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Detailed Information on Pet Butler’s Initial Franchise Fee, Royalty Fee + 29 Other Fees (Items 5 and 6, 2022 FDD)

1. Initial Franchise Fee: $12,500

To acquire a franchise for a Franchised Business, you must pay an initial franchise fee of $12,500 for a Territory containing up to 50,000 single-family dwelling units (“SFDUs”). However, if you elect, and are eligible, to participate in the Pet Industry Professional Program, Pet Butler will waive the initial franchise fee for a geographic territory containing up to 50,000 SFDUs.

If you wish to obtain a Territory of more than 50,000 SFDUs, and Pet Butler approves, you must pay Pet Butler an additional fee of $0.25 for each SFDU over 50,000 SFDUs, even if you are eligible to participate in the Pet Industry Professional Program.

50% of the initial franchise fee due under the Franchise Agreement, plus any additional SFDUs, is due and payable when you sign the Franchise Agreement and the remaining 50% is due before you attend the initial training program.

If you elect, and are eligible, to participate in Pet Butler Franchise Fee Financing for the initial franchise fee, you will still have to make a down payment of 50% of the initial franchise fee, plus pay for any additional SFDUs, upon your signing the Franchise Agreement. However, the remaining balance of the initial franchise fee may be financed over 5 years.

If you acquire more than one Territory, even if you already own a Franchised Business, you must pay additional initial franchise fees. The Pet Industry Professional Program is not available for any additional Territories or in addition to Franchised Businesses that you or your affiliates own or acquire.

2. Marketing Fees for New Pet Butler Franchise: $15,000

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If you are purchasing a new Pet Butler franchise, you must pay to Pet Butler the sum of $15,000 for an initial marketing campaign.

Pet Butler will use all of the fee for marketing and advertising in the Territory and will provide you with assistance with the generation of an initial marketing campaign, which may include the following: direct response advertising, name recognition advertising, and print, electronic and other media advertising.

For new franchisees, the initial marketing campaign fee is payable in a lump sum when you attend the initial training program. However, if you participate in the Flex Start Program, Pet Butler may allow you to pay the initial marketing campaign fee in more than one installment, depending on the business season and the timing of your commencement of the Franchised Business.

3. Initial Property Data: $500

You must pay Pet Butler, or its affiliate, a fee for the collection of initial property data relevant for marketing within your Territory. Pet Butler’s affiliate, SGE, or its designee, will collect and provide the property data to you.

Based on a Territory size of 50,000 SFDUs, the fee is $500 for a new Territory. You will be charged for the actual size of your Territory at that time.

This “initial property data fee” is payable in a lump sum when you attend the initial training program and is fully earned and non-refundable.

4. Initial Supply Package: generally not more than $2,732

Pet Butler is the supplier of your initial supply package (consisting of opening inventory and supplies), which you must acquire before your Franchised Business opens. The amount for the initial supply package varies but is generally not more than $2,732.

5. Computer: $1,100, plus tax and shipping (if applicable)

In addition, before you begin operating your Franchised Business, you must acquire a computer that meets Pet Butler’s specifications.

Though you are not required to purchase your computer from Pet Butler, you may elect to do so. If purchased from Pet Butler, the cost for your computer is estimated to be $1,100, plus tax and shipping (if applicable).

6. Royalty: 12% of Gross Sales of the Franchised Business

Due Date: Payable weekly on the Wednesday following the end of the reporting week.

7. Marketing Fund Contributions: 2% of Gross Sales of the Franchised Business

Due Date: Payable weekly on the Wednesday following the end of the reporting week.

8. Regional Marketing Fee: if established, up to 2% of Gross Sales of Franchised Business

Due Date: Payable weekly on the Wednesday following the end of the reporting week.

Pet Butler does not currently collect a Regional Marketing Fee.

9. Local Marketing Shortfall: will vary

Due Date: Annually (if incurred).

If your Local Marketing expenditures are less than the minimum amount required, you must pay Pet Butler the amount of the shortfall and it will contribute such amount to the Fund.

10. Audit: cost of inspection or audit

Due Date: As incurred.

If you do not submit required reports or if you understate your Gross Sales of the Franchised Business by 5% or more.

11. Transfer Fee: 2½% of Gross Sales of the Franchised Business within the 12 months immediately preceding the effective date, but no less than $7,500 and no more than $17,500

Due Date: Before, or at, the closing of the approved transfer.

If you obtain Pet Butler’s approval to the transfer, you will be required to pay the transfer fee at closing.

12. National Advisory Council Assessment Fee: not currently charged

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Due Date: When billed.

Pet Butler does not currently collect a National Advisory Council Assessment Fee.

13. National Training Conference Fee: $71 per month for 7 months during years that a conference is scheduled to take place, which is currently every other calendar year

Due Date: When billed.

14. Indemnification: will vary under circumstances

Due Date: As incurred.

15. Interest: the greater of 1½% per month or 3% over Bank of America Prime Rate, but not above the highest legal rate permitted by applicable law

Due Date: When billed.

Payable on all overdue amounts under the Franchise Agreement.

16. Invoice Customer Fee (paper billing): $2.00 per invoice

Due Date: When billed.

If Pet Butler is required to prepare and mail paper invoices, it will charge this fee per invoice.

17. Management Fee: $300 per day, plus costs and expenses

Due Date: As agreed.

Upon death or incapacity of franchisee, if requested or if no competent manager is available.

18. Education Fee: if required, Pet Butler estimates this cost to be $100 per year

Due Date: When billed.

19. Ongoing/Refresher Training: not currently charged. If implemented, it will be Pet Butler’s then-current fee (currently, $250 per day).

Due Date: When billed.

If Pet Butler requires that you or your employees attend ongoing and refresher training programs.

Pet Butler may increase the fee during the term of the Franchise Agreement.

20. Operating Software Fee: currently, $45 per month

Due Date: When billed.

21. Technology Fee: not currently charged. If implemented, it will be Pet Butler’s then-current fee (currently estimated at $150 per month)

Due Date: When billed.

22. Accounting Service Fee: if required, Pet Butler estimates this cost to be $125 per hour

Due Date: When billed.

23. Insufficient Funds: $50

Due Date: As incurred.

24. Failure to Report Gross Sales Fee: currently, $25

Due Date: As incurred.

25. National or Regional Meeting Fee: currently, $500, plus expenses for the National Meeting. This fee is subject to change.

Due Date: As incurred.

26. Customer Survey Fee: not currently charged (but if implemented, estimated to be approximately $1.50 per customer)

Due Date: As incurred.

27. Services to Customers: actual costs incurred

Due Date: As incurred.

28. Taxes: will vary

Due Date: As incurred.

You are responsible for paying taxes arising out of the operation of your business. You must reimburse Pet Butler for any taxes that it must pay to any state taxing authority on account of either your operation or payments that you make to Pet Butler.

29. Updated Property Data Fee: not currently charged