How does Camp Margaritaville use the Marketing Fee collected from franchisees?

In consideration of your Marketing Fee, we will administer the Marketing Program. We will use the Marketing Fee in a manner that we determine, in our sole discretion, to be in the general best interests of the Camp Margaritaville System. For example, we may use the Marketing Fee in the following manners: (i) conducting local, regional or national advertising, promotional or brand building programs of any kind; (ii) developing, maintaining, administering, directing, preparing, or reviewing advertising and marketing materials, promotions and programs; (iii) public awareness of any of the Camp Margaritaville Intellectual Property; (iv) public and consumer relations and publicity; (v) brand development; (vi) research and development of technology, products and services; (vii) website and application development and search engine optimization; (viii) development and implementation of quality control programs; (ix) changes and improvements to the Camp Margaritaville System; (x) the fees and expenses of any advertising agency we engage, in our discretion, to assist in producing or conducting advertising or marketing efforts; (xi) any other programs or activities that we deem necessary or appropriate to promote or improve the Camp Margaritaville System; and (xii) our or our affiliates' expenses associated with direct or indirect labor,

administrative, overhead or other expenses incurred in connection with promotional, marketing or advertising efforts or any of the foregoing activities, including working with public relations firms, advertising agencies, advertising placement services, and creative talent. Our ability to use the Marketing Fee on any of the foregoing products or services does not reduce or negate your obligation to separately pay for those products or services as otherwise provided in this Item 11. We retain sole authority to direct the Marketing Program, with sole control over the creative concepts, materials, and media used and the placement and allocation of marketing programs. We reserve the right to use any media, create any programs, and allocate advertising and promotional expenditures to any regions or locales we deem appropriate. We do not use any marketing funds from your contributions principally for the solicitation of new franchisees.

We currently do not, and are not required to, maintain the Marketing Fee in a separate account from our other money. We are not required to expend any specific funds from the Marketing Fee on the area or territory for your Resort. Other franchisees may not be required to pay the Marketing Fee, may be required to pay a different Marketing Fee, or may be required to contribute to a different advertising fund. We have no obligation to make expenditures from the Marketing Fee that are equivalent or proportionate to your Marketing Fee, ensure that you benefit directly or proportionately or in any amount from the placement of advertising, or ensure that any advertising impacts or penetrates your area. In the calendar year ended December 31, 2024, 18.36% of the Marketing Fees were used for digital media promotion, including websites, social, email marketing, and digital ads; 2.30% for creative services and content development, including graphic design, video production and podcast; 38.58% for events, including sweepstakes and contests, charitable events, and pickleball tournaments; 5.10% for public relations, 20.97% for resort performance support, including photoshoots, customer service email support, 13.53% for media support from Radio Margaritaville, and 1.15% for administration. The foregoing figures have been rounded to the second decimal place. If we do not spend all of the Marketing Fee in the calendar year which it accrues, then those funds will roll over to be expended in the following year. We may have the collections and expenditures audited, with the expenses of the audit being paid for out of the Marketing Fee, by an independent certified public accountant we select. We will provide you with an unaudited statement of the operations of Marketing Fee expenditures within 30 days of your written request. Any amounts that we or our affiliates contribute to the Marketing Fee will be considered a loan and we and/or our affiliates will have the right to be reimbursed from the Marketing Fee in any amounts that we advance to the Marketing Program. There are no advertising councils composed of franchisees. However, we may form these advertising councils. You are not required to participate in an advertising cooperative.

Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 46–55)