NATIONAL ADVERTISING PRODUCTION FEES. During the term of each Franchise Agreement signed by the FRANCHISEE pursuant to this Agreement, the FRANCHISEE will pay to CITY LOOKS weekly National Advertising Production Fees, as defined in the Franchise Agreement, equal to one-half of one percent (.5%) the weekly Gross Revenues, as defined in the Franchise Agreement, which are received, billed or generated by or from the FRANCHISEE'S City Looks businesses in the Franchised Area. The FRANCHISEE will pay National Advertising Production Fees to CITY LOOKS at the applicable rate stated in the preceding sentences, even if the Franchise Agreements signed by the FRANCHISEE specify National Advertising Production Fees that are greater than or different from the National Advertising Production Fees specified herein. With the possible exception of the percentage of the FRANCHISEE'S Gross Revenues which will be payable to CITY LOOKS, the National Advertising Production Fees for each of the FRANCHISEE'S City Looks businesses will be payable by the FRANCHISEE according to the terms of the applicable Franchise Agreements signed by the FRANCHISEE pursuant to this Agreement.
NATIONAL ADVERTISING PRODUCTION FEES. The FRANCHISEE will pay CITY LOOKS weekly National Advertising Production Fees equal to one half of one percent (.5%) of the FRANCHISEE'S weekly Gross Revenues for deposit in the National Production Account ("NPA") which will be administered and controlled exclusively by CITY LOOKS. The FRANCHISEE'S failure to pay the National Advertising Production Fees will be a material breach of this Agreement. CITY LOOKS will have the right to use the NPA monies, in its sole discretion, to purchase and pay for any services or products relating to the production of advertising for City Looks Franchisees, including the purchase of production materials, ad slicks, brochures, radio and television commercials, services provided by advertising agencies, market research and development costs, advertising and promotion development and production costs (including all costs relating to media costs for television, radio, newspaper, direct mail and point-of-purchase advertising, and all costs of collateral materials required for such advertising), creative costs, product research costs, all costs and expenses incurred in administering the NPA (including, but not limited to, salaries, travel expenses, office supplies, and related general and administrative expenses), and all other costs relating to the advertising and promotion of all City Looks Salons International and The Barbers Franchisees and the Business System. The use of the monies in the NPA and the administration of the NPA will be under the absolute direction and control of CITY LOOKS. CITY LOOKS will have the absolute right to determine, in its sole discretion, the advertising agencies that will be retained, the type and content of the services and products, and all other matters pertaining to the expenditures made by CITY LOOKS from the NPA. CITY LOOKS will have no fiduciary duty to the FRANCHISEE with respect to collection or expenditure of the National Advertising Production Fees, and any advertising fund will not be a trust or escrow account. CITY LOOKS will not be required to contribute to the NPA; however, all City Looks businesses that are owned and operated by CITY LOOKS will be required to contribute to the NPA in accordance with the terms of their respective Franchise Agreements. The National Advertising Production Fees paid by the FRANCHISEE will not be refundable to the FRANCHISEE under any circumstances.
