What is the purpose of the Aw Marketing Fund?

You understand and acknowledge that the Marketing Fund is intended to maximize recognition of the Marks and patronage of Papa Ray's Pizza Restaurants. Although we will endeavor to use the Marketing Fund to develop advertising, marketing and promotional materials, and to place advertising in a manner that will benefit all Papa Ray's Pizza Restaurants, we undertake no obligation to ensure that expenditures by the Marketing Fund in or affecting any geographic area are proportionate or equivalent to contributions to the Marketing Fund by Papa Ray's Pizza Restaurants operating in that geographic area or that any Papa Ray's Pizza Restaurant will benefit directly or in proportion to its contribution to the Marketing Fund from the

development of advertising, marketing and promotional materials or the placement of advertising. Except as expressly provided in this Paragraph 12.1, we assume no direct or indirect liability or obligation to you with respect to the maintenance, direction, or administration of the Marketing Fund.

• 12.2 Local Advertising.

Once you have completed the grand opening advertising campaign during the first three (3) months of operation of your Papa Ray's Pizza Restaurant, in addition to the requirement for you to contribute to the Marketing Fund, you must spend on local advertising, marketing and promotion a minimum of Three Thousand Eight Hundred Dollars ($3,800.00) per month throughout the term of this Agreement.

Such expenditures will be made directly by you, subject to our approval and direction.

We may require that you use suppliers designated by us for certain types of local advertising, marketing and promotion.

Within thirty (30) days of the end of each calendar quarter, you must furnish to us in a manner approved by us an accurate accounting of your monthly local advertising and marketing expenditures for the previous calendar quarter.

• 12.3 Advertising Approval. Prior to your use of them, samples of all local advertising, marketing and promotional materials not prepared or previously approved by us, and all proposed content for any Internet or social media advertising or promotion, must be submitted to us for approval.

If you do not receive our written approval within thirty (30) days from the date we receive the materials, the materials will be deemed to have been disapproved.

You may not use any advertising or promotional materials that we have disapproved.

12. ADVERTISING

12.1 Marketing Fund. We administer a system-wide marketing fund ("Marketing Fund"). Your required contributions to the Marketing Fund are set forth in Paragraph 10.3 of this Agreement.

We will be entitled to direct all advertising, marketing and promotional programs financed by the Marketing Fund, with sole discretion over the creative concepts, materials, and endorsements used in them, and the geographic, market, and media placement and allocation of the programs. You agree that the Marketing Fund may be used to pay the costs of preparing and producing video, audio and written advertising materials; administering national, regional or local advertising programs including, without limitation, direct mail and other media advertising, and employing advertising agencies to assist in those activities; establishing and maintaining the Company Website; supporting public relations, market research and marketing activities; and providing advertising, marketing and promotional materials to Papa Ray's Pizza Restaurants. The Marketing Fund will furnish you with approved advertising, marketing and promotional materials at its direct cost of producing those materials.

The Marketing Fund will be a separate and distinct account and will be accounted for separately from the other funds of the Company and will not be used to defray any of our general operating expenses, except for any reasonable salaries, administrative costs and overhead we may incur in activities reasonably related to the administration of the Marketing Fund and its advertising, marketing and promotional programs (including, without limitation, conducting market research, preparing advertising, marketing and promotional materials, and collecting and accounting for contributions to the Marketing Fund). We may spend in any fiscal year an amount greater or less than the total contribution of Papa Ray's Pizza Restaurants to the Marketing Fund in that year. We may cause the Marketing Fund to borrow from us or other lenders to cover deficits of the Marketing Fund or cause the Marketing Fund to invest any surplus for future use by the Marketing Fund. All interest earned on monies contributed to the Marketing Fund will be used to pay advertising, marketing and promotional costs of the Marketing Fund before other assets of the Marketing Fund are expended. We will prepare an annual statement of monies collected and costs incurred by the Marketing Fund and will furnish it to you on written request.

Source: Item 22 — CONTRACTS (FDD pages 39–40)