C to the Franchise Agreement
Lease Rider Appendix D to the Franchise Agreement
Development Agreement Exhibit B
General Release Exhibit G

Nondisclosure and Noncompete Agreement Exhibit H

State-Required Franchise Agreement Riders Exhibit 1

State-Required Development Agreement Riders Exhibit 1

Franchise Disclosure Document -47- 01/15

EAST\87466944.6
ITEM 23 RECEIPT
Attached as the last two pages of this Disclosure Statement are copies of the Receipt
which you will be required to sign. One signed copy of the Receipt must be returned to us, as
provided on the Receipt.

0 1 / 1 5
Franchise Disclosure Document -48- •
EAST\87466944.6
 EXHIBIT A
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Franchise Agreement

(attached)

Franchise Disclosure Document 01/15

EAST\87466944.6
 FRANCHISE AGREEMENT

between

CYCLEBAR FRANCHISING, LLC

and

CycleBar - Franchise Agreement 01/15

EASTV86749142.5
 T A B L E O F CONTENTS
(continued)

Page
1
RECITALS
Section 1 Rights Granted 2
1.1 Grant of Franchise 2
1.2 Acceptance of License 2
1.3 Limited Territorial Protection 2
1.4 Operating Principal and Key Manager., 2
1.5 Ownership and Guarantee 3
Section 2 Initial Term and Successor Term 3
3
2.1 Initial Term
2.2 Successor Term 3
4
Section 3 Fees
4
3.1 Franchise Fee
4
3.2 Royalty Fee •
5
3.3 Marketing Fee
3.4 Technology Fee 5
5
3.5 Successor Fee
5
3.6 Transfer Fee
5
3.7 Relocation Fee •
5
3.8 Training Fee. -
3.9 Payments of Fees 5
3.10 Methods of Payment 6
6
3.11 Interest; Late Fee
6
3.12 Taxes
Section 4 Site Selection, Development, and Opening of Studio 6
4.1 Site Selection Assistance 6
4.2 Site Selection 6
4.3 Definition of the Territory 7
7
4.4 Site Acquisition
4.5 Site Construction : 7
4.6 Opening Deadline 8
8
4.7 Relocation ;
Section 5 Training and Assistance 8
9
5.1 Initial Training
9
5.2 Opening Advice
5.3 Additional Training 9
5.4 Remedial Training 9
1 0
5.5 Training by You
5.6 Requested Consulting Services 10
5.7 Travel and Living Expenses 10
Section 6 Studio Operation and System Standards 10
1 0
6.1 Manuals
6.2 Management and Personnel 11
1 1
6.3 Operation of the Studio
6.4 Upkeep of the Studio 12
6.5 Refurbishing and Renovations 12

CycleBar - Franchise Agreement 01/15

EAS'n86749142.5
 66 0^5505 12
67 Produce 5 u p ^ e 5 , O p e r ^ 13
66 O^botion 14
6.9 Pa^p^oninSyste^^
Coonci^ 14
6.10 Studio Management andTechnology System 15
6.11 Customer Agreements 15
612 Compliance with Laws and Good Business Practices 15
613 Notice of Proceedings 16
614 Insurance 16
615 Taxes 16
Sections Marketing 16
7.1 Cur Advertising Materials 16
72 Marketing Pund 16
7 3 Local Marketing 16
7.4 Advertising Cooperatives 16
75 Oigital Marketing 19
Sections Records, Reports, Audits, and Inspections 19
61 Bookkeeping and Records 26
6.2 Reports and Pinancial Statements 20
6.3 Additional Intormation 20
64 Inspection 20
65 Auditing 21
66 Mystery Shopper Program 21
Sections Intellectual Property 21
9.1 Marks andTradeOress 21
92 Copyrights 22
93 No Contesting Cur Rights 22
94 Changes to the Intellectual Property 22
95 ThirdPartyChallenges 22
9.6 Post Termination or Expiration 22
9.7 Innovations 22
SectiontO Proprietary Intormation 23
10.1 Receipt ot Proprietary Intormation 23
10 2 Nondisclosure ot Proprietary Intormation 23
10.3 Customer Intormation 23
Sectiontt Indemnification 24
11.1 Indemnification B y Y o u 24
11.2 Indemnification Procedure 24
113 Willful Misconduct or Cross Negligence 25
Section12 Your Covenant Not to Compete 25
121 Ouring Term 25
12.2 AfterTermination,Expiration,orTransfer 26
12.3 PubliclyTraded Corporations 26
12.4 Covenants of Cwners and Employees 26
12.5 Enforcement of Covenants... 26
Section13 Transfer and Assignment 26
131 TransferbyLls 26
13.2 Oefinition ofTransfer 27
13 3 No Transfer Without Cur Consent 27
134 ControlTransfer 27

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 13.5 Non-Control Transfers 29
13.6 Transfer To An Entity 29
13.7 Permitted Transfers 29
13.8 Transfer Upon Death Or Incapacity 30
13.9 Our Right Of First Refusal 30
Section 14 Termination and Default 31
14.1 Events of Default 31
14.2 Our Remedies After An Event of Default 33
14.3 Termination By You 34
Section 15 Your Obligations Upon Expiration or Termination 34
15.1 Payment of Costs and Amounts Due 34
15.2 Discontinue Use of the System and the Intellectual Property 35
15.3 Return of Proprietary Information 35
15.4 Cease Identification with Us 35
15.5 Our Right to Purchase Studio Assets 35
15.6 De-identification of the Site 36
15.7 Reimbursement of Unused Classes 37
15.8 Promote Separate Identity 37
15.9 Comply with Noncompete 37
15.10 Injunctive and Other Relief 37
Section 16 Dispute Resolution and Governing Law 37
16.1 Mandatory Pre-Litigation Mediation 37
16.2 Forum for Litigation 37
16.3 Governing Law 38
16.4 Mutual Waiver of Jury Trial 38
16.5 Mutual Waiver of Punitive Damages 38
16.6 Remedies Not Exclusive 38
16.7 Limitations of Claims 38
16.8 Our Right to Injunctive Relief 38
16.9 Attorneys' Fees and Costs 38
Section 17 Miscellaneous 38
17.1 Entire Agreement 38
17.2 Amendments and Modifications 39
17.3 Waiver 39
17.4 Importance of Timely Performance 39
17.5 Construction 39
17.6 Severability 39
17.7 Applicable State Law Controlling 39
17.8 Survival 39
17.9 Consent 39
17.10 Independent Contractor Relationship 39
17.11 Notices 40
17.12 Execution in Counterparts • 40
17.13 Successors and Assigns 40
17.14 No Third Party Beneficiaries 40
17.15 Additional Terms; Inconsistent Terms 40
Section 18 Your Representations and Acknowledgments 40
18.1 Truth of information 41
18.2 Due Authority 41
18.3 Terrorist Acts 41
18.4 Independent Investigation 41

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EAST\86749142.5
 18.5 Timely Receipt and Review ot Agreement and Disclosure
Document 41
18.6 Financial Pertormance Representations 41

Appendix A- Franchisee-Specific Terms

Appendix B- Marks
Appendix C- Payment and Performance Guarantee
Appendix D- Lease Rider

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EAS'n86749142.5
 OYOLE^AR
F R A N C H ^ E AGREEMENT

T R ^ A G R E E M E N T ^ s ^ A g r e e m e n ^ i s made and e n ^ e d
forth o n A p p e n d i x A o t ^ i s Agreement (the ^ E ^ e c t i v e O a t e ^
and schedules attached to this Agreement are hereby incorporated by this refer^^
G Y G L E R A R E R A N G ^ S I N G , L L G , an Ghio limited liability c o m p a n y ^
business at 7720 Montgomery Road, Suite 200, Gincinnati^Ghio 45236 ( ^ G y c l e R a ^ ^
person or entity identitied on A p p e n d i x A a s the franchisee (^Erancbisee^ with its p ^
place ot business as set torth on AppendixA In this A g r e e m e n t , ^ w e B ^ s B ^ and ^our^ refers
toGycleRar ^ Y o u ^ and ^your^ refers to Eranchisee

RECITALS

A We and our affiliates have accumulated knowledge and experience in the

personal fitness industry on the basis of which we have developed and will continue to develop
adistinctive business format and set ot specifications and operating procedures (collectively,
t h e ^ S y s t e m ^ f o r the operation of personal fitness indoor cycling studios under the service
mark^GYGLERAR" The distinguishing characteristics otthe System include, but are not limited
to,our studio designs (including our tiered custom cycling theater known as CycleTheatre),
layouts, a n d i d e n t i f i c a t i o n s c h e m e s ( c o l l e c ^
equipment, inventory,and accessories; our fitness programs and classes; our website or series
of websitesfor the studios (the ^System W e b s i t e s ; our relationships with vendors; our
software and computer programs; our proprietary in house and online music system
(^CycleReats^); our in house and online customer pertormance database ( ^ C y c l e S t a t ^ ) ; ^
o n l i n e c l a s s b o o k i n g s y s t e m ; t h e a c c u m u l a t e d e x p e r i e n c e r e t l e c t e d i n o u r trainingprogram,
operating procedures, customer service standards methods, and marketing techniques; and the
mandatory and suggested policies, procedures, standards, specifications, rules, and
requirements (^System S t a n d a r d s ) set out in our operations manuals (^Manuals^ and
otherwise in writing. We may change, improve, add to, and further develop the elements of the
System from time to time.

R. We identity the studios operating underthe System by means o f t h e mark

C Y C L E R A R ^ and certain other trademarks, service marks, trade names, signs, associated
designs,artwork,andlogos set forth on A p p e n d i x R ( c o l l e c t i v e l y , t h e ^ M a r k ^ ) Wemay
designate for your use other trade names, service marks, and trademarks as Marks from time to
time. These marks which will also be included in the term the "MarksB

C If you areacorporation, limitedliabilitycompany,partnership,or other entity

(collectively, an ^Entity^), all of
(the ^Cwners^) are listed on Appendix A. It you are an Entity, the individual owner who you
must appoint to have authority over all business decisions related to your business and to have
the powerto bind you in all dealings with us will be referred to as your ^ C p e r a t i n g R r m c ^

C. You desire t o o p e n a n d o p e r a t e a C y c l e R a r studio using theMarks and the

System (a ^Studio^),and we are willing to grant to youalicense to open and operateaStudio
on the terms and conditions of this Agreement.

NCW^ T R E R E E C R E , tor and in consideration o t t h e f o r e g o i n g p r o m i s e s a n d t h e

covenants and agreements contained herein, and for other good and valuable consideration,
the receipt and sufficiency ot which are hereby acknowledged, the parties agree as follows^

15
CycieBarF^ch^e Ag^eme^ t o^
^^^749^5
Sections Rights G r a n ^

11 Grant ot Franchise Ooon the terms and c o l o n s o t ^ s A g ^ e m e ^

grant to youanonexoiusive license (the
theSystem TheStodiowiii be located atasite to be mutuaiiy agreed upon subsequent to
execution ot this Agreement, pursuant to Section42(Site Seiection) (the ^ S i t e ^
area set torth on AppendixA(the d e s e l e c t i o n Area^) You have no right to (i) sublicense
the Marks or the System to any other person or entity, (ii) use the Marks or the System at any
location other than theSite,or (iii) t o u s e t h e M a r k s or theSystem inany w h o l e s a l e
commerce, or other channel ot distribution besides the operation otthe Studio at the Site.

1^2 Acceptance ot License. You hereby accept the Licenseandagreeto

operate the Studio according to the provisions ot this Agreement tor the entire Term, as defined
inSection22(SuccessorTerm)

13 Limited Territorial Protection Gnceyou haveselectedand wehave

acceptedaSite in the Site Selection Area in accordance with Section 4.2 (Site Selection),we
will designate an area within the confines otthe Site Selection Area as your protected territory
(the^Territory^) Except as provided in this Section13, we and our affiliates will not open, or
licenseatbird party to open,aStudio within yourTerritory Except tor the foregoing sentence,
we and our atfiliates have the right to conduct any business activities, under any name, in any
geographic area, and at any location, regardless otthe proximity to or effect on your Studio For
example, without limitation, we have the rightto^

(a) establish or license franchises andtor company owned indoor

cycling studios or other facilities or businesses offering similar or identical products, s e ^
and classes and using the System or elements of the System (i) under the Marks anywhere
outside of theTerritory or (ii) under names,symbols,or marks other than the Marks anywhere,
including inside and outside of the Territory;

(b) sell or offer, or license others to sell or offer, any products,

services, or classes using the Marks or other marks through any alternative distribution
channels, including,without limitation, throughecommerce, in retail stores, via reco^^^
via online videos, or via broadcast media, anywhere, including inside and outside of the
Territory;
(c) advertise, or authorize others to advertise, using the Marks
anywhere,including inside and outside oftheTerritory; and

(d) acquire, be acquired by, or merge with other companies with

existing fitness facilities, fitness businesses, andtor Studios anywhere (including inside or
outside of theTerritory) and, even it such businesses are located in the Territory, (i) convert the
other businesses to the GycleSar name, (ii) permit the other businesses to continue to operate
under another name, andtor (iii) permit the businesses to operate under another name and
convert existing Studios to such other name.

14 GoeratinoFrincioal and l^ev Manaoer lfyouareanEntity,youmust

appointanindividualownerasyourGperating Principal who musthaveautborityoverall
business decisions related to your Studio and must have the power to bind you in all dealings
with us Inaddition, you must appointamanager to manage the daytoday business of your
Studio (the ^ e y Managed) Y o u r G p e ^

1 5
Cyo^Bar F r a n c e Agreemem 2 O^
EA^r^7^^5
we brieve that he or she does not have s ^ Yoor Operating
Prinoipai most have at ieastatO% o w n e r s h i p s
not reqoired to have an ownership interest in yoor Entity Yoor Operating Erinoipai and ^ey
Manager (it known at the time ot signing) shaii be iisted on Appendix^ Yoo most provide os
witb written notice ot yoor Operating Erinoipai and ^eyManager(s) at ieast 60 days prior to
openingandmaynotohange yoor Operating Prinoipaiand^ey Manager withoot oor prior
written approval

t.5 Ownership and Ooarantee.

(a) Owners otEooitv ityooarean Entity, each otyoor Owners most

exeoote the "Payment and Pertormance Ooarantee" that is attached in Appendix 0 (the
^Ouarantee^) By execotingtheOoarantee,eachOwner wiii be boond by the provisions
contained in this Agreement, incioding withoot limitation the restrictions set fort^
(Yoo^Oovenant Notto Compete) Porther, a vioiationot any ottheprovisionsotthis
Agreement, incioding tbe covenants contained in Sectiont^by any Ownerwiiiaisoconstitotea
violation by yoo ot yoor obligations onder this Agreement. Yoo represent that the individuals
executing this Agreement onderthe Ooarantee representthat they are yoor sole owners.

(b) OoverninoOocoments. It yoo are (orTranster this Agreement to)

anEntity, open oor reqoest,yoo agree to tornish os withalistot holders ot direct or indirect
equity interests and their percentage interests, as well as copies of yoor governing docoments
and any other corporate docoments, books, or records, incloding certiticates ot good standing
trom yoor state The Owners may not enter into any shareholders'agreement, management or
operating agreement,votingtrost, or other arrangement that givesathird party the power to
direct and control yoor affairs withoot oor prior written consent. Ooring the Term, yoor
governing docoments most provide that no transfer ofany ownership interest may be made,
except in accordance with Section t3 (Transfer and Assignment) of this Agreement. Any
secoritiesthatyoo issue most bearaconspicooos printed legend to that effect.

Sections InifialTerm and Successor Term.

2t InitialTerm The initialterm (the ^mfialTerm^) otthe License begins on

the Effective Oate and ends ten years trom the date that yoor Studio opens for business (the
^Opening Oafe^), unless this Agreement is terminated sooner as provided in other sections of
this Agreement.

22 Successor Term Opontheexpirationofthe InitialTerm,ifyou (i) are not

in default under this Agreement, (ii) have substantially complied with this Agreement throughout
theTerm, (iii) have timely paid all monies due to us or our affiliates, and (iv) comply w i t h ^
Section 2.2,yoo may, at yoor option,obtain two additional consecotivesoccessor terms often
years each (each,a^SuccesserTerm^) The InitialTerm and Successor Terms are referred
collectively in this Agreement as the^TermB^ You may only exercise this right to obtaina
SuccessorTermby^

(a) giving us written notice of your desire to obtain a successor

License at least six, but no more thant2, months before the expiration otthe thencurrent Initiai
TermorSuccessorTerm;
(b) delivering to usafully executed franchise agreement on our then
current form ottranchiseagreement, which you acknowledge may containtermsmaterially

C y o l e B a r D F r a n o ^ e Agreement 6 0t^5
E A ^ ^ ^ ^ l ^
d i f t e ^ than those c ^
Royalty Fees and Marketing F e e s ^
modiftedTerntory;
(o) refurbishing or renovating the Studio, at yoor expense, to oonform
thedeoo40oiorsohemes,storefront, signage, and presentation of the Marks to ourthenourrent
image and, if necessary, in our sole opinion, to update and repiaoe the equipment, furniture,
signage, and fixtures to meet ourthencurrent specifications;

(d) executingagenerai release,inaform we prescribe,of any and aii

claims against us, our affiliates, our past, present, and future officers, directors, sha
and employees arising out of, or relating to, your Studio;

(e) completing, and having your Operating Principal and ^ey

Manager complete, all of ourthencurrent training requirements, including any additional^
that we may require;
(f) securing the right from your landlord to continue operating at the
Site tor the remainder ot such SuccessorTerm;

(g) substantially and timely complying with each provision ofthis

Agreement or any other agreement with us, our affiliates, or your landlord throughout the Initial
Term and having no Event of Default (as defined in Section t^t(Fvents of Oefault)),or event
which with the giving of notice andtor passage oftime would constitute an Event ot Default, in
existence as otthe expiration of the InitialTerm; and

(h) paying to us the Successor Eee (as defined in Section 3.5

(Successor Eee)).

Sections Eees.
3.t Eranchise Eee. You must pay us an initial franchise fee as set torth on
AppendixA(the^ErancbiseEee^ upon execution of this Agreement The initial Eranchise Eee
is paid in consideration of the rights granted in Sectiont(Rights Granted) and will be deemed
fully earned at the time paid. Youacknowledge that we have no obligation to refund the
Eranchise Eee, in whole or in part, tor any reason.

32 Royalty Eee.

(a) Amountof RovaltvEee You must pay usaroyaltyfee(the

^Royalty Eee^) equal to the greater of (i) 7% ofyour Gross Revenue (as defined in Section
32(b))ofproductsandservicessoldinyourStudioor(ii)theMinimum Royalty The ^Minim^
Royalty^ is currently $250 per week, but it may be increased at the start of any year by no
greaterthan the GRIIncrease(as detined in Section32(c))
(b) Gross Revenue ^Gross Revenues means all revenue that you
receive or otherwise derive from operating the Studio, whether from cash, check, credit or debit
card, gift card or gift certificate, or other credit transactions, and regardless of collection orwh
you actually provide the products or services in exchange for the revenue If you receive any
proceeds from any business interruption insurance applicable to loss of revenue at the Studio,
there shall be added to Gross Revenue an amount equal to the Imputed gross revenue that the

15
c^eaar F ^ ^ A g ^ m ^ 4 o^
EA^^7^^5
i n s u ^ used to c ^ ^ e those ^oceeds Gross Revenue does not inolude^^omotion^
allowanoes or rebates paid to you in oonneotion with your purchase otprod^^^
any bona tide returns and credits that are aotuaiiy provided to customers, and^ii)^
other taxes that you coiiect from customers and pay directiy to the appropriate taxing authors
You may not deduct payment provider tees (ie,bank or credit card company fees and gitt card
^endortees)fromyourGrossRevenuecaicuiation The Royalty Fee is non refundabie and is
paid in consideration otthe ongoing right to use the Marks and the System in accordance with
this Agreement and not in exchange for services rendered by us.

(c) GRi increase Tocaicuiate the "GRIIncrease^ on any amount,

muitipiythatamountbyafraction, the numeratorotwhich isthe inflation index on the f i ^
the year for which the increase is to apply, and the denominator tor which is the intlation index
on January t , 2 0 t 5 or the effective date of the most recent GRi increase, whichever is more
recent. The intlation Index^ means the O S Gity AverageRrice Index tor All Urban
GonsumerstorAli Items (Rase Y e a r t 9 8 2 8 ^ , a s published by the United States Department of
Labor, Rureauot Labor Statistics, or, if such index is discontinued or unavailable, such other
comparable indexforcalculating changes in the cost ot living or purchasing power for
consumers in the United States that we reasonably designate

33 Marketino Fee You must contribute an amount up to 2% of your Gross

Revenue (the ^Mar^etrngFee^ to the
34 TechnoloovFee You must payto us, orathird party that we designate,
atechnology tee tor various technology services that we will provide or arrange tor third parties
to provide, which services are subject to change over time (a ^Technology Fee^ Currently,
the Technology Fee is $900 per month, but we reserve the right to increase the tee periodically
at the start of any calendar year by providing you with written notice of any change at least 30
days priorto the start ot any calendaryear The Technology Fee currently includes fees related
to your access to and usage of CycleStats, GycleReats, our reservation system, our intranet,
any mobile applications wedevelop, and the System Website We may add, delete, or
otherwise modify the products and services tbat are included in the Technology Fee

35 Successor Fee Upon your execution ot a successor franchise

agreement pursuant to Section22(Successor Term),you will payto usasuccessor fee equal
to $t0,000 (the ^Successor Fee^)
35 Transfer Fee It youTransfer (as defined in Section t32(Oefinition of
Transfer)) your Studio or this Agreement, you must pay usaTransfer Fee as specitied in
Sectionst34(b),t35,andt35
37 Relocation Fee Ifyou relocateyourStudiofrom t h e S i t e t o a n e w
location,you will payto usarelocation tee equal to $2,500 (the ^Relocation Fee^)

33 Trainino Fee Upon your execution of this Agreement, you must pay usa
training tee of $t0,000 (the ^Training F e o f f o r up to three ofyour representat
InitialTraining (see Section 5.t(lnitialTraining).
39 FavmentsofFees YourRoyaltyFees, Marketing Fees, andTechnology
Fees (the Operating Fees^) are due to us and must be reported to us at the times and in the
mannerthat we specify trom time to time in the Manuals or otherwise Currently, you must pay
us your Royalty Fees and Marketing Fees weekly within five business days after the end ot

C^eBar F^oo^A^ment 5
8 ^ ^ 7 4 ^ 5
each oa^ndar week, based y ^
your Teohnology Fee within five ^ mother fees and
payments due to us must be paid to us within ten days ofyour receipt of an ^

3^0 Methods of Payment. You must make aii payments to us by the method
or methods that we specify trom time to time in the Manuals, which may include payment via
wire transfer or electronic debit to your bank account You must furnish us and your bank with
all authorizations necessary to effect payment bythe methods we specify We currently
you to make payment by electronic debit from your specified checking or savings account, and
you must complete and sign an Authorization Agreement for Preauthorized Payments for this
purpose You must maintain sufficient funds in your account to permit us to withdraw the
Operating Pees due from time to time You may not, under any circumstances, set oft, deduct or
otherwise withhold any Operating Pees, interest charges, or any other monies payable under
this Agreement on grounds of our alleged nonperformance ofany obligations or for any other
reason. If you fail to timely report your Oross Revenue, or we are othenvise unable to access
your Oross Revenue,we may estimate the amount of fees due and makeacorresponding
withdrawal from your bank account based on our estimate, plus 20% of our estimate Ifwe
underestimate any fees due,you will remain obligated to pay the total amount of fees due,
which,ifwe institute an automaticdebit program, we maydebitfrom your account automatical
It we overestimate any fees due, we will credit the tees paid (without interest) against fees due
in the next payment period atterwe receive accurate records regarding your Oross Revenue

3 tt Interests Late Pee It any payment due to us is not received in full by the
due date, you agree to pay us daily interest on the amount owed, calculated from the due date
until paid, at the rate of t8% per annum (or the maximum rate permitted by law, it less than
t8%) You also agree to pay usalate fee in the amount of $t00 for each week thatapayment
is paid after the applicable due date Tbis late fee is subject to increase upon 60 days'prior
written notice, but will not be increased more than once in any t2 month period You
acknowledge that this S e c t i o n ^ t t i s not our agreement to accept any payments after they are
due and that any late payments areadetault underthis Agreement

3 t2 Taxes You are responsible for all taxes, assessments, and government
charges levied or assessed on you in connection with your business activities underthis
Agreement In addition, as part of the Royalty Pee and Marketing Pee, you will pay to us the
amountof any taxes imposed on usorouraffiliates(and any taxesimposed onus orour
affiliatesasaresultofsuch imposition) byfederal, state, or local taxing authorities
our receipt ofany Royalty Pee or Marketing Pee, not including any tax measured on our income

Sections Site S e l e c t s Oevelopment and Opening ofSfudio

4BI Site Selection Assistance We will provide you with site selection
guidelines, counseling, and assistance that we consider necessary and appropriate, and such
on site evaluation as we consider necessary and appropriate, as part of our evaluation of your
reguestfor acceptance otthe location ofthe Studio pursuantto Section42(Site Selection) We
may provide you withalist of recommended real estate brokers to assist you in locatingasite,
but you are not required to use our recommended providers.
42 Site Seiection You must locateasite in the Site Selection Area that is
reasonably suited tor the conductof the Studio and is consistent with any site selection
guidelines that we may provide Refore entering into any lease or purchase agreement tor the
site, you must submitasite proposal package describing details about the proposed site and

CyoieBar^Frano^se Agreement 6 0t/t5

E A ^ r ^ 7 ^ ^
any other i ^ o r m a ^ ^ You acknowledge that we may refuse to
aooeptaproposed site for any reason It we aooept the proposed site and you obtain it, we will
insert a description ot the specitic location on Schedule t to Appendix A YOO
A C ^ N O W L E O O E ANO A O R E E THAT OOR A O O E P T A N O E O F A P R O P O S E O SITE IS NOT
A W A R R A N T Y O R R E P R E S E N T A T I O N OE ANY ^INO A S TO THE POTENTIAL SOOOESS
O R P R O E I T A R I L I T Y O E Y O O R S T O O I O . IT IS S O L E L Y YOOR RESPONSIBILITY TO
S E L E O T A S O I T A R L E SITE EOR T H E STOOIO. The address listed on S c h e d u l e t , it
completed and signed by us, will be the ^Sife^ referred to in this Agreement A s i t e i s n o t
accepted until you have received our acceptance in writing, as indicated by our delivery otthe
completed and signed S c h e d u l e L

43 Oefinition oftheTerritory Once the Site has been accepted,we will

identity your Territory in S c h e d u l e t t o A p p e n d i x A b a s e d on the factors that we deem relevant,
which might include demographics, t h e c h a r a c t e r o f the Site, and nearby businesses and
residences. Once we have defined theTerritory,youwillhave no further territorial or other
rights in those portions of the Site Selection Areathat are outside theTerritory

4.4 SiteAcouisition. Reforeyou or an affiliate makeabinding commitment to

purchase, lease, or s u b l e a s e a s i t e , w e must accept the location in writing and approve in
writing the proposed lease or purchase agreement or any letter of intent between you and the
thirdparty s e l l e r o r lessor I f y o u or your affiliate l e a s e s t h e S i t e , unless we waivethe
requirement in writing, you must arrange for the execution of the Lease Addendum in the form
of AppendixOby you and your landlord in connection with any lease or sublease for your Site
(^Slfe L e a s e d and any other provisions that we may reasonably require We may require you
to engage an attorney to review your Site Lease or purchase agreement tor the Site that we
have accepted and to supply us with reasonable documentation in connection with such review,
includingalease abstract and confirmation that the terms in the agreement reflect the terms in
any letter of intent between you and the thirdparty seller or lessor You must secureaSite that
w e h a v e a p p r o v e d by s i g n i n g a S i t e Lease or purchase agreement within 90 days after the
Effective Oate We may extend this deadline by 90 days in our sole discretion Youmust
deliver to us the completely executed purchase agreement or Site Lease and Lease Addendum
within tO days after execution of the Site Lease or purchase agreement, and you may not
amend or renew any Site Lease without our written consent. You must comply with the terms
and conditions of your Site Lease. W e a r e not obligated to execute your lease or guaranteea
lease for you.

45 SiteOonstruction

(a) Oesion Phase Wewill make available to you at no c h a r g e a s e t

of prototype plans and specitications^not for construction) for the Studio and for the exterior and
interior design and layout. You must, at your expense, adapt tor the Site our standard plans
and specifications tor the exterior and interior design and layout, fixtures, f u r n i s h ^
Trade Oress, and equipment for the Studio You must submit to us tor our approval architectural
drawings and specifications tor the construction of the Studio showing all leasehold
improvements, interior designs, and elevation
architectural and engineering firms that we approve in writing to develop your Plans and to
assist with the construction ofyour Studio, and we may require you to use only firms that we
havepreapproved. You may not begin construction until we have given you written approval of
t h e P l a n s a n d a p p r o v e d y o u r c h o i c e o f architectural and engineering firms After we have
accepted the final Plans, you may not modity the Plans without our priorwritten consent

CycleBar - Franchise Agreement 7 01/15

EAST\86749142.5
 (b) Permit L i c e n s e and Com^anoe Before beginning any
oonsfruofion, yoo, af yoor expense, most ^
forthe lawfoloonsfroofion and operation of yoor Bfodio Yoo most abide by yoor iandiord'sroies
and goideiines.it is yoor responsibility to ensorefbaf aii Piansoompiywifb tbe Amerioans^
OisabiiitiesAot (tbe "AOA") and similar roies governing pobiioaooornrnodat^^^
disabilities, otber applicable ordinances, boilding codes, permit regoirements, and Lease
regoirements and restrictions. Oor reviewof yoor Plans is limited to ensoring yoor compiiance
witb oor design regoirements and is not designed to assess compliance witb federal, state, or
local laws and regolations or yoor Lease.
(c) Oonstroction Phase. Yoo most provide os with written notice
identifying yoor general contractor and yoo most ensore that the contractor is doly licensed in
yoor jorisdiction and adegoatelyinsored. We most approve yoor general contractor in writing,
and we may regoire yoo to ose general contractors that we havepreapproved. Yoo most notify
os in writing promptly when oonstroction begins and most maintain continooos oonstroction ontil
the Stodio is completed. Yoo agree to complete the oonstroction of yoor Stodio in accordance
with the approved Plans at yoor expense We, oor employees, and oor agents may inspect the
oonstroction at all reasonable times. After completion ot oonstroction, yoo most promptly obtain
acertiticate of occopancy and provideacopy otthe certificate to os.

4.8 Ooenino Oeadline Yoo mostcompleteconstroction of and open yoor

Stodio for bosiness no later than t o d a y s after possession of the Site is delivered to yoo by
yoor landlord and no later than 270 days after the ^
onless wegrant yoo an extension in writing. We reserve theright to regoireyoo pay an
extensionteeof$2,500foreachmonth (or portion otamonth) for which the Opening Oeadline
is extended. Yoo may not open the Stodio ontil yoo bave received oor written approval, which
we will not provide ontil we have viewed the certificate of occopancy and confirmed that yoo
have complied with the Plans Yoo most open the Stodio for bosiness to the pobiic within ten
days from the date we give oor written approval Time is of the essence in constrocting tbe
premises for and opening the Stodio.

4.7 Pelocation. Yoomay not relocate the Stodio withoot oor prior written
consent. Soch approval will not be onreasonably withheld, provided that (i) the new location tor
the Stodio premises is satisfactory to os, (ii) yoor lease, if any, for the new location complies
with oorthen correntregoirements and yoo and yoor landlord execote the Lease Addendom,
(iii)yoo comply with oor thencorrentregoirements tor constrocting and tornishing the new
location, (i^) the new location willnot,asdeterminedin oor sole discretion, materially and
adversely affect theOross Revenoeof any otherStodio, (v) yoo havefolly performed and
complied with each provision of this Agreement within the last three years prior to, and as of, the
date we consent to soch relocation (the ^Reloc^
(ashereindefined),oreventwhich with the giving of notice andtor passage of time woold
constitote an Event of Oetaolt, exists as otthe Pelocation Pegoest Oate, and (vii) yoo have met
all of oorthencorrent training regoirements. If yoor Site Lease expiresor is otherwise
terminated,yoo most secore oor approval of another site and enter intoaSite Lease for tbe new
approved site within 90 days. Yoo agree to pay os the Pelocation Pee opon notifying os of yoor
intent to relocate the Stodio toanew Site, whether or not the new Site is approved We reserve
the right to terminate tbis Agreement it yoo fail to secoreanew approved site within 90 days
after yoo lose the Site Lease.

Sections Training and Assistance

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EAS'A86749142.5
 5.1 ^ ^ T ^ n i n o . P n o r ^ o p e n i n g ^ e S^dio, yoo (oryoorOpo^ing
P n n o ^ if yoo are an Enftty) and yoor ^oy Manager
porsonaiiyaftond and safisfaofohiyoompiofo oor initiai training
Wowiii provide initiaiTraining as soon as praotioabio after tho oxoootion
Agreement at oor offices, oorrentiy in Cincinnati, Chio, or at any other location that we
designate. Correntiy,initiaiTraininginciodes five consecotive days ot training at oor o ^
aStodio in Cincinnati, Chio and, at ieast 50 days iater, five consecotive days of onsite trains
at yoor Stodio, thoogh we reserve the right to modity the iength and location of initiaiTra^
WemaywaiveaportionotinitiaiTraining or aiter the training schedoie if we determine that yoo
ReqoiredTrainees have softicient prior experience ortraining or have previoosiy bee
one ot oor Stodios. Each sobsegoent Operating Principai and ^ey Manager most attend oor
initiaiTrainingoniess we otherwise agree in writing,bot we may permit them to attend i n ^ ^
Training remoteiyviarecorded media,teieconference,videoconference, the internet,webinar,
or any other means, as we determine.

(a) Cost We wiii provide instroctors,faciiities, and materiais torthe

optothreeofyoorrepresentatives(inciodingyoor RegoiredTrainees)fortheTrainingEee,
provided that aii ot yoor trainees are trained doring the same training session if space is
avaiiabie,yoomay bring more than three representatives to initiaiTraining. We reserve the
right to chargeatraining fee ot$t,000,which we may increase opon 50 days^ written notice to
yoo,for^each person in excess of three trainees,(ii) each person who is repeating the coorse
orrepiacingapersonwhodidnotpass, and (iii) each sobsegoent Operating Erincipai,^ey
Manager,orempioyee who attend the coorse.

(b) Comoietion of initiai Trainino if yoor Regoired Trainees are

onabietosoccessfoiiy oompiete, in oor soie discretion, initiaiTraining forany reason, yoor
RegoiredTraineesmostrepeatinitiaiTraining or yoo most send repiacementRegoiredTrainees
to oompiete initiaiTraining Yoor RegoiredTrainees most soooesstoiiy oompiete initiaiTraining
at ieast ten days before the Opening Oeadiine. We wiii not refond any initiai franchise fees paid
by yoo. if yoo and yoor personnel satisfactoriiy oompiete oor initiaiTraining and yoo do not
expressly inform os at the end ot initiaiTraining that yoo teei that yoo or they have not been
adegoateiy trained,thenyooand they wiilbe deemed to havebeen trained sotticientiy to
operateaStodio.

5.2 Opening Advice. PriortoopeningyoorStodio,wewiil advise yoo as to

initial orders ot merchandise and sopplies, development of class schedoies, and local marketing
and networking efforts.

53 AdditionalTrainino We may periodically condoct mandatory or optional

training programs for yoor RegoiredTrainees andtor yoor employees at oor office or another
location that we designate. There will be no charge tor training programs that we regoire yoo or
yoor employees to attend, bot we may charge yoo a reasonablefee for optional training
programs. We may provide additional training in person or via recorded media, teleconference,
videoconference, the Internet, webinar,or any other means, as we determine. We may regoire
yoor RegoiredTrainees or employees to satisfactorily complete any additional training pr^^^
that we specify WemayregoireyoorRegoiredTraineesto participate in refresher or advanced
training in each year of theTerm.

5.4 Remedial Trainino. If, in oorsole jodgment, yoo fail to maintainthe

goality and service standards set forth in the Manoals,we may, in addition to allot oor other
rights andremedies,assigntrainerstotheStodio to retrain Stodio employees and restore

Cyo^Bar Franchise A g ^ e m e ^ 9
E A 5 ^ ^ ^ ^
s e ^ c e ^ v e ^ a n d ^ requii
gaining programs atalocation tbat we d e s i g n s Wemayobargeareasonabletee(oorreo^
$400 per day) tor eaob trainer assigned to yoor Stodio and any rem^ Wemay
increase tbe amoont to be obarged tor eaob trainer opon 60 days^ priorwritten notioe

5.5 Trainino by Yoo. Yoo andtor yoor Operating Prinoipai and yoor ^ey
Managers are responsibie tor training aii of yoor otber empioyees^inoiodingsobseqoent^ey
Managers, inaooordanoewitb oor standards and training programs. Weretertoanyoiass
instrootors tbat soooesstoiiy oompiete oor training programs in aooordanoewitb oor System as
CycleStar mstruotorsB it, in oor soie jodgment, yoo taii to properiy train yoor empioyees in
aooordanoe witb oorstandards, wemay prohibit yoo trom training additional employees and
either regoire them to attend training at oor beadqoarters tor tbe tee described in Section 5^(a)
(InitiaiTraining)) or pay for oor costs and expenses to send one ot oor representatives to train
them at yoor Stodio.

5.5 Reooested Oonsoltino Services We will provide to yoo additional

consolting services with respect to the operation otthe Stodio opon yoor reasonable regoest
and sobject to the availability of oor personnel. We will make available to yoo information aboot
new developments, technigoes, and improvements in the areas of merchandising, advertising,
management, operations, andStodiodesign. W e m a y providesoohadditional consolting
servicesthroogh the distribotion of p r ^
torom, meetings or seminars,teleconferences, webinars, or inperson. If soch services are
rendered inpersonotherthanatoorotfices, yoo most pay osaconsolting fee of $400 tor each
of soch employeesoragentsforeachdayorpartialday services arerendered. Wemay
increase the amoont to be charged for soch regoested consolting services opon 50 days'prior
writtennotice. Soch additional consolting services will be rendered atamotoally convenient
time.

57 Travel and Livino Expenses Yoo are responsible for any travel and living
expenses (incloding meals, transportation, and accommodations), wages, and otber expenses
incorred by yoor trainees Yoo are responsibie tor reimborsingos for any travel and living
expenses incorred by oor employeesoragentsrelatedto providing any additional training,
remedial training, or consolting services at yoor Stodio.

Sections Studio Operation and System Standards

5.t Manoals.

(a) Oompliance with the Manoals We will fornish yoo with electronic
accessto oor Manoals, on ioanfor as long as this Agreementorasoccessor franchise
agreement remains in effect. We reserve the right to fornish all or part of the Manoals to yoo in
electronic form and to establish termsof ose for access to any restricted portion otoorwebsite
Yoo most comply with and abide by each regoired System Standard contained in the Manoals,
as they may be amended, modified, or sopplementedperiodically and soch other written or
electronically transmitted System Standards that we may issoe periodically Yoo acknowledge
that we may amend, modify, or sopplement the Manoals at any time, so long as soch
amendments, modifications, or sopplements will, in oor good faith opinion, benefit os and oor
existing and fotore tranchisees or will otherwise improve the System Yoo most comply with
revised mandatory System Standardswithin^Odaysafterwetransmlttbeopdates, onless
otherwise specified.

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EASTV86749142.5
 (b) UseottbeMaooa^ Yoo agree to keep yoor copy of the Manors
op-tomato. Ifthereisanydispoteastotheoorrentoonte^oftheManoa^thetermsofoor
master oopy maintained at oor headqoartersw^oootrol Yooaoknowiedgethatweownthe
copyright in the Manoais and that yoor oopy ot the Manoais remains oor property a n d ^
retorned to os immediately opon expiration or termination of this Agreement Yoo wiii treat the
Manoals, and the information contained therein, as confidential and wiii maintain the
confidentiaiity ot soch information. Yoo will not, withoot oor prior written consent, copy,
dopiicate, record, ose, or otherwise reprodoce in any way the Manoais, in whole or in part, or
otherwisemake their contents available to any onaothorizedperson,except as provided in
SectiontO(Proprietary information)

6.2 Manaoement and Personnel.

(a) Stodio Manaoement. Unless otherwise specified in the Manoals,

at all times that yoor Stodio is open for bosiness,it most be onderthe personal,onpremises
sopervision of either yoo,yoor Operating Principal,yoor l^ey Manager, oratrained attendant
Yoor ^ey Manager or another trained manager most be available at all times the Stodio is open
for bosiness. Yoo may not permit yoor Stodio to be operated, managed, directed, or controlled
by any other person or entity withoot oor prior written consent.

(b) Pmolovment Decisions and Policies. Yoo are solely responsibie

for aillabor and employmentrelatedmatters and decisions related toyoor Stodio, incioding
hiring,firing, promoting, demoting, and compensating(inclodingthroogh wages, bonoses,or
benefits) yoor employees. Yoo most ensore that yoor employees are qoaiitied to perform their
doties in accordance with oor System and standards We do not regoire yoo to implement any
empioyment related policies or procedores or secority related policies or procedores that we (at
oor option) may make available to yoo in the Manoals or otherwise for yoor optional ose. Yoo
shall determine to what extent, if any,these policies and procedores may be applicable to yoor
operations at the Stodio.

(c) Peolacement^ev Manager, it yoor l^ey Manager ceases to be

employed by yoo at the Stodio,yoo most bireanew^eyManager,and have them soccessfolly
complete InitialTraining,within 60 days after yoor former ^ey Manager's employment at the
Stodio ends it yoo are onable to immediately appoint and traina^eyManager,wemay,in oor
solediscretion, providea^ey Manager towork at yoorStodiotemporariiyontilanew^ey
Manager is appointed and trained. In soch instances yoo will pay to os oor actoal costs and
expenses tor soch temporary l^ey Manager so assigned to the Stodio, incloding, withoot
limitation, soch ^ey Manager's salary and traveland livingexpenses Inaddition, wemay
charge yooareasonable tee for this service.

(d) Temporary OvcleStar Instrootors We may provide, in oor sole

discretion and opon yoor regoest,OycleStar instrootors to teach classes at yoor Stodio o n a
temporary basis. If we provide yoo withatemporaryOycleStarinstroctor, yoo most pay o s a
reasonable fee, as listed in the Manoal, and pay tor soch CycleStar instrootors travel and living
expenses.

66 Operation of the Stodio. Yoo will not ose the Site tor any porpose other
than the operation otthe Stodio in compliance witb the System and the Manoals. Yoo will not
lease^soblease,or assign the Site Lease for all or any portion of the Site,withoot oor prior
written consent. Yoomay not offer or allow others to offer classes at the Stodio otber than
OycleSar indoor cycling classes taoght by OycleStar instrootors. Yoo, yoor Owners, and yoor

1 5
C ^ e B a r F ^ o c ^ e Agreemem tt O^
E A 5 ^ ^ ^ 5
a b a t e s may not provide tanning s o ^ o o s ,
any other heaith-reiated servioes to yoor Stodios oostomers (whether those services are
provided at the Stodio or any other iooation) Yoo, yoor Owners, and yoor aftiiiates may not
operate any retail location providing any prodoots or services that are anoiiiary to the Stodio's
bosiness to costomers (soch as, for exampie,ajoice or smoothie bar) frornaiocation at or near
the Site. Yoo most keep the Stodio open for bosiness to the pobiic at least doring the hoors we
prescribe trom time to time in the Manoals or otherwise approve, onless prohibited by applicable
law or by the Site Lease (it any) tor the Stodio premises. OoringtheTerm,yoo agree to hold
yoorseitoot to the pobiic as an independent contractor operating yoor Stodio onder license trom
os, and yoo most display notices in a manner that we may specify that yoor Stodio is
independently owned and operated in tbe Stodio and on forms, advertising, sopplies, employee
oniforms, bosiness cards, and other materials we designate.

64 Upkeep of the Stodio Yoo most keep the exterior (incloding parking lot)
and interior of yoor Stodio and all fixtores,tornishings, signs, and egoipment (the ^Operating
A s s e t s ) in the highest degree of cleanliness, orderliness, sanitation, and repair in accordance
with the Manoais. Yoo most place or display at the Site (interior and exterior) only those signs,
emblems, designs, artwork, lettering, logos and display and advertising materials that we
periodically regoire or aothorize Yoo may not make any material alteration, addition,
replacement, orimprovementtoyoorStodio, incloding its Operating Assets,withoot oor prior
written consent.

6.5 Reforbishing and Renovations. Yoo agree to take,withoot limitation,the

following actions doring the Term at yoor expensed (i)thoroogh cleaning, repainting and
redecorating o f t h e interiorand exteriorof theStodio at intervals thatwe may periodically
designate and at oor direction; (ii) interior and exterior repair otthe Stodio as needed; and (iii)
repair or replacement, at oor direction, ot damaged, worn oot or obsolete Operating Assets at
intervals that we may periodically specify (or, if we do not specify an interval for replacing any
item, as that itemneeds to be repaired or replaced) Uponoorwrittenregoest,yoomost
reforbish the Stodio at yoor expense to conform the decor, Trade Dress, color schemes,
signage, and presentationof the M a r k s t o o o r t h e n c o r r e n t image Soch reforbishing may
include, as we deem necessary, remodeling, redecoration, and other modifications to existing
improvements andopdating or replacing any Operating Assets. Yooacknowledgethatthis
obligation coold resolt in yoor making extensive stroctoral changes to, and significantly
remodeling and renovating,the Stodio,and^or in yoor spending sobstantial amoonts tor new
OperatingAssets, andyoo agreeto incor,withoot limitation,any capital expenditores regoired in
order to comply with this obligation and oor regoirements (even if those expenditores cannot be
amortizedovertheremainingTerm). Within 66 days after receiving written notice from os
most have plans prepared according to the System Standards we prescribe and, if we regoire,
osing architects and contractors we approve, and yoomostsobmit those plans to os tor oor
approval. Yoo most complete all work according to the plans we approve within the time period
that we reasonably specify.

6.6 Classes. Yoo most condoct all classes in accordance with the System
and onder tbe leadership ofatrainedOycleStarinstroctor Yoo most offer at the Stodio any
classes or programs that we deem to be mandatory. Any classes that yoo or yoor CycleStar
instrootors develop most be consistent with the System Standards that we specify from time to
time. Yoo may ose in the classes only the mosic that we have approved and provided throogh
OycieReats. i f w e d i s a p p r o v e o f any class or program that yoo otter,yoo most immediately
discontinoe offering the class or modify the class in accordance with oor instroctions.

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EAST\86749142.5
 6.7 P r o d 0 C t 5 B S 0 P O ^ 5 . O o e ^ n 0 A 5 5 e ^ a n d S e ^ C e ^

^ Porchases. We have the nght to require that prodoct 5 0 ^ 1 ^

Operating Assets and services that yoo ^
Stodio^i) meet speoitioations that we establish trom time to t ^ ^
or model; (iii) be purchased or leased oniy trom suppliers or servioe providers that we have
expressly approved; andtor (iv) bepurchasedorleasedonlytromasinglesoorcethatwe
designate (which may include us or our aftiiiatesorabuying cooperative organized by us or ou^
attiliates). Totheextentthatweestablishspecitications, require approval ot suppliers or service
providers, or designate specific suppliers or service providers tor particular items or services, we
will publish our requirements in the Manuals.

(b) Products and Services You Mav Otter. You mayotter inthe
Studio tocustomersonly the products and services that we haveapproved in writing, in
addition, you must otter the specitic products and services that we require in the Manuals or
otherwise in writing. We may change these specifications periodically, and we may designate
specitic products or services as optional or mandatory. You must offer all products or services
that wedesignate as mandatory. You may sell productsoniy in the varieties, forms, and
packagesthatwehaveapproved.You must maintainasufficient supply ot required products to
meet the inventory standards we prescribe in the Manuals (or to meet reasonably anticipated
customer demand, if we have not prescribed specific standards)

(c) Revenue trom Purchases. You acknowledge and agree that we

andtor our atfiliates may derive revenue based on your purchases and leases, including from
charging you tor products and services we or our affiliates provide to you and trom promotional
allowances,volume discounts,and other payments made to us by suppliers andtor distributors
that we designate or approve for some or allot our tranchisees. We and our affiliates may use
all amounts received from suppliers andtor distributors, whether or not based on your or other
franchisees'actual or prospective dealings with them, without restriction for any purposes we or
our affiliates deem appropriate.

(d) Approval Process. If you would like to offer products or use any
supplies, Operating Assets, or services that we have not approved or to purchase or lease from
asupplierorservice providerthatwe have notapproved,you must submitawritten request tor
approval and provide us with any intormation that we request. We have the rigbt to inspect the
proposed supplier's facilities and test samples of the proposed products and to evaluate the
proposed service provider and the proposed service offerings. You agreetopayusacharge
not to exceed the reasonable cost of the inspection and our actual cost ot testing the proposed
product or evaluating the proposed service or service provider, including personnel and travel
costs, whether or not the item, service, supplier, or service provider is approved. We have the
right to grant, deny, orrevokeapprovalof products, services, suppliers, or service providers
based solely on our judgment. We will notify you in writing of ourdecision as soon as
practicable following our evaluation, if you do not receive our approval within 96 days after
submitting all otthe information thatwe request, ourfailureto respond will bedeemed a
disapproval otthe request. You acknowledge that the products and services that we approve
tor you to offer in your Studio may differ from those that we permit or require to be offered in
other Studios.

(e) Pevocationot Aooroval. Wereservetherighttoreinspectthe

facilities and products of any approved supplier and to reevaluate the services provided by any
service provider at and to revoke approval of the item, service, supplier, or service provider it

Oy^Bar F^ch^eAg^me^ t6 0t^5

^^^749^5
anyta^o meet any ot our thenoo^ento^en^ It you reoeiveanotioeot revocation ot approval
you agree to oease purchasing or leasing the formerly^approved item or servioe or a
services trom the formeriy^approved supplier or service provider and you must dispose ot your
remaininginventoryottheformerlyapproved items and services as we direct, it we revoke
approval otapreviouslyapproved product that you have been selling to customers or service
that you have been ottering to customers, you must immediately discontinue ottering the service
and may continue to sell theproduct only trom your existing inventory tor upto 30days
tollowing ourdisapproval Wehave the right toshorten this period it, inouropinion,the
continued saieof the product would provedetrimental toour reputation. Atterthe^Oday
period,or suchshorter period that we may designate,youmust dispose of your remaining
tormerly approved inventory as we direct.

66 Distribution. You may not make any sales ot products or services outside
ottheStudio,conductclasses outside otthe Studio, or use vendor relationships tbat you
establish through your association with us or the CycleBar brand for any other purpose besides
the operationof theStudio, unless we consent in writing. You agree to purchase products
solely forresaletoretailcustomers, and nottor resale or redistribution toany other party,
including other CycleBar franchisees. You may not otter products or services in connection with
the Marks on any website on the Internet or any other electronic communication network unless
we consent in writing.

6.9 Particioation in System wide Proorams^ Conferences^ and Councils.

(a) Promotional Proorams. You must participate in ail in Studio

promotional programs that we offer to franchisees. You will follow our guidelines concerning the
acceptance and reimbursement ot gift certificates, gift cards, coupons, corporate discounts, and
other promotional programs as we set forth trom time to time in the Manuals or otherwise in
writing You will not allow use of gift certificates, gift cards, or coupons (including Croupons and
similar discounts) unless approved or offered by us or our affiliates.

(b) Conferences. You, your Operating Principal, your l^ey Managers,

or any of your representatives that we designate must attend franchise conventions, meetings,
product shows or demonstrations, and teleconferences that we may require periodically in the
Manuals or otherwise in writing. We, in our sole discretion, will designate the time and place of
anymeetings,which may be held in person or remotely via teleconference or web seminar. In
each year, you and your employees shall not be required to attend in person more than three
days of franchisee conventions and meetings that we organize, which shall count towards the
five days of additional training programs that we may require your PequiredTrainees to attend
annually We will be responsible for arranging meetings and providing meeting materials You
are responsibie for arranging and paying for travel and living expenses tbat you andtor your
representatives incur. We mayrequireyou to pay usareasonable registration fee for you and
each of your representatives.

(c) Pranchisee Advisory Council. We may establish an advisory

counciloffranchisees^PrancbiseeAdviseryCeunci^usingaform and process set forth in
the Manuals to advise us on various issues and strategies. The Pranchisee Advisory Council
will have an advisory role, but no operational or decisionmaking power. We may change the
structure and process of the Pranchisee Advisory Council or dissolve the Pranchisee Advisory
Council at any time, if we establishaPranchisee Advisory Council,you must participate in all
council related activities and meetings and must pay any dues related to the administration ot
the Pranchisee Advisory Council.

C ^ e O ^ F ^ n o h ^ e Agreemem t4 0t/t5
EA5^^7^^5
 610 Studio M a n a o e m e ^ a n d T e c h o o ^ v S ^ e m .

(^ Aoqu^tionandOodatos You must obtain maintain and uso tho

hardware s o t t w a r ^ o t h o r o q u ^
tho Manuals nooossary to oporato tho OyoioStatstoohnoiogypiatform^ the
system, tho point ot sale system, tho customer relationship management system, and th^
reservation system (oolleotively, the studio Management and Teoh^^ You
must use the Studio Management andTechnology System t o ^ e n t e r and track purchase
orders and receipts, classes and attendance, and customer intormation, (ii) update inventory,
(iii)enter and manage your customer's contact information,(iv) generate sales reports and
analysis relating to the Studio, and (iv) provide other services relating to the operate
Studio, it we require you to use any proprietary software or to purchase any software troma
designated vendor, you must execute and pay any tees associated with any software license
agreements or any related softwaremaintenance agreements that we or thelicensor of the
software require You must replace, upgrade, or update at your expense the Studio
Management andTechnology System aswe may require periodically without limitation Wewill
establish reasonable deadlines for implementation of any changes to our Studio Management
andTechnology System requirements

(b) Ose otthe Studio ManaoementandTechnoloov Svstem You

agreed (i) that your Studio Management andTechnology System will be dedicated for business
uses relating to the operation of the Studio; (ii) to use the Studio Management andTechnology
System in accordance with our policies and operational procedures; (iii) to transmit financial and
operating data to us as required by the Manuals;(iv) to do all things necessary to give us
unrestrictedaccesstotheStudio Management andTechnology System at all times (including
users lOs and passwords, if necessary) so that we may independently download and transfer
data viaamodem or other connection that we specify; (v) to maintain the Studio Management
andTechnology System in good working order at your own expense; (vi) to ensure that your
employeesareadequately trained in the useof theStudio ManagementandTechnology
System and our related policies and procedures; and (vii) not to load or permit any unauthorized
programsorgameson any hardware included inthe Studio ManagementandTechnology
System. You also must comply with all laws and payment card provider standards relating to the
security otthe Studio Management andTechnology System, including, without limitation, the
Payment Card Industry Oata Security Standards You are responsible for any and all
consequences that may arise if the system is not properly operated, maintained and upgraded
or if the Studio Management andTechnology System (or any of its components) tails to operate
onacontinuous basis or as we or you expect.

6 tt Customer Aoreements You must ensure that every customer agreement

and waiver you use complies witb all of our requirements and all applicable laws, rules, and
regulations of anygovernmentalauthoritywith jurisdiction over the Studio. You must send us
copies of all customer agreements and waivers you intend to use at least thirty (60) days before
you begin using such documents.
612 Comoliance with Laws and Cood Business Practices You must comply
witb all applicable federal, state, and local laws, rules, regulations, and ordinances You will
obtain and maintain in good standing any and all licenses, permits, and consents necessary tor
you to lawfully operate the Studio You have sole responsibility for such compliance despite any
intbrmationor advice that we may provide You must in all dealings withyour members,
prospective members, suppliers, us and the public adhere to the highest standards of honesty,
integrity, fair dealing and ethical conduct. You agree to refrain from any business or advertising

1
cy^eBar F^c^eA^eeme^ 15 o^ ^
8A5^7^25
pra^oe whioh might
Stodios
5^3 Notion of Prooeodioos. Yoo wiii notify os in writing within tivo days aftor
tho oommonoomont ofany aotion, soit or prooooding, orof tho issoanooof any ingoiry,
sobpoona,ordo4writ,injonotion,award,ordoorooofanyooort,agonoy,orothorgovornmontai
instromontaiity in oonnootion with tho operation or finanoiai condition of tho Stodio, inoi^^^
withootiimitationanyoriminaiaotionorproooodingbrooghtbyyoo against anyompioyoo,
oostomor, or other person, bot oxoiodingoivii proceedings against oostornors to ooiioot monies
owed.
6^4 insorance Doring theTerm yoo most maintain inforceatyoorsoie
expense the insorance coverage for the Stodio in the amoonts, covering the risks, and
containing oniy the exceptions and exciosions that we periodicaiiy specify in the Manoais for aii
simiiariy sitoated Stodios Aii of yoor insorance carriers most be ratedAor higher b y A M S e s t
and Company, inc (or soch similar criteria as we periodicaiiy specify) These insorance p o ^
most be in effect on or before the deadlines we specify All coverage most be on an
"occorrence" basis, except for the employment practices liability insorance coverage, which is
ona^claims made" basis All policies shall apply onaprimary and noncontribotory basis to
any other insorance or self-insorance that we or oor atfiliates maintain. All general liability and
workers compensation coverage most provide for waiver of sobrogation in favor of os and oor
affiliates. We may, opon at least 60 days'notice to yoo, periodically increase the amoonts of
coverage regoired andtor regoire different or additional insorance coverage at any time to reflect
intlation, identificationof newrisks, changesin law or standardsof iiability, higher damage
awards or other relevant changes in circomstances. All insorance policies most name os and
any affiliates we designate as an additional insored and provide for 60 days^ prior written notice
to osofapolicy's material modification or cancellation Yoo agree periodically to send o s a
valid certiticate of insorance or doplicate insorance policy evidencing that yoo have maintained
the regoired coverage and paid the applicable premioms. If yoo tail to obtain or maintain (or to
prove that yoo have obtained or maintained) the insorance we specify, in addition to oor other
remedies, we may (bot need not) obtain soch insorance for yoo and the Stodio on yoor behalf,
in whicheventyooshall cooperate with osandreimborseostorallpremioms,costsand
expenses we inoor in obtaining and maintaining the insorance and pay osareasonable fee for
soch service.
6.t6 Taxes. Yoo will pay when doe all taxes, assessments, and governmental
charges opon or against yoo or yoor real or personal properties, income, andrevenoes;
provided that no soch tax, assessment, or governmental charge need be paid so long as the
validity, applicability, or amoont thereof is being contested in good faith by appropriate
proceedings and appropriate reserves are maintained to pay the dispotedamoont, if necessary

Sections Marketing

7t Cor Advertising Materials We may periodically tormolate, develop,

prodoce, and condoct, at oor sole discretion, advertising or promotional programs in soch form
and media as we determine to be most effective We may make available to yoo for yoo to
porchase approved advertising and promotional materials, incloding signs, posters, collaterals,
etc that we have prepared We oroor affiliates wiilretain all copyrights relating to soch
advertisingmaterials.

7.2 Marketino Fond.

c^aar F ^ o ^ A g ^ e m ^ t6
E A ^ ^ ^ i ^
 ^ FundManaoemenL W e m a ^ b o t a r e n o t o b ^ ^ e d ^ e s t a b ^ h
the Mark^ogFoo^asegregated or independent fond into
paid, innoeventwiiiwebedeemedatidooiary^^
or administer. We are not required to have an independent audit ofthe Marketing Fund
oompieted. We wiii prepare an unaudited statement ot contributions and expenditures tor the
Marketing Fund and make it avaiiabie within 80 daysattertheoiose of ourtisoai year to
franchisees that makeawritten request foraoopy. if any monies in the Marketing Fund remain
at the end ofafiscai year, they wiii carry-over in the Marketing Fund into the next fiscai year.
We or one of our attiiiates may make or otherwise arrange ioans to the Marketing Fund in any
year in whioh the balance of the Marketing Fund is negative and chargeareasonabie rate ot
interest. The amounts loaned to the Marketing Fund wiii be repaid from future contributions to
the Marketing Fund in the year the loan is made or in subsequent years.

(b) Useof Marketino Fund. We may use monies in theMarketing

Fund and any earnings on the Marketing Fund account tor any costs associated with advertising
(media and production), branding, marketing, public relations andtor promotional programs and
materials, and any other activities we believe would benefit the CycleBar brand or the Studios
generally, including advertising campaigns in various media; creation, maintenance, and
optimization of the System Website or otber websites; keyword or adword purchasing programs;
conducting and managing social media activities; direct mail advertising; market research,
inciuding, without limitation, secret shoppers and customer satisfaction surveys; branding
studies; employing advertising andtor public relations agencies; purchasing promotional items;
conducting and administering promotions, contests, giveaways, public relationsevents, and
community involvement activities; and providing promotional and other marketing materials and
services toour tranchisees. Wewill not usethe Marketing Fundtoranything whosesole
purpose is the marketing ot franchises,bowever,you acknowledge that the System Website,
public relations activities, community involvement activities, and other activities s
Marketing Fund may contain information about franchising opportunities. We will not use any
contributions to the Marketing Fund to defray our general operating expenses, except for
reasonable administrative costs and overhead we incur in activities reasonably related to the
administration of the Marketing Fund or the management of Marketing Fund supported
programs (including the prorataamount ot salaries ot our personnel whodevote time to
Marketing Fund activities and retainers and tees for outside agencies). We may use monies in
the Marketing Fund to pay for an independent audit of the Marketing Fund, it we elect to have it
audited. We do not guarantee that you will benefit from the Marketing Fund in proportion to
your contributions to the Marketing Fund.

(c) Control Over Marketino Fund. We may consult with, in our sole
discretion,afranchiseeadvisorycouncil selected by franchisees oracommittee of franchisees
that we appoint regarding marketing programs. Flowever, we have the right to direct all
marketing programsand usesof the Marketing Fund, with thefinaldecision overcreative
concepts, materials, and media used in the programs and their placement

(d) Materials Froduced. Any sales and other materials produced with
Marketing Fund monies will be made available to you without charge or atareasonable cost.
The proceeds ofsuch saies will also be deposited into the Marketing Fund.

(e) Cther Contributions. It we or our affiliates operate any Studios,

we or our affiliates will contribute to the Marketing Fundapercentage otthe receipts of those
Studios, on thesamebasisasrequired for tranchisees. if wereducetheMarketing Fund
contribution rate for trancbisees,we will reduce the contribution rate tor company or a f f i ^ ^

C y ^ e B a ^ F r a o o h ^ e Agreement t7 01/15
^ 5 ^ 7 4 ^ 5
owned Stodios by the same amount Yoo aoknowledge that oor other franohisees may not be
required to oontribote to the Marketing Fond, may be required to oontribote to the Marketing
Fond ataditterent rate than yoo,or may be reqoired to oontribotetoaditterent m a r k e d

7.3 Looai Marketing.

(a) Looai Marketino Reooirements. Yoo most participate in sooh

advertising, promotionai, and oommonityootreaoh programs that we may speoity trom time to
time, at yoor own expense. Yoo most ose yoor best ettorts to promote the ose otthe Marks in
yoorTerritory. You must ensure that aii ot your advertising,marketing,promotional,customer
reiationship management, pubiic relations and other brand related programs and materials that
you or your agents or representatives develop or implement relating to the Studio is completely
clear, tactual and not misleading, complies with all applicable laws and regulations, and
contorms to the highest ethical standards and the advertising and marketing policies that we
periodically specity. Any media advertising or direct mail marketing that you conduct must be
predominantly tocused within your Territory, unless we agree otherwise There are no
territorial restrictions trom accepting bosiness trom retail costomers that resideorwork or
are otherwise based ootside otyoorTerritoryitthese costomers contact yoo,bot we reserve
the right to implement roles and restrictions regarding soliciting soch costomers in the foto^^
oor Manoals or otherwise in writing.

(b) AoorovalotAdvertisino Materials. Yoo most obtain oor advance

written approval prior to osing or prodocing any advertising or marketing materials osing any ot
the Marks,in whole or in part. Yoo agree to condoct all advertising inadignitied manner and to
contorm to the standards and reqoirements we specity in tbe Manoals We will have the final
decision on all creative development ot advertising and promotional messages. It oor written
approval is not received withint^days trom the date we received the material,the material is
deemed disapproved. We reserve the rightto reqoire yoo todiscontinoe the use of any
advertising or marketing materials.

(c) MinimumMarketinoFxoenditore. Yoo most spend at least $500

per month on local advertising and promotional activities (the ^Marketing Spending
Requirements Yoor Marketing Spending Reqoirement is in addition to yoor Marketing Fee
We have the right to designate in the Manoals the typeset expenditores that will or will not
count toward the Marketing Spending Requirement At our request, you must submit
appropriate documentation to verify compliance with the Marketing Spending Requirement, if
you tail to spend (or prove that you spent) the Marketing Spending Requirement in any month,
then we may, in addition to and withoot limiting oor other rights and remedies, reqoire you to
pay os the shortfall as an additional Marketing Fee or to pay os the shortfall for os to spend on
local marketing for your Stodio.

(d) Grand Ooenino Advertising, in connection with the opening of tbe

Stodio, yoo most spendaminimumot $25,000 for grand opening advertising and promotion in
tbefoor weeks prior to opening theStodio and thefoor weeks afteropeningtheStodioin
accordancewithaplanthatyoomostsobmittoos. We have the right to modify yoor grand
opening plan,in oor soie discretion,and may reqoire yoo to oseapublic relations firm to assist
with yoor grand opening. No amoont paid by yoo tor yoor grand opening will be credited toward
the MarketingSpending Reqoirement. You mostprovideoswithsopportingdocomentation
evidencing these expenditores opon reqoest.

CycleBar - Franchise Agreement 18 01/15

EAST\86749142.5
 74 Advertising Cooperatives. You agree to join and actively participate in
any organizations or associations of franchisees or advertising cooperatives that we establish or
approve for the purpose of promoting, coordinating, and purchasing advertising in local,
regional or national areas where there are multiple Studios ("Advertising Cooperatives") and
to abide by the bylaws, rules, and regulations duly required by the Advertising Cooperative,
which we have the right to mandate or approve. If you join an Advertising Cooperative, the
Advertising Cooperative may require you to spend additional funds on marketing programs
conducted by the Advertising Cooperative, which may be in addition to your Marketing Fee or
Marketing Spending Requirement. We shall have the right to approve any marketing materials
or marketing programs developed by any Advertising Cooperative in the same manner as
specified in Section 7.3(b) (Approval of Advertising Materials).

7.5 Digital Marketing.

(a) Restrictions. We or our affiliates may, in our sole discretion,
establish and operate websites, social media accounts (such as Facebook, Twitter, Instagram,
Pinterest, etc.), applications, keyword or adword purchasing programs, accounts with websites
featuring gift certificates or discounted coupons (such as Groupon, Living Social, etc.), mobile
applications, or other means of digital advertising on the Internet or any electronic
communications network (collectively, "Digital Marketing") that are intended to promote the
Marks your Studio and the entire network of Studios. We will have the sole right to control all
aspects of any Digital Marketing, including those related to your Studio. Unless we consent
otherwise in writing, you and your employees may not, directly or indirectly, conduct or be
involved in any Digital Marketing that use the Marks or that relate to the Studio or the network.
If we do permit you or your employees to conduct any Digital Marketing, you or your employees
must comply with any policies, standards, guidelines, or content requirements that we establish
periodically and must immediately modify or delete any Digital Marketing that we determine, in
our sole discretion, is not compliant with such policies, standards, guidelines, or requirements.
We may withdraw our approval for any Digital Marketing at any time.
(b) Svstem Website. As part of our Digital Marketing, we or one of
our designees will operate and maintain a System Website, which will include basic information
related to the Studio, the ability for customers to purchase classes at your Studio, and access
to the Studio's reservation system. You must promptly provide us with any information that we
request regarding your Studio for inclusion on the System Website.
(c) Daily Deals. As part of our Digital Marketing, we or our affiliates
have the right, but not the obligation to, offer daily deals or other discounted class promotions,
coupons vouchers, or gift certificates on third party websites or apps, such as, without
limitation, Groupon and Living Social, or other similar promotions designed to drive new
customers to Studios ("Deals"). If we or our affiliates offer any Deals, we and our affiliates
have the right to collect and retain any revenue from such Deals, including any customer
payments to such third parties, and to use all such amounts we and they receive without
restriction for any purposes. You must provide classes or other products or services to any
customers redeeming any vouchers, gift certificates, or coupons related to such Deals in
accordance with the standards and other terms that we periodically specify. Except as we
otherwise approve, you must treat customers who purchase Deals in the same manner as any
other customer and must not limit their access to your Studio or classes. You will not be entitled
to receive any payment or reimbursement from us, our affiliates, customers who purchase
Deals, or third parties for any classes, products, or services that you provide to customers who
purchase Deals.

0 1 / 1 5
CycleBar - Franchise Agreement 19
EAST\86749142.5
SectionO Records R e p o ^ Audits and Inspe^ions

81 Bookkeeoioo and Records You agree to keep compete and accurate

books, records, and accounts ot abusiness conducted under this Agreement in accordance
with general accepted accounting principles. You must preserve allot your books and records
In hard copy or inatormat from which hard copies can be readily generated tor at least tive
years trom the date ot preparation or such longer period as may be required by law. Youmust
maintain such intormation and records on the Studio Management andTechnology System as
we may require from time to time in the Manuals and you acknowledge and agree that we will
have access to that data remotely viaanetwork connection that we will specify. At our request,
you must retain and use, at your expense, the services of an accountant or accounting firm that
we approve.
82 Reports and Financial Statements You agree to submit financial and
operational reports and records to us at the times and in the manner specitied in the Manuals
Oponourwrittenrequest, byAprilt5 ot each year,you must submit your balance sheet and
incomestatementforthe previous calendaryear Withrespecttoyouryearendincome
statement and balance sheet, you or theOperating Rrincipal mustcertify that the income
statement and balance sheet are correct and complete and that they have been prepared in
accordance with generally accepted accounting principles. We have the rightto demand
audited financial statements if an Event of Default has occurred within the last calendar year in
addition,you must provide us withint^daysatter our request, exact copies of federal and state
income andothertaxreturnsandanyotherforms, records, books, reports and other intormation
that we periodically require relating to the Studio or you.

88 Additional Intormation You shall respond promptiy to requests from us

for clarification andtor additional information regarding any matter entrusted to you u n d e r a
Agreement. We may from time to time require information about your financial condition,
earnings,sales,profits,costs, expenses, and pertormance to provideabasis for providing our
prospective franchisees with information concerning actual or potential earnings or to comply
with applicable laws and regulations governing the sale ot franchises. You will provide such
informationpromptiy upon our request,and you will certify that suchinformation is true and
complete in all material respects.
8.4 Insoection. We have the right, through our employees and any agents we
designate, at any time during business hours and without prior notice to you to^i) inspect the
Site and Studio for compliance with the Manuals, (ii) videotape, photograph or otherwise record
the operation of the Studio, (iii) interview your employees, landlord, and customers, (iv)exa
the records, invoices,payroll records, check stubs,sales tax records and returns,and other
supporting records and documents otthe Studio,and (v) examine your income tax records and
any other information, records or properties relating to the ownership, management, or
operation of the Studio Youmustinstalland maintain, at your expense,avideo surveillance
system that we designate which we may access remotely throughaoonnection that we specify
to ensure compliance with our standards and the Manuals Our right to inspect your business
records includes records maintained electronically or otf site You must cooperate with such
inspections by giving our representatives unrestricted access and rendering such assistance as
our representatives may reasonably request, ifwe notify youofanydeficienciesafter the
inspection, you must promptly take steps to correct them If you fail to correct any deficiencies
withinareasonabletime, not to exceed 80 days, we have the right to correct such deficiencies
and charge youareasonable tee plus our costs and expenses incurred in such inspection. Any
inspections will be made at our expense, uniess the inspection is necessitated by your repeated

o^Bar F ^ n ^ e A g ^ m ^ 20
EA^^7^^5
orcootinoing^ureto^^
oharge you the oostsot making 5 ^
ot travel and living expenses tor our representatives

8.5 Auditino. Without limiting the foregoing, wemayauditoroauseto be

audited any statement you are required to submit pursuant to Section 8.2 (Reports and
Finanoiai Statements) and we may review, or cause to be reviewed, the reoords maintained by
any bank or other tinanciai institution used by you in connection with tbe Studio, if any such
audit or review discloses an understatement otthe Gross Revenue tor any period or periods,
you will payto us, withintOdaysatter demand tor payment is made, all additional Royalty Fees,
Marketing Fees, or other amounts required to be paid based upon the results ot such audit or
review. In addition,it such understatement tor any period or periods is 2 ^ or more otthe Gross
Revenue tor such period or periods, you will reimburse us for the cost ot such audit or review,
including without limitation the charges of any independent accountant and any related
attorneys^ tees and the cost of travel and living expenses and wages for such accountant and
employees or other agents of us. You will pay to us, upon demand, on any delinquent fees
interest at the lesser o f t 8 ^ per annum or the maximum rate allowed by law calculated trom the
date when the fees should have been paid to the date of actual payment.These remedies are in
addition to our other remedies and rights under this Agreement and applicable law.

88 Mystery Shoooer Frooram. We may require you to participate in a

mystery shopper service in order to ensure your compliance with the System and our customer
service standards. We may specify mystery shopper services that you must engage at your
expense, or we may engage the mystery shopper service on your behalf. It we engage the
mystery shopper service onyourbebalt,you must pay usareasonable fee oratbirdparty
managing such service that we will specify in the Manuals upon demand. You must share the
results of any mystery shopper program with us and must promptly address any deficiencies
identified in any such report. You must foiiow any evaluation process, and use such evaluation
forms, as we may trom time to time require.

SectienO Intellectual Property.

gt Marks andTradeOress.

(a) Acknowledoements. You acknowledge that we are the owner of

tbe Marks and theTrade Oress,that you have no interest in the Marks and theTrade Oress
beyond tbe nonexclusive License granted herein, and that, as between we and you, we have
the exclusive right and interest in and to the Marks and theTrade Oress and the goodwill
associated with and symbolized by them Opon the expiration or termination of this Agreement,
no monetary amount will be attributable to goodwill associated with your activities as a
franchisee under this Agreement.

(b) Riohts. Yourrighttousethe Marks and theTrade Oress applies

only totheStudio operatedatthe Siteasexpressly provided in tbis Agreement, including
advertising related to the Studio You may only use in your Studio the Marks and theTrade
Oress we designate, and only in compliance with written rules that we prescribe from time to
time. You may not use any Mark (i) as part of any corporate or legal business name, (ii) with
any prefix, suffix or other modifying words, terms, designs or symbols (otherthan logos we have
licensed to you),(iii) in selling any unauthorized services or products,(iv) as part ofany domain
name, electronic address^ metatag, social media account, or otherwise in connection with any
website or other electronic medium witbout our consent, or (v) in any otber manner we have not

Cyo^ar F ^ o h ^ A ^ m ^ 2t 0t^5
E A 5 ^ ^ 9 ^ 5
oxp^55^a^onzedinw^ng Noma^a^onwhiohany^^
appear w^ be used by you w^oot our prior
time opon roasonabionotioo to yoo. Yoo most display tbe Marks inamanner tbat wo spooky on
signage at tbe Stodio and on terms, advertising soppiies, employee onitorms, bosiness
and otber materials we designate.
92 Cooyripbts. Yoo acknowledge tbat as between yoo and os, any and ail
present or totore copyrights relating to tbe System or tbe OyoleBar concept, incloding, bot not
limited to, the Manoals and marketing materials, (collectively, the "Oep^
andexclosivelytoos. Yoo have no interest in tbe Copyrights beyond the non exclosive License
granted in this Agreement.
93 No Contestino Cor Riohts Ooring theTerm ofthis Agreement and after
its expiration or termination, yoo agree not to directly or indirectly contest oor ownersh^
right or interest in or to, or oor license to ose, or the validity of, (i) the Marks, ( i i ) t h e T ^
Oress, (iii) the Copyrights, or (iv) any trade secrets, methods, or procedores tbat are part of the
System (collectively, the intellectual Property"), or contest oor sole rigbt
license others to ose the Intellectoal Property

94 Cbanoes to the Intellectoal Prooertv We have the right, opon reasonable

notice,to change, discontinoe, or sobstitote for any of thelntellectoal Property and to adopt
entirely different or new Intellectoal Property for ose with the System withoot any liabi^^^^
in oor sole discretion Yoo agree to implement any soch change at yoor own expense within the
time we reasonably specify

95 Third Partv Challenoes Yoo agree to notify os promptly of any

onaothorized ose of the Intellectoal Property ot which yoo have knowledge Yoo also agree to
inform os promptly of any challenge by any person or Entityto the validity of oor ownership ofor
oor right to license others to ose any of the Intellectoal Property We have the right, bot no
obligation, to initiate, direct, and control any litigation or administrative
Intellectoal Property, incloding, bot not limited to, any settlement We will be entitled to retain
any and all proceeds, damages, and other soms, incloding attorneys'fees, recovered or owed
to os or oor affiliates in connection with any soch action Yoo agree to execote ail docoments
and, render any other assistance we may deem necessary to any soch proceeding or any effort
to maintain the continoed validity and enforceability of the Intellectoal Property

9.5 Post Termination or Expiration. Opon the expiration or termination of this

Agreement for any reason, all of yoor rights to ose the Intellectoal Property will aotomatical^^
revertto os withootcost and withoot the execotion or delivery of any docoment. Opon oor
regoest, yoo will execote all docoments that we reqoire to confirm soch reversion

97 Innovations All ideas,concepts,techniqoes or materials relating t o a

Stodio or theSystem (collectively, "Innovations"), whether or not protectableintellectoal
property and whether created by or for yoo or yoor Cwners, employees, or contractors, most be
promptly disclosed to os and will be deemed to be oor sole and exclosive property, part of the
System and thelntellectoalProperty,and works madeforhire for os To tbe extent any
Innovation does not goality asaworkmadetorhire tor os, by this Section yoo assign ownership
of that Innovation, and all related rights to that Innovation, to os and agree to sign (and to caose
yoor Cwners, employees, and contractors to sign) whatever assignment or other docoments we
regoest to evidenceoorownershiporto help os obtain intellectoal property rightsinthe
Innovation We and oor affiliates have no obligation to make any payments to yoo or any other

Cy^eBa^Franot^e Agreement 22 ^ 01/15

EA^r^749^5
person with respect to any Innov^oo^ Yoo may not ose any Innovation in operating the Studio
or othenvise withoot oor prior approval.

SectiontO Proprietary Intormation.

tO.t Peceiot ot Proprietary intormation. Yoo acknowledge that prior toor

doring theTerm,we may disclose in contidence to yoo,either orally or in writing,certain trade
secrets, know how, and other contidential intormation relating to the System, oor bosiness, oor
vendor relationships^ oor classes, or the oonstroction, management, operation, or promotion ot
the Stodio (collectively, "Proprietary Intormation"), incloding (i) siteselection criteriaand
methodologies; (ii) methods, tormats, systems, System Standards, sales and marketing
techniqoes, knowledgeandexperienceosed in developing andoperating Stodios, incloding
intormation in the Manoals; (iii) marketing research and promotional, marketing, advertising,
pobiic relations, costomer relationship management and other brand related materials and
programs torStodios; (iv) knowledge otspeciticationstor and soppliers ot,andmethodsot
ordering, certain items tbat Stodios ose andtor sell; (v) knowledge otthe operating resolts and
financial pertormance ot other Stodios;(vi) costomer commonication and retention programs,
along with data osed or generatedinconnection with those programs;and(vii)any other
intormation we reasonably designate from time to time as confidential or proprietary.
^Proprietary Information^does not inclode(i)information that is part otthe pobiic domain or
becomes partotthepoblicdomainthrooghnofaoltofyoo,(ii) information disclosed to yoo bya
third party having legitimate and onrestricted possession of soch information, or (iii) i n ^
that yoo can demonstratebyclearand convincing evidence was witbinyoor legitimate and
onrestricted possession when the parties began discossing the sale of the franchise.

to.2 Nondisclosoreot Proprietary Information. Weandoorattiliatesownall

right, title, and interest in and to the Proprietary Information. Yoo will not, nor will yoo permit any
person to, ose or disclose any Proprietary lnformation(incloding withoot limitation all or any
portion of the Manoals) to any otber person, except to the extent necessary for yoor
professionaladvisorsandyooremployeestoperform their fonctions inthe operationof the
Stodio. Yoo acknowledge that the yoor ose otthe Proprietary Information in any other bosiness
woold constitote an unfair method of competition with os and oor franchisees. Yoo will be liable
to os for any onaothorized ose or disclosoreot Proprietary Information by any employee or other
person to whom yoo disclose Propriety Intormation Yoo will take reasonable precaotions to
protect the Proprietary Information from onaothorized ose or disclosore and will implement any
systems, procedores,or trainingprograms tbat weregoire. At oor regoest,yoo will regoire
anyone who may have access to tbe Proprietary Information to execute non-disclosure
agreements inaform satisfactory to os that identifies os asathird party beneficiary of soch
covenants with the independent right to enforce the agreement.

t0.3 Costomer Information.

(a) Protectionot Costomer Information. Yoo most comply with oor

System Standards, other directions trom os, and all applicable laws and regolations regarding
the organizational, physical, administrative and technical measores and secorityprocedores to
safegoard the confidentiality and secority of Costomer Intormation on yoor Stodio Management
andTechnology System or otherwise in yoor possession or control and,in any event, employ
reasonable means to safegoard the confidentiality and secority of Costomer Information.
^Customer Information^meansnames, contact information, financialintormationandother
personal information ot or relating to the Stodios costomers and prospective costomers If there
isasospectedoractoal breach of security or onaothorized access involving yoor Costomer

Oyo^aar F r a n c e A g ^ e m e o t 23 0t/t5
E A ^ r ^ 7 ^ ^
^ o r m ^ o n , yoo must
oooo^onoo and spooky tho oxtont to whioh Customer formation was oompromisod or
disoiosod You are responsibie tor any fioanoiai losses you inour or romodiaiaot^^
must take asaresuitotabreaohot security or unauthorized aooess to Customer intormation in
your oontroi or possession
(b) Cwnershioot Customer intormation You agree that aii Customer
intormation that you ooiieot trom customers and potential customers in oonneotion with your
Studio is deemed to be owned by us, and must be furnished to us at anytime tbat we request it
In addition,we and our attiiiates may, through the Studio Management andTechnoiogySystem
or otherwise, have independent access to Customer Information.

(c) Use of Customer Information. You bave the rigbt to use Customer
IntormationwhilethisAgreementorasuccessorfranchiseagreementisin effect, but only to
market CycleBar products and services to customers in accordance with the policies that we
establish periodically and applicable law You may not sell, transfer, or use Customer
Information for any purpose other than marketing CycleBar products and services Weandour
attiiiates may use Customer Information in any manner or for any purpose, except, during tbe
Term, we and our affiliates will not use the Customer Intormation that we or they derive from
your Studio to market indoor cycling classes for another brand that competes directly with tbe
Studio You must secure from your customers, prospective customers, and others all consents
and authorizations, and provide them all disclosures, that applicable law requires to transmit
Customer Information to us and our affiliates, and tor us and our affiliates to use that Customer
Information, in the manner that this Agreement contemplates

Sections Indemn^cation.
tt t Indemnification BvYou. You agree to indemnify and hold harmless us,
our atfiliates, andour and their respectiveowners, directors, officers, employees, agents,
representatives, successors, and assignees (the ^ndemnitied P a r t i e s against, and to
reimburseanyoneormoreotthe Indemnified Parties for,all Losses (defined below) directly or
indirectly arising out ofor relating^ (i) the Studio's operation; (ii) the business you conduct
under this Agreement; (iii) your breach of this Agreement; (iv) your noncompliance or alleged
noncompliance with any law, ordinance, ruleor regulation, including those concerning the
Studio's construction,designoroperation,andincludingany allegation that we or another
Indemnified Partyisajoint employer or otherwise responsible for your acts or omissions r e ^ ^
to your employees; or (v) claims alleging either intentional or negligent conduct, acts or
omissions by you (or your contractors or any of your or their employees, agents or
representatives), or by us or our affiliates (or our or their contractors or any of our or their
employees, agents or representatives),subject to Sectiontt^ messes'means any and all
losses,expenses,obligations,liabilities,^
reasonable defense costs that an Indemnified Party incurs, including accountants^ arbitrators',
mediators',attorneys', and expert witness fees, costs of investigation and proof of tacts, court
costs,travel and living expenses, and other expenses ot litigation, arbitration, or alte^^
dispute resolution, regardless of whether litigation, arbitration, or alter^^^
commenced.
tt 2 Indemnification Procedure You agree to defend the Indemnified Parties
against any and all claims asserted or inquiries made (formally or informally), or legal a c ^
investigations,or other proceedings brought, byathird party and directly or i n d i ^
of or relating to any matter describedinSubsectionttt(i)through(v) above (collectively,

1 5
C^eBar F ^ o ^ e A ^ e m ^ 24 O^
E A 5 ^ ^ ^ 5
^oceedmgs^ioo^
w^ul m i s c o o d u ^ a n ^ w ^ wrongs omissions Each ^demn^ed Party may at your
oxponsodofond and othorwiso respond to and a c r o s s any olaimas^^
Proooodingbrought,thati5su^oottothisSootion11 (instead ot having you defend it as
required above^and agreeto settiements or ta^
actions, tor aii ot whioh defense and response costs and other Losses you are soieiy
responsibie, subject to Sectiontt ^ An indemnified Party need not seek recovery from any
insurer or other third party, or otherwise mitigate its Losses, in order to maintain and re^^^
fuiiyaciaimagainstyou,andyouagreethatafaiiuretopursuearecoveryormitigateaLoss
wiii not reduce or aiter tbe amounts tbat an indemnified Party may recover from you under this
Sectiontt Your obligations in this Sectiontt wiii survive the expiration or termination of this
AgreemenL
tt3 Wiiifui Misconduct or Oross Neoiioence Despite Sectionttt,you have
noobiigationtoindemnityorhoid harmless an indemnified Partyfor,and we wiii reimburse you
for,any Losses (including costs of defending any Proceeding under S e c t i o n t t ^ t o tbe extent
theyaredetermined inatinal,unappealable ruling issued byacourt or arbitrator with competent
jurisdiction to have been caused solely and directly by the Indemnified Party's willful mis^^
or gross negligence, so long as the claim to which those Losses relate is not asserted on the
basis of theories of vicarious liability (including agency,apparent agency, or employment) or our
failure to compel you to comply with this AgreemenL Flowever, nothing in this Section t t ^
limits your obligation to defend us and the other Indemnified Parties under Sectiontt^

Sectiontt Yeur Covenant Net fe Compete.

t^t Durino Term. You acknowledge that you will receive valuable,
specialized training and confidential information regarding the manufacturings
promotional,and marketing methods otthe CycleBar concept During the Term, you and your
Cwners will not, without our prior w r i t t e n ^
through, on behalf ot, or in conjunction witb any other person or Entity^
(a) own,manage, engage in, be employed by,advise, make loans to,
or have any other interest in (i) any businessthat offers indoorcyclingclasses, (ii) any
gymnasium, studio, athletic or fitness center, health club, exercise, indoor cycling, or aerobi^^
facility, or similar facility or business, or (iii) any entity that grants franchis^^
of these typeset businesses (collectively,each,a"Competitive Busmess") at any location in
the United States;
(b) divert or attempt to divert any business or customer or potential
business or customer ot tbe Studio to any Competitive Business, by direct or indirect
inducement or otherwise;
(c) perform, directly or indirectly, any other act injurious or prejudicial
to the goodwill associated with tbe Marks and the System;
(d) use any vendor relationship established through your association
with us for any purpose otber than to purchase products or equipment tor use or retail sale in
the Studio; or

CycleBar - Franchise Agreement 25 01 ^ 5

EAS'm6749142.5
 (e) d^o^orindireo^so^
time wi^in the i m m e d ^ p a 5 t 1 2 m o o ^ 5 has been e ^
ot our franchisees.

t2.2 Atter Terminations Expirations or Transfer. For two years after the
expiration or termination of this Agreement or an approvedTranster toanew tranche
and your Owners may not, without our priorwritten oonsent, (i) direotiy or indirectiy own,
manage,engagein,beempioyedinamanageriaipositionby,advise,make ioans to, or have
any other interest in any Competitive Business that is (or is intended to be) iooatedwithinat^^^
miie radius ofyour former Studio or any other Studio that is operating or under deveiopment at
the time ofsuch expiration,termination, orTransfer, or (ii) solicit tor empioyment any pers^^
w h o a t a n y time within theimmediatepast t^monthshasbeenempioyedby us,orour
affiliates, or by any of our franchisees. With respect to the Owners, the time period in this
Sectiontt.2 wiii run from the expiration,termination,orTranster of this Agreement or trom the
terminationof the Owner'sreiationship with you,whichever occurs first.

t2.3 EubiiciyTradedOoroorations. Ownership of iess than five percent of the

outstanding voting stock ofany class of stock ofapubiiciy traded corporation wiii not, by itseit,
violate this Sectiontt.

t2.4 Covenants of Owners and Emoiovees. The Owners personally bind

themselves to this Sectiont^by signing tbis Agreement or the attached Ouarantee. Wemay,
in our sole discretion, require you to obtain from your officers, directors, ^ey Managers,
CycleStar instructors, Owners spouses, and other individuals that we may designate executed
agreements containing nondisclosure and noncompete covenants similar in substance to those
contained in this Sectiont^as we prescribe in the Manuals and otherwise. The agreements
must be inaform acceptable to us and specifically identity us as having the independent right to
enforce them.
t2.5 Enforcement ot Covenants. You acknowledge and agree that (i) the time,
territory, andscopeofthecovenantsprovidedinthisSectiont^are reasonable and necessary
tor the protection ot our legitimate business interests; (ii) you have received sufficient and v a ^
consideration in exchange for those covenants; (iii) enforcement of the same would not impose
undue hardship;and (iv) theperiod of protectionprovidedby these covenants willnot be
reduced by any period of timeduring which you are in violation otthe provisions of those
covenants or any period oftime required for enforcement of those covenants. Tothe extent that
this Sectiontt is judicially determined to be unenforceable by virtue ofits scope or in termsof
area or length of time, but may be made enforceable by reductions of any or all thereof, the
same will be enforced to the fullest extent permissible You agree that the existence of any
claim you may have against us, whether or not arising from this Agreement, will not constitutea
defense to our enforcement of the covenants contained in tbis Sectiontt. You acknowledge
that any breach or threatened breach ot this Sectiont^will cause us irreparable injury torwhich
noadequate remedyat law is available, andyouconsenttotheissuanceof an injunction
prohibiting any conduct violating the terms ofthis Sectiontt Such injunctive relief will be in
addition to any other remedies that we may have.

Secfien13 Transfer and AssignmenL

t3.t Transfer bvUs. We mayassignthisAgreementand all of our rights,

duties, and obligations under this Agreement to any person or Entity that we choose in our sole
discretion. Upon any such assignment, we will be released from all of our duties and obligations

Cyo^Bar F r a n o ^ e A g ^ m o ^ 26 0t^5
E A ^ ^ ^ ^
h e ^ u n d e 4 a n d y o u w ^ l ^
ob^ation^
t32 O ^ o ^ o n ^ T r a n s ^ For purposesof this A g r e e m e ^ ^ a n s ^ a s a
verb moans fo so^ assign, give away, transfer, ^ d g o , mortgage, or enoumber, either
voiunfahiy or by operation of iaw (suoh as through divoroe or bank^^
interest in fhis Agreement,the Studio, substantiaiiy aii fhe assets of the S t u ^
ownership otthe franchisee (if you are an Entity) "Transte^asanoun means any suoh saie,
assignment, gift, transter,piedge, mortgage, or e n o u m b r a n o e A ^ o n t r e l T r a n ^ ^
Transfer of (i) this Agreement or any interest in this Agreement; (ii)the Studio or aii or
substantiaiiy aii of the Studio'sassets; or (iii) any Oontroiiing Ownership
inyou (ifyou are an Entity),whether directiy or indirectiy throughatransferot iegai or benef^^
ownership interests in any Owner that is an Entity,and whether in one transaction oraseries of
related transactions, regardless of the time period over which these transactions take piace
R e f e r e n c e s t o a ^ O e n f r e ^ n g O w n e ^ p l n f e r e ^ in you mean either (i)t^^
or more of your direct or indirect iegai or beneficial ownership interests in your Entity or (^
interest the acquisition ot which grants the power (whether directly or indirectly) to d ^ ^ ^
cause the direction ot management and polices of you or the Studio to any individual or Entity,
or group ot individuals or Entities, that did not have that power before that acquisition

t 3 3 NoTransfer Without Our Oonsent This Agreement and the License are
personal to you, and we have granted the License in reliance on your (and, it you are an Entity,
your Owners') business skill, financial capacity, and personal character Accordingly, neither
you nor any of the Owners or any successors to any part ofyour interest in this Agreement or
the License may make anyTransfer or permit anyTransfer to occur without obtaining our prior
writtenconsent,exceptasprovided in Section t37(EermittedTransters) if you or any of your
Owners desire to makeaTransfer,you must promptiy provide us with written notice Any
purportedTransfer, without our prior written consent, will be null and void and will constitute an
Event otDefault(ashereindetined), tor which we may terminatethis Agreement witbout
opportunity to cure We have sole and absolute discretion to withhold our consent, except as
otherwise provided in Sectionst34throught38 We have the right to communicate with both
you,your counsel,and the proposed transferee on any aspect ofaproposedTransfer You
agreetoprovideanyintormation and documentation relating to the proposedTransfer that we
reasonably require NoTransferthatrequiresourconsentmaybecompleted until at least 60
days afterwereceivewritten notice ofthe proposedTransfer Our consent toaTransfer does
not constituteawaiver ofany claims thatwe have againstthetransferor,nor is itawaiver of our
right to demand exact compliance with the terms of this AgreemenL if your Studio is not open
and operating,wewillnotconsenttoyourTransfer ofthis Agreement, and we are under no
obligation to do so.
t 6 4 Oontrol Transfer Eor a proposed Oontrol Transfer, tbe following
conditions apply(unless waived by us)^
(a) Whenyouprovidewritten notice of the proposedTransfer,you
must pay to usanonrefundable deposit of $6,000 to cover our administrative costs incurred in
reviewing the proposal The deposit will be applied towards yourTransfer Eee in the event that
theTranster is completed.
(b) You or your transferee must pay to usaTransfer Eee equal to
$t6,666 You must make such payment by wire transfer trom the proceeds of the sale at the
closing if we so request.

1 5
OycieBar F ^ o c ^ e A ^ e e m e ^ 27 O^
E A ^ ^ ^ ^ 5
 (c) Yoo must s a ^ y ^ o f yoor a o o r ^
aodmostboiooom^anoowith^o^gationstoosondor^^
agroomontthatyoohavow^osandoorat^atosasotthoda^
of^oTransteroryoomostmakoarrangomontss^sfaoto^ytoostooom
tho dato ot tho Transfer
(d) Yoo and yoor Owners most oxoootoagonoral release, inatorm
that we presonbe,intavorot os,oor attiiiates,and oor and oor affiliates^
fotore officers, directors, mangers, members, eqoity holders, agents, and employees,^
them from all claims, incloding claims arising onder federal, state, and local laws, roies, and
regolations
(e) Yoo and yoor Owners most agree to remain iiabie tor all otthe
obligations to os in connection with the Stodio arising before the effective date ottheTransfer,
and execote any and all instroments that we reasonably regoest to evidence soch iiability.

(t) Yoo and yoor Owners most continoe to be boond by the

provisions of Sections 9 (Intellectoal Property), tO (Proprietary Information), tt
(Indemnification), and t2(YoorOovenant Not to Oompete) as if they were the Pranchisee and
this Agreement had expired or terminated as of the effective date ottheTranster

(g) Yoo most provide os with written notice from yoor landlord
indicating that yoor landlord has agreed to transferthe Site Lease to yoor transferee

(h) Yoor proposed transferee (or,if the transferee is not an individoal,

all owners of any legal or beneficial interest in thetransferee) most demonstrate to oor
satisfaction that h e o r s h e meets all of oor thencorrentgoalifications to becomeaOycieSar
franchisee, incloding nothavinganyinvolvementwithaOompeting Bosiness, or if he or she is
alreadyaOycleBarfranchisee, he or she most not be in defaoltonder any of their agreements
with os and most haveagood record ot costomer service and compliance with oor System
Standards.
(i) Yoor proposed transferee and their representatives most
soooesstoiiy complete oor tben-corrent training regoirements at their expense.

(j) Yoor proposed transferee (and, if the transferee is not an

individoal, soch owners ofalegal or beneficial interest in the transferee as we may regoest)
most (i) enter intoawritten assignment, inaform satisfactory to os,assoming and agreeing to
discharge and goarantee allot yoor obligations onder this Agreement and (ii) most execote oor
then corrent torm ot personal goarantee.

(k) Yoor proposed transferee (and, it the transferee is not an

individoal, soch owners ofalegal or beneficial interest in the transferee as we may regoest)
most execote, foraterm ending on the last day otthe Term and with soch SoccessorTerm as is
provided by this Agreement,oorthencorrent franchise agreement for new tranchisees and soch
other agreements as we may regoire, which agreements will supersede this Agreement in all
respects The terms otthe new franchise agreement may differ significantly from the termsof
this Agreement The prospective transferee will not be regoired to pay any initial Pranchise Pee

CycleBar - Franchise Agreement 28 01/15

EAS'I\86749142.5
 (1) Yoor proposed ^ao^eree must
ronovato, or opgradotho Stodio, at its expense, to oontorm to oorthencorrent System
Standards tor new OyoieBar Stodios.

(m) Yoor proposed transferee mostoovenant that it wiii oontinoeto

operate the Stodio onderthe Marks and osing the System

(n) We most determine, in oor soie discretion, that the porohase price
and payment terms wiii not adversely affect the operation otthe Stodio, and if yoo or yoor
Owners finance any part of the porchase price,yoo and they most agree that aii obligations
onder promissory notes, agreements, or secority interests reserved in the Stodio are
sobordinate to the transferee's obligation to pay aii amoonts doe to os and oor attiiiates and
otherwise to comply with tbis Agreement.

t3.5 Non-OontrolTransfers. For anyTransfer tbat does not resoitinaOontroi

Transfer, yoo most give os advance notice and sobmitacopy ofall proposed contracts and
other information concerning theTransfer and transferee that we may regoest We will have the
right to regoire yoo to payaTranster Fee tbat is egoai to $2,500 pios oor administrative costs in
processing soch Transter,incloding any attorneys'tees and otherthird party costs that we incor
Wewiiibaveareasonabletime (not iess than 30 days) after we have received aii regoested
informationto evaloate the proposedTransfer Yoo andtor yoor transferee most satisfy, in
addition to others that we may specify, the conditions in Sections t34(c) (comply with
obligations), t3 4(d) (sign general release),13 4(e) (remain liable tor pre-Trans
t34(t) (remain boond tocertain provisions), t34(h) (transferee meetsgoalifications), and
t3 4(j) (sign assignment and goaranty) Yoo and yoor Owners most sign the form ot agreement
and related docoments that we then specify to reflect yoor new ownership stroctore Wemay
withhold oorconsenton any reasonable groonds or give oor consent sobject to reasonable
conditions.
t 3 5 Transfer To An Entity. We will consent to the assignment of this
Agreement to an Entity that yoo form tor the convenience of ownership, provided thaL(i) the
Entity has and will have no other bosiness besides operating OycleEar Stodios; (ii) yoo satisfy
the conditions inSections t34(c) (comply with obligations), t34(d)(sign general release),
t3 4(e) (remain liable for pre Transfer obligations), t3 4(f) (remain boond to c e ^
and t34(j) (sign assignment and goaranty); (iii) the Owners hold egoity interests in the new
Entity in the same proportion shown on Appendix A; and (iv) yoo payaTransfer Fee that is
egoal to $2,500 plos oor administrative costs in processing soch Transfer, incloding any
attorneys'tees and otherthird party costs that we incor

t37 FermittedTransfers The other provisions in this Section do not apply,

incloding oor right offirst refosal and right ot approval, to the followingTransfers^

(a) Secority Interests. Yoo maygrantasecority interest in the Site (if

yoo own the Site), the Stodio, any Operating Assets, this Agreement, or any direct or indirect
legal andtor beneficial interest in yoo toatinancial institotion or other party that provide
provides any tinancing yoor acgoisition,development, andtor operation otthe Stodio,bot only it
that party signs oor then corrent torm of lender consent to protect oor rights onder this
Agreement. Any foreclosores or other exercise otthe rights granted onder that secority interest
are sobject to all applicable terms and conditions of this Sectiont3.

CycleBar - Franchise Agreement 29 01 /15

EAST\86749142.5
 (b) Transfer toaTrusL AnyOwnerwho is an individual mayTransfer
his or her ownership interest in you (or any of your Owners that is an ^ ^ ^ ^
sheesfabiishesforesfafepianning purposes, as iong as he or she isatrusfee of fhe trust and
otherwise controls the exeroise of the rights in you (or your Owner) heid by the trust and you
notify us in writing ofthe Transfer at least ten days beforeits anticipated effective date
Oissoiution of or transfers trorn any trust described in this Sectiont37(b) are subject t^
applicable terms and conditions of this Sectiontt

t3 8 Transfer IdoonOeath Or Incaoacitv. If you or any Owner dies, becomes

incapacitated, or enters bankruptcy proceedings^
representative, or trustee must apply to us in writing within three months after the event (death,
declaration of incapacity, or filing otabankruptcy petition) for consent toTranster the person'^
interest. TheTranster will be subject to the provisions of this Sectiontt, as applicable, except
there shall be noTransfer Fee due In addition,it the deceased or incapacitated person is you
or the Operating Principal, we will have the right (but not the obligation) to take over operate
the Studio until theTransferis completed and to chargeareasonable management fee tor our
services. For purposes ofthis Section,^incapacity^ means any physical or mental infirmity that
will prevent the person from performinghis or her obligations under this Agreement (i)fora
period ot 30 or more consecutive days or (ii) tor 60 or more total days duringacalendaryear In
the case ofTransfer by beguestor by intestate succession, it the heirs or beneficiaries are
unable to meet the conditions of Section t3.4(h) (transferee meets gualifications), the executor
may transfer the decedent's interest to another successor that we have approved, subject to all
of theterms and conditions torTransfers containedinthis Agreement. If an interest is not
disposed of under this Section t36within t o d a y s after the date of death or appointment ofa
personal representative or trustee,we may terminate this Agreement under Sections.2 (Our
Remedies After An Event of Default).

t3 9 Our Rioht Of First Refusal

(a) Our Rioht We bave the right, exercisable within 30 days after
receipt of the notice ofyour intent toTransfer and such documentation and information that we
require, to send written notice to you tbat we intend to purchase the interest proposed to be
Transferred on the same economic terms and conditions offered bythe thirdparty or, at our
option, the cash equivalent thereof It you and we cannot agree on the reasonable equivalent in
cashoriftheTransterisproposedtobemadebygift,wewilldesignate,at our expense,an
independent appraiser to determine the fair market value of the interest proposed to be
transferred. We may purchase the interest at the fair market value determined by the appraiser
or may elect at that time to not exercise our rights. We must receive, and you and your Owners
agree to make, all customary representations, warranties and indemnities given by the seller of
the assets of a business or ownership interests in an Entity, as applicable, including
representations and warranties regarding ownership and condition of, and title to, assets and (it
applicable) ownership interests,liens and encumbrances on assets, validity of contracts and
agreements, and theliabilities, contingentorotherwise, relating totheassets or ownership
interests being purchased, and indemnities for all actions, events and conditions that existed or
occurred in connection with the Studio or your business prior to the closing of our purchase.
Olosing on our purchase must occur within 90 days after the dateof our notice to the seller
electing to purchase the interest We may assign our right of first refusal to another Entity or
person either before or after we exercise it. Flowever, our right of first refusal will not apply with
regard toTransfers to anEntity under Section t37(FermittedTransters) or t33(Transfer
Opon Death or Incapacity) orTransters to your spouse, son, or daughter

CycleBar - Franchise Agreement 30 01/15

EAST\86749142.5
 (b) Oeo^noOorRiohL Ifwe e^ct not to exeroise our ng^s under
this Sootion,tho transferor may oom^otothoTransfor after o o ^
provisions in Section t3 Oiosing of theTransfer must ooour within 90 days of our eieotion (or
suohionger period as appiioabie iaw may required otherwise^thethirdparty'sof^
treated a s a n e w otter subject to our right of first refusal Any materiai change in the termsof
the offer trom athirdparty after wehaveeiectednot to purchasethe seller's interest wiii
constituteanew offer subject to the same right of first refusal as the third p a r t y ' s ^
TheTransfer is conditional upon our determination that the Transfer was on terms substantial^
the same as those offered to us

Sections TermmafienandOefau^
^t Events of Oefault Anyone of more otthefoilowing constitutes an "Event
efOefault" underthis AgreemenL
(a) You or any Owner make any material misrepresentations or
omissions in connection with your application to us for the franchise, this AgreemenL or any
related documents, or you submit to us any report or statement that you know or should knowto
be false or misleading;
(b) Your RequiredTrainees tail to successfully complete initiai training
to our satisfaction at least ten days before the Opening Oeadline;

(c) You fail to submit information regarding the proposed Studio

location, fail to obtain our acceptance forasite, or fail to obtain our approval toraSite Leas
within the time periods specified in Section42(Site Selection);

(d) You fail to open for business by the Opening Oeadline;

(e) You tail to make changes to the Site and the Studio as required in
Section65(Refurbishing and Renovations) within the applicable time periods;

(t) You fail to maintain possession of the Site and tail to secure our
approvalofand enter intoalease toranew, accepted Site within 90 days afterthe expiration or
termination otthe Site Lease;
(g) You voluntarily suspend operation otthe Studio without our prior
written consent for five or more consecutive business days on which you were required to
operate, unless we determine, in our sole discretion, tbat the failure was beyond your control;

(h) You,your Operating Erincipal,your l^ey Managers, or any ofyour

representatives that we designate fail to attend or participate in two or more r e q u i r e d ^
conventions, meetings, andteleconterences during any t2monthperiod,without our prior
written consent;
(i) You,any Owner,or any ofyour officers or directors are convicted
of or plead nolo contendere toafeiony,acrime involving moral turpitude or consumertraud, or
any other crime or offense tbat we believe is likely to have an adverse effect on our franchise
system,the Marks and any associated goodwill,orthe OycleSar concept (an"Adverse Effect")
or you,any Owner, or any ofyour officers or directors has engaged in or engages in activities
that, in our reasonable opinion, have an Adverse Effect;

C^eSar F ^ o ^ e A ^ e m e n t 3t
8 A ^ 8 ^ 9 ^ 5
 ^ You use any of the Marks or any o t h e r s
us other than io tho operation or promotion of tho Studio;

(k) You or any of your Owners, directors, or officers disclose or

d i v u i g e t h e c o n t e n t s o f t h e M a n u a i s o r o t h e r Proprietary information contrary toSection to
(Proprietary information);

(i) Any Transfer occurs that does not comply with Section t3
(Transfer and Assignment),includingafailure to transfer toaqualified successor after death or
disability within the time allowed by Sectiont38(Transfer Opon Oeath or incapacity^

(m) You or any Owner violates the noncompete covenants in Section

t2(YourOovenantNottoOompete);

(n) You breach or fail to comply with any law, regulation, or ordinance
which results i n a t h r e a t to the publics health or safety and tail to cure the noncompliance
within 24 hours tollowing receipt ot notice thereof from us or applicable public officials,
whichever occurs first;

(o) You become insolvent or make an assignment tor thebenefitof

your creditors,execution is levied against your business assets,orasuit to foreclose any lien or
mortgage is instituted against you and not dismissed within 30 days;

(p) (i)You fail,refuse, or neglect to pay any monies owing to us or

ouraffiliatesorfailtomakesufficienttundsavailableto us as provided in Section 3.tO(Methods
of Payment) within ten days after receiving written notice of your default or 30 days after due
date of the payment, whichever is the shorter period, or (ii) you have previously been given at
least two notices of nonpayment for any reason within the last 24 months and you subsequently
fail to timely pay when due any monies; or (iii) you fail to do all things necessary to give us
access to the intormation contained in your Studio Management and Technology System
pursuant to Section^BIO (Studio Management andTechnology System) withintO days after
receiving notice;

(g) You are more than 60 days past due on your obligations to
suppliers and trade creditors in an amount exceeding $2,000, unless you have given us prior
noticethatthefailuretopayisaresultofabonafidedisputewith such supplier or trade creditor
that you are diligently trying to resolve in good faith;

(r) You tail to pay when due any federal, state or local income,
service, sales orother taxes d u e o n t h e S t u d i o ' s operation, unless y o u a r e i n good faith
contesting your liability for these taxes;

(s) You underreport Oross Revenue by more than 2 ^ two times or

more in any two year period or by 5 ^ or more tor any period of one week or greater;

(t) You refuse to permit, or try to hinder, an examination, inspection,

or audit of your books and records, the Studio, or the Site as required by this Agreement;

(u) You fail to timely file any periodic report required in this
Agreement o r t h e Manuals threeor more times in a t2month period, whetheror not you
subsequently cure the default;

CyoieBar Franoh^e Agreement 32 01/15

E A ^ ^ 7 ^ ^
 (v) You defauh under any other franohise agreement or other
agreement between you and us or our abates, provided that the defaults
atfiiiate to terminate that agreement;

(w) You breaoh or taii to oompiy with any other covenant, agreement,
standard, procedure, practice, or ruie prescribed by us, whether contained in this Agreement, in
the Manuals, or otherwise in writing and faii to cure such breach or taiiure to our s a t i s t a c ^
within 30 days (or such longer period as applicable iaw may require) atter we provide you with
written notice ot tbe detault; or

(x) You are in default three or more times within anyt3month period,
whether or not the defaults are similar and whether or notthey are cured

14.2 Our Remedies After An Event otOefault.

(a) Rioht toTerminate. if an Event of Default occurs, we may, at our

sole election and without notice or demand of any kind, declare this Agreement and any and all
other rights granted under this Agreement to be immediately terminated and, except as
otherwiseprovided herein, of noturtherforceoreffect idpontermination, you will not be
relieved ofany ofyour obligations, debts, or liabilities under this Agreement, including
limitation any debts, obligations, or liabilities thatyou accrued priorto such t^^

(b) Other Remedies itan Event of Default occurs,we may, at our

sole election and upon delivery of written notice to you, take any or all of the following actions
witbout terminating this AgreemenL

(i) temporarilyor permanently reducethe size oftheTerritory,

in whicheventthe restrictions on us andour affiliatesunder Sectiontt (LimitedTerritorial
Rrotection) will not apply in the geographic area that was removed from theTerritory;

(ii) temporarily remove intormation concerning the Studio from

the System Website andtor stop your or the Studio's participation in any other programs or
benefits offered on orthrough the System Website;

(iii) suspend your right to participate in one or more programs

or benefits that the MarketingFund provides;

(iv) suspend any other services that we or our affiliate provides

to youunder this Agreementor any other agreement, includingany services relating to the
Studio Management andTechnology System;

(v) suspend or terminate any temporary or permanent fee

reductionsto which we might have agreed (whetherasapoiicy, inanamendmenttothis
Agreement, or otherwise);

(vi) suspend our pertormance of,or compliance with, any of

our obligations to you under this Agreement or otber agreements;

(vii) undertake or perform on your behalf any obligation or duty

that you are required to, but fail to, perform under this AgreemenL You will reimburse us upon

CycleBar - Franchise Agreement 33 01 /15

EAST\86749142.5
demand f o r ^ c o s t s and e x p e n d
ordu^and^r

^ii) enter the Studios premises and assume the management

ef the Studieeurseiveserappeintathird party (who may be our a f t i i ^
Aii funds trom the operation of the Studio while we or our appointee assumes its management
wiii be kept inaseparateaooount,and aii of the expenses of the Studio wiii be charged to that
aooount. We o r o u r a p p o i n t e e m a y o h a r g e y o u ( i n addition totheamounts due under this
Agreement)amanagement fee equal t o ^ o f the Studio's Gross Revenue during the period of
management,plus any direct outofpooket costs and expenses. We or our appointee h a s a
duty to utilize oniy reasonable ettorts and will not be iiabie to you for any debts, losses, or
obligations the Studio incurs, or to any of your creditors tor any products or services tbe Studio
purchases, while managing it. You shall not take any action or fail to take any action that would
interfere with our or our appointee's exclusive right to manage the Studio and may, in our sole
discretion, be prohibited from visiting the Studio so as to not intedere with its o p e r a t ^ ^ Gur
(or our appointee's) management otthe Studio will continue for intervals lasting up to 90 days
each (and, i n a n y e v e n t , f o r n o m o r e t h a n a t o t a l o f o n e y e a r ) , and we will during each interval
periodically evaluate whether you are capable of resuming the Studio's operation and
periodically discuss the Studio's status with you

(o) Exercise of Other Remedies Our exercise of our rights under

Section t42(b) (Other Remedies) will not ( i ) b e a d e f e n s e tor you to our enforcement of any
other provision of this Agreement or waive or release you trom any ofyour other obligations
under this Agreement, (ii) constitute an actual or constructive termination of this Agreement, or
(iii) be our sole or exclusive remedy tor your default You must continue to pay all fees and
otherwise comply withall of yourobligations under this Agreement(except as set torthin
Sectiont42(viii) (our assumption of management)) following our exercise of any of these right^^
I f w e e x e r c i s e a n y o t our rights under Section t42(b), we may thereafter terminate this
Agreement without providing you any additional corrective or cure period, unless the default
giving rise to our right to terminate tbis Agreement has been cured to our reasonable
satisfaction.

t4 3 Termination Ry You You may terminate this Agreement only IL (i)we

commitamaterialbreachofthisAgreement;(ii)yougiveuswritten notice of the breach; (iii) we
fail to cure the breach, or to take reasonable steps to begin curing the breach, within 60 days
after receipt ofyour notice; and (iv) you are in tull compliance with your obligations under this
Agreement If we cannot reasonably correct the breach within this 60 day period but provide
you, within this 60 day period, witb reasonable evidence of our effort to correct the breach within
areasonable time period,then the cure period shall run through the end ofsuch reasonable
time period Termination will be effective no less than ten days after you deliver to us written
notice of termination tor failure to cure within the allowed period Any attempt to terminate this
Agreement without complying with this S e c t ^
Studio or otherwise cease operations under this Agreement) will constitute an Event of Default
byyou.
Secfien15 Yeur Obligations Open Exp^afienerTermmafien^

You covenant and agree that upon expiration or termination of this Agreement for any
reason, unless we direct you otherwises

CycleBar - Franchise Agreement 34 01 /15

EAST\86749142.5
 151 P a v m e ^ ^ O O 5 ^ a n d A m O U 0 t 5 0 ^ YOU W ^ p ^ d o m a n d ^ S U m S
owiogtousandoura^ato^ ^thisAgroomo^is^m^atodduotoanEvo^ofOofau^you
w^ promptly pay all damages, oosts, and oxponsos, Inoludlog reasonable attorneys' fees,
Incurred by us asaresult of your default Tbese payment obligations will give rise to and
remain,until paid In full,allen In favor of us against tbe Studio premises and any a^^
personal property,tlxtures,equipment, and Inventory tbat you own at tbe time ot tbe ooourrenoe
of tbe Event ot Default We are berebyautbonzed at any time after tbe Etteotlve Oate to make
any filings and to execute suob documents on your bebalf otto perfect tbe lien created bereby.
You also will pay to us all damages, costs, and expenses, Including reasonable attorneys'fees,
tbat we Incur after tbe termination or expiration ot tbis Agreement In obtaining Injunc
relief for tbe enforcement ofany provisionof tbis Section 15(Your Obligations Opon E
orTermlnatlon).
t52 Discontinue Ose of tbe Svstem and tbe Intellectual Erooertv Youmust
lmmedlatelyceaseuslng,byadvertlslngorlnanyotbermanner,^tbe Intellectual Property
(lncludlng,wltboutllmltatlon,tbe Marks and tbeTrade Dress), (ll)^^
elements associated witb tbe System, and (III) any colorable Imitation of any of the Intel^^^^
Property or any trademark, service mark, trade dress, or commercial symbol tbat Is confusingly
slmllartoanyoftbe Marks or tbeTrade Dress.

t5 3 Return of Proprietary Intormation You must Immediately return to us, at

your expense, all copies of tbe Manuals, all of your customer Information, and all otber
Proprietary Information (and all copies thereof). You may not use any Proprietary Information or
sell, trade or othenvise profit In any way from any Proprietary Information at any time f o l ^
the expiration or termination of this Agreement.

t 5 4 Pease Identification with Os You must Immediately take all action

required (I) to cancel all assumed name or equivalent registrations relating to your use of the
Marksand (II) tocancel or transfer to usorourdeslgneeall authorized and unauthorized
domain names, social media accounts, telephone numbers, post office boxes, and classified
and other directory listings relating to,or used in connection with,the Studio or the Marks
(collectively,^denf^ers") You acknowledge that as between you and us, we have the sole
rights to and interest in all Identifiers If you fail to comply with tbis Section 15 4, you hereby
authorize us and irrevocably appoint us or our designee as your attorney in fact to direct the
telephone company, postal service, registrar, Internet Service Provider and all listing agencies
to transfer such Identifiers to us The telephone
Service Providers and each listing agency may accept such direction by us pursuant to this
Agreement as conclusive evidence of our exclusive rights in such Identifiers and our authority to
direct theirtransfer

15 5 Our Pioht to Purchase Studio Assets

(a) Exercise ot Option Opon termination ofthis Agreement for any

reason (other than your termination in accordance with Section14.3 (Termination Sy You)) or
expiration ofthis Agreement without our and your signingasuccessor franchise agreement, we
have the option, exercisable by giving you written notice within fifteen (15) days after tbe date of
termination or expiration (the ^ E x e ^
Assets, and other assets used in the operation of the Studio that we designate (the ^Purchased
Assets ') We have the unrestricted right to exclude any assets we specify relating to the
fromtbePurchased Assets andnot acquire them Youagreeto provide ustbefinancial
statements and other intormation we reasonably require, and to allow us to inspect the Studio

Cyc^Bar F ^ o h ^ e A g r e e m ^ 35 01^5
^ ^ 7 4 ^ 5
and its assets to determine w h e ^ ifyou or
one of your a b a t e s owns the Site, we may
partof the Purohased Assets or, at our option,iease the Site trom you or that a f f i ^
initiai tiveyearterm with one renewai term ottiveyears(atouroption) onoommeroiaiiy
reasonable terms You (and your Owners) agree to oause your affiliate to oompiy with these
reguirements. ifyou iease the Site from anunatfiiiatediessor,you agree (at our option) to
assign the Lease to us or to enter intoasubiease for the remainder of the Lease term on the
same terms (including renewai options) as the Lease
(b) Operations PendinoPurohase While we are deciding whether to
exercise our option under tbis Section t5.5 (Our Right to Purchase Studio Assets), and, if we do
exercise that option, during the period beginning with our delivery of the Exercise Notice and
continuing through the closing ot our purchase or our decision not to complete the purchase,
you must continue to operate the Studio in accordance with this AgreemenL l^owever,wemay,
at any time during that period,assume tbe management otthe Studio ourselves or appointa
third party (who may be our affiliate)to manage the Studio pursuant to the terms of Section
t42(b)(viii)
(o) Purchase Price. The purchase price for the Purchased Assets will
be their fair market value tor use in the operation otaOompetitive Business (but notaOycleRar
Studio), however, tbe purchase price will not include any value for any rights granted by tbis
Agreement, goodwill attributable to the Marks, our brand image, any Proprietary I n f o r m a l
our other intellectual property rights, or participation in the network of Studios Por purposesof
determining the fair market value of all eguipment (including the exercise eguipment and Studio
Management andTechnology System) used in operating the Studio, the eguipment's useful lite
shall be determined to be no more than three years. If we and you cannot agree on fair market
value for the Purchased Assets, we will select an independent appraiser after consultation with
you, and his or her determination ot fair market value will be the finai and binding purchase
price.
(d) Olosing We will pay the purchase price at the closing, which will
take place within 60 days after the purchase price is determined, although we may decide after
the purchase price is determined not to complete the purchase We may set off against the
purchase price, and reduce the purchase price by, any and all amounts you owe us or our
affiliates We are entitled to all customary representations, warranties and indemnities in our
asset purchase, including representations and warranties as to ownership and condition of, and
title to,assets,liens and encumbrances on assets,validityot contracts and agreements, and
liabilities affecting the assets, contingent or otherwise, and indemnities tor all ^
and conditions that existed or occurred in connection with the Studio or your business prior to
the closing ot our purchase At the closing, you agree to deliver instruments transferring to us^
(a) good and merchantable title to tbe Purchased Assets,freeandclearof all liensand
encumbrances(othertban liensandsecurity interests acceptabletous),withallsalesand
transfer taxes paidbyyou;and (b)allottbeStudio'slicenses and permits which may be
assigned or transferred. It you cannot deliver clear title to all of the Purchased Assets, or if
there are other unresolved issues, the sale will be closed through an escrow You and your
Owners further agree to sign general releases, inaform satistactoryto us, of any and all claims
against us and our affiliates and our and their respective owners, officers, directors, employees,
agents, representatives, successors and assigns.

CycleBar - Franchise Agreement 36 01/15

EAST\86749142.5
 (e) AssionmeoL We mayassign our nghts underthis S e ^ o n 1 5 ^
(Our Right to Purohaso Studio Assets) to any Entity (who mayb^
wiii have aii otthe rights and obligations underthis Seotiont55

t5 6 Oe identifioationoftheSite it we do not exeroise our option to acquire

the Site Lease or the Site, you wiii make suoh moditioations or alterations to the Site
immediately upon terminationorexpirationot this Agreement that we deem necessary to
distinguish the appearance otthe Site tromaOycleRar Studio, including, but not limited to,
removing the signs, the Marks, and anyTrade Oress so as to indicate to the public that you are
no longer associated with us. If you do not comply with tbe reguirements ot this S e c t i o n t t ,
we may enter the Studio without being guilty of trespass or any other tort, for tbe purpose of
making or causing to be made any required changes. You agree to reimburse us on demand
for our expenses in making such changes.

t5 7 Reimbursement of Onused Glasses In addition to any procedures that

applicable law reguires, we may reguireyou to notify all of theStudio'scustomersof the
termination or expiration of this Agreement and offer each ofthem the option to receivearefund
of all unused prepaid class credits, which you are solely responsible for refunding to them ina
manner that we may specify We must approve in writing the content ofany such notice, prior
to you contacting any of the Studio'scustomers, or may elect to send the notice on your behalf.

t56 Rromote Separate Identity You willnot,directly or indirectly, inany

manner,identity yourself, or any individual connected with you,asaformerOycleRar franchisee
or as otherwise having been associated witb us, or use in any manner or for any purpose any of
theMarks
t5 9 Gomplv with Noncompete You and your Owners must comply with the
covenant not to compete in Sectiont2(YourOovenant Notto Gompete)

t5 t0 Injunctive and Other Relief You acknowledge that your failure to abide
bytbeprovisionsofthisSection t5(Your Obligations Opon Expiration orTermination)wi^^
in irreparable harm to us, and that our remedy at lawfor damages will be inadeguate
Accordingly, you agree that if you breach any provisions of tbis Section t5, we are entitled to
injunctive relief (including the remedy of specitic performance) in addition to any other remedies
available at law or in eguity

Secfien16 Oispufe Resolution and GevernmgLaw^

t6.t Mandatory Rre Litioation Mediation Except as otherwise provided in this

Section, prior to tiling any proceeding to resolve any dispute based upon, arising out of, or in
any way connected with tbis Agreement, each party shall bave tbe right to demand that all of the
parties participate in mediation before one mediator selected by the parties, and if the parties
cannot agree upon the mediator, then a mediator selected by the American Arbitration
Association ("AAA") The mediation shall be held in the metropolitan area of our then current
principal place of business and shall not last more than one day. If we and you do not resolve
our dispute, then thereafter any party may file tor litigation, as applicable in accordance w ^
terms ofthis Agreement The mediation shall be governed by the rules of the AAA It is the
intent otthe parties that mediation shall be held not later thant^daysafterawritten request for
mediation shall bave been served on the otber parties The obligation to mediate shall not be
bindingupon either party with respect to claims relating to the Marks,the nonpayment or
underpaymentot any monies due under this Agreement,thenoncompetitioncovenants,or

1 5
C ^ e B a r F ^ o ^ e Agreemem 37 O^
EA^r^7^^
r e q u e ^ by eitber party for tempo^y rosfraining orders prolimioary i^^ofions or ofbor
prooodurosioaooortofoompofor^ju^
by suob oourt foprosorvo fbo status goo or proved irroparabloi^urypond^^
aotual dispute.
t6 2 Forum for Otioatioo. You and tbo Owners must fiio any suit against us,
and wo may fiio any suit against you, in fodorai or state oourtsiooatod in tbo state in wbiob our
prinoipaioffioe is iooated at tbe time any litigation oommenoes Tbe parties waive aii questions
ot personal jurisdiction and venue for tbe purpose of carrying out tbis provision

t5.3 Oovernino Law. Tbis Agreement willbegovernedby,construed, and

enforced in accordance witb tbe laws of tbe State otObio Intbeeventofanyconflict of law
question, tbe laws of Obiosball prevail, witbout regard to tbe application of Ohio c o n f ^
rules.
t64 Mutual Waiver otdurvTrial. You and we eacb irrevocably waive trial by
jury in any litigation.
t6.5 Mutual Waiver ot Punitive Oamaoes. Each of us waives any rigbt to or
claim ot punitive, exemplary, multiple, or consequential damages against tbe other in ^
and agrees to be limited to the recovery ot actual damages sustained.

t6.6 Remedies Not Exclusive. ExceptasprovidedinSection t6.5 (Mutual

Waiver of Punitive Damages), no right or remedy that the parties have under this Agreement is
exclusive ofany otber right or remedy under this Agreement or under applicable law Each and
every such remedy will be in addition to, and not in limitation ofor substitution for, every o ^
remedy available at law or in equity or by statute or othenvise.

t6.7 Limitations of Oiaims Except for claims arising from your non payment or
underpaymentotamountsyouowe us, any andallclaimsarisingoutof or relating totbis
agreement or our relationship with you will be barred unlessajudiciai proceeding is commenced
in tbe proper forum within one year from the date on which the party asserting the claim knew or
should have known of tbe facts giving rise to the claim.

t6 8 Our Pioht to Injunctive Relief Nothing in this Agreement bars our right to
obtain injunctive ordeclaratoryrelietagainstabreach orthreatened breach of this Agreement
that will causeus loss ordamage. Youagree that we willnot be required to prove actual
damagesorpostabondinexcessot$t,OOOorothersecurityinseeking or obtaining injunctive
relief (both preliminary and permanent) andtor specific performance with respect to this
Agreement.

t6 9 Attorneys'Pees and Posts You agree to reimburse us for all expenses

we reasonably incur (including attorneys'tees)^(i) to enforce the terms of this Agreement or any
obligation owed to us by you andtor tbe Owners (whether or not we initiatealegal proceeding,
unless we initiate and fail to substantially prevail in such court or formal legal proceedings
(ii) in tbe defense of any claim you andtor tbe Owners assert against u s o n which we
substantially prevail in court or other formal legal proceedings We agree to reimburse you tor
all expenses you reasonably incur (including attorneys'fees)^ (i) to enforce the terms of tbis
Agreement or any obligation owed to you by us (whether or not you initiateaiegal proceeding,
unless you initiate and fail to substantially prevail in such court or formal legal proceeding); and

0 1 / 1 5
CycleBar - Franchise Agreement 38
EAST\86749142.5
(i^in the defense ot any olaim we
or other formallegal proceedings.

Seotient^ Misoe^neeu^

t7 t Entire Aoreement This Agreement and the documents referred to herein

constitute the entire agreement between you and us with respect to the Studio and supersede
aiiprior discussions, understandings, representations, and agreements concerning the same
subject matter This Agreement includes the terms and conditions on Appendix A,whicb are
incorporated into this Agreement by this reference.

t7 2 Amendments and Modifications This Agreement may be amended or

modifiedoniybyawrittendocumentsigned by each party to this Agreement. The Manuals and
any policies that we adopt and implement may be changed by us from time to time.

t 7 3 Waiver Any term or condition of this Agreement may be waived at any

time by the party which is entitled to the benefit of the term or condition, but such waiver must
be in writing. No course ot dealing or pertormance by any party,and no failure,omission,delay,
or forbearance by any party,in whole or in part,in exercising any right, power,benefit,or
r e m e d y , w i l l c o n s t i t u t e a w a i v e r o f s u c h right, power, benefit, or remedy Our waiver of any
particular default does not affect or impair our rights with respect to any subsequent default you
may commit Our waiver ofadetauit by anotherfranchisee does not atfect or impair our right to
demand your striot compliance with the terms of this Agreement We have no obligation to deal
with similarly situated franchisees in the same manner Our acceptance of any payments due
from you does not waive any prior defaults.

t74 Importance of Timely Performance Time is o f t h e essence in this

Agreement

t75 Oonstruction The headings in this Agreement are for convenience of

reference and are notapart of this Agreement and will not affect the meaning or construction ot
any ofits provisions. Onlessotherwisespecified,all references toanumber of days shall mean
calendar days and not business days The words ^ n c l u d e B ^ n c l u d m g B and words ot similar
import shail be interpreted to mean including, but not limited to''and the terms f o l ^
words shall be interpreted as examples of, and not an exhaustive iist of, the appropriate subject
matter.

t7.6 Severability. Each provision o f t h i s Agreement isseverablefrom the

others. If any provision of this Agreement or any of the documents executed in conjunction with
t h i s A g r e e m e n t i s f o r a n y r e a s o n d e t e r m i n e d b y a c o u r t t o b e i n v a l i d , illegal,or unenforceable,
the invalidity, illegality, or unenforceability will not affect any otber remaining p
Agreement or any other document. Tbe remaining provisions will continue to be given full force
and effect and bind us and you.

t77 Aoolicabie State Law Oontrollino if the termination, renewal, or other

provisions set torth in this Agreement are inconsistent with any applicable state statute, in effect
as of the Effective Oate, governing the relationship of us and franchisees, the provisions of such
statute will apply to tbis Agreement, but oniy to the extent of such inconsistency.

t78 Survival Each provision ot tbis Agreement that expressly or by

reasonable implication is to be pedormed,in whole or in part, after the expiration,termination,^

C y o ^ B a r F r a n o h ^ Agreement 39 0t/t5
E A ^ ^ ^ t 4 2 5
T r a n s a c t ^ 5 Agreement w i l l s ^
not limited to, Sections 9 (inteiieotuai Property 10 (Propnetaty information), tt
(indemnitioation), t2 (Yoor Covenant Not to Compete), and t5 (Yoor Obligations Opon
Expiration orTermination).

t79 Consent. W b e n e v e r o o r p r i o r written approvaloroonsent is regoired

ondertbisAgreement, yoo agreeto makeatimeiywritten regoest to os for soob oonsent. Cor
approval or oonsent most be in writing and signed by an aotborized officer to be effective.

t7 t0 Independent Contractor Relationsbio. Tbis Agreement does not create,

nor does any condoct by os create,atidociary or otber special relationsbip or make yoo or os
an agent, legal representative,joint ventorer,partne4 employee or servant of eacb otber for any
porpose. Yoo are not aotborized to make any contract, agreement, warranty, or representation
on oor bebalf, or to create any obligation, express or implied, on oor bebaif. Y o o a r e , a n d s b a l l
remain, an independent contractor responsible tor all obligations and liabilities of, and for a^^
or damage to, tbe Stodio and its bosiness, incloding any personal property, Operating Assets, or
reai property and tor ail claims or demands based on damage or destroction of property or
based on injory, illness or deatb of any person or persons,directly or indirectly,resolting from
tbe operationof tbe Stodio Eortber,we and yoo are not and do not intend to be partners,
associates, or joint employers in any way, and we sball not be constroed to be jointly liable for
any ot yoor acts or omissions onder any circomstances. We bave no relationship witb yoor
employees and yoo bave no relationship witb oor employees.

t7.tt Notices. All notices and othercommonications regoired or permitted

onder this Agreement will be in writing and will be given by one of the following methods ot
delivery^ (i)personally; (ii) by certifiedorregisteredmail, postage prepaid; (iii)by overnight
delivery service; or (iv) by facsimile (if the sender receives machine confirmation of soccessfol
transmission) Notices to yoo will be sent to tbe address set forth on AppendixA Notices to os
most be sent to^

CycleBar Franchising, LLC

7720 Montgomery Road, Soite 200
Cincinnati,Ohio45236
Attn^ kristian Higgs, Esg.
Fax^ (513)297 9212

Either party may change its mailing address or facsimile nomber by giving notice to the other
party Notices will be deemed received the same day when delivered personally, opon
attempted delivery when sent by registered or certified mail or overnight delivery service, or tbe
next bosiness day when sent by facsimile.

1712 Execotion in Coonteroarts This Agreement may be execoted in two or

more coonterparts,eachof which will be deemed an original,and ail of which will constitote one
and tbe same instroment.

17.13 Soccessors and Assigns. Except as expressly otherwise provided herein,

this Agreement is binding opon and wiii inore to tbe benefit of tbe parties and their respective
heirs, execotors, legal representatives, soccessors, and permitted assigns.

CycleBar - Franchise Agreement 40 01/15

EAST\86749142.5
 1714 N o T h i ^ Partv B e n ^ c i a h ^ Except as e x p ^ ^ o ^ ^ s e provided
herein, oo third party shall bave the dght to claim any of the b e n e ^
Agreement
1715 AdditionalTerms^lnconsistentTerms The parties may provide additional
terms by incloding the terms on AppendixA Tothe extentthatany provisions ot AppendixA
are indirectconflictwith the provisions of this Agreement, the provisions otAppendixAshall
control.
Section 18 Yoor Representations and Acknowledgments
Yoo (on behalf otyoorself and yoor Owners) represent, warrant, and acknowledge as
follows^
18.1 Troth ot Intormation The information (incloding withoot limitation all
personal and financial information) that yoo and yoor Owners have fornishedorwill fornish to os
relating to the sobject of this Agreement is troe and correct in all material respects and inciodes
all material facts necessary to make soch information not misleading in light of the
circomstances when made

18 2 OoeAothoritv Tbis Agreement has been doly aothorized and execoted

by yoo or on yoor behalf andconstitotesyoor valid and binding obligation, enforceable in
accordance with its terms, sobject to applicable bankroptcy, moratoriom, insolvency,
receivership, and other similar laws affecting the rights ot creditors generally

18 8 Terrorist Acts Yoo acknowledge that onder applicable O S law,

incloding, withoot limitation, Execotive Order 18224, signed on September 28, 2001 (the
"Order"), we are prohibited from engaging in any transaction with any person engaged in, or
with a person aiding any person engaged in, acts of terrorism, as defined in the Order.
Accordingly, yoo represent and warrant to os tbat, as otthe date of this Agreement, neither yoo
nor any personholdinganyownership interest inyoo,controlled by yoo,or onder common
control with yoo is designated onder tbe Order asaperson with whom bosiness may not be
transacted by os, and that yoo^(i) do not, and hereafter will not, engage in any terrorist activity;
(ii) are not affiliated with and do not sopport any individoal or Entity engaged in, contemplate
or sopporting terrorist activity; and (iii) are not ac
with the intent to generate fonds to channel to any individoal or Entity engaged in,
contemplating, or sopporting terrorist activity,or to otherwise sopport or forther any terrorist
activity.
184 independent Investioation Yoo have condocted an independent
investigationof the bosinessventorecontemplatedby this Agreement andrecognizethat it
involves bosiness risks and that yoor resolts will be largely dependent opon yoor own efforts
and ability Yoo bave been accorded ample time to consolt witb yoor own legal coonsei and
other advisors aboot the potential risks and benefits of entering into this Agreement, and we
have advised yoo to do so.

t 8 5 Timely Receipt and Reviewof Aoreementand Oisclosore Oocoment

Yoo bave received an execotion ready copy ofthis Agreement at least seven calendar days
before yoo execoted this Agreement or any related agreements or paid any consideration to os.
Yoo havealsoreceivedaEranchise Oisclosore Oocoment (tbe ^EOO") regoired by applicable
state andtor federal laws, inclodingatorm ofthis Agreement, at least14calendar days (or soch

C y ^ e B a r D F r a n o h ^ e Agreement 41 0t/t5
E A ^ r ^ ^ t ^
long-time period as r e q o ^
any reiated agreements or paid any consideration to os Yoo have reviewed this Agreement
and the POO and have been given ample opportonity to oonsoit with, and ask qoestionsot, oor
representatives regarding the docoments Yoo have no knowledge of any representations
madeaboot the OycieOar franchise opportonity by os,ooraftiiiates,or any otoor or their
officers, directors, owners, or agents tbat are contrary to the statements made in oor POO or to
tbe terms and conditions ofthis Agreement. Yoo have read this Agreement and oor POO and
onderstand and accept that the terms and covenants in this Agreement are reasonable and
necessary tor os to maintain oor high standards of goality and service, as well as the oniformity
ot those standards at each Stodio, and to protect and preserve tbe goodwill of the Marks

t8 6 Financial Pertormance Representations Except as may be stated In the

FOO,neitherwe, nor any of oor atfiliates, nor any of oor or oor atfiliates'ofticers,agents,
employees, or representatives have made any representation to yoo, express or implied, as to
the historical revenoes, earnings, or profitability ot any CycleRar Stodio orthe anticipated
revenoes, earnings, or profitability otthe bosiness sobject to the License or any other bosiness
operated by os, oor licensees, oor franchisees, or oor affiliates In entering into tbis Agreement,
yoo are not relying opon any intormation tornisbed by os or oor representatives other than the
information contained in this Agreement and the POO Any intormation yoo have acgoired from
otber CycleBar franchisees regarding their sales, profits or cash flows is not information
obtained from os, and we make no representation aboot that information's accoracy

^gnaforepagefeilow^

5
CycleBar - Franchise Agreement 42 01 ' 1
EAS'n86749142.5
 IN WITNESS W H E R E O F , each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar - Franchise Agreement 43 01/15

EAST\86749142.5
 APPENDIX A
TO THE
FRANCHISE AGREEMENT
FRANCHISEE-SPECIFIC TERMS

1. Effective Date:

2. Franchisee's Name:

3. Franchisee's State of Organization (ifapplicable):

4. Ownership of Franchisee (Recital C):

If the franchisee is an Entity (as defined in the Agreement), the following persons
constitute all of the owners of a legal and/or beneficial interest in the franchisee:

Name Percentage Ownership

5. Operating Principal (Recital C):

6. Site Selection Area (Section 1.1):

7. Franchise Fee (Section 3.1):

6. Operating Principal (Section 1.4):

7. Key Manager (Section 1.4):

8. Franchisee's Address and Fax Number for Notices (Section 17.11):

9. Additional Terms; Inconsistent Terms (ifany) (Section 17.15):

CycleBar - Franchise Agreement A-1 01/15

EAST\86749142.5
 Signature Page for Appendix A f Franchisee-Specific Terms)

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:
Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar - Franchise Agreement A-2 01/15

EAS'n86749142.5
 Schedule 1 to Appendix A of the Franchise Agreement

Franchisee-Specific Terms

(to be completed after site selection and acceptance)

1. Site (Section 4.2):

2. Territory (Section 4.3):

CycleBar Franchising, LLC agrees that, effective on the date specified below, (i)
the address listed above is hereby accepted by us as the Site pursuant to
Section 4.2 (Site Selection) of this Agreement; and (ii) the area listed above
shall be the Territory of this Agreement pursuant to Section 4.3 (Definition of the
Territory) of this Agreement.

C Y C L E B A R FRANCHISING, L L C :

By:
Name:
Title:

Date:

Acknowledged and Agreed:

[Franchisee]

By:
Name:
Title:

Date:

0 1 / 1 5
CycleBar - Franchise Agreement A-3
EASTV86749142.5
 APPENDIX B
TO THE
FRANCHISE AGREEMENT

Marks

Registered Marks

Mark Registration No. | RegistrationDate

C Y C L E BAR 4,049,076 | 11/1/11

Trademark ADplications

Mark Application No. | Application Date

86,413,102 10/2/14

o CYCLEBAR 86,410,523 9/30/14

CycleBar - Franchise Agreement B 01/15

r
EAS R86749142.5
 APPENOIXC
TOTHE
ERANCHISE A G R E E M E N T

CYCLERARERANCHISING^LC
P A Y M E N T ANO R E R E O R M A N C E G O A R A N T E E

I n o ^ to induce G y ^ e R a r E r ^
Eranchise Agreement (the "Eranchise A g r e e m e n t by and between Erancbisor and the
Franchisee named in the Franchise Agreement dated to which this Payment
and Pedormance Guarantee (the " G u a r a n t e e ^ ^
(cciiectiveiy referred to as t b e " G u a r a n t e r s " a n d i n d i v i d u a i i y r e t e r ^
hereby covenant and agree as tciiews:

1 Guarantee ef Payment and P e r f e r m a n c e . T b e Guarantors jointiy and severaiiy

unconditionaiiy guarantee to Franchisor and its attiiiates the payment and pertormance when
due,wbether by acceieration or otherwise,of aii obiigations, indebtedness, and i i a b i e
Franchisee to Franchisor, direct or indirect, absolute or contingent, ot every kind and nature,
whether now existing or incurred trom time to time hereafter, whether incurred pursuant to the
Franchise Agreement or othenvise, together with any extension, renewai, or modification thereof
in whoie or in part (the "Guaranteed L i a b ^ t l e s " ) The Guarantors agree that if any of the
Guaranteed Liabilities are not so paid or performed by Franchisee when due, the Guarantors
wiii immediately do so The Guarantors further agree to pay aii expenses (including reasonable
attorneys'fees) paid or incurred in endeavoring to enforce this Guarantee or the payment ofany
Guaranteed Liabilities The Guarantors represent and agree that they have each revieweda
copy of theFranchise Agreement and have had the opportunity to consult with counsel to
understand the meaning and import of tbe Franchise Agreement and tbis Guarantee.

2. Waivers by G u a r a n t e r s . T b e Guarantors waive presentment, demand, notice ot

dishonor, protest, and all otber notices whatsoever, including without limitation notices of
acceptance hereot,of the existence or creation of any Guaranteed Liabilities, of the amounts
andtermsthereof, ofall defaults, disputes, or controversies between Franchisorand F r a n c h ^
and of the settlement, compromise, or adjustment thereof Tbis Guarantee is primary and not
secondary, and will be enforceable without Franchisor having to proceed first against
Franchisee oragainst any o r a l l o t t h e G u a r a n t o r s o r a g a i n s t any othersecurity forthe
Guaranteed Liabilities This Guarantee will b e e f f e c t i v e r e g a r d l e s s o f theinsolvency ot
Franchisee by operation of law, any reorganization, merger, or consolidation of Franchisee, or
any change in the ownership of Franchisee.

3. Term: Ne Waiver. This Guarantee will be irrevocable, absolute, and

unconditional and will remain in full force and effect as to each of the Guarantors until the later
ot(i) such time as all Guaranteed Liabilities of Franchisee to Franchisor and its a f t i ^ ^
been paid and satisfied in full, or (ii) the Franchise Agreement and all obligations of Franchisee
thereunder expire No delay or failure on tbe part of Franchisor in the exercise of any rigbt or
remedy will operate a s a w a i v e r thereof, and no single or partial exercise by Franchisor ofany
right or remedy will preclude other further exercise ofsuch rigbt or any other right or remedy

4. Other Covenants. Each of the Guarantors agrees to comply with tbe provisions
of Sections 8 (Records, Reports, Audits, and Inspections), 9 (Intellectual Property), tO
(Proprietary Intormation), tt (Indemnification), and t 2 (Your Covenant Not to Compete) ottb^
Franchise Agreement as though each such Guarantor were the^Franchisee" named in the

O ^ B ^ O ^ ^ e t 0t/t5
E A ^ r ^ 7 ^ ^
Franchise Agreement and agrees that the undersigned will take any and all actions as may be
necessary or appropriate to cause Franchisee to comply with the Franchise Agreement and will
not take any action that would cause Franchisee to be in breach of the Franchise Agreement.

5. Dispute Resolution. Section 16 (Dispute Resolution and Governing Law) of the

Franchise Agreement is hereby incorporated herein by reference and will be applicable to any
all disputes between Franchisor and any of the Guarantors, as though Guarantor were the
"Franchisee" referred to in the Franchise Agreement.

6. Miscellaneous. This Agreement will be binding upon the Guarantors and their
respective heirs, executors, successors, and assigns, and will inure to the benefit of Franchisor
and its successors and assigns.

IN WITNESS WHEREOF, the undersigned Guarantors have caused this Guarantee to

be duly executed as of the day and year first above written.

Print Name:

Print Name:

Print Name:

Print Name:

CycleBar - Guarantee 2 01/15

EAST\86749142.5
 APPENDIX D
TO THE
FRANCHISE AGREEMENT

L E A S E RIDER

THIS L E A S E RIDER is entered into this day of , 20 by

and between CycleBar Franchising, LLC ("Company"),
("Franchisee"), and ("Landlord").

W H E R E A S , Company and Franchisee are parties to a Franchise Agreement dated

, 20 (the "Franchise Agreement"); and

W H E R E A S , the Franchise Agreement provides that Franchisee will operate a CycleBar

retail Studio ("Studio") at a location that Franchisee selects and Company accepts; and

W H E R E A S , Franchisee and Landlord propose to enter into the lease to which this Rider
is attached (the "Lease"), pursuant to which Franchisee will occupy premises located at

(the "Premises") for the purpose of constructing and operating the Studio in accordance with
the Franchise Agreement; and

W H E R E A S , the Franchise Agreement provides that, as a condition to Company's

authorizing Franchisee to enter into the Lease, the parties must execute this Lease Rider;

NOW, T H E R E F O R E , in consideration of the mutual undertakings and commitments set

forth in this Rider and in the Franchise Agreement, the receipt and sufficiency of which the
parties acknowledge, the parties agree as follows:

During the term of the Franchise Agreement, Franchisee will be permitted to use the
Premises for the operation of the Studio and for no other purpose.

Subject to applicable zoning laws and deed restrictions and to prevailing community
standards of decency, Landlord consents to Franchisee's installation and use of such
trademarks, service marks, signs, decor items, color schemes, and related components of the
CycleBar system as Company may from time to time prescribe for the Studio.

Landlord agrees to furnish Company with copies of all letters and notices it sends to
Franchisee pertaining to the Lease and the Premises, at the same time it sends such letters and
notices to Franchisee.

Company will have the right, without being guilty of trespass or any other crime or tort, to
enter the Premises at any time or from time to time (i) to make any modification or alteration it
considers necessary to protect the CycleBar system and marks, (ii) to cure any default under
the Franchise Agreement or under the Lease, or (iii) to remove the distinctive elements of the
CycleBar trade dress upon the Franchise Agreement's expiration or termination. Neither
Company nor Landlord will be responsible to Franchisee for any damages Franchisee might
sustain as a result of action Company takes in accordance with this provision. Company will
repair or reimburse Landlord for the cost of any damage to the Premises' walls, floor or ceiling
that result from Company's removal of trade dress items and other property from the Premises.

CycleBar - Lease Rider 1 01/15

EAS'I\86749142.5
 Franchisee will be permitted to assign the Lease to Company or its designee upon the
expiration or termination of the Franchise Agreement. Landlord consents to such an
assignment and agrees not to impose any assignment fee or similar change, or to increase or
accelerate rent under the Lease, in connection with such an assignment.

If Franchisee assigns the Lease to Company or its designee in accordance with the
preceding paragraph, the assignee must assume all obligations of Franchisee under the Lease
from and after the date of assignment, but will have no obligation to pay any delinquent rent or
to cure any other default under the Lease that occurred or existed prior to the date of the
assignment.

Franchisee may not assign the Lease or sublet the Premises without Company's prior
written consent, and Landlord will not consent to an assignment or subletting by Franchisee
without first verifying that Company has given its written consent to Franchisee's proposed
assignment or subletting.

Landlord and Franchisee will not amend or modify the Lease in any manner that could
materially affect any of the provisions or requirements of this Lease Rider without Company's
prior written consent.

The provisions of this Lease Rider will supersede and control any conflicting provisions
of the Lease.

Landlord acknowledges that Company is not a party to the Lease and will have no
liability or responsibility under the Lease unless and until the Lease is assigned to, and
assumed by, Company.

IN WITNESS W H E R E O F , the parties have executed this Lease Rider of the date first
above written:

COMPANY: FRANCHISEE:

C Y C L E B A R FRANCHISING, LLC

By: By:
Name: Name:
Title: Title:

LANDLORD:

By: _
Name:
Title:

CycleBar - Lease Rider 2 01/15

EAS'I\86749142.5
 EXHIBIT B
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Development Agreement

(attached)

Franchise Disclosure Document 01/15

EAST\87466944.6
 DEVELOPMENT AGREEMENT
between

CYCLEBAR FRANCHISING, LLC

and

Developer:,
Area:

CycleBar -Development Agreement 01/15

EASTW579943.3
 T A B L E OF CONTENTS

Page

1. Orantot Oevelopment Pights and Oevelopment Area 1

2 E e e s ^
3. Oevelopment Sobedule 2
3Bl Deadlines 2
3.2 Damaged Studios 2
4. Oevelopment Area 2
4Bl Oevelopment Area 2
42 NoOtberPestnotlonOnOs 2
5. Term 3
6. Termination ^ 3
6 t Events otOetault 3
3.2 Our Remedies 3
7. Assignment 4
3. Eranohlsee'sOovenant Not to Compete 4
3 t In Term Covenants 4
3^2 Eost Term Covenants 4
3.3 EubllolyTraded Corporations 5
34 Covenants ot Others 5
3.5 Enforcement of Covenants 5
9. Incorporation of OtherTerms 5
tO.Miscellaneous 6

AppendlxA^EranchlseeSpeclflcTerms
A p p e n d l x E ^ E o r m of Eranchise Agreement
AppendixC^Eayment and Performance Ouarantee

C^eBar Oe^oomeotAg^emeot ^ 0t/t5

^ S ^ 5 ^ ^
 CYCLEBAR
OEVELCRMENT AGREEMENT

TRIS A G R E E M E N T ' S " A g r e e m e n t s

forth eo A p p e n ^ A e f this A g r e e m e ^ ^ e " E t t e e t ^ e Oate")
and soheduies attached to this Agreement are hereby inoorporated by this r^^^
C Y C L E R A R E R A N C H i S i N G , L L C , an Chio limited iiabiiity company with its p^^^
business at 7720 Montgomery Road, Suite 200,Cincinnati, Chio 45236 ( " C y c l e B a r " ) , ^
personorentityidentitiedonAppendixAasthefranchisee("Erancbi8ee")witbitsprinci^^^
piaceotbusinessassettorth on AppendixA in this Agreement, " w e B " o 8 B and " e o r " refers
toCycieRar. " Y o o " and " y e o r " refers to Eranchisee.

RECITALS

A W e a n d y o u h a v e e n t e r e d i n t o a c e r t a i n Franchise Agreement dated the same

date as this Agreement (the "Initial Erancblse Agreement"), in which we have gran^^^
rightto establish and o p e r a t e o n e C Y C L E R A R ^ s t u d i o (a "Stodio")

R We desire to grant to you the exclusive right to establish and operateaspecified

numberof Studios within aspecitied geographical a r e a i n accordance with adevelopment
schedule

C Ifyou areacorporation, limited liability company,partnership,or other entity

(collectively, an "Entity"),all of your owners o f a l e g a l and/or beneficial interest in
(the "Cwners") are listed on Appendix A of this Agreement (Appendix A and all other
appendices hereto being hereby incorporated herein by reference).

0 You desire to establish andoperateadditional Studios upon theterms and

conditions contained in our then current standard franchise agreements (a "Erancblse
AgreemenL"thecurrentformofwhichisattached hereto as Appendix R).

N C W ^ T H E R E E C R E , for and in consideration of the foregoing premises and the mutual

covenants and agreements contained herein, and for other good and valuable consideration,
thereceipt and sufficiency of whichareherebyacknowledged,tbepartieshereby agree as
follows:

^ Grant of OeveloomentRiobts and Oevelopment Area.

Subject to the terms and conditions of this Agreement, we grant to you tbe right, and you
undertake the obligation,to establish and operate in the area designated on AppendixAto tbis
Agreement (the"Oevelopment Area") tbe number of Studios specified in the development
schedule i n A p p e n d i x A ( t h e " S c b e d o l e " ) This Agreement does not grant you any rightto use
tbe Marks (as detined in your Initial Eranchise Agreement) or the System (as defined in your
Initial Eranchise Agreement) Rights to use the Marks and the System are granted only by the
Eranchise Agreements.

2. Eees.

OponexecutionofthisAgreement,you must pay usadevelopment fee in the amount

specitiedonAppendixA(the "Oevelopment Eee"),which is based on the initial franchise fee
you must payfor each Studio that you develop (tbe "ErancbiseEeeB'wbich is also specified on

C ^ e S a ^ O e v e i o o m ^ Agreemem ^ 0^t5
^S^875^^3
Appendix^ TheOeve^pmentFeew^becred^
ooder the Eranohise Agreement tor each Studio that you dev^^
The Oevelopment Fee is tuily earned by us when we and you sign thi^
refundable, even if you do not oomply with the Soheduie OponexeoutionoteaohFranohise
Agreement, you must pay us an initiai training tee in the amount specified in AppendixAfor
each Studio that you develop (the "Training Fee")

3. OeveioomentSebedoie.

Oeadiines. You must enter into Franchise Agreements and open and operate
Studios in accordance with the deadlines set forth in tbe Schedule. 8y each "Fee Oeadiine"
specitied intheSchedule,you must have delivered to us the Training Fee andasigned copy ot
ourthen currentstandardform of Franchise Agreement for tbe number of Studios specified on
tbe Schedule Oyeach "Opening Oeadiine"specified in the Schedule, you must have the
specified number of Studios open and operating You must locate the Studios only at sites tbat
we have accepted in accordance with the terms of the applicable Franchise Agreement.

3.2 Oama^ed Studies. IfaStudioisdestroyed or damaged by any cause beyond

your control such tbat it may no longer continue to be open tor tbe operation of business, you
must immediately give us notice ofsuch destruction or damage ("Oestructien Events You
must diligently work to repair and restore the Studio to our approved plans and specifications as
soon as possible at the same location or at a substitute site accepted by us within the
Oevelopment Area IfaStudio is closed due toaOestructionFvent, tbe Studio will continue to
be deemeda^Studio in operations for the purpose ofthis Agreement tor up tot80 days attertbe
Oestruction Event occurs IfaStudio (i)isclosed inamanner other than those described inthis
Section 3.2 or as otherwise agreed by us in writing or (ii) tails to reopen witbint^O days aftera
Oestruction Event, then we may exercise our rights under Section 6.2 (Our Remedies).

4. OeveieomentArea.

4Bi OeveieomentArea. Except as provided in this Sectiontt,while this

Agreement is in effect, provided that you open and operate the Studios in each Studio Category
in accordance with the Schedule and tbe minimum number of Studios in each Studio Category
that you have open and operating in the Oevelopment Area at any given time is not less than
the minimum required pursuant to the Schedule, we will not operate, or license any person other
than you to operate,aStudio under the Marks (as detined in your Initial Franchise Agreement)
and the System (as defined in your Initial Franchise Agreement) within the Oevelopment Area.

4.2 Ne Otber Restrictien On Os. Except as expressly provided in Section4tor

any otheragreement between theparties, w e a n d o u r affiliatesretain theright, incur sole
discretion, to conduct any business activities, under any name, in any geographic area, and at
any location, regardless of the proximity to or effect on your Studios. For example, we and our
affiliates bave tbe rigbt to:

(a) Establish or licensefranchises and/orcompanyowned indoor cycling

studios or other facilities or businesses offering similar or identical products, services,
andclassesandusing theSystem orelements otthe System (i)under the Marks
anywhere outside otthe Oevelopment Area or (ii) under names, symbols, or marks other
than the Marks anywhere, including inside and outside otthe Oevelopment Area;

CycleBar - Development Agreement ? 01/15

EAST\87579943.3
 (b) 5^1 Or Or ^ 0 0 5 0 0 ^ 5 ^
0^5505 using thoMarks or othor marks through any ^ornativod^^^
inoiuding,without limitation,throughooommoroo, in r o ^
via oniinovidoos, or via broadcast modia,anywhoro, including insido and o u t s ^
OovoiopmontAroa;

(c) Advortiso, or authorize others to advortisoanywhoro^ using tho Marks;

(d) Acquire, be acquired b y , o r merge with other companies with existing

titnesstacilities, fitness businesses, and/or studios anywhere (including inside or o u ^
otthe Oevelopment Area) and, even it such businesses are located in the Oevelopment
Area, (i) convertthe other b u s i n e s s e s t o t b e P y c l e S a r name, (ii) permit theother
businesses to continue to operate under another name, and/or (iii) permittbe businesses
to operate under another name and convert existing Studios to such other name; and

(e) Engage in any other activity, action or undertaking that we are not
expressly prohibited from taking under tbis AgreemenL

5. Term.

This Agreement expires at midnight on the last Opening Oeadline date listed on the
Schedule,unless this Agreement is terminated sooner as provided in other sections of this
AgreemenL

6. Termmatien.

^ Events e f O e t a u l L Anv one or more of the following constitutes an ^ E v e n t e f

Oetault" under this AgreemenL

(a) You tail to pay any Eranchise Eee or execute any Eranchise Agreement
by any Eee Oeadline specified in the Schedule;

(b) You fail to have open and operating the minimumnumberot Studios
specified in the Schedule by any Opening Oeadline specitied in the Schedule;

(c) An Event of Oetault occurs under any Eranchise Agreement, resulting in

the termination ofsuch Eranchise Agreement; or

(d) You breach or otherwise fail to comply fully with any other provision
contained in this Agreement,including Section8(Eranchisee'sOovenant Not to Oompete).

6.2 Our R e m e d i e s . l t any Event of Oetault occurs under S e c t i o n 6 t , w e may,at our

sole election, declare this Agreement and any and all other rights granted to you under this
Agreement to be Immediately terminated and of no further force or effect Opon terminationof
this Agreement for any other reason whatsoever, we will retain the Oevelopment Eee and you
will not be relieved of any of your obligations, debts, or liabilities hereunder, including w
limitation anydebts, obligations, or liabilities which bave accrued priorto such te^ Your
failure to open and thereafter operate Studios in accordance with tbe Schedule will not, in itself,
constitute cause for us to terminate any previously executed Eranchise AgreemenL

CyckB=r_Devekpmen,A«r=«n«n, 3 ^ 7 5 7 ^ 1
7. Ass^nmenL

This Agreement and the n g h t s ^

and neither this AgreemenL ner any otthe rights granted te you h e r e u n ^
equity interest in you may be voiuntariiy or invoiuntariiy,direotiy or i n d ^ ^
or otherwise, assigned or otherwise transferred, given away, or encumbered by you without ou^
prior written approval, whioh we may grant or withhold tor any or no reason, it you or your
Owners intend to transfer any interest in you or this Agreement,we shaii havearight of tirst
refusal in aooordanoe with the procedure set torth in Seotiont3.9(Our Rigbt of First Refusal) ot
the Initial Franchise Agreement. We may assign this Agreement or any ownership interests in
us without restriction.

8. Francbisee^OevenantNetteOomoete.

8.1 InDTermOeveoants. You acknowledge that you will receive valuable,

specialized training and confidential intormation regarding the manufacturing, operat^^^
promotional,and marketing methods ot the OycleRar concept. Ouring theTerm,you and your
Ownerswillnot,withoutourpriorwritten consent,either directiy or indirectly, for themselves, or
through, on behalf ot, or in conjunction with any other person or entity:

(a) own, manage, engage in, be employed by, advise, make loans to, or have
any other interest in (i) any business that offers indoor cycling classes, (ii) any
gymnasium, studio, athletic or fitness center, healthclub,exercise, indoor cycling, or
aerobics facility, or similar facility or business, or (iii) any entity that grants trancbi^^
licenses for any ot these types ot businesses (collectively, each, a "Oempet^ve
Rusmess") at any location in the United States;

(b) divert or attempt to divert any business or customer or potential business

or customer of the Studio to any competitive Business, by direct or indirect inducement
orotherwise;

(c) perform, directly or indirectly, any other act injurious or prejudicial to the
goodwill associated witb the Marks and the System;

(d) use any vendor relationship established through your association with us
tor any purpose other than to purchase products or equipment for use or retail saie in the
Studios; or

(e) directly or indirectly solicit for employment any person who at any time
within the immediate past t2 months has been employed by us, or our affiliates, or by
any ot our franchisees.

8.2 ResfDTermOevenanfs. Fortwo years attertbe expiration ortermination ofthis

Agreement or an approved transfer toanew franchisee,you and your Owners may not, without
ourpriorwrittenconsent,(i)directlyorindirectlyown, manage, engage in, be employed i n a
managerial position by, advise, make loans to, or have any other interest in any Oompetitive
Rusinessthatis(orisintendedtobe) located withinatenmile radius otthe Oevelopment Area
orany other Studiothatisoperating or underdevelopmentatthetimeof such expiration,
termination,or transferor (ii)solicit for employment any person who at any time within the
immediate past t2 months has been employed by us, or our affiliates, or by any ot our

C ^ e B a r D O e ^ o p m e o t Agreemem ^ 0t/t5
E A S ^ 5 7 ^ 3 3
^ o h i 5 e e 5 With ^speotto the Owners the ^
expiratio^terminatio^ertransterotthis Agreeme
relationship with you, whichever occurs tirst

8^ P o ^ c l v Traded C o ^ o r a t i o o ^ Ownershipof iess than 5 ^ otthe outstanding

voting stock ot any class of stock otapubiiciy traded corporation wiii not, by itseit,vioiat^
Sections

8.4 CeveoaotsefOtbers. The Owners personally bind themselves to this Sections

bysigningtheOuaranteethatis attached as AppendixOto this Agreement. You must also
obtain trom your otticers, directors, managers, instructors, Owners^ spouses, and other
individuals that we may designate executed agreements containing nondisclosure and
noncompete covenants similar in substance to those contained in this Section8as we prescribe
in theManuals and otherwise Theagreementsmustbeinaformacceptabletousand
specifically identity us as having the independent right to enforce them.

8.5 Enforcement etOevenaots. You acknowledge and agree that^the time,

territory and scope of the covenants provided in this Section8are reasonable and necessary for
the protection of our legitimate business interests;(ii)youbave received sufficient and valid
consideration in exchange for those covenants; (iii) enforcement of the same would not impose
undue hardship; and (iv) the period of protection provided by thesecovenants will not be
reducedby any period of timeduring which you arein vioiationot theprovisions of those
covenants or any period ot time required for enforcement of those covenants. Tothe extent tbat
tbis Section8is judicially determined to be unenforceable by virtue of its scope or in terms of
area or length of time, but may be made enforceable by reductions of any or all thereof, tbe
same will be enforced to the fullestextent permissible. You agree that the existence of any
claim you may have against us,whether or not arising from this Agreement,will not constitutea
defense to our enforcement of the covenants contained in this Section 8. You acknowledge tbat
any breach or threatened breach ot this Section8will cause us irreparable injury tor which no
adeguate remedy at law is available, and you consent to the issuance ot an injunction
prohibiting any conduct violating the terms ofthis Section 8. Such injunctive relief will be in
addition to any other remedies that we may have.

9. Incorporation of Otber Terms.

Section tO(Eroprietary information), Section t8 (Dispute Resolutionand Ooverning

Law), Section t7 (Miscellaneous), and Section t8 (Your Representations and
Acknowledgements) of thelnitial Eranchise Agreement are incorporatedby reference in this
Agreement and will govern all aspects ot our relationship and the construction ofthis Agreement
as if fully restated within the text ofthis Agreement.

tO. Miscellaneous. Oapitalized terms used and not otherwise detined in this
Agreement shall have tbe meanings set forth in the Initial Eranchise Agreement. Tbis
Agreement, together with the Initial Eranchise Agreement, supersedes all prior agreements and
understandings,whether oral and written,among the parties relating to its subject matter, and
there are no oral or other written understandings, representations, or agreements among tbe
parties relating tothe subjectmatterof tbis Agreement. ThisAgreementmaybesignedin
multiple counterparts, but all such counterparts together shall be considered one and the same
instrument The provisions of tbis Agreement may be amended or moditied only by written
agreement signed by the party to be bound.

CycleBar- Development Agreement 5 01/15

EAS"n87579943.3
 IN WITNESS WHEREOF, each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:
Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar - Development Agreement 01/15

EAST\87579943.3
 APPENDIX A
TO THE
DEVELOPMENT AGREEMENT

FRANCHISEE-SPECIFIC TERMS

1. Effective Date (First Paragraph):

2. Franchisee's Name:

3. Franchisee's State of Organization (if applicable):,

4. Development Area (Section 1): [attach map if necessary]

5. Total Development Fee (Section 2): $_

6. Franchise Fee for each Studio developed pursuant to this Development

Agreement (Section 2): $

7. Training Fee for each Studio developed pursuant to this Development Agreement
(Section 2): $

8. Development Schedule (Section 3): You agree to establish and operate a total of
Studios within the Development Area during the term of this Agreement. The Studios
must be open and operating in accordance with the following Schedule:

MINIMUM N U M B E R F E E DEADLINE MINIMUM NUMBER O F OPENING DEADLINE

OF STUDIOS Deadline for Paying STUDIOS Deadline for Having the
The Minimum Number Training Fee and The Minimum Number of Minimum Number of
of Studios for Which Executing Studios Open and Studios Open and
Training Fees Have Franchise Agreement for Operating by Each Operating
Been Paid and The Minimum Number of Opening Deadline
Franchise Agreements Studios Paid and Signed
Executed by Each Fee
Deadline
,20 .20
, 20 .20
, 20 .20
,20 .20
, 20 ,20
.20 .20
,20 , 20
.20 .20
(the Expiration Date of
the Agreement)

CycleBar - Development Agreement A-1 01/15

EAST\87579943.3
9. Ownership of Franchisee (Recital C): If the franchisee is an Entity, the following
persons constitute all of the owners of a legal and/or beneficial interest in the franchisee:

Name Percentage Ownership

10. Other Terms:

0 1 / 1 5
CycleBar- Development Agreement /\_2
EASTW579943.3
 Signature Page for Appendix A (Franchisee-Specific Terms)

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title: "
Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar - Development Agreement A-3 01/15

EAST\87579943.3
 APPENDIX B
TO THE
DEVELOPMENT AGREEMENT

Form of Franchise Agreement

[See Exhibit A to Franchise Disclosure Document]

^Bar_Dcvek)pmeNAuroe^ B EASTW57%3
 APPENO^C
TOTHE
OEVELOPMENT AOREEMENT

OYOLERARERANOH^NO^LLO
PAYMENT ANO PEREORMANOE OOARANTEE

border to induce O y o l e R a r E ^ ^
Oovolopmont Agrooment (the "Oevelopment Agreement by and botw^
Eranobisee named in tbe Oevelopment Agreement dated ^towbiob tbis Payment
and Pedormanoe Guarantee (tbe "Ooarantee^
(ooiieotiveiy referred to as tbe"Ooaranter8"and individually referred t^
bereby covenant and agree as follows:
t. Guarantee of Payment and Performance Tbe Guarantors jointiy and severally
unconditionally guarantee toPranobisor and its affiliates tbe payment and performance wben
due, wbetber by accelerationorotberwise^of allobligations, indebtedness,and liabilities of
Erancbisee to Erancbisor, direct or indirect, absolute or contingent,of every kind and nature,
wbetber now existing or incurred from time to time bereatter,wbetber incurred pursuant
OevelopmentAgreementorotberwise,togetberwitbanyextension, renewal, or modification
tbereof in wbole or in part (tbe "Guaranteed Llab^fles^ Tbe Guarantors agree tbat if any of
tbe Guaranteed Liabilities are not so paid or performed by Erancbisee wben due, tbe
Guarantors will immediately do so Tbe Guarantors turtber agree to pay all expenses (including
reasonable attorneys'fees)paid or incurred in endeavoring to entorce tbis Guarantee or tbe
payment ofany Guaranteed Liabilities Tbe Guarantors represent and agree tbat tbey bave
eacbreviewedacopyot tbe Oevelopment Agreement and bave bad tbe opportunity to consult
witb counsel to understand tbe meaning and import of tbe Oevelopment Agreement and tbis
Guarantee.
2. Waivers bv Guarantors. Tbe Guarantors waive presentment, demand, notice ot
dishonor, protest, and all otber notices whatsoever, including without limitation notices ot
acceptance hereof, otthe existence or creation of any Guaranteed Liabilities, of the amounts
and terms thereof, ofall defaults, disputes, or controversies between Eranohiser and Erancbisee
and of the settlement, compromise, or adjustment thereof This Guarantee is primary and not
secondary, and will be enforceable witbout Eranohiser having to proceed first against
Erancbisee or against any or all ofthe Guarantorsor against any othersecurity forthe
Guaranteed Liabilities This Guarantee will be effective regardless of the insolvency ot
Erancbisee by operation of law, any reorganization, merger, or consolidation of Erancbisee, or
any change in the ownership of Erancbisee.

3. Term: No Waiver This Guarantee will be irrevocable, absolute, and

unconditional and will remain in tull force and effect as to each of the Guarantors until such time
as all Guaranteed Liabilities ot Erancbisee to Eranohiser and its affiliates have been p ^
satisfied in full No delay or failure on tbe part of Franchisor in the exercise of any right or
remedy will operate asawaiver thereof, and no single or partial exercise by Franchisor ofany
right or remedy will preclude other further exercise ofsuch rigbt or any otber rigbt or remedy.

4. Otber Oovenants Each otthe Guarantors agrees to comply with the provisions
of Section 8 of the Oevelopment Agreement as though each sucb Guarantor were the
^Franchisee" named in tbe Oevelopment Agreement and agrees that he or she will take any and
all actions as may be necessary or appropriate to cause Franchisee to comply with the
5
C y o ^ B a r - O e ^ o p m o ^ Agreemem r^ ^
EAS^87^^3
Development Agreement and will not take any action that would cause Franchisee to be in
breach of the Development Agreement.

5. Dispute Resolution. Section 16 (Dispute Resolution and Governing Law) of the

Initial Franchise Agreement (as defined in the Development Agreement) is hereby incorporated
herein by reference and will be applicable to any disputes between Franchisor and any of the
Guarantors, as though Guarantor were the "Franchisee" referred to in the Development
Agreement.

6. Miscellaneous. This Agreement will be binding upon the Guarantors and their
respective heirs, executors, successors, and assigns, and will inure to the benefit of Franchisor
and its successors and assigns.

IN WITNESS WHEREOF, the undersigned Guarantors have caused this Guarantee to

be duly executed as of the day and year first above written.

Print Name:

Print Name:

Print Name:

Print Name:

CyckBar-DevekprnemAa^mem C-2 EASTWST^

 EXHIBIT C
TOTHE
FRANCHISE DISCLOSURE DOCUMENT

Financial Statements

(attached)

0 1 / 1 5
Franchise Disclosure Document

EAS1\87466944.6
 C Y C L E B A R FRANCHISING, L L C

(An Ohio Limited Liability Company in the Development Stage)

FINANCIAL STATEMENT

J A N U A R Y 6, 2015

COLLINS HEEB MILLER & Co., INC.

CERTIFIED PUBLIC ACCOUNTANTS
 CONTENTS

Page

Independent Auditor's Report 1

Financial Statement

Balance Sheet 2

Note to Financial Statements 3

 C O L L I N S H E E B M I L L E R & Co., INC.
CERTIFIED PUBLIC ACCOUNTANTS

4903 VINE STREET

CINCINNATI, OH 45217-1252

INDEPENDENT AUDITOR'S REPORT

The Members
CycleBar Franchising, LLC

(An Ohio Limited Liability Company in the Development Stage)

Report on the Financial Statements

W e have audited the accompanying balance sheet of CycleBar Franchising, L L C (an Ohio Limited Liability Company in the
Development Stage) as of January 6, 2015, and the related note to the finandal statements.
Management's Responsibility for the Financial Statement
Management is responsible for the preparation and fair presentation of this financial statement in accordance with accounting
principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of
internal control relevant to the preparation and fair presentation of the finandal statement that is free from material
misstatement, whether due to fraud or error.

Auditor's Responsibility
O u r responsibility is to express an opinion on this finandal statement based on our audit. We conducted our audit in accordance
with auditing standards generaUy accepted in the United States of America. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the finandal statement is free from material misstatement.

A n audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the finandal statement.
The procedures selected depend on the auditor's judgment, including the assessment ofthe risks of material misstatement ofthe
finandal statement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the entity's preparation and fair presentation of the finandal statement in order to design audit procedures tliat are
appropriate i n the drcumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal
control. Accordingly, we express no such opinion. A n audit also includes evaluating the appropriateness of accounting polides
used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statement.

W e believe that the audit evidence we have obtained is.suffident and appropriate to provide a basis for our audit opinion.

Opinion
KjpilllUH

In our opinion, the balance sheet referred to above presents fairly, in all material respects, the financial position of CycleBar
Franchising, L L C as of January 6, 2015, in conformity with accounting principles generally accepted in the United States of
America.
:a.

A m * ^ iW- mM- f-^-

January 6, 2015

-1-
 C Y C L E B A R FRANCHISING, LLC
(An Ohio Limited Liability Company i n the Development Stage)

B A L A N C E SHEET

January 6, 2015

ASSETS

Current assets:
c
t^.^ E

Total current assets 109,585

Total asset,

LIABILITIES A N D M E M B E R S ' EQUITY

Current liabilities:
Accounts payable ^

Total current liabilities

1 Q 9 5 8 5
Members' equity '

Total liabilities and members' equity $ 109,585

See accompanying note.

-2-
 C Y C L E B A R FRANCHISING, LLC
(An O h i o Limited Liability Company i n the Development Stage)

NOTE T O FINANCIAL STATEMENTS

January 6, 2015

1. Summary o f significant accounting policies

Organization and basis o f accounting - The Limited Liability Company was formed on April 1, 2014 in
the State of Ohio and is the franchisor of premium indoor cycling studios.

-3-
 EXHIBIT D
TO THE
F R A N C H I S E D I S C L O S U R E DOCUMENT

State Administrators and Agents for Service of Process

Listed here are the names, addresses and telephone numbers of the state agencies
having responsibility for franchising disclosure/registration laws and for service of process. We
may not yet be registered to sell franchises in any or all of these states.

CALIFORNIA: CONNECTICUT

Department of Business Oversight State of Connecticut

320 West 4th Street, Suite 750 Department of Banking
Los Angeles, C A 90013 Securities & Business Investments Division
(213) 576-7500 Toll Free (866) 275-2677 260 Constitution Plaza
Hartford, CT 06103-1800
1515 K Street, Suite 200 (860) 240-8230
Sacramento, C A 95814
(916) 445-7205 Agent: Banking Commissioner

1350 Front Street

San Diego, C A 92101
(619) 525-4233

One Sansome Street, Suite 600

San Francisco, C A 94104
(415) 972-8559

HAWAII ILLINOIS
(state administrator)
Franchise Bureau
Business Registration Division Office of the Attorney General
Department of Commerce and Consumer 500 South Second Street
Affairs Springfield, Illinois 62706
335 Merchant Street, Room 203 (217) 782-4465
Honolulu, Hawaii 96813
(808) 586-2722

(agent for service of process)

Commissioner of Securities
State of Hawaii .
335 Merchant Street
Honolulu, Hawaii 96813
(808) 586-2722

Franchise Disclosure Document 01/15

EAST\87466944.6
INDIANA
Indiana Secretary of State
Securities Division, E 111
302 Washington Street
Indianapolis, Indiana 46204
(317) 232-6681
MICHIGAN
(state administrator)
Consumer Protection Division
Antitrust and Franchise Unit
Michigan Department of Attorney General
525 W. Ottawa Street, 1st Floor
Lansing, Michigan 48933
(517) 373-7117
(for service of process)
Corporations Division
Bureau of Commercial Services
Department of Labor and Economic Growth
P.O. Box 30054
Lansing, Michigan 48909
NEW Y O R K
(state administrator)
New York State Department of Law
Bureau of Investor Protection and Securities
120 Broadway, 23rd Floor
New York, New York 10271
(212) 416-8211
(for service of process)
Secretary of State of New York
41 State Street
Albany, New York 12231
(518) 474-4750
Franchise Disclosure Document
EAS'n87466944.6
MARYLAND
(state administrator)
Office of the Attorney General
Securities Division
200 St. Paul Place
Baltimore, Maryland 21202 2021
(410) 576-6360
(for service of process)
Maryland Securities Commissioner
200 St. Paul Place
Baltimore, Maryland 21202-2021
(410) 576-6360
MINNESOTA
(state administrator)
Minnesota Department of Commerce
85 7th Place East, Suite 500
St. Paul, Minnesota 55101-2198
(651)296-6328
(for service of process)
Minnesota Commissioner of Commerce
NORTH DAKOTA
North Dakota Securities Department
State Capitol, Fifth Floor, Dept. 414
600 East Boulevard Avenue
Bismarck, North Dakota 58505
(701) 328-4712
01/15
OREGON RHODE ISLAND

Department of Insurance and Finance Division of Securities

Corporate Securities Section Rhode Island Dept. of Business Regulation
Labor and Industries Building John O. Pastore Complex - Bldg. 69 1
Salem, Oregon 97310 1511 Pontiac Avenue
(503) 378-4387 Cranston, RI 02920
(401)462-9500

SOUTH D A K O T A VIRGINIA

Division of Securities State Corporation Commission

Department of Labor & Regulation Division of Securities and Retail Franchising
445 East Capitol Avenue 1300 East Main Street, 9th Floor
Pierre, South Dakota 57501 Richmond, Virginia 23219
(605) 773-4823 (804) 371-9051

(for service of process)

Clerk of the State Corporation Commission
1300 East Main Street, 1st Floor
Richmond, Virginia 23219
(804) 371-9733

WASHINGTON WISCONSIN
(state administrator) (state administrator)

Department of Financial Institutions Division of Securities

Securities Division Department of Financial Institutions
P.O. Box 9033 345 W. Washington Ave., 4th Floor
Olympia, Washington 98507 9033 Madison, Wisconsin 53703
(360) 902-8760 (608) 266-1064

(for service of process) (for service of process)

Director, Department of Financial Institutions Administrator, Division of Securities
Securities Division Department of Financial Institutions
150 Israel Road S.W. 345 W. Washington Ave., 4th Floor
Tumwater, Washington 98501 Madison, Wisconsin 53703

Franchise Disclosure Document 01/15

EAS'n87466944.6
 EXHIBIT E
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Table of Contents for CycleBar Franchise Operations Manual

Title # of Pages

Introduction to CycleBar 1
Mission and Vision 2
CycleBar the Brand 2
CycleStar instructors 20
• What is a CycleStar instructor?
• The Mission and Vision of our C-Star Platform
• What sets our CycleStar instructors apart?
• Value Proposition
o The Stage (CycleTheatre)
o Compensation
o Branding
• Initial Market Analysis
• Recruitment Strategy
• Auditions
• Bootcamp
• Training
• HR
• Development Program
• CycleStar instructor Master's Program
• Quality Control/Brand Standards
• C B F Support

CycleBeats 6
• What are CycleBeats?
• The Mission and Vision of our C-Beats Platform
• Why are CycleBeats Important?
• CycleBeats Technology
• The Process
• Consumer Facing Delivery
• CycleBeats Brand Standards
• C B F Support

CycleStats 6
• What are CycleStats
• The Mission and Vision of our C-Stats Platform
• Why are CycleStats important?
• CycleBeats Technology
• The Process
• Consumer Facing Delivery
• CycleBeats Brand Standards
• C B F Support

CycleTheatre 3
• What is the CycleTheatre?
• Why did we design the CT like this?
• The Mission and Vision of our C-Stats Platform

0 1 / 1 5
Franchise Disclosure Document
 D Consumer Facing O e ^ e r y
D CyoieBoats Brand Standards

Market Analysis ^
^ The Market Analysis worksheet
^ BreakingaTerritoryOown
D Sphere otintiuenoe Assets
D B u i i d i n g a C S t a r Database
^ Community Partner Opportunities
D BuiidingaCommunity Partner Database
indoor Cycling Researoh^Strategy
^ Build and Analyse
^ Fitness Density
^ l i s t i n g Facility Analysis
D C B F Support

Reai estate Site Selection t3

^ The C B F Real Estate Strategy
D The Real Estate Process
o C B RE Marketing
Specifications
D Renderings
o Territory Analysis
Demographics
CoTenants
Fitness Density
Visibility
o The Team
Proiect Manager
national Broker
Local Broker
o Site Selection Process
o Site Approval Process
o L C i Process
o Initial Design Process
o Due Diligence Process
o Lease Review and Revision Process
D Lease Obligations
^ Leasehold Improvement Requirements

Construction Management 8
D TheTeam
o C D S Development Services
o Project Manager
o Design Supervisor
^ Due Diligence
o As Built/Conditions Survey
o Site Investigation Report
o Space Planning
o Lease R e v i e w s ^ D D Summary
D Design and Construction Document Phase
^ Permitting Phase
D Project Management Phase
o Project Flow
o Competitive Bidding
o Site Visits and Meetings
o Monitoring^Reporting

Franchise Disclosure Document

^ ^ ^ 7 4 ^ ^
 o Vendor Coordination
o Administrative
o Representation
o Hard Construction
o Turnover
o Project Close Out

Setting Up a CycleBar Location 18

• Layouts
• Lobby
• Restrooms
• Community Bar
• CycleTheatre
• Design Manual
• Tenant Finish Questionnaire
• Brand Standards

Pricing, Products, and Services 2

• Pricing
• Products
• Services

Insurance 1
• The Process
• Requirements
• Checklist

Grand Opening 8

• Public Relations Campaign

• Pop up Events
• Ambassador Program
• Community Partner Program
• Studio Promotional Events
• VIP Events
• Above the Line Marketing
• C R M Marketing
• Website Evolution
o Landing Page
o Microsite
• Social
• Sponsorships
• Private Open House Classes
• CycleBar Blast

Human Resources 10
• E E O C Guidelines
• Laws Regarding Harassment
• Immigration Reform
• Wage and Labor Laws
• Job Descriptions
• Working with Independent Contractors
• Recruitment
• Interview Process and Techniques
• Reference Check/Job Offer
• . Developing Personnel Policies
• Training Employees

Franchise Disclosure Document 01/15

EAS'I\87466944.6
 Recommended Compensation Structures
Time Reporting
Dress Codes
Performance Evaluations
Problem Resolution
Termination

CycleStar Instructors Development 7

• CycleStar Instructor Types
o Theatrical Performer
o Dance Party
o Rockstar
o Inspirational
o Results Oriented
o Social Promoter
o Performance/The Athlete
o Mind/Body Connect (Ballet Dancer)
o Endurance/Outdoor Cyclist
o Visualization Rider
o The Lion
o The Proven Developer
• Bike Training
• Continuing Education
• Development of your C-Star Community

Studio Operations 14
• How the Studio Worts
o Lobby
o Restrooms
o Community Bar
o CycleTheatre
• New to CycleBar
• Day to Day Processes
• Daily Class Process
• Studio Maintenance
• Bike Maintenance
• Studio Supplies
• Studio Amenities
• Class Schedule
• Hours of Operations
• Pricing Guide
• Pick a Bike
• Cancellation Policy
• Uability Waivers
• Suppliers
o Supplier List
o Ordering Supplies
• Operations Protocol
• Apparel

Business Management Software 10

• Creating a Profile
• Buying Credits
• Online Booking
• Scheduling
• Reservations

• Client Management
0 1 / 1 5
Franchise Disclosure Document

EAST\87466944.6
 • Creating Online Packages
• Special Events
• Merchant Processing
• Customer Purchasing Policies
• Client Notifications
• Customer Data Maintenance

Guest Relations 7
• Welcoming a Guest
• First Time Guests
• Shoes
• Studio Tour
• Guest Surveys
• Guest Concerns/Complaints
• Guest Rewards
• Email Contact
o Proper Responses
o Educate
o Promote
o Gratitude
o Reward
• Brand Standards

Class Schedule and Rides 7

• Class Times
• Class Counts
• CycleBar Classic
• CycleBar Strength
• CycleBar Endurance
• CycleBar Compete
• CycleBar Surge
• Theme Rides
o Mashup Rides
o Throwback Rides
o Genre Rides
o LIVE Concert Series
o LIVE DJ Rides
o Sunday Brunch
o Happy Hour
o Mojo Rides
o Teen Rides
• Charity Rides
• Community Partner Rides
• Corporate Wellness Rides
• Private Party Rides

Cleaning and Maintenance 1

• Opening
• Closing
• Between Classes

Safety 2
• Rider Safety
o Posture
o Breathing
• Weather Procedures
• Lighting

0 1 / 1 5
Franchise Disclosure Document

EAST\87466944.6
 o Studio
o Theatre
• Noise Levels

Technology 6
• CycleBeats
• CycleStats
• CycleBar Intranet
• Mobile App
• Microsite
• Business Management Software

Marketing and Promotion 15

st
• The 1 100 Days
• Continuity Marketing
• Local Advertising Requirement
• Obtaining Advertising Approval
• Guidelines for Using the Marks
• Brand Standards
• Marketing Campaign Suggestions
• Building a Database
• Managing your Database
• C R M Marketing
• Public Relations
• Above the Line Marketing
• Digital Marketing
• Social Marketing
• Cause Marketing Platform
o Primary Cause
o Secondary Causes
• Daily Deals
• CycleStar Instructor Branding
• Theme Ride Branding
• Studio Promotions
• Corporate Wellness
• Community Partners
• Challenges
• Special Offerings

Reporting and Metrics 6

• Business Management Software Reporting
• Benchmarking
• Annual/Monthly/Weekly Goals
• Measuring
• Tracking Worksheets

Unit Economics and Finance 8

• Initial Investment
• Financing Options
• Studio Economics
o Revenue
Packages
- Rides
o Expenses
Fixed
Human Resources
Variable
0 1 / 1 5
Franchise Disclosure Document

EAS'n87466944.6
 • Working Capital
• Margins
• Budgeting
• Quick Books

CycleBar Brand Standards

• The Importance of Brand Standards
• CycleBar Brand Standards

CycleBar Retail
• Initial Inventory
• Inventory Management System
• Reporting
• Re-Ordering Supplies

TOTAL PAGES: 190

0 1 / 1 5
Franchise Disclosure Document
r
EAS R87466944.6
 EXHIBIT F
TO THE
F R A N C H I S E D I S C L O S U R E DOCUMENT

Current and Former Franchisees

Current Franchisees:

MASSACHUSETTS

Alexandra Klemmer and William Pryor

386 Washington Street
Wellesley, MA 02481
(781)235-0520

MICHIGAN

Lisa Hillman and James Wilde

413 North Main Street
Royal Oak, Ml 48067
(248) 376-2744

Former Franchisees:

NONE

Franchise Disclosure Document 01/15

EAST\87466944.6
 EXHIBIT G
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Form of General Release

(attached)

Franchise Disclosure Document 01/15

EAS'n87466944.6
 GENERAL RELEASE

TRISGENERAL RELEASE ^ R ^ ^ i s e ^ o ^ o n
^
^E^nch^ee^
^ G u a ^ o ^
^ T r a n s ^ e e ^ a s a o o ^ o n o t ^ ^ h e ^ s ^ o f ^
^ a y ^ ^ e a ^ between GyoleRar Eranob^ng, LLG ( ^ C R E ^ and Eranobisee ^ E r a n c b i s e
A g r e e m e n ^ e r ^ t b e e x e o u t i e n o f asuooesser EranobiseAgreemen^
GRE. ^ftbis Release is e x e r t e d under tbe conditions set t o r t b i n ^ ) ^
Reieaseto^ransferee^sbouid be ignored)

^ Release by Erancbisee^ Transferees and Guarantors' Eranobisee and

Transferee (on bebaif of tbemseives and tbeir parent
respective past and present officers, directors, sbareboiders, managers, members, agent^^
empioyees, in tbeir corporate and individual capacities), and Guarantors (on bebaif ot
tbemseives and tbeir respective beirs, representatives, successors and assigns) (coiieotiveiy,
tbe ^Releasors^)freeiy and witbout any influence forever release (i)GRE,(ii)GRE^s past and
present officers, directors, sbarebolders, managers, members, agents, and employees, in their
corporate and individual capacities, and (iii) G R E s parent, subsidiaries, and a f f i ^
respective past and present officers, directors, sbarebolders, managers, members, agents, and
employees, in tbeir corporate and individual capacities (collectively, tbe ^Released R a ^ ^
from any and all claims, debts, demands, liabilities, suits, judgments, and causes of action
whatever kind or nature, whether known or unknown, vested or contingent, suspected or
unsuspected (oollectively,^Giainis^),which any Releasor ever owned or held, now owns or
holds, or may in the future own or hold, including, witbout limitation, claims arising under teder^^^
state, and local laws, rules, and ordinances and claims arising out of, or relating to, the
Eranchise Agreement and all other agreements between any Releasor and G R E o r G R E s
parent, subsidiaries, or affiliates, arising out of, or relating t o a n y act, omission orevent
occurring on or before tbe date ofthis Release,unless prohibited by applicable law.

^ R i s ^ o f G b a n g e d E a o t s D Eranchisee,Transferee, and Guarantors understand

that the facts in respect of whioh the release in S e c t i o n t i s given may turn out to be different
from thetacts now k n o w n o r believed by them t o b e true. Eranchisee,Transferee, and
Guarantors hereby accept and assume the risk otthe tacts turning out to be different and agree
that the release in S e c t i o n l s b a l i nevertheless be effective in all respects and not subject to
termination or rescission by virtue ot any such difference in facts.

^ Covenant Not to SueD Eranchisee,Transferee, and Guarantors (on behalf ot

Releasors) covenant not to initiate,prosecute,encourage,assist, or(except as required by law)
participate in any civil, criminal, or administrative proceeding or investigation in any court,
agenoy, or other forum, either affirmatively or by way of cross claim, defense, or counterclaim,
against any person or entity released under Sectiontwith respect to any Claim released under
Sectiont

^ No Rrior Assignment and Competenoy^ Erancbisee, Transferee, and

Guarantors represent and warrant that: (i) the Releasors are the sole owners ofall Claims and
rights released in Section t and tbat the Releasors have not assigned or transferred, or
purported to assign or transfer, to any person or entity,any Claim released under S e c t i o n t ^ i i ^
each Releasor has full and complete power and authority to execute this Release, and that the
execution of this Release shall not violate the terms of any contract or agreement between them

Franchise O ^ o s u r e O o c u m e o t t 0^15
F A 5 ^ 7 4 ^ ^
or any court order; and (iii) this Release has been voluntarily and knowingly executed after each
of them has had the opportunity to consult with counsel of their own choice.

5. Complete Defense. Franchisee, Transferee, and Guarantors: (i) acknowledge

that the release in Section 1 shall be a complete defense to any Claim released under Section
1; and (ii) consent to the entry of a temporary or permanent injunction to prevent or end the
assertion of any such Claim.

6. Successors and Assigns. This Release will inure to the benefit of and bind the
successors, assigns, heirs, and personal representatives of the Released Parties and each
Releasor.
7. Counterparts. This Release may be executed in two or more counterparts
(including by facsimile), each of which shall be deemed an original, and all of which shall
constitute one and the same instrument.

8. Capitalized Terms. Any capitalized terms that are not defined in this Release
shall have the meaning given them in the Franchise Agreement.

[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK.]

0 1 / 1 5
Franchise Disclosure Document 2
EAS'A87466944.6
 IN WITNESS WHEREOF, Franchisee, Transferee, and Guarantors have executed this
Release as of the date shown above.

ATTEST: FRANCHISEE:

By: By:

Print Name: Print Name:

Title:
Date:

ATTEST: TRANSFEREE:

By: By:

Print Name: Print Name:

Title:
Date:

GUARANTOR:
WITNESS:

Print Name:
Print Name:
Date:

GUARANTOR:
WITNESS:

Print Name:
Print Name:
Date:

Franchise Disclosure Document 01/15

EAS'n87466944.6
 EXHIBIT H
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Form of Nondisclosure and Noncompete Agreement

(attached)

0 1 / 1 5
Franchise Disclosure Document
EAS'I\87466944.6
 NONOISOLOSURE ANO NONCOMPETE AGREEMENT

T^Ag^me^isd^d^
as and ^ u B ^ located at [AOORES^ and [NAME OE EMPLOYEE OR
I N O E E E N O E N T O O N T R A O T O R ^ ^ e t e n e d t o a s ^ e ^ a n d ^ e u ^ You are signing this
Agrooment in consideration o^ and as a condition to, your association with us and the
compensation, dividends, or other payments and benefits you wiii receive trom us.

RAOKOROUNO
We are a franchisee of OycieRar Franchising, LLO ^ORE^) under a OycieRar
Franchising, LLO Eranchise Agreement dated [OATE^the^Eranebise Agreements We have
aiicense to use the certain trademarks designated by ORE (the ^Marks^,certain policies and
proceduresusedinOycieRarbusinesses(the^ystem^,andtheOonfidentiai intormation
developed and owned by ORE in our OycieRar studio (the ^Studie^ ORE recognizes that, in
order for ustoeftectively operate our business, ourempioyeesandindependentcontractors
whom we retain must have access to certain confidential information and trade secrets owned
by ORE Oisclosure of this confidential intormation and trade secrets to unauthorized persons,
or its use tor any purpose other than the operation of our business, would harm ORF, other
franchise owners, and us Acoordingly,ORF requires us to bave you to sign this Agreement

AOREEMENT

t. Oentidential Intormation. As used in this Agreement, ^Oontidentiai

Intormation^ means all manuals, trade secrets, know how, methods, training materials,
intormation, management procedures, and marketing and pricing techniques relating to the
Studio, tbe OycieRar System, or ORF^s business In addition, Oonfidential Information includes
all marketing plans, advertising plans, business plans, financial information, member
information, employeeinformation, independentcontractorintormationand other confidential
information of ORF,ORF^saffiliate^^
obtain during your association with us

2. Nondisclosure. You agree not to use or disclose, or permit anyone else to use
or disclose, any Oonfidential Information to anyone outsideof our organization (other than the
Interested Parties) and not to use any Oonfidential Information for any purpose except to carry
out your duties as our employee or as an independent contractor to us. You also agree not to
claim any ownership in or rights to Oonfidential Intormation and not to challenge or contest our,
ORF^s, or ORE^s affiliates^ ownership ot it These obligations apply both during and after your
association with us.

3. Return otOontidential Intormation. It your association with us ends tor any

reason, you must return to us all recordsdescribed in Paragraph t, all otherOontidential
Information, and any authorized or unauthorized copies of Oonfidential Intormation that you may
have in your possession or control. You may not retain any Oonfidential Intormation after your
association with us ends.

4. Noncompete Ouring Association. You may not, during your association with
us, without our prior written consent:

(a) own,manage, engage in,be employed by,advise,make loans to,

or have any other interest in (i) any business that offers indoor cycling classes, (ii) any

F r a n c ^ s e C l o s u r e Oooument t 0t^5
EA^r^74^^
 gymnasium, studio, ath^io or fitness center hoaithoiub,oxoroiso, indoor oyoiing, or
aorobiosfaoiiity, or similar faoiiity or business, or (iii) any entity that g
iioenses for any of these types of businesses (ooiieotiveiy, eaob, a ^Oompe^ve
Business) at any iooation in the united States;

(b) divert or attempt to dived any business or customer or potential business

or customer of the Studio to any Competitive Business, by direct or indirect inducement
orotherwise;
(c) perform, directiy or indirectiy, any other act injurious or prejudicial to the
goodwill associated with the Marks and tbe System;

(d) use any vendor relationship established through your association with us
for any purpose other than to purchase products or equipment for use or retail sale in the
Studio;or
(e) directly or indirectly solicit for employment any person who at any time
within the immediate past t2 months has been employed b y ^ u s , ( ^ C B F , ( ^ our or
CBF^s affiliates, or (iv) any CycleBarfranchisees.

5. NenoempeteAtter Association Ends. For two years after your association

witb us ends for any reason, you may not, without our prior written consent:

(a) directly or indirectly own, manage, engage in, be employed by, advise,
make loansto,orhaveany other interest inany CompetitiveSusiness that is (or is
intended to be) located withinatenmileradius of your former Studio or any otber
CycleBar studio that is operating or under development at the time your association with
us ends;or

(b) directly or indirectly solicit tor employment any person who at any time
within tbe immediate past t2 months has been employed by (i) us, (ii)CBF,(iii) our or
CBF s attiiiates, or (iv) any CycleBar tranchisees.

6. Reniedies. It you breach or threaten to breach this Agreement, you agree that
we will be entitled to injunctive relief (without posting bond) as well asasuittor damages

7. Severability. If any part ofthis Agreement is declared invalid tor any reason,the
invaliditywill not affectthe remaining provisions ofthis Agreement. Ifacourtfinds any provision
of this Agreement to be unreasonable or unenforceable as written, you agree that the court can
modity the provision to make it enforceable and that you will abide by tbe provision as modified

8. Independent Agreement. The Agreement is independent of any other

obligations between you and us. This means that it is enforceable even it you claim that we
breached any otber agreement, understanding, commitment or promise.

9. Tbird Party Rigbt otEntorcemenL You are signing this Agreement not only for
our benefit, but also tor the benefit ot CBF and CBF^s atfiliates We, C B F , a n d C B F s atfiliates
have the right to enforce tbis Agreement directly against you.

^0. Not An Employment Agreement. Tbis is not an employment agreement

Nothing in tbis Agreement creates or should be taken as evidence of an agreement or

Franchise Disclosure Document 2 01/15

EAST\87466944.6
understanding by us, express or implied, to continue your association with us for any specified
period.
11. Modification and Waiver. Your obligations under this Agreement cannot be
waived or modified except in writing.

12. Governing Law. This Agreement is governed by the laws of the state in which
our principal office is located.

13. Attorney's Fees. If we have to take legal action to enforce this Agreement, we
will be entitled to recover from you all of our costs, including reasonable attorney's fees, to the
extent that we prevail on the merits.

14. Representation. You certify that you have read and fully understood this
Agreement, and that you entered into it willingly.

WITNESS EMPLOYEE or
INDEPENDENT CONTRACTOR

/1
Franchise Disclosure Document 3 01 5
EAS'n87466944.6
 EXHIBIT I
TO THE
FRANCHISE DISCLOSURE DOCUMENT

Additional State-Required Disclosures and Riders

Franchise Disclosure Document 01/15

EAST\87466944.6
 AOO^ONALO^CLOSURESFORTHE
FRANCH^EO^CLOSOREOOCOMENTOF
CYCLEBAR F R A N C H ^ N ^ LLC

T h e f o ^ w i o g are a g o n a l diso^sures t o r t h e Eranohise Oisolosure Oeoomeot ot

C y o l e O a r E r a o o h i s i ^ LLC r e a r e d by various state traoohis^ Eaob provision of these
additional disoiosures wiii oniy appiy to you it the appiioabie state traoohiser^^^
disoiosure iaw applies to you.

CALIECRNIA

t THECALiECRNiAERANCHiSEINVESTMENTLAWRECLiiRESTRATA
C E ALL R R C R C S E O A G R E E M E N T S RELATING T C T R E SALE C E T R E E R A N C R i S E RE
OELIVEREOTCGETRERWITRTHEOiSCLCSOREOCCLIMENT

2 SECTION 3 t ^ 5 C E T H E ERANCHISE INVESTMENT LAW RECLiiRES LIS T C

GIVE Y C O A OISCLCSLIRE O C C O M E N T A R R R C V E O RY THE CCMMISSICNER C E
EASINESS OVERSIGHT R E E O R E W E A S K YOO TO CONSIDER A MATERIAL
MOOIEICATIONOEYOOR OEVELORMENT A G R E E M E N T OR E R A N C H I S E A G R E E M E N T

3 OOR WEBSITE, wwwovolebaroon^ HAS NOT BEEN REVIEWED OR

ARRROVEO R Y T H E CALIEORNIA O E R A R T M E N T O E B L I S I N E S S O V E R S I G H T ANY
COMRLAINTS C O N C E R N I N G T H E C O N T E N T OE T H E WERSITE MAY BE DIRECTED TO
T ^ ^ ^ ^ ^ D ^ P ^ T M ^ T ^ E R ^ I S I N E S S OVERSIGHT AT wwwdbooaoov

4. The tollowing is added at the end o f i t e m s

Neither we, our parent, predecessor or aftiliates nor any person in

Item 2 o t t h e Oisolosure Dooument is subject to any currently
ettectiveorderotany national securitiesassooiation or national
securities exchange, as detined in the Seourities Exchange Act of
t 9 3 4 , t 5 L I S C A Sections 78a e L s e ^ , suspending or expelling
sucb persons from membership in that association or exchange.

5 The tollowing paragraphs are added at the end of Itemt7:

California Rusiness and Professions Code Sections 20000

through 20048 provide rights to the franchisee and multi unit
developer concerning termination or nonrenewal ofafranchise. If
the Development Agreement or Eranchise Agreement containsa
provision tbat is inconsistent with the law, and the law applies, the
law will control.

The Development Agreement and Eranchise Agreement containa

covenant not to compete that extends beyond termination of the
franchise. This provision might not be enforceable under
California law.

0^8^
^ ^ F O O I E ^ ^ ^ ^ ^ ^ ^ ^ ^
^ 5 ^ 4 ^ ^
 TheOe^opmeotAg^em^
upon b a n k r u p t This provision might not bo onforooabio undor todorai
bankruptoy i a w ^ 1 0 S C ^ S o o t i o n s 1 0 1 o t s o ^

Tho Oovoiopmont Agroomontand Franohiso Agroomontro^uiroappiioationof

thoiawsofthoStatoofOhio This provision might not bo onforooabioundor
Caiiforniaiaw

Tho Oovoiopmont Agroomont and Franohiso Agroemont ro^uiro pro iitigation

mediation Tho mediation wiii bo oonduotod in tho motropoiitan area ot our thon
ourront prinoipaipiaoo of business (ourrontiyOinoinnati, Ohio) The Oovoiopmont
Agreement and Eranobise Agreement aiso require that any aotion you bring be
oommenoed in tederai or state oourts in the state in whioh our prinoipaiottioe is
iooated(ourrentiy,Ohio) Prospeotivemuiti unit developers and tranohisees are
encouraged to consult private iegai counsel to determine the applicability of
Oalifornia and federal laws (such a s O u s i n e s s and Professions Oode Section
200405, Oode of Oivii Procedure S e c t i o n t 2 8 t , a n d t h e Federal Arbitration Act)
to any provisions of tbe Oevelopment Agreement and Pranchise Agreement
restriotingvenuetoaforum outside the State of Oalifornia

The Oevelopment Agreement and Pranchise Agreement require you to s i g n a

general release of claims upon renewal or transfer ot the Oevelopment
Agreement or Franchise Agreement Oalifornia Oorporations Oode Section
3t5t2providesthatanycondition,stipulation or provision purporting to bind any
person acquiring any franchise to waive compliance with any provision of that law
or any rule or order thereunder is void Section 3 t 5 t 2 might voidawaiver of
your rights under the Franchise Investment Law (Oalifornia Oorporations Oode
Section 3 t 0 0 0 ^ 3 t 5 t 5 ) Business and Professions Oode Section 200t0migbt
v o i d a w a i v e r o t your rightsundertbeFranchiseRelationsAct(Business and
ProtessionsOode Sections 20000^20043)

HAWAII

T H F S F F H A N O H I S F S H A V F B F F N F I L F O O N O F P THF FRANOHISF I N V E S T S
LAW OF T H F STATF O F HAWAII FILINO OOFS NOT OONSTITOTF A P P R O V A L ,
RFOOMMFNOATION O R F N O O R S F M F N T R Y T H F O I R F O T O R O F OOMMFROF ANO
OONSOMFR AFFAIRS OR A FINOINO RY T H F OIRFOTOR OF OOMMFROF ANO
OONSLIMFR AFFAIRS THAT T H F INFORMATION PROVIOFO HFRFIN IS TROF,
OOMPLFTFANONOTMISLFAOINO

THF FRANOHISF INVESTMENT LAW M A K F S IT ONLAWFOL TO O F F F R OR SFLL

ANY FRANOHISE IN THIS STATE WITHOOT FIRST PROVIOINO TO THE PROSPEOTIVE
FRANOHISEE, OR SORFRANOHISOR, AT LEAST S E V E N OAYS PRIOR TO THE
E^EOLiTIONRYTHEPROSPEOTIVEFRANOHISEE,OFANYRINOINOFRANOHISEOR
OTHER A O R E E M E N T , O R AT L E A S T S E V E N OAYS PRIOR TO THE PAYMENT OF ANY
OONSIOERATiONRYTHEFRANOHISEE,ORSORFRANOHISOR,WHIOHEVEROOOORS
FIRST A OOPY O F T H E EOO, T O G E T H E R WITH A OOPY O F ALL P R O P O S E D
AGREEMENTS RENTING TOTHE SALEOFTHEFRANOHISE

C^eB^
^ot5Fooi^^s^A^^n^5
^ 5 ^ 7 ^ ^
 THIS EOO O O N T A ^ S A S O M ^ ^
THE ERANCHISE A G R E E M E N T T H E GGNTRAGT G R A G R E E M E N T SHGOLO RE
^ ^ ^ ^ O T G E G R A S T A T E M E N T G E ALL RIGHTS, GGNOITIGNS,RESTRIGTIGNS ANO
GRLIGATIGNSGERGTHTHEERANGHISGRANOTHEERANGH1SEE

R e g i s ^ e d agendo the ^ e a ^ h o n z e d to ^ c e i v e s e ^ ^ Gomm^onerof

Seountie5,OepartmentotGommeroeandGonsumerA^^
SeountiesGom^anoe^^

ILLINOIS

^ Item 1 ^ Additional O l s o l o s u r e ^ T h e t o ^ o w ^ s t a t e d

The ^ n o i s Eranchise Oisclosore Act provides that any provision in the Eranchise
Agreement or the Oeveiopment Agreement that designates jurisdiction or venue i n a
torum outside otiiiinois is void with respect to any action whioh is otherwise enforcea^^
iniiiinois.
The iiiinois Eranchise Oisciosure Act requires that iiiinois iaw appiy to any c i a i m a ^
under the iiiinois Eranchise OisoiosureAcL

The conditions under which your Eranchise Agreement or Area Oeveiopment Agreement
can be terminated and your rights upon nonrenewal may be aftected by S e c t i o n s t ^ a n d
20 ot the iiiinois Eranchise OisciosureAoL

INDIANA

t Item I ^ A d d l t l e n a l O l s c l e s o r e s . T h e f o i i o w i n ^ statements are added to item t ^

The indianaOeceptive Eranchise R r a c t i c e s L a w ( i n d i a n a G o d e 2 3 2 2 7 e t s e ^ in

general governs the reiationship between the franchisor and the tranchisee by forbidding
certain provisions in the franchise agreement and reiated documents and by preventing
the franchisor from engaging in certain acts and practices which couid be considered
coercive or oppressiveto thefranchisee i t a n y of the provisions of theEranchise
Agreement orthe Oeveiopment Agreement confiict with this iaw, this iawwiii control.

Any provisions requiring you to s i g n a g e n e r a i release of claims against us, inciuding

upon execution o t a s u c c e s s o r Eranchise Agreement, retundotinitial fees, or transfer,
does not release any claim you may have under the Indiana Deceptive Eranchise
Practices Law.

The Eranchise Agreement and the Oevelopment Agreement provide that suit must be
brought in Ghio These provisions may not be entoroeable under Indiana iaw

Indiana franchise laws wiii govern the Eranchise Agreement, the Oeveiopment
Agreement, and any and aii other reiated documents

Cy^e^
^ t 5 F 0 0 | ^ ^ S ^ ^ ^ ^ ^ ^
^ ^ 8 7 ^ 9 ^
MARIANO

t The to^wingis added tothe e n d o f ^ e ^ m m a ^ s ^ ^ t^o),

entitled Recrements tor tranohisee to renew or extend, and ^
tranohisor approval ot transfer:

However, any release r e a r e d as a condition ot renewai, sale andtor

assignment^transfer wiii not apply to oiaims or liability arising under the Maryland
Franchise Registration and Oisolosure Law

2. The tollowing is added to the end of the nummary" section of itemt7(h),entitied

^Cause^defined^non-curable defaults:

The Oeveiopment Agreement and Franchise Agreement provide for termination

upon bankruptcy. This provision might not be enforceable under federal
bankruptcy law (tt O S O SectionstOt e t s e ^ ) , but we will enforce it to the
extent enforceable.

3 The following sentence is added to the end of the nummary" section of

ltemt7(v),entitled Choice of forum:

You may bring suit in Maryland for claims arising under the Maryland Franchise
Registration and Oisciosure Law.

4 The following language is added to the end of the chart in Item 17:

You must bringany claims arising under theMaryland FranchiseRegistration

and Oisclosure Law within^years after the grant otthe franchise.

MICRICAN

See page after state effective dates near front ofthe FOO

M^NFSCTA
t Trademarks The foilowino sentence is added to the end of ltemt3:

4
Cyole^
^ 0 t 5 F O O | ^ ^ S ^ A ^ o ^ R ^ 5
E ^ ^ ^ ^ ^
 Provided you have oomplied
and Pranohise Agreement a p p l ^ ^
use the Marks and we also wi^ndemnify you from any ioss^oosts or expenses
from any oiaims, suits or^ demands regarding your use of the Marks in
aooordanoe with M i n n S t a t S e o 8 0 C B i 2 S u b d t ( g )

^ RenewaLTermma^^TransterandOiso^eReso^on Thefoiiowingis
added at the end ofthe ohart in i t e m t ^

With respeot to franchises governed by Minnesota iaw,we wiii oompiy

withMinn Stat 5 e o 8 0 C t 4 , Subds 3 , 4 a n d 5 w h i o h r e g u i r e , except in certain
specitied cases, that you be given 90 days'notice ot termination (with 60 days to
cure) otthe Oeveiopment Agreement and Pranchise Agreement and t60 days'
notice for non renewal of the Oeveiopment Agreement and Pranchise
Agreement.

Minn Stat Sec 60C 2t and Minn Ruie2660 4400d might prohibit us
trom requiring litigation to be conducted outside Minnesota, requiring waiver o f a
jury trial or requiring you to consent to liquidated damages, termination penalties
or judgment notes in addition, nothing in the Pranchise Oisclosure Oocument,
Oevelopment Agreement or Pranchise Agreement can abrogate or reduce any of
Oeveioper^s or Pranchisee's rights as provided tor in Minnesota Statutes t 9 6 ^
Chapter 600, or your rights to any procedure, forum or remedies provided for by
theiaws of thejurisdiction Those provisions aisoprovidethat no condition,
stipulation or provision in tbe Oevelopment Agreement or Pranchise Agreement
will in any way abrogate or reduce any of your rights underthe Minnesota
Franchises Law, including, if applicable, the rightto submit matters to the
jurisdiction of the courts ot Minnesota

Any release required as a condition ot renewal, sale andtor

transter^assignment will not apply to tbe extent prohibited by applicable law with
respect to claims arising under Minn. Rule 2660.4400O.

NFWYORK

t The following information is added to the cover page of the Pranchise Oisclosure
Oocument:

^ F O R M A T I O N COMRARINO F R A N C H I S O R S IS A V A I L A B L E C A L L THE
STATE ADMINISTRATORS LISTED IN EXHIBIT A O R YOOR RDBLIC
LIBRARY EOR S O D R C E S O E INFORMATION. REGISTRATION O F THIS
FRANCHISE BY NEW Y O R K S T A T E D O E S NOT M E A N THAT NEW Y O R K
STATE R E C O M M E N D S IT O R H A S VERIFIED THE INFORMATION IN THIS
ERANCHISE D I S C L O S D R E D O C D M E N T . IE YOO L E A R N THAT ANYTHING
INTHE FRANCHISE DISCLOSURE DOCOMENTISDNTRDE^CONTACTTHE
FEDERAL TRADE COMMISSIONANDNEWYORKSTATEDERARTMENTOF
LAW^ B D R E A D O F INVESTOR RROTECTION AND SECDRITIES^ 120
B R O A D W A Y ^ ^ R D FLOORS N E W Y O R K ^ N E W Y O R K I O ^ I

CydeS^
2 0 t 5 F O O | ^ ^ S t ^ ^ e ^ R ^ ^
^ ^ 7 ^ ^
 THEFRANOH^ORMA^^^CHO^^
ITEMS C O V E R E O IN T H E ERANCHISE OISCLCSORE OCCOMENT
HOWEVER^ T H E E R A N C H I S C R C A N N O T OSE THE NECCTIATINC
P R O C E S S TO PREVAIL OPON A P R O S P E C T I V E D E V E L O P E R OR
F R A N C H I S E E TO A C C E P T T E R M S WHICH A R E L E S S E A V O R A R L E THAN
T H O S E S E T E O R T H INTHIS ERANCHISE OISCLOSORE OOCOMENT.

2 The^owingisadded^^eend^^m^

E x c e p t a s p ^ d e d a b o v e , with regard t o t h e t ^ c h i s o ^ itspredecessor, a

person identitied in item 2, er an attiiiate ottering tranohises under the
franohisor'sprinoipai trademark

A. No suoh party has an administrative, oriminai or oivii aotion pending

against that person aiieging: afeiony,avioiationotatranohise,antitrust,
or seourities iaw, traud, embezziement, trauduient conversion,
misappropriation of property,untair or deceptive practices, or oomparabie
civii or misdemeanor aiiegations.

R No such party has pending actions, other than routine litigation incidental
to thebusiness, which aresignificant i n t h e c o n t e x t o f t h e n u m b e r o t
tranchisees and t h e s i z e , nature ortinancial condition of thefranchise
system or its business operations

R N ^ ^ ^ h p ^ r t y h ^ b e e n convicted ofafelony or pleaded nolo contendere

toatelony charge or, within t h e t O y e a r period immediately preceding the
application for registration, has been convicted ot or pleaded nolo
contendere toamisdemeanor charge or has been the subject o f a c i v i l
action alleging: violation ofafranchise, antifraud, or seourities law; fraud;
embezzlement; fraudulent conversion or misappropriation of property; or
unfair or deceptive practices or comparable allegations.

C No sucb party is subject toacurrently effective injunctive or restrictive

order or decree relating to the franchise, or underaEederal, State, or
Canadian franchise, seourities, antitrust, trade regulation or trade practice
law, resulting fromaconcluded or pending action or proceeding brought
b y a p u b l i c a g e n c y ; or is subject to any currently effective order of any
national securities association or national securities exchange, as detined
in the Securities and Exchange Act o f t 9 3 4 , suspending or expelling such
person from membership in such association or exchange; or is subject to
acurrently ettectiveinjunctive or restrictive order relating to anyother
business a c t i v i t y a s a r e s u i t o t a n action brought b y a p u b l i c a g e n c y or
department, including,without limitation,actions atfectingalicense a s a
real estate broker or sales agenL

3. Thefollowing is added to the end o f i t e m s

None otthe franchisor, its attiiiate, its predecessor, officers, or general partner
during t h e t O y e a r period immediately before the date otthe offering circular: (a)
filed as debtor (or had tiled against it)apetition to start an action under t h e O S

CydeS^
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 bankruptcy C o d e ; ^ ) obtained adisobargoot its debts under tbobankruptoy
oode; or (o) w a s a principal otticer of acompany oragenerai partner in a
partnership tbat eitbertiiedasadebtor (or bad fiied against it)apetition to start
an action under t b e O . ^ Bankruptcy Code or tbat obtainedadiscbarge of its
debts under tbe O.S. Bankruptcy Code during or witbintyear after tbat officer or
general partner of tbe franchisor beid tbis position in tbe company or partnership.

4. Thefoiiowingisaddedtotbeendofitem5:

The initiai franchise tee constitutes part of our general operating funds and wiii be used
as such in our discretion

5 Thefollowing i s a d d e d t o t h e e n d o t t h e ^ u m m a r y ^ s e c t i o n s o f item t7(c^

entitied Reouirements for franchisee to renew or extend, and Item entitled C o n d i ^
franchisor aoorovai of transfer:

However, to the extent required by applicable law, ail rights you enjoy and any
causesof action arisinginyour favor trom the provisions of Article 33 of the
General Business Lawof the Stateof New Yorkand the regulations issued
thereunder shall remain in force; it being the intent ofthis proviso that the
nonwaiver provisions of General BusinessLaw Sections 637.4and 637.5 be
satisfied.

6. The followinglanguage replaces the^Summa^section of Item t7(d),entitled

Termination bv franchisee:

You may terminate the agreement on any grounds available by law.

7 The following is added to the end ot the ^Summary^ section ot Item t 7 ^ , entitled
Assionment of contract bv franchisor:

However, no assignment will be made except to an assignee who in good faith

andjudgment of thefranchisor, is willing and financially able toassumethe
franchisor's obligations under the Oevelopment Agreement or Franchise
Agreement

3 The tollowingis added tothe end of the^Summary'sectionsot Item t7(v),

entitled Choice ot forum.and Itemt7(w^ entitled Choice oflaw:

Theforegoingchoice of lawsbould not be considered awaiver ofany right

conferred upon the franchisor or upon the franchisee by Article 33 of the General
Business Law of the Stateof NewYork.

Cycie^r
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^ 5 ^ 7 ^ ^
NORTH DAKOTA

1. The following is added to the end of the "Summary" sections of Item 17(c),
entitled Requirements for franchisee to renew or extend, and Item 17(m), entitled Conditions for
franchisor approval of transfer:

However, any release required as a condition of renewal, sale and/or

assignment/transfer will not apply to the extent, prohibited by the North Dakota
Franchise Investment Law.

2. The following is added to the end of the "Summary" section of Item 17(0, entitled
Non-competition covenants after the franchise is terminated or expires:

Covenants not to compete such as those mentioned above are generally

considered unenforceable in the State of North Dakota; however, we and you will
enforce the covenants to the maximum extent the law allows.

3. The "Summary" section of Item 17(u), entitled Dispute resolution bv arbitration or

mediation is deleted and replaced with the following:

To the extent required by the North Dakota Franchise Investment Law (unless
such requirement is preempted by the Federal Arbitration Act), mediation will be
at a site to which we and you mutually agree.

4. The "Summary" section of Item 17(v), entitled Choice of forum, is deleted and
replaced with the following:

You must sue us in Ohio, except that to the extent required by the North Dakota
Franchise Investment Law, you may bring an action in North Dakota.

5. The "Summary" section of item 17(w), entitled Choice of law, is deleted and
replaced with the following:

Except as otherwise required by North Dakota law, the laws of the State of Ohio
will apply.

RHODE ISLAND

1. The following language is added to the end of the "Summary" sections of

Item 17(v), entitled Choice of forum, and 17(w), entitled Choice of law:

Section 19-28.1-14 of the Rhode Island Franchise Investment Act provides that
"A provision in a multi-unit development agreement or franchise agreement
restricting jurisdiction or venue to a forum outside this state or requiring the
application of the laws of another state is void with respect to a claim otherwise
enforceable under this Act."

VIRGINIA

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 1. The l o w i n g language is added to the end of the "Summary" section of
Itemt^e^entitledTermination by franchisor without cause:

Pursuant to Section 1 3 ^ 564 of the Virginia Retail Franchising Act, it is unlawful

forafranchisor to cancelafranchise without reasonable cause. If any grounds
fordefaultorterminationstated i n t h e Oevelopment Agreement or Franchise
Agreement does not constitute "reasonable oauseB as that term may be defined
in theVirginia Retail Franchising Act or tbe laws ofVirginia, that provision may
not be enforceable.

WASRINGTON

The following paragraphs are added at the end of itemt7:

If any of theprovisionsin this Franchise Oisclosure Oocument, Oevelopment

Agreement or Franchise Agreement are inconsistent with the relationship
provisions ot Revised Code ot Washington Section ^.tOO.t^O o r a n y otber
reguirements otthe Washington Franchise Investment Protection Act (the "Act"),
the provisions of the Act will prevail over the inconsistent terms otthe Franchise
Oisclosure Oocument, Oevelopment Agreement or Francbise Agreement

RCW ^ 9 . t 0 0 . t 8 0 and court decisions may supersede the Franchise

Agreement and the AreaOevelopment Agreement inyour relationship withus,
including in the areas of termination and renewal of your franchise

A r e l e a s e o r w a i v e r o t r i g h t s e x e c u t e d b y afranchisee will not includerights

under the Washington Francbise Investment Protection Act, except when
executed pursuant toanegotiated settlement after the agreement is in effect and
where the parties are represented by independent counsel. Provisions such as
those which unreasonably restrict or limit the statuteot limitations periodfor
claims under the Act, or rights or remedies under the Act, sucb a s a r i g h t t o a j u r y
trial, may not be enforceable in Washington.

Transfer tees are collectable to the extent that they refiect our reasonable
estimated or actual costs in effectingatranster.

Cyo^B^
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 THE FOLLOWING PAGES IN THIS EXHIBIT ARE
STATE-SPECIFIC RIDERS TO THE
FRANCHISE AGREEMENT

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 RA^RTOTHE
ERANCH^EAGREEMENT
F O R O S E ^ ^ N d S

T H I S R I O E R ^ h i s ^ d e ^ is m a d e a n d e n ^ e d ^ o b y a n d b e t w o e o C Y C L E B A R
E R A N C R I ^ N C ^ L L C , an C h i o i i m ^ d i i a b i e compa^^
7720 Montgomery Road, Suite 200,Cincinnat4Chio
entity idontifiod on A p p e n d
business as set torth on AppendixA in this R i d e r ^ ^ e B ^ s B and ^our^ refers to CyoieRar.
^ Y e u ^ and ^yeur^ refers to Eranohisee.

t. R A C K C R C O N O We and ypu are parties to that certain Eranohise Agreement

^ted , 20 (the "Eranchise Agreements This Rider is
annexed to and forms part otthe Eranchise Agreement This Rider is being signed because (a)
any of the ottering or saies activity relating to the Eranchise Agreement occurred in i i i i n o i s a ^
the Studio that you wiii operate under the Eranchise Agreement wiii be located in iiiinois, andtor
(b) you are domiciled in Illinois.

2 ECROM ECRLITICATICN Thefollowing sentenceis added t o t h e end of

Section t6.2 of the Franchise AgreemenL

Section^ot the Illinois Eranchise Oisclosure Act provides that any provision i n a
franchise agreement which designates jurisdiction or venue inaforum outsideof Illinois
is void with respect to any cause ofaction which otherwise is enforceable in Illinois.

3 CCVERNINCLAW Section t 8 3 o f the Franchise Agreement is deleted and

replaced with the tollowing:

E ^ C E F T T C T R E EXTENT C C V E R N E O R Y T H E LINITEO STATES T R A O E M A R K A C T

CFt^(l^NRAMACT,t5OSCSECTlCNSt05t^SEC^,CRCTRER0NlTEO
S T A T E S F E O E R A L L A W , T H l S A C R E E M E N T , T R E FRANCHISE, ANO ALL CLAIMS
ARISING F R C M T H E R E L A T I C N S H I F R E ^ E E N O S A N O Y C O W I L L R E C C V E R N E O
R Y T H E LAWS C F THE S T A T E C F ILLINOIS W I T H C L i T R E C A R O T C ITS CCNFLiCT
C F LAWS ROLES

4 M O T O A L W A I V E R C E d O R Y T R I A L ANO RONITIVE D A M A G E S The toilowino

language is added to the end of S e c t i o n s t 6 4 a n d t 6 5 o f the Franchise AgreemenL

HOWEVER, T H i S S E C T l C N S H A L L N C T A C T A S A C C N O l T l C N , S T l R O L A T f C N C R
RROVISIONFORRORTING T O R I N O ANY F E R S O N A C O O I R I N G A N Y FRANCHISE
TOWAIVECOMRLIANCEWITHANYFROVISIONOFTHE ILLINOIS FRANCHISE
O l S C L O S 0 R E A C T A T S E C T l O N 7 0 5 ^ t OR ILLINOIS R E G O L A T I O N S A T S E C T I O N
200609

^ LIMITATIONS O F CLAIMS. Section t 6 7 o t t h e Franchise Agreement is

amended by adding the following:

However,nothing contained in this Section shall constituteacondition,stipulation,or

provision purporting to bind any person to waive compliance with any provision of tbe

t
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 Illinois Franchise Disclosure Act at Section 705/27 or any other law of the State of
Illinois, to the extent applicable.

6. ILLINOIS F R A N C H I S E D I S C L O S U R E ACT. The following language is added

as Section 16.10 of the Franchise Agreement:

16.10 Illinois Franchise Disclosure Act. Section 41 of the Illinois Franchise

Disclosure Act states that any condition, stipulation, or provision purporting to
bind any person acquiring any franchise to waive compliance with any provision
of the Act or any other law of Illinois is void.

IN WITNESS W H E R E O F , each of the undersigned has executed this Agreement under

seal as of the Effective Date.

FRANCHISOR FRANCHISEE

C Y C L E B A R FRANCHISING, L L C (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
FRANCH^EAGREEMENT
EOROSEINMARYLANO

T H I S R I O E R ^ i s ^ d e ^ is m a d e a n d e n ^ e d into by aod b o t w o o n C Y C L E B A R
F R A N C H ^ N G , L L C , an Obioiimitod iiability o o m ^
7720 Montgomory Road, Suito 2 0 0 , ^
entity idontitiod on A p p o n d i x A a s t b o t r a n o b i s o o ^ a o o b ^ e ^ ^ ^ ^
businossas sot tortb on AppendixA in tbis R i d e ^ ^ e B ^ s B and ^oor^ refers to OyoieRar
^Yoo^ and ^yoor^ refers to Eranobisee

t R A C K C R C O N O We and you are parties to tbat certain Eranobise Agreement

^ted^ ^ 20 (tbe "Eranobise Agreements Tbis Rider is
annexed to and forms part of tbe Eranobise Agreement Tbis Rider is being signed because (a)
you are domiciled in Maryland, and/or(b) tbe Studio tbat you wiii operate under tbe Erancbise
Agreement wiii be located in Maryland.

2 R E L E A S E S Tbefollowing is added to tbe end of Sections22(d) ("Successor

Term^,t3t("TransferRy0s^t34(d)("ControlTrans^^
t 3 6 ( " T r a n s f e r T o A n Entity^,and

Rowever,any release required asaconditionot renewal,sale and/or

assignment/transfer will not apply to any claims or liability arising under tbe
Maryland Erancbise Registration and Oisclosure Law.

3 INSOLVENCY Tbe tollowing sentence is added to tbe end of Section t4

(Termination and Defaults otthe Erancbise AgreemenL

Section t 4 t ( o ) may not be enforceable under federal bankruptcy l a w ( t t L I S C

SectionstOt etseq.).

^ ECROMECR LOCATION Tbe following language is added to tbe end of

Seotiont62("Eorum for Litigation") oftbeErancbise AgreemenL

You may bring an action in Maryland tor claims arising under tbe Maryland Eranchise
Registration and Oisclosure Law

5 C C V E R N I N C L A W The following sentence is added to the end of S e c t i o n t t

("Ooverning Law") of the Eranchise AgreemenL

Notwithstanding the foregoing, the Maryland Eranchise Registration and Oisclosure Law
shall govern any claim arising underthat law.

6 LIMITATIONS OE C L A I M S The following sentence is added to the end of

Sectiont67("Limitations of Claims") ofthe Eranchise AgreemenL

You mustbringanyclaimsarising underthe Maryland Eranchise Registration

and Oisclosure Lawwithin^yearsatterwe grant you the franchise

t
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 7. ACKNOWLEDGMENTS- The following is added as a new Section 19 to the end
of the Franchise Agreement:

19. ACKNOWLEDGEMENTS.

All representations requiring you to assent to a release, estoppel or waiver of liability are
not intended to nor shall they act as a release, estoppel or waiver of any liability incurred
under the Maryland Franchise Registration and Disclosure Law.

IN WITNESS WHEREOF, each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
FRANCH^EAGREEMENT
FORUSE^MINNESOTA

THIS R I O E R ^ ^ d e ^ i s made and e n ^ d i ^

F R A N C H I S I N G L L C , an Ohio limited l i a b ^ y c ^
7720 Montgomery Road, Suito 200, C ^ ^
entity identified on A p p e n d i x A a s the f r a n o h i s e e ^ F r a o o h i s e e ^ with i^^
businessassettorth on AppendixA in this Rider, ^ w e B ^ s B and ^ o o ^ refers to CyoieRar
^Yeo^ and ^yoor^ refers to Franchisee.

t RACKCRCLINO We and you are parties to that certain Franchise Agreement

^ted
annexed to and forms part of the
the Studio that you wiii operate
and/or(b) any of the offering or
Minnesota
^ 20 (the "Franchise Agreements This Rider is
Franchise Agreement This Rider is being signed because(a)
under the Franchise Agreement wiii be located in Minnesota;
saies activity relating to the Franchise Agreement occurred in

2 R E L E A S F S . T h e foilowing is added to the end of Sections22(d),t^t,t34(d),

t 3 5 , t 3 6 , a n d t 5 6 ( d ) of the Franchise AgreemenL

Anyreleaserequiredasacondition of renewal,saie and/orassignment/transfer

will not appiytothe extent prohibited bythe Minnesota Franchises Law

3 S U C C E S S O R T E R M ANO TERMINATION T F R M The following is added to the

e n d o f S e c t i o n s 2 2 a n d t 4 o t t h e Franchise AgreemenL

However, with respect to franchises governed by Minnesota iaw, we will comply

witbMinn Stat S e c 8 0 C t 4 , S u b d s 3 , 4 a n d 5 w h i c b require, except in certain
specified cases, that you be given 90 days^ notice of termination (with 60 days to
cure)andt60 days'notice of nonrenewal of this AgreemenL

^ NOTIFICATION O E I N E R I N O E M E N T ANO CLAIMS The followino sentence is

added to the end of S e c t i o n 9 t o f tbe Franchise AgreemenL

Provided you have complied witb all provisions ofthis Agreement applicable to
the Marks, we wiii protect your right to use the Marks and will indemnity you from
any loss, cots or expenses arising out ofany claims, suits or demands regarding
your use ofthe Marks in accordance with M i n n ^ S t a t S e c 6 0 C t 2 , Subd t(g)

5 F O R U M FOR LITIOATION The tollowing language is added to the end of

Sectiont6.2 otthe Franchise AgreemenL

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 NOTWITHSTANDING THE F O R E G O I N G , MINN. STAT. SEC. 80C.21 AND MINN.
RULE 2860.4400J PROHIBIT U S , E X C E P T IN CERTAIN SPECIFIED C A S E S , FROM
REQUIRING LITIGATION TO B E C O N D U C T E D OUTSIDE OF MINNESOTA.
NOTHING IN THIS A G R E E M E N T WILL A B R O G A T E OR REDUCE ANY O F YOUR
RIGHTS UNDER MINNESOTA STATUTES C H A P T E R 80.C OR YOUR RIGHTS TO
A N Y P R O C E D U R E , F O R U M O R REMEDIES THAT THE LAWS O F THE
JURISDICTION PROVIDE.

6. GOVERNING L A W The following statement is added at the end of Section 16.3

of the Franchise Agreement:

NOTHING IN THIS A G R E E M E N T WILL A B R O G A T E OR REDUCE ANY OF YOUR

RIGHTS UNDER MINNESOTA STATUTES C H A P T E R 80C OR YOUR RIGHT TO ANY
P R O C E D U R E , F O R U M OR REMEDIES THAT THE LAWS OF THE JURISDICTION
PROVIDE.

7. MUTUAL WAIVER O F J U R Y TRIAL AND PUNITIVE D A M A G E S . If and then

only to the extent required by the Minnesota Franchises Law, Sections 16.4 and 16.5 of the
Franchise Agreement are deleted.

8. LIMITATIONS O F CLAIMS. The following is added to the end of Section 16.7 of

the Franchise Agreement:

; provided, however, that Minnesota law provides that no action may be

commenced under Minn. Stat. Sec. 80C.17 more than 3 years after the
cause of action accrues.

9. INJUNCTIVE RELIEF. Section 16.8 of the Franchise Agreement is deleted and

replaced with the following:

Nothing in this Agreement bars our right to obtain specific performance of the
provisions of this Agreement and seek injunctive relief against conduct that
threatens to injure or harm us, the Marks or the System, under customary equity
rules, including applicable rules for obtaining restraining orders and preliminary
injunctions. You agree that we may seek such injunctive relief. You agree that
your only remedy if an injunction is entered against you will be the dissolution of
that injunction, if warranted, upon due hearing, and you hereby expressly waive
any claim for damages caused by such injunction. A court will determine if a
bond is required.

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 IN WITNESS W H E R E O F , each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
ERANCH^EAGREEMENTFORUSE^THE
STATE O E N E W Y O R K

T H I S R I O E R ^ i s ^ d e ^ is m a d e a n d e o ^ e d intoby a n d b e t w e e n C Y C L E B A R
ERANCHISING, L L C , an Ohio limited ^ b ^ y o o m ^
7720 Montgomery Road, Suite 200, Oinoinnati, Ohio ^
entity identifiedon Appendix A a s t h e f r a n o h i s e e ^ E r a n o h i s e e ^ with itspnnoipaipiaoeot
business assetforth on AppendixA in this R i d e ^ ^ e B ^ ^ s ^ and ^eor^ refers to OyoieSar.
^Yeo^ and ^yeor^ refers to Eranohisee.

t R A O K O R O U N O We and you are parties to that oertainEranohise Agreement

dated , (the "Eranohise Agreements This Rider is being
signed beoause (a) you are domioiied in the Stateof New York and the Studio that you wiii
operate under the Eranohise Agreement wiii be iooated in New York, and/or(b) any otthe
offering or saies aotivity relating to the Eranobise Agreement ooourred in NewYork

2 T R A N S E E R - R Y O S The toiiowing language is added to the end ot

S e o t i o n t ^ t o f the Eranohise AgreemenL

Rowever,to the extent required by applioabie law, no transferwiii be made

exoept to an assignee who, in our good faith judgment, is willing and able to
assume our obligations under this Agreement

3. R E L E A S E S . The following language is added to tbe end of Sections 2.2(d),

t 3 t , t 3 . 4 ( d ) , t 3 5 , t 3 ^ , a n d t 5 0 ( d ) of the Eranohlse AgreemenL

Notwithstanding the foregoing all rights enjoyed by you and any oausesot aotion
arising in your favor from the provisions of Artioie 33 of the Oeneral Rusiness
Law of the State of NewYork and the regulations issued thereunder shall remain
inforoetotheextentrequired bythe nonwaiver provisions otORL Sections
6 3 7 4 a n d 037 5, as amended

4 TERM^ATIONOEAOREEMENT-RYYOU Thefollowinolanouaoeisadded
to the end of Seotiont4.3 of the Eranohlse AgreemenL

You also may terminate tbis Agreement on any grounds available by law under
the provisions of Artioie 33 of the General Rusiness Law otthe State of New
York

5 ^ONOTIVERELIEE The following sentence is added to the end of Sections

t5ttandt03:

Our right to obtain injunctive relief exists only after proper proofs are made and the
appropriate authority has granted such relief.

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 6. F O R U M FOR LITIGATION. The following statement is added at the end of
Section 16.2 of the Franchise Agreement:

This section shall not be considered a waiver of any right conferred upon you by
the provisions of Article 33 of the New York State General Business Law, as
amended, and the regulations issued thereunder.

7. GOVERNING LAW. The following is added to the end of Section 16.3 of the
Franchise Agreement:

This section shall not be considered a waiver of any right conferred upon you by
the provisions of Article 33 of the New York State General Business Law, as
amended, and the regulations issued thereunder.

IN WITNESS W H E R E O F , each of the undersigned has executed this Agreement under

seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
. Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 ^OERTOTHE
FRANCH^EAGREEMENT
FOR U S E I N N O R T H D A K O T A

T R I S R I O E R ( ^ " R i d e ^ is m a d e a n d e n ^ e d intoby and betweenOYOLFRAR

FRANORISINO^LLO, an Ohio iimited uabiiity company wit^
7720 Montgomory Road, Suito 2 0 0 , O i n o ^
entity idontitiodon Appendix A a s t h o t r a n o h i s o o ^ F r a n o h i s e e ^ with itspnnoipai piaooof
business as set torth on Appendix A. in this R i d e ^ ^ w e ^ ^ o s ^ and ^eor^ refers to OycieRar
^Yeo^ and ^yeor^ refers to Franchisee.

t. RAOKORODNO W e and you are parties to that certain Franchise Agreement

dated , 20 (the "Franchise Agreements This Rider is
annexed to and forms part of the Franchise Agreement. This Rider is being signed because(a)
you a r e a r e s i d e n t o t North Dakota and the Studio that you wiii operate under the Francbise
Agreement wiii be iocated or operated in North Dakota; and/or(b) any of the offering or saies
activity relating to the Franchise Agreement occurred in North Dakota.

2 RELEASES ThetoiiowingisaddedtotheendofSections22(d^t^t,t3.4(d),
t 3 5 , t 3 0 , a n d t 5 . 6 ( d ) otthe Franchise AgreemenL

Any release required asacondition of renewai,saie and/orassignment/transfer

will not apply to the extent prohibited by tbe North Dakota Franchise Investment
Law.

3 OOVENANTNOTTOOOMRETE The toiiowinoisaddedtotheendot Section

t 2 o t the Franchise AgreemenL

Oovenantsnot to competesuch as those mentioned aboveare

generally considered unenforceable in the State of North Dakota;
however, we wiilentorcetbe covenants tothe maximumextent
tbe iaw allows.

6 O O V E R N I N O L A W . S e c t i o n t 0 3 o t the Franchise Agreement is deleted and

replaced with the following:

EXOEFT T O THE EXTENT G O V E R N E D RY THE UNITED STATES

T R A D E M A R K A O T O F t 9 4 0 ( L A N R A M A O T , t 5 L I S O SECTIONS t05t FT
S E O ^ , O R O T R E R L I N I T E D STATES F E D E R A L LAW, AND E X O E F T A S
OTHERWISE REOUIRED RY NORTH D A K O T A L A W , THIS A O R E E M E N T , T H E
FRANCHISE, AND ALL CLAIMS ARISING FROM THE RELATIONSHIF
BETWEEN U S A N D Y O U WILL RE G O V E R N E D R Y T H E LAWS O F THE
STATE O F OHIO WITHOUT R E G A R D TO ITS CONFLICT O F LAWS RULES,
E X C E F T T H A T A N Y L ^ W REGULATING T H E SALE OF FRANCHISES OR
GOVERNING THE RELATIONSHIF O F A FRANCHISOR AND ITS
FRANCHISEE WILL NOT A F R L Y UNLESS ITS JURISDICTIONAL
R E O U I R E M E N T S A R E MET INDEFENDENTLYWITHOUT R E F E R E N C E TO
THISSECTION

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 6. F O R U M FOR LITIGATION. The following is added to the end of Section 16.2 of
the Franchise Agreement:

NOTWITHSTANDING THE F O R E G O I N G , TO THE EXTENT REQUIRED BY

THE NORTH DAKOTA FRANCHISE INVESTMENT LAW, AND SURJECT TO
Y O U R ARRITRATION OBLIGATIONS, Y O U MAY BRING AN ACTION IN
NORTH DAKOTA FOR CLAIMS ARISING UNDER THE NORTH DAKOTA
FRANCHISE INVESTMENT LAW.

7. WAIVER OF PUNITIVE D A M A G E S . To the extent required by the North Dakota

Franchise Investment Law, Section 16.5 of the Franchise Agreement is deleted.

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 IN WITNESS WHEREOF, each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
FRANOH^EAGREEMENT
EOROSE^RHOOE^LANO

THIS R I O E R ^ ^ d e ^ i s made and e n ^ e d ^

FRANCHISING, L L C , an Ohio limited liab^y oo
7720 Montgomery Road, Suite 2 0 0 , C i n o ^
entity identitied on A p p e n d i x A a s t h e t r a n o h i s e e ^ F r a o o h l s e e ^ with
business as set torth on AppendixA inthisRider,^we^^8^and^e^reterstoCyoieRar
^Yeo^and^yeo^reterstoFranohisee.

t R A C K C R C U N O We and you are parties to that certain Franchise Agreement

^ted ^ 20 (the "Franchise Agreements This Rider is
annexed to and forms part of the Franchise AgreemenL This Rider is being signed because(a)
you are domiciled i n R b o d e i s i a n d and the Studio that you wiii operate under theFranchise
Agreement will be located in Rhode island; and/or(b) any of the offering or saies activity r e l a t e
to the Franchise Agreement occurred in Rhode island.

2 N C N - R F N E W A L A N O TERMINATICN.Thefoliowino paragraph is added to the

endotSections22andt42:

S e c t i o n 6 5 0 4 o f the Rhode Island Fair Oealership Law includes the requirement that, in
certain circumstances,afrancbisee receive 90 days notice of termination,cancellation,
non renewal or substantial change in competitive circumstances. The notice shall state
all tbe reasons tor termination, cancellation, non renewal or substantial change in
competitive circumstances and shall provide that the franchisee has 60 days in which to
rectify any claimed deficiency and shall supersede tbe reguirements of theFranchise
Agreement to the extent tbey may be inconsistent with the Law's reguirements Ifthe
deficiency is rectified within 00 days the notice shall be void. The above notice
provisions shallnot apply it thereason tor termination,cancellation or nonrenewalis
insolvency,the occurrence of an assignment tor the benefit of creditors or bankruptcy. If
the reason for termination, cancellation, nonrenewal or substantial change in competitive
circumstances is nonpayment ot sums due under the Franchise Agreement, you shall be
entitled to written notice ofsuch default, and shail havetOdays in which to remedy such
default from the dateof delivery or posting of such notice

3 C C V E R N 1 N C L A W / F C R O M FOR LITIGATION The following language is

added to the end of S e c t i o n s t 6 3 a n d t 0 2 o f the Franchise AgreemenL

S F C T I O N t 9 26 t t4 O F T H F RHOOF ISLAND FRANCHISF INVESTMENT

ACT FROVIOES THAT "A FROVISION IN A FRANCHISE A G R E E M E N T
RESTRICTING JLIRISOICTION OR VENUE T O A F O R O M O L I T S I O E THIS
STATE OR REOUIRING THE AFFLICATION O F THE LAWS OF ANOTHER
STATE IS VOID WITH R E S F E C T T O A C L A I M OTHERWISE ENFORCEARLE
UNDER THIS A C T B TO T H E EXTENT REOUIRED R Y A F F L I C A R L E LAW,
RHODE ISLAND LAW WILL A F F L Y T O CLAIMS ARISING U N D E R T H E
RHODE ISLAND FRANCHISE INVESTMENT A C T

C^88r
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 IN WITNESS W H E R E O F , each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

C Y C L E B A R FRANCHISING, L L C (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

' [Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
FRANCH^EAGREEMENT
FOROSE^WASH^GTON

^ i s ^ d e ^ is m a d e a n d e n ^ e d i ^ o b y a n d b e t w e e n C Y C L E O A R
FRANCH^N^LLC,anOhio^ed^^c^
7720 M o ^ g o m ^ y Road, Suite ^ O ^ C i o o i o n a ^ O h ^
entity ideot^ed on A p p e ^
business as set forth on A p p e n d i x ^ in this R i d e ^ ^ w e ^ ^ s ^ and ^oor^ refers to CyoieRar.
^Yoo^ and ^yoor^ refers to Franohisee.

1 R A C K G R O O N O We and you are parties to that certain Franohise Agreement

dated , 20 ( t h e f r a n c h i s e Agreements T h i s R i d e r i s
annexed to and forms part of the Franchise Agreement This Rider is being signed because (a)
you are domioiied in Washington; and/or(b) the Studio that you wiii operate underthe Franchise
Agreement wiii be iocated or operated in Washington; and/or(c) any of the offering or saies
activity relating to the Franchise Agreement occurred in Washington.

2 WASR1NGTONLAW The foiiowing paragraphs are added to the end otthe

Franchise AgreemenL

in recognition ot the requirements of the Washington Franchise

investment Frotection Act (the "Act") and the ruies and regulations promulgated
thereunder^the Franchise Agreement shail be moditied as follows:

The Stateof Washington h a s a s t a t u t e , RCW tOtOOtBO, which might

supersedethis Agreement i n y o u r relationship withus, including t h e a r e a s o t
termination and renewal of your franchise. There might also be court decisions
which supersede this Agreement in your reiationship with us, including
termination and renewal of your franchise.

In the event o f a c o n f l i c t o t laws, to the extent required by the Act, the

provisions of the Act, C h a p t e r t 0 t 0 0 R C W , s h a l l prevail

Tothe extent required by the A c t , a r e l e a s e or waiver of rights executed

byyou shall not include rights undertheAct,exceptwhen executed pursuant t o a
negotiated settlement after the Franchise Agreement is in effect and where the
parties are represented by independent counsel. Frovisions such as those which
unreasonably restrict or limit the statuteot limitations period for claims under the
A c t , o r r i g h t s o r r e m e d i e s u n d e r t h e A c t , such a s a r i g h t t o a j u r y trial,might not
be enforceable.

T o t h e e x t e n t required b y t h e Act, transfer fees are collectabletotbe

extentthattheyreflectour reasonable estimate or actual c o s t s i n e t t e c t i n g a
transfer.

IN WITNFSS W R E R F C F , e a c h of the undersigned has executed this Agreement under

sealasoftheFtfectiveOate

CyoleOar
2 0 t 5 F O O i F r 8 0 ^ 5 e A ^ e m o ^ Riders
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FRANCHISOR FRANCHISEE

C Y C L E B A R FRANCHISING, L L C (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 RIOERTOTHE
ERANCH^EAGREEMENT
FOROSEINW^CON^N

THIS RIOER ^ i s ^ d e ^ i s m a d e a o d e n ^ e d ^ o b y a n d b e t w e e n C Y C L E B A R
F R A N C H I S I N G L L C , an O ^ o ^ e d ^ ^
7720 M o n ^ o m e ^ Road, Suite 200, C i n o i n n a ^ C h i o ^ ^ ^
e n ^ i d e n ^ e d on A p p e n d i x A a s ^ e f r a n c s
business as sottorth on Appendix A. in tbis R i d e ^ ^ e B ' ^ s ^ and ^ooB^ refers to CyoieRar
^Yoo^ and ^ y o o ^ refers to Franobisee

t R A C K C R C O N O W e and you are parties to tbat oertainFranobise Agreement

^ted ^^20 (tbe "Franobise Agreements Tbis Rider is
annexed to and forms part oftbeFranobiseAgreement Tbis Rider is being signed beoause (a)
y o u a r e d o m i o i i e d in Wisconsin a n d t b e S t u d i o t b a t you wiiioperateunder tbe Franobise
Agreement wiii be iooated in Wisconsin; and/or(b) any ofthe offering or saies aotivityre^^^
tbe Franobise Agreement occurred in Wisconsin.

^ N C N - R F N F W A L A N O TFRMINATICN.Tbefoiiowin^ paragraph is added to tbe

endofSeotions22andt42:

Section t 3 5 0 4 otthe Wisconsin Fair Oeaiersbip Law includes the requirement that, in
certain circumstances,afranchisee receive 90 days'notice of termination,canceiiation,
non renewal or substantial change in competitive circumstances The notice shall state
ail the reasons for termination, canceiiation, non renewal or substantial change in
competitive circumstances and shall provide that the franchisee has 00 days in which to
rectify any claimed deficiency and shall supersede the requirements of the Franchise
Agreement to the extent tbey may be inconsistent with the Law's requirements Ifthe
deficiency is rectified within 00 days the notice shall be void The above notice
provisions shall not apply it the reason tor termination, cancellation or nonrenewal is
insolvency,the occurrence ot an assignment forthe benefit of creditors or bankruptcy. It
the reason for termination, cancellation, nonrenewal or substantial change in competitive
circumstances is nonpaymentof sums due underthe Franchise Agreement, you shall be
entitled to written notice of such default, and shall havetOdays in which to remedy such
default trom the dateof delivery or posting ofsuch notice

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 IN WITNESS WHEREOF, each of the undersigned has executed this Agreement under
seal as of the Effective Date.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 THE FOLLOWING PAGES IN THIS EXHIBIT ARE
STATE-SPECIFIC RIDERS TO THE
DEVELOPMENT AGREEMENT

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 RIOERTO THE C Y C L E B A R F R A N C H ^ ^ L L C
OEVELCRMENT AGREEMENT
ECRUSEINILLINCIS

THIS R 1 0 E R ^ 5 " R ^ ^ i 5 made and e n ^ e d ^ o ^

ERANCHISINC, L L C , an Chio limited l i a b ^ y company
7720 Montgomery Read, Suite 200, C ^
entity identitied on A p p e n d i x A a s the t r a n o b i s e e ^ E r a o o h i s e e ^ witb
business as set torth on AppendixA in this R i d e r , ^ w e ^ ^ s ^ and ^eoB^ refers to CyoieRar.
^Yeo^ and ^yeor^ refers to Eranobisee.

t RACKCRCONO We and you are parties to tbat certain Oeveiopment

Agreement dated ^20 (the "Oeveiopment Agreements that
has been signed oonourrentiy with the signing of this Rider. This Rider is annexed to and forms
part of the Oeveiopment AgreemenL This Rider is being signed because (a) any of the offering
or saies activity relating to the Oeveiopment Agreement occurred in iiiinois and the CycieRar
Studios that you will operate and develop under the Oeveiopment Agreement will be located in
Illinois, and/or(b) you are domiciled in Illinois.

2 1NCCRRCRAT1CNCE CTHER TERMS The following language is added to the

end o t S e c t i o n ^ o f the Oevelopment AgreemenL

EorumtorLitioation. S e c t i o n ^ o t t h e Illinois Eranchise Oisclosure Act provides that any

provisioninatrancbise agreement which designates jurisdiction or venue i n a f o r u m
outside of Illinois is void with respect to any cause ofaction which otherwise is
enforceable in Illinois.

CoverninoLaw Notwithstanding SectiontO.3 of the Initial Eranchise Agreement, this

Agreement will beconstrued and interpreted under t h e l a w s o t t h e S t a t e o f Illinois,
without regard to its conflicts ot laws rules, except to the extent governed by the United
StatesTrademark Act o t t 9 4 0 (Lanham A o t , t 5 U S C S e c t i o n t 0 5 t e t seq)

Mutual Waiver otJurvTrial and RunitiveOamaoes. Notwithstanding Sections t0.4and

tO.5 of the Initial Eranchise Agreement, this section shall not act as a condition,
stipulation or provision purporting to bind any person acquiring any franchise to waive
compliance with any provision of the Illinois Eranchise Oisclosure Act at Section 705/4t
or Illinois Regulations at Section 200 009.

Limitations ot Claims Notwithstanding Section t 0 7 o f the Initial Eranchise Agreement,

nothingcontainedin this sectionshall constituteacondition, stipulation, or provision
purporting t o b i n d a n y p e r s o n t o waive compliance withany provision ofthe Illinois
Eranchise Oisclosure Act at Section 705/27 or any other law of the state of Illinois, to the
extent applicable.

3 ILLINOIS ERANCHISE O I S C L C S U R E A C T The foilowing language is added

as S e c t i o n t t o f the Oevelopment AgreemenL

tt Illinois EranchiseOisclosure Act S e c t i o n s of thelllinois Eranchise

OisclosureAct states that anycondition,stipulation, or provisionpurporting to

t
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 bind any person acquiring any franchise to waive compliance with any provision
of the Act or any other law of Illinois is void.

IN WITNESS WHEREOF, the parties have executed and delivered this Rider on the
dates noted below, to be effective as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:

Date:
(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 ^OERTOTHECYCLEBARERANCH^^LLC
OEVELOPMENT AGREEMENT
EORUSE1NMARYLANO

T R 1 S R I O E R ^ s " R i d e ^ i s m a d e a n d e n ^ e d intoby a n d b ^ w e e n O Y O L E R A R
ERANOR^NG,LLO,anObio^ed^^oom^^
7720 M o ^ o m e r y Road, S u ^ ^ O ^ n n ^ ^
on^yidon^odon AppondixAastho^anohisoo^Er^^
busiooss as sottorth oo Appendix A. l o ^ s R i d o ^ ^ ^ ^ ^ a n d ^ o o ^ ^ o r s t o O y o l o R a ^
^Yoo^ and ^ y o o ^ rotors to Eranohisoo

1 RAOKGROONO Wo and you aro parties to that oortain Oeveiopment

Agreement dated ^20 (the "Oeveiopment Agreements that
has been signed oonourrentiy with the signing ot this Rider This Rider is annexed to and forms
part otthe Oeveiopment Agreement This Rider is being signed because (a) you are domioiied
in Maryland, and/or (b)tbeGyoieRar S t u d i o s t h a t y o u w i i i o p e r a t e a n d d e v e i o p u n d e r t h e
Oeveiopment Agreement wiii be iooated in Maryland.

2 1 N G G R R G R A T I G N G E G T R E R T E R M S The following language is added to the

end otSeotion9("lnoorporation of GtherTerms") of the Oevelopment AgreemenL

insolvenov Notwithstanding Section 14 ("Termination and Oefault") of tbe Initial

Eranchise AgreemenL this section may not be enforceable under federal bankruptoy law
(ttOSGSectionstOtetseg)

EorumEorLitioation Notwithstanding Section t02("EorumforLitigation^ ofthe Initial

Eranchise Agreement, any release required a s a c o n d i t i o n o f renewal, sale and/or
assignment/transfer will not apply to any claims or liability arising under the Maryland
Eranchise Registration and Oisclosure Law

GoverninoLaw. Notwithstanding Section t03("Governing Law") ofthe Initial Eranchise

AgreemenL the Maryland Eranchise Registration and Oisclosure Law shall govern any
claim arising under that law.

Limitations otGlaims Notwithstanding Sectiont07("Limitations of Glaims") of the Initial

Eranchise Agreement, you must bring any claims arising under the Maryland Eranchise
Registration and Oisclosure Lawwithin^yearsafterwe grant you the franchise

3 A G K N G W L E O G M E N T S . The tollowing language is added as Sectiontt ofthe

Oevelopment AgreemenL

tt AGKNGWLEOGEMENTS

All representations requiring y o u t o a s s e n t t o a r e l e a s e , estoppel or waiver of liability are

not intended to nor shall they act a s a r e l e a s e , estoppel orwaiver of any liability incurred
underthe Maryland Eranchise Registration and Oisclosure Law.

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 IN WITNESS W H E R E O F , each of the undersigned has executed this Rider under seal
as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By: i
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

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 ^OERTOTHEOYCLEBARFRANOH^N^LLC
OEVELOPMENT AGREEMENT
EORUSEINMINNESOTA

THIS R I O E R ^ s ^ d e ^ is made aod e o ^ e d i ^ o ^

E R A N O R ^ N G , L L O , a o Ohio limited liabi^y company w ^
7720 Montgomery Road, Suite 2 0 0 , O i ^
entity identitied on Appendix A a s t h e t r a n o h i s e e ^ E r a o e h i s e e ^ with itsphnoipai piaoeot
business as set forth on Appendix A. in this R i d e r , ^ w e ^ ^ 8 ^ and ^ e o ^ refers to OyoieRar.
^Yeo^ and ^ y e o ^ refers to Eranohisee.

t RAOKOROONO We and you are parties to that certain Oeveiopment

Agreement dated ,20 (the "Oeveiopment Agreements that
has been signed concurrentiy with the signing ofthis Rider This Rider is annexed to and forms
partof the Oeveiopment AgreemenL This Rider isbeing signedbecause (a) the OycieRar
Studios that you wiii operate and develop under the Oeveiopment Agreement wiii be iocated in
Minnesota; and/or (b) any of the ottering or saies activity relating to the Oevelopment
Agreement occurred in Minnesota.

2D 1NOORRORATION O E O T R E R T E R M S The foilowinolanouaoe is added to the

end of Section9("incorporationotOtherTerms^ of the Oevelopment AgreemenL

SuccessorTermAndTerminationTerm. Notwithstanding Sections 2.2 and t4 of the

initiai Eranchise Agreement,with respect to franchises governed by Minnesota iaw,we
wiii comply w i t h M i n n . S t a L S e c . 8 0 0 . 1 4 , Subds. 3 , 4 a n d 5 w h i c h require, except in
certain specitied cases, that you be given 90 days notice of termination (with 00 days to
c u r e ) a n d t 8 0 days'notice of nonrenewal ofthis Agreement.

Notification Ot infrinoement And Oiaims. Notwithstanding Sections9BI o f t h e initial

Eranchise Agreement, provided you have complied witb all provisions of this Agreement
a p p l i c a b i e t o t h e M a r k s , w e wiii protect your right to use the Marks and wiii indemnify
you from any loss, cots or expenses arising out of any claims, suits or demands
regarding youruse ofthe Marks in accordancewith Minn.Stat.Sec. 000 t2,Subd.t(g).

Eorum Eor Litioation NOTWITRSTANOINO SECTION t 0 2 OE THE INITIAL

ERANORISEAOREEMENT,MINNSTATSEO80O2tANOMINNRLILE20004400d
RRORIRIT LIS, EXOERT IN CERTAIN SRECIEIEO C A S E S , EROM REOOIRINO
LITIOATION TO RE C O N O L I C T E O O L I T S I O E O E MINNESOTA NOTHING IN THIS
A G R E E M E N T WILL A R R O G A T E O R REOLICE A N Y O E Y O O R R I G H T S O N O E R
MINNESOTASTATLITES CHARTER 0 0 C O R YOOR RIGHTS TO ANY E R O C E 0 0 R E ,
EORLIMORREMEOIESTHATTHELAWSOETHEJORISOICTIONRROVIOE

GoverninoLaw N O ^ I T H S T A N 0 I N G S E O T I O N S t 0 3 O E T H E INITIAL ERANCHISE

AGREEMENT,NOTHINGINTHISAGREEMENTWILLARROGATEORREOLICEANY
O E Y O L I R R I G H T S L I N O E R M I N N E S O T A STATUTES CHAPTER 00C OR YOOR
RIGHT T O A N Y R R O C E O O R E , E O R O M O R REMEDIES T H A T T H E LAWS OE THE
JORISOiCTIONRROVlOE

Cycie^
2 0 t 5 F O O 1 O e ^ o p m ^ Agreemem
E A ^ 7 ^ ^
 Mutual Waiver Of J u r v T o ^ And Pun^ve Oamaoe5. If and then only tothe extent
required by the Minnesota Franohlses Law, Sections 16.4 and 16.5 of the Initial
Franchise Agreement shall not be Incorporated Into this AgreemenL

Limitations Of Claims Notwithstanding SectlonstOBBotthe Initial Franchise Agreement,

Minnesota law provldesthatnoactlon may be commenced under Minn Stat Sec
800t7morethan3yearsatterthe cause of action accrues

Inlunctlve RelleL Section t ^ 8 ot the Initial Franchise Agreement shall not be

Incorporated Into this AgreemenL Nothing In this Agreement bars our right to obtain
specific performance ofthe provisions ofthis Agreement and seek Injunctive relief
against conduct that threatens to Injure or harm us, the Marks or the System, under
customary eguity rules, Including applicable rules for obtaining restraining orders and
preliminary Injunctions. You agree that we may seek suoh Injunctive relleL Youagree
that your only remedy If an Injunction Is entered against you will be the dissolution of that
Injunction, If warranted, upon due hearing, and you hereby expressly waive any claim tor
damages caused by such Injunction. Acourtwlll determine Ifabond Is required.

IN WITNESS WHERFOF,eacb of the undersigned has executed this Rider under seal
as of the Fttectlve Oate of tbe Oevelopment AgreemenL

FRANCHISOR FRANCHISEE
CYCLEBAR FRANCHISING, LLC (IF ENTITY):
By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

CycleBar
2015 FDD | Development Agreement Riders
EAS'n87466944.6
 (IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar
2015 FDD | Development Agreement Riders
EAST\87466944.6
 RIOERTOTHE
CYCLEBARERANOH^^LLC
OEVELOPMENT A G R E E M E N T E O R U S E ^ T H E
S T A T E OE N E W Y O R K

THIS RIOER ^ 5 " R ^ e ^ i s m a d e a n d e o ^ e d intoby and betweenOYOLERAR

ERANOR^NO,LLO,anOhio^^^
7720 Mon^omery Road, Suite 200, Oincinna^ Ohio
on^idon^odonAppondixAas^o^ano^oo^^
b^nossas^torthonAppondixA I n ^ R i d o ^ ^ B ^ B a n d ^ ^ ^ o ^ t o O y o ^ R a r
^Yoo^ and ^ y o o ^ rotors to Eranohisoo.

t RAOKOROONO Wo and yoo aro parties to that oortain Oovoiopmont

Agroomontdatod ^20 ^ho^Oovoiopmont Agrooment that
has boon signed oonourrontiy with this Ridor This Rider is being signed booauso (a) you aro
domioiied in the State ot New Y o r k ^ t h e O y o i e R a r Studios that you wiii operate and d e v e ^
under the Oeveiopment Agreement wiii be iooated in New York, and/or(b) any of the ottering or
saies activity relating to tbe Oeveiopment Agreement ooourred in New York.

2. 1 N O O R R O R A T I O N O E O T R E R T E R M S The foilowing language is added to the

end of Seotion^^inoorporation of OtberTerms") of the Oevelopment AgreemenL

Transfer Rv Lis Notwithstanding Section t 3 t of the initial Eranchise

Agreement, to the extent required by applicable iaw, no transfer wiii be made
except to a n a s s i g n e e who, in our good faith judgment,is willing and able to
assume our obligations under this AgreemenL

Termination Of Aoreement Rv You Notwithstanding S e c t i o n t t o f the Initial

Eranchise Agreement,you also may terminate this Agreement on any grounds
available by law under the provisionsof Article 33 otthe General Rusiness Law
ofthe Stateof NewYork

Injunctive Relief Notwithstanding Sections t 5 t t and tOO of the Initial

Eranchise Agreement, our right to obtain injunctive relief exists only after proper
proofs are made and the appropriate authority has granted such relief.

Eorum Eor Litioation. Notwithstanding Section t 0 2 of the Initial Eranchise

Agreement, this section shall not be consideredawaiver ofany rigbt conferred
upon you by the provisions of Article 33 ofthe NewYork State General Rusiness
Law, as amended, and the regulations issued thereunder.

Governino Law Notwithstanding Section t 0 3 of the Initial Eranchise

Agreement, tbis section shall not be consideredawalver of any right conferred
upon you by the provisionsof Article 33 of the New York State General Rusiness
Law, as amended, and tbe regulations issued thereunder.

Cyo^Bar
20t5FOO^O^^meotAg^m^Rd^
EA5^74^^
 IN WITNESS W H E R E O F , each of the undersigned has executed this Rider under seal
as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

C Y C L E B A R FRANCHISING, L L C (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar
2015 FDD | Development Agreement Riders
EAST\87466944.6
 RIDER TO T H E C Y C L E B A R FRANCHISING, L L C
DEVELOPMENT AGREEMENT
FOR U S E IN NORTH D A K O T A

THIS RIDER (this "Rider") is made and entered into by and between C Y C L E B A R
FRANCHISING, L L C , an Ohio limited liability company with its principal place of business at at
7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236 ("CycleBar"), and the person or
entity identified on Appendix A as the franchisee ("Franchisee") with its principal place of
business as set forth on Appendix A. In this Rider, "we," " u s , " and " o u r " refers to CycleBar.
" Y o u " and "your" refers to Franchisee.

1. BACKGROUND. We and you are parties to that certain Development

Agreement dated , 20 (the "Development Agreement") that
has been signed concurrently with the signing of this Rider. This Rider is annexed to and forms
part of the Development Agreement. This Rider is being signed because (a) you are a resident
of North Dakota and the CycleBar Studios that you will operate and develop under the
Development Agreement will be located or operated in North Dakota; and/or (b) any of the
offering or sales activity relating to the Development Agreement occurred in North Dakota.

2. INCORPORATION O F OTHER T E R M S . The following language is added to the

end of Section 9 ("Incorporation of Other Terms") of the Development Agreement:

Covenant Not To Compete. Notwithstanding Section 12 of the Initial

Franchise Agreement, covenants not to compete are generally considered
unenforceable in the State of North Dakota; however, we will enforce the
covenants to the maximum extent the law allows.

Governing Law. NOTWITHSTANDING SECTION 16.3 O F THE INITIAL

FRANCHISE A G R E E M E N T , E X C E P T TO T H E EXTENT G O V E R N E D BY THE
UNITED S T A T E S T R A D E M A R K ACT O F 1946 (LANHAM ACT, 15 U.S.C.
SECTIONS 1051 ET SEQ.), OR OTHER UNITED STATES FEDERAL LAW,
AND E X C E P T A S OTHERWISE REQUIRED BY NORTH DAKOTA LAW, THIS
A G R E E M E N T , T H E FRANCHISE, AND ALL CLAIMS ARISING FROM THE
RELATIONSHIP R E T W E E N US AND Y O U WILL BE G O V E R N E D BY THE
LAWS O F THE STATE O F OHIO WITHOUT R E G A R D TO ITS CONFLICT OF
LAWS R U L E S , E X C E P T THAT ANY LAW REGULATING T H E SALE OF
FRANCHISES O R GOVERNING THE RELATIONSHIP O F A FRANCHISOR
AND ITS F R A N C H I S E E WILL NOT A P P L Y UNLESS ITS JURISDICTIONAL
REQUIREMENTS A R E MET INDEPENDENTLY WITHOUT R E F E R E N C E TO
THIS SECTION.

Forum For Litigation. NOTWITHSTANDING SECTION 16.2 OF THE

INITIAL FRANCHISE A G R E E M E N T , TO T H E EXTENT REQUIRED BY THE
NORTH DAKOTA FRANCHISE INVESTMENT LAW, AND S U B J E C T TO YOUR
ARBITRATION OBLIGATIONS, Y O U MAY BRING AN ACTION IN NORTH
DAKOTA FOR CLAIMS ARISING UNDER T H E NORTH DAKOTA FRANCHISE
INVESTMENT UWV.

Waiver Of Punitive Damages. Section 16.5 of the Initial Franchise

Agreement shall not be incorporated into this AgreemenL

1
CycleBar
2015 FDD | Development Agreement Riders
EAST\87466944.6
 IN WITNESS W H E R E O F , each of the undersigned has executed this Rider under seal
as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

C Y C L E B A R FRANCHISING, L L C (IF ENTITY):

By:
Name: [Name]
Title:

Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar
2015 FDD | Development Agreement Riders
EAST\87466944.6
 RIOER TO THE C Y C L E B A R F R A N O H ^ N ^ L L C
OEVELOPMENT AGREEMENT
EOR U S E I N R R O O E ISLAND

THIS R I O E R ^ ^ R I d e ^ is made and e n ^ e d into by

E R A N C R I S I N O , L L C , an Obio limited liability company w i t b ^
7720 Montgomery Road,Suite 200,Cinoinnat40bio 45236 ( " C y o i e R a r , a n d tbe person or
entity identified on A p p e n d i x A a s t b e t r a n o b i s e e ^Eranobisee") witb its p r i n o i p a i ^
business as set tortb on Appendix A. in tbis R i d e r , " w e , " " u s , " a n d " e o r " refers to CyoieRar.
" Y o o " and " y e o r " refers to Eranobisee.

t RACKORODNO We and you are parties to tbat certain Oeveiopment

Agreement dated , 20 (tbe "Oeveiopment Agreement")
tbat bas been signed concurrently witb tbe signing of tbis Rider. This Rider is annexed to and
forms part of tbeOevelopment AgreemenL Tbis Rider is being signed because (a) you are
domiciled in Rhode Island and tbe OycieRar Studios tbat you wiii operate and develop under tbe
Oevelopment Agreement will be located in Rhode Island; and/or(b) any of tbe ottering or sales
activity relating to the Oevelopment Agreement occurred In Rhode Island.

2 INCORPORATION O E O T H E R T E R M S Thetollowinolanouaoe is addedtotbe

end of Section9("incorporation of OtherTerms") otthe Oevelopment AgreemenL

N O N R E N E W A L ANO TERMINATION S e c t i o n 0 5 0 4 o f t h e Rhode island Eair

Oealersbip Law includestherequirement that, in certain circumstances,afranohisee
receive 90 days'notice of termination, cancellation, non renewal or substantial change in
competitive circumstances. The notice shall state all the reasons for termination,
cancellation, nonrenewal or substantial change in competitive circumstances and shall
provide that the franchisee has 00 days in which to rectify any claimed deficiency and
shail supersede the reguirements otthe Eranchise Agreement to tbe extent they may be
inconsistent with the Law's reguirements. If the deficiency is rectified within 00 days the
notice shall be void. The abovenotice provisionsshall not apply if the reason for
termination, cancellation or nonrenewal is insolvency, the occurrence ot an assignment
forthe benefitof creditors or bankruptcy. If the reason for termination, cancellation,
nonrenewal or substantial change in competitive circumstances is nonpayment of sums
due underthe Eranchise Agreement, you shall beentitled to written notice o f s u c h
default, and shall bave t o d a y s in which to remedy such default from the dateof delivery
or posting of such notice.

OOVERNINO L A W / E O R L I M EOR LITIOATION SECTION t9 20 t t 4 O E T R E

RHOOE ISLAND ERANCHISE INVESTMENT ACT RROVIOES THAT "A RROVISICN
I N A E R A N C H I S E A O R E E M E N T RESTRICTING JLIRISOICTION OR VENLIE T O A
EOROM OOTSIDE THIS STATE O R REOLIIRING THE A R R L I C A T I O N O E T H E LAWS
OE ANOTHER STATE IS VOID WITH R E S P E C T TO A CLAIM OTHERWISE
E N E O R C E A R L E ONDER THIS ACTB' TO T H E EXTENT REOOIRED RY APPLICABLE
L A W , R H O O E ISLAND LAW W I L L A P P L Y T O CLAIMS ARISING ONDER THE RHODE
ISLAND ERANCHISE INVESTMENT A C T

Cyo^Bar
^5FOO^Oeve^meotAgroem^R^5
8 A ^ ^ ^ ^
 IN WITNESS W H E R E O F , the parties have executed and delivered this Rider on the
dates noted below, to be effective as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar
2015 F D D | Development Agreement Riders
EAS'n87466944.6
 RIOER TO T H E C Y C L E B A R F R A N O H ^ N ^ L L C
OEVELOPMENT AGREEMENT
EOR08EINWASHIN0TON

THIS R I O E R ^ i s ^ R ^ e ^ i s made and e n ^ e d into by and

ERANCRISINO, L L C , an Obio limited iiability company witb its p^^^
7720 Montgomery Road, Suito 2 0 0 , 0 ^ ^
entityidentitiedonAppendixAastbetranobisee^Eranobisee^witb its principal piaoeot
business as set tortb on Appendix A. in tbis R i d e 4 ^ 6 ^ " u s ^ a n d " e u r " r e t e r s to OycieRar.
" Y e u " and "yeur"reters to Erancbisee.

t. RACKOROONO We and you are parties to tbat certain Oeveiopment

Agreement dated , 20 (tbe "Oeveiopment Agreements
tbat bas been signed concurrently witb tbe signing ot tbis Rider Tbis Rider is annexed to and
terms part ot tbe Oevelopment AgreemenL Tbis Rider is being signed because (a) you are
domioiledinWasbington;and/or(b)tbe OycieRar Studios tbat you will operate and develop
under tbe Oevelopment Agreement will be located or operated in Washington; and/or(c) any ot
tbe ottering or sales activity relating to tbe Oevelopment Agreement occurred in Washington.

2 WASHINOTON L A W The tollowing paragraphs are added to tbe end of the

Oevelopment AgreemenL

in recognition ot the reguirements of the Washington Eranchise

Investment Rrotection Act (theB Act^ and the rules and regulations promulgated
thereunder^the Oeveiopment Agreement shall be moditied as follows:

The State of Washington b a s a s t a t u t e , R C W t 9 t 0 0 t 0 0 , which might

supersedethis Agreement inyour relationship with us, inciuding theareas of
termination and renewal of your francbise. There might also be court decisions
which supersede this Agreement in your reiationship with us, including
termination and renewal of your franchise.

In the event ofaconfiiot of iaws,to the extent required by the Act,the

provisionsoftheAct,Chaptert9.t00 RCW,shall prevail

T o t h e extent required by the A c t , a r e l e a s e or waiver of rights executed

by you shall not include rights under the Act,except wben executed pursuant t o a
negotiated settlement atter the Oeveiopment Agreement is in effect and where
the parties are represented by independent counsel Provisions such as those
which unreasonably restrictor limit thestatute of limitations period tor claims
undertheAct,orrightsor remedies under the Act, sucb a s a r i g h t t o a j u r y trial,
might not be enforceable.

To the extent required by the Act,transfer fees are collectable to tbe

extentthattheyreflectour reasonable estimate or actual costs i n e f f e c t i n g a
transfer.

CycieBar
2 0 t 5 F O O ^ O e v e i o p m ^ Agreemem R ^ e r s
E A ^ 8 7 4 ^ ^
 IN WITNESS WHEREOF, each of the undersigned has executed this Rider under seal
as of the Effective Date of the Development Agreement.

FRANCHISOR FRANCHISEE

CYCLEBAR FRANCHISING, LLC (IF ENTITY):

By:
Name: [Name]
Title:
Date: By:
Name:
Title:

Date:

(IF INDIVIDUALS):

[Signature]

[Print Name]

[Signature]

[Print Name]

Date:

CycleBar
2015 FDD | Development Agreement Riders
EAST\87466944.6
 EXHIBIT J
TOTHE
FRANCHISE DISCLOSURE DOCUMENT

Compliance Questionnaire

(attached)

Franchise Disclosure Document 01/15

EAST\87466944.6
 QUESTIONNAIRE TO BE C O M P L E T E D B E F O R E
Y O U SIGN T H E FRANCHISE A G R E E M E N T

You are preparing to enter into a CBF® Franchise Agreement (the "Franchise
Agreement") with CycleBar Franchising, LLC ("we" or "us"). The purpose of this Questionnaire
is to confirm that you understand the terms of the contract and that no unauthorized statements
or promises have been made to you. Please review each of the following questions and
statements carefully and provide honest and complete responses to each. In this
Questionnaire, our "representatives" include our officers, directors, employees, agents, sales
brokers, and/or any other representatives working on our behalf.

1. When and where did you have your first face-to-face meeting with our representative(s)?

Approximate date of first meeting:

Place of meeting:

2. Which of our representative(s) have you been dealing with?

Name(s):

3. Have you personally read the C Y C L E B A R Disclosure Document ("FDD")?

Yes No

4. Did you give us a signed receipt for the copy of the FDD that we furnished to you?

Yes No If yes, on what date? ,

5. Do you understand all ofthe information contained in the FDD?

Yes No

If not, what parts of the FDD do you not understand? (Attach additional pages, if
necessary.)

6. Have you personally read the Franchise Agreement?

Yes No

7. Do you understand all of the terms of the Franchise Agreement?

Yes No

Franchise Disclosure Document 1 01/15

EASns 7466944.6
 If not, what parts of the Franchise Agreement do you not understand? (Attach additional
pages, if necessary.)

8. Have any of our representatives recommended that you have the FDD and related
agreements reviewed by an attorney or other professional advisor?

Yes No

9. Have you, in fact, discussed the FDD, the related agreements, and the benefits and risks
of operating a C Y C L E B A R franchise with an attorney, accountant, or other professional
advisor?

Yes No

If yes, name and profession of advisor:

If no, do you wish to have more time to do so?

Yes No

10. Other than the information presented in Item 19 of the FDD, has any of our employees
or any other person speaking on our behalf (this does not include franchisees whom you
contact on your own) made any statement or representation (oral, written, or visual)
regarding:

a. The amount of money that others have made or that you might make as a C B F
franchisee?

Yes No

b. The revenue or profits that a C Y C L E B A R franchise will generate?

Yes No

c. Any other financial performance information about C Y C L E B A R franchises?

Yes No

Franchise Disclosure Document 2 01/15

EASr\8 7466944.6
11. If your answer to any part of Question 10 is "yes," please describe the statement or
representation. Please include when, where, and by whom the statement or
representation was made. Please provide full details in the following space. (Attach
additional pages, if necessary.)

12. Have you contacted any of our existing franchisees about their financial performance?

Yes No

13. if your answer to Question 12 is "yes," please describe the information that they shared
with you in the following space. (You do not need to identify the franchisees with whom
you spoke.)

14. Please think about the statements or promises made to you by our employees (or by any
other person purporting to speak on our behalf) concerning the advertising, marketing,
training, support, or assistance that we will furnish to you. Were any such statements or
promises contrary to, or different from, the information contained in the FDD?

Yes No

15. If you answered "Yes" to Question 14, please provide full details in the following space.
(Attach additional pages, if necessary.)

Franchise Disclosure Document 3 01/15

EAS-HS 7466944.6
16. Have you entered into any agreement with us before today concerning our franchise
opportunity?

Yes No If Yes, please describe:

17. Have you paid any money to us before today in connection with our franchise
opportunity?

Yes No If Yes, please describe:

18. In entering into the Franchise Agreement, are you relying on any statement, promise, or
assurances by us or anyone speaking or purporting to speak on our behalf, other than
the terms of the Franchise Agreement itself? If "Yes", please provide full details in the
following space. (Attach additional pages, if necessary.)

19. Would you agree that the success or failure of your franchise will depend in large part
upon your own skills and abilities, competition from other businesses, the size of your
market, and other economic and business factors?

Yes No

20. In which state do you reside?

21. In which state do you intend to operate the C Y C L E B A R franchise?

22. Have you selected a specific site at which you propose to open your C Y C L E B A R
Studio?

Yes No

If yes, please specify the location:

23. Do you have personal knowledge of the market area in which you will operate?

Yes No

24. Did you obtain advice from anyone other than our representatives in selecting your site?

Franchise Disclosure Document 4 01/15

EAS'n87466944.6
 Yes No If yes, name of advisor:

If not, do you wish to have more time to do so?

Yes No

25. Have all of your questions concerning your proposed investment in a C Y C L E B A R

franchise been answered to your satisfaction?

Yes No

Please understand that your responses to these questions are important to us and that
we will rely on them. By signing this Questionnaire, you are representing that you have
responded truthfully to the above questions.

FRANCHISE APPLICANT

Date:

Franchise Disclosure Document 5 01/15

EAS-n87466944.6
ITEM 23 RECEIPT

This disclosure document summarizes certain provisions of the franchise agreement and
other information in plain language. Read this disclosure document and all agreements
carefully.
If CycleBar Franchising, LLC ("CBF") offers you a franchise, it must provide this
disclosure document to you 14 days before you sign a binding agreement with, or make a
payment to, C B F or one of its affiliates in connection with the proposed franchise sale.
New York and Rhode Island require that C B F provide you with this Disclosure Document
at the earlier of the first personal meeting or ten business days before you sign a binding
agreement with, or make payment to, C B F or one of its affiliates in connection with the
proposed sale. Iowa and Michigan require that C B F provide you with this Disclosure Document
ten business days before you sign a binding agreement with, or make payment to, CBF or one
of its affiliates in connection with the proposed sale.
If C B F does not deliver this disclosure statement on time or if it contains a false or
misleading statement, or a material omission, a violation of federal law and state law may have
occurred and should be reported to the Federal Trade Commission, Washington, D.C. 20580
and the state agency listed on Exhibit D.
This franchise is being offered by the following sellers, all of whom are located at
CycleBar Franchising, LLC, 7720 Montgomery Road, Suite 200, Cincinnati, Ohio 45236 (check
all that have been involved in the sales process):
a Emily Brown n Kit Higgs • Todd Kirby • Joe Roda
o Lance Freeman o Lisa Hillman • Alex Klemmer • Jimmy Wilde
o Jeff Herr o Jim Jagers • Bill Pryor •

CBF's registered agents authorized to receive service of process are set forth on Exhibit
D.
Issuance Date: January 6, 2015

I, personally, and as a duly authorized officer of the prospective franchisee (if the
franchisee is an Entity), hereby acknowledge receipt from CycleBar Franchising, LLC of the
Franchise Disclosure Document (to which this Receipt is attached) dated January 6, 2015.
This Disclosure Document included the following exhibits A. Franchise Agreement; B.
Development Agreement; C. Financial Statements; D. State Administrators and Agent For
Service of Process; E. Manuals' Tables of Contents; F. Current Franchisees and Former
Franchisees; G. General Release; H. Nondisclosure and Noncompete; I. Additional State-
Required Disclosures and Riders; and J . Compliance Questionnaire.

Signature (individually and as an officer) Date Disclosure Document Received

Print Name TO BE KEPT FOR YOUR FILES

Franchise Disclosure Document 01 /15

EASTO 7466944.6
ITEM^ RECENT

This disclosure document summaries certain p r o v ^

other intormation in piain language. Read this disclosure document and all agreements
caretuliy.
It OycieRar Franchising, LLO ("ORF^ otters you a franchise, it must provide this
disclosuredocument t o y o u t o d a y s h e t o r e y o u s i g n a hindingagreementwith, o r m a k e a
payment to, ORF or one ot its attiiiates in connection with the proposed franchise sale
NewYork and Rhode Island require that ORE provide you with this Oisclosure Oocument
a t t h e e a r l i e r o f t h e f i r s t personal meeting or ten businessdays h e f o r e y o u s i g n a binding
agreement with, or make payment to, ORF or one ot its affiliates in connection with the
proposed sale Iowa and Michigan require that ORF provide you with this Oisclosure Oocument
ten business days before you signahinding agreement with,or make payment to,ORF or one
of its affiliates in connection with the proposed sale
I t O R F does not deliver this disclosure statement on time or if it contains a false or
misleading statement, oramaterial omission,aviolation of federal law and state law may have
occurredandsbouldbereportedtotheFederalTradeOommission,Washington, 0.0 20580
and tbe state agency listed on FxhibitO
This franchise is being offered by the following sellers, all of whom are located at
OycieRar Franchising, LLO, 7720 Montgomery Road, Suite 200, Oincinnati, Ohio 45230 (check
all that have been involved in the sales process):
• Emily Brown D Kit Higgs • Todd Kirby • Joe Roda
• Lance Freeman • Lisa Hillman • Alex Klemmer • Jimmy Wilde
• Jeff Herr n Jim Jagers • Bill Pryor •

CBF's registered agents authorized to receive service of process are set forth on Exhibit
D.
Issuance Date: January 6, 2015

I, personally, and as a duly authorized officer of the prospective franchisee (if the
franchisee is an Entity), hereby acknowledge receipt from CycleBar Franchising, LLC of the
Franchise Disclosure Document (to which this Receipt is attached) dated January 6, 2015.
This Disclosure Document included the following exhibits A. Franchise Agreement; B.
Development Agreement; C. Financial Statements; D. State Administrators and Agent For
Service of Process; E. Manuals' Tables of Contents; F. Current Franchisees and Former
Franchisees; G . General Release; H. Nondisclosure and Noncompete; I. Additional State-
Required Disclosures and Riders; and J . Compliance Questionnaire.

Signature (individually and as an officer) Date Disclosure Document Received

Print Name TO BE RETURNED TO:

CycleBar Franchising, LLC

Print Franchisee's Name (if an Entity) 7720 Montgomery Road, Suite 200
Cincinnati, Ohio 45236

Franchise Disclosure Document 01/15

EAST\87466944.6