Pearle Vision’s Initial Franchise Fee, Royalty Fee + 21 Other Fees

Detailed Information on Pearle Vision’s Initial Franchise Fee, Royalty Fee + 21 Other Fees (Items 5 and 6, 2021 FDD)

1.  Development Fee:  $10,000 for each Licensed EyeCare Center you intend to develop under the Limited Exclusive Development Agreement

• If you enter into a Limited Exclusive Development Agreement, simultaneously with signing that Agreement, you must pay a Development Fee of $10,000 for each Licensed EyeCare Center you intend to develop under the Limited Exclusive Development Agreement; provided that, depending on the market that you will develop, Pearle Vision reserves the right to charge up to the entire amount of the Initial Franchise Fees for all of the Licensed EyeCare Centers you intend to develop under the Limited Exclusive Development Agreement.

• The Development Fee is uniform for all developers who execute the Limited Exclusive Development Agreement, is fully earned when paid, and is nonrefundable.

• If you enter into a Non-Exclusive Development Agreement, you will also pay the Development Fee, but you will pay a reduced Royalty.

2.  Initial License Fee:  $30,000 for New Licensed Owner; $20,000 for Existing Licensed Owner

• When you sign the Location Addendum to License Agreement, you must pay a lump sum “Initial License Fee” for each EyeCare Center you License.

• A “New Licensed Owner” is an individual or entity that does not currently operate a Licensed EyeCare Center, and an “Existing Licensed Owner” is an individual or entity that currently operates one or more Licensed EyeCare Centers.

• If you sign a Location Addendum to the License Agreement but you fail to submit the site materials or commence construction by the deadlines, Pearle Vision may, at its option, terminate the License Agreement. In that event, Pearle Vision will refund, without interest, the License Fee (less $5,000 for administrative and out-of-pocket expenses) and you must sign a general release in Pearle Vision’s favor.

• Non-traditional venues such as military bases, universities, hospitals, health clinics, medical practices, store-in-store venues, government buildings, and large employers may pay a different Initial License Fee than Pearle Vision’s traditional Licensed EyeCare Centers.

3.  Royalty:  7% of Gross Revenues

• Due Date:  Payable monthly on the 15th day of each month by electronic funds transfer.

• Gross Revenues includes all revenues generated from your Licensed EyeCare Center, excluding Professional Fee Revenues, taxes, unclaimed orders, coupon discounts or documented refunds, reimbursements, or price adjustments.

4.  Advertising Contribution:  8% of Gross Revenues

• Due Date:  Payable monthly on the 15th day of each month by electronic funds transfer.

• This fee may increase if you do not participate in EyeMed or the Local Co-op votes to increase the fee.

5.  New Start Grand Opening Advertising:  no less than $15,000

• Due Date:  Payable in 3 equal installments on the 25th of the month by electronic funds transfer.

6.  Independent Conversion Grand Opening Advertising:  no less than $7,500

• Due Date:  Payable in 2 equal installments on the 5th of the month by electronic funds transfer.

7.  Renewal Fee:  $5,000

• Due Date:  At the time you sign a License Agreement to renew your License.

• You pay this fee to Pearle Vision to renew your License.

8.  Transfer Fee:  up to $7,500

• Due Date:  At the time you submit your transfer request to Pearle Vision.

• You pay this fee to Pearle Vision to transfer any interest in your Licensed EyeCare Center. The fee is prorated depending upon the amount of interest you transfer.

9.  A&E Fees:  $16,300

• Due Date:  At the time you sign or renew the License Agreement.

10.  Project Services Fees:  $16,000

• Due Date:  At the time you are required to complete a full remodel or relocate.

• You pay these fees to Pearle Vision if you are completing a full remodel or relocation of your EyeCare Center.

11.  Third-Party Service Provider Fees:  $300 to $1,500

• Due Date:  These fees are charged at the end of the project on your consolidated statement.

• These are service/coordination fees. There is no preferred vendor list for these projects.

12.  Frames:  varies

• Due Date:  As agreed.

• You must purchase and replenish enough Frames to meet the requirements of your License Agreement.

13.  Inventory:  varies

• Due Date:  As agreed.

• You will purchase certain Inventory from Pearle Vision or its Approved Suppliers.

14.  Lab Services:  varies

• Due Date:  As agreed.

• You must obtain Lab Services from Pearle Vision or its Approved Suppliers.

15.  Additional Training:  $100 to $500

• Due Date:  Upon completion of training.

• You will pay this fee to Pearle Vision for each additional training session. This cost will vary according to how many members of your staff attend training and the type of training attended.

16.  Audit:  cost and expenses of audit (including travel and per diem costs) and attorneys’ fees

• Due Date:  Paid on the 25th day of the month following the month your account has been billed.

• You will pay this fee to Pearle Vision for a periodic review of your books and records if the audit reveals any underreporting.

17.  Late Fees:  18.0% per annum or the maximum rate permitted by law, whichever is lower, on any overdue amount

• Due Date:  Paid on the 25th day of the following month after your account has been billed.

• You will pay Pearle Vision certain Late Fees for payments returned due to insufficient funds, late payments, or late financial statements.

• Late Fees may be charged in addition to any other remedies Pearle Vision may have including, for example, the NSF Fee.

18.  Insufficient Funds Fee (“NSF Fee”):  in a calendar year, $35 for the 1st incident and $100 for all additional incidents or as otherwise provided in the Operating Manual

• Due Date:  Immediately upon notice.

• Assessed if any payments due Pearle Vision are returned from your bank due to insufficient funds in your account.

• Fee may be changed as provided in the Operating Manual.

19.  Financial Statement Late Fee:  $250 per month for late Financial Statements submitted in calendar quarters Q1, Q2, or Q3; $1,000 per month for late Financial Statements submitted in calendar quarter Q4

• Due Date:  Immediately upon notice.

• Assessed if Financial Statements are not provided timely in the manner specified in the Operating Manual.

• Fee may be changed as provided in the Operating Manual.

20.  Management Fee:  8.0% of Gross Revenues

• Due Date:  Payable monthly on the 15th day of the next month.

• You will pay Pearle Vision this fee if it manages your EyeCare Center due to the death or disability of you or your Designated Operator, or your failure to comply with your License Agreement.

21.  External Credentialing Review:  up to $100 per “Optometric Professional” (an ophthalmologist or optometrist)

• Due Date:  At time of submission of application for external credential review.

22.  Indemnification:  varies

• Due Date:  On demand.

23.  POS Support and Maintenance Fee:  not to exceed $400/month if required

• Due Date:  Payable monthly on the 25th day of the month.