ed to be disclosed in this Item.

ITEM 5. INITIAL FEES

If you are purchasing a franchise from us, you will pay us an initial franchise fee of $25,000 for the Main Office when you sign the Standard Franchise Agreement. If we approve you for a Better Homes and Gardens® Real Estate franchise, we will countersign your Standard Franchise Agreement. The initial franchise fee is nonrefundable and is fully earned by us upon our countersignature. As further described in Item 1, we have a franchise sales incentive program under which we may waive or reduce the initial franchise fee and provide other business benefits for prospective franchisees that meet the eligibility requirements. As of the issuance date of this disclosure document, the initial franchise fee the Main Office under the program is waived and we provide other business benefits.

The initial franchise fee under the Franchise Agreement, for each additional Branch Office will be $5,000 and due when the Branch Office is added to the Franchise Agreement. If you are an existing franchisee and acquire another qualifying real estate brokerage business that you combine into your Office(s), without adding a new Branch Office, we will not charge you an additional initial franchise fee. If you are approved to open additional Better Homes and Gardens® Real Estate Branch Office(s), you will sign a Location Addendum to your Franchise Agreement to amend it to reflect the existence and the location of additional Branch Office(s) (see Location Addendum, Exhibit C-1). We may condition the approval of additional offices on certain other terms and conditions, including minimum annual royalty fees, which terms will be included in the Location Addendum.

We do not refund any initial franchise fees, except that we will refund your initial franchise fee if we do not accept you as a franchisee. You must pay us any franchise fees in a lump sum. We have the right to vary, waive (in whole or in part), reduce, negotiate, or make an exception to our published fee structure and/or payment terms for any reason, including, without limitation, large or otherwise significant transactions. We also have the right to negotiate conversion funding or other incentives that may vary in type, amount, and

duration. Our exercise of these rights may have the effect of directly or indirectly decreasing the initial franchise fee. See Item 10.

If we permit you to open a Limited Purpose Office, we will charge you a one-time, non-refundable fee of $1,000, and you will be required to sign a Limited Purpose Office Addendum. See Item 1.

In 2024, initial franchise fees paid by franchisees ranged from $0 to $25,000 for a Main Office, and from $0 to $5,000 for a Branch Office.

**ITEM 6.

Source: Item 5 — INITIAL FEES (FDD pages 24–25)