Detailed Information on BrightStar Care’s Initial Franchise Fee, Royalty Fee + 20 Other Fees (Items 5 and 6, 2022 FDD)

1.  Initial Franchise Fee:  $25,000 to $50,000

• You will pay BrightStar Care an Initial Franchise Fee of $50,000 for the first 200,000 to 300,000 in population in your Protected Territory with a minimum of 15,000 in population 65 years of age or older. You must pay BrightStar Care $100 per each additional 1,000 people (pro rata) in the Protected Territory over 300,000.

• If you are acquiring a franchise for a Medium Density Market territory, which is a Protected Territory with less than 200,000 in population, you will pay BrightStar Care an Initial Franchise Fee of $25,000.

• BrightStar offers a one-time $5,000 discount (“Vet Fran Discount”) on the Initial Franchise Fee to honorably discharged veterans of the United States Armed Forces. The $5,000 discount is available only on the Initial Franchise Fee for your first Territory.

2.  Royalty/Continuing Fee:  franchisees signing BrightStar’s Franchise Agreement for a new Agency or renewing their existing franchises pay (i) 5.25% of monthly Net Billings generated from non-National Accounts and (ii) 6.25% of monthly Net Billings generated from National Accounts

• Due Date:  Deducted from your bank account via EFT 28 days after the date on the invoice you receive from BrightStar.

3.  General Marketing Fee:  franchisees signing BrightStar’s Franchise Agreement for a new Agency (including for a Medium Density Market Agency) or renewing their existing franchises pay, beginning on the Opening Date of the Agency, the greater of $500 per month or 2.5% of the prior month’s Net Billings

• Due Date:  Deducted monthly from your bank account via EFT.

4.  Monthly Athena Business System and Email Service Fee:  beginning on your Agency’s Opening Date (including for a Medium Density Market Agency), you will pay the higher of $250 per month or .83% of the prior month’s Net Billings

• Due Date:  Deducted monthly from your bank account by BrightStar Technology via EFT.

5.  Microsoft Teams/One-drive/Web Version Office Package Option:  beginning in the month you execute the Microsoft Teams/One-drive/Web Version Office Package Opt-in Addendum, you will pay $7.85 per user per month (subject to change upon written notice)

• Due Date:  Deducted monthly from your bank account by BrightStar Technology via EFT.

6.  State Electronic Visit Verification (“EVV”):  up to $1,000 one-time set-up fee and up to $.50 per record transmitted on your behalf. You must notify BrightStar Care no less than 90 days before your state implements EVV.

• Due Date:  One-time fee paid upon receipt of invoice. Per-record charges deducted monthly from your bank account by BrightStar Technology or other approved vendor via EFT.

7.  State EVV Late Notice Fee:  up to an additional $1,000 if you provide less than 90 days’ notice to set-up your ABS record(s) to integrate with your state’s EVV requirements

• Due Date:  Per occurrence; paid upon receipt of invoice.

• Deducted from your bank account by BrightStar Technology or other approved vendor via EFT.

8.  State EVV Version Upgrade Fee:  $500 per EVV version upgrade required by your state. You must submit the changes no less than 90 days before your state’s effective date of the required change.

• Due Date:  Per occurrence; paid upon receipt of invoice.

• Deducted from your bank account by BrightStar Technology or other approved vendor via EFT.

9.  State EVV Version Upgrade Late Notice Fee:  up to an additional $500 per each EVV version upgrade submitted less than 90 days before your state’s effective date of the required change

• Due Date:  Per occurrence; paid upon receipt of invoice.

• Deducted from your bank account by BrightStar Technology or other approved vendor via EFT.

10.  Additional Training (to be provided on an as-needed basis):  $100/day per attendee for group training programs, plus travel to Gurnee, IL or regional training location. $300/day per attendee for advanced training. On-site training available on a resource-available basis at a cost of $500 per day per trainer, plus room, board, and travel for each trainer.

• Due Date:  Upon receipt of invoice.

11.  Annual Conference and up to 2 Branch Leadership Conferences each year, if any:  you are solely responsible for all travel, room, board, and salary expense. BrightStar may charge a registration fee to cover speakers, meals, and activities up to $2,000 per person for the Annual Conference, up to $1,000 per person for each in-person Branch Leadership Conference, and up to $500 per person for each virtual Branch Leadership Conference (charged regardless of attendance)

• Due Date:  Any other charges for any annual conference are due upon invoice.

12.  Insurance (excluding workers’ comp):  $6,780 to $9,730 for your first year of operation

• Due Date:  Directly to approved supplier as per supplier’s invoice.

• Either lump sum payment or finance premiums on monthly installments depending upon provider selected.

13.  Workers’ Comp Insurance:  $1,488 to $23,411 for your first year of operation, subject to audit based on actual payrolls incurred during the policy term

• Due Date:  Directly to approved supplier as per supplier’s invoice.

14.  Transfer Fee:  50% upon listing Agency for sale; if no formal listing, then 50% due before buyer attends Discovery Day, and balance due when buyer signs the Franchise Agreement

• Due Date:  At or before transfer.

15.  Termination Damages:  depends on circumstances

• Due Date:  Upon 15 days after effective date of termination.

16.  Indemnification and Defense:  all costs, including attorneys’ fees; amount will vary under circumstances

• Due Date:  As incurred.

• You must reimburse BrightStar for losses it suffers resulting from your operation of your Agency.

17.  Cost and Attorneys’ Fees:  will vary under circumstances

• Due Date:  Upon settlement or conclusion of claim or action.

18.  Examination/Audit of Your Records:  depending on circumstances (including your cooperation), but estimated examination expense is $1,000 (including BrightStar’s reasonable accounting, legal fees, and travel expenses), plus full amount of any underpayment and interest and late charges on any underpayment

• Due Date:  Upon receipt of invoice.

19.  Late Fees:  highest applicable legal rate for open account business credit, not to exceed 1.5% per month

• Due Date:  Accrues immediately after due date if you fail to pay full obligation.

• Interest is payable on the entire overdue amount beginning with the date payment is due until you pay the arrearage, late charges, and interest in full.

20.  Tax Reimbursement:  out-of-pocket cost reimbursement

• Due Date:  As incurred.

• You must reimburse BrightStar for taxes it must pay any state taxing authority on account of either your operation or your payments to it (except for its income taxes).

21.  Vendor Evaluation Fee:  up to $5,000 if the vendor is approved

• Due Date:  As incurred.

• Evaluation of proposed new vendors to support the brand.

22.  Cross-Territorial Policy Payment:  varies, although currently the payment may be as much as the full gross margin (less royalties, ABS-related fees, and General Marketing Fees) for each client

• Due Date:  Varies.

• A violation of the Cross-Territorial policy may subject you to a payment to one or more franchisees if you service clients in other franchisees’ territories without permission or authorization.