Has the Fruit Bouquets Marketing Fund been established for Flowerama franchisees?

Fruit Bouquets Marketing Fund

We or 1-800-Flowers or our respective affiliates may also maintain and administer a marketing fund for franchisees that purchase the Fruit Bouquets Program (the "Fruit Bouquets Marketing Fund"). If you purchase the Fruit Bouquets Program, you will pay into the Fruit Bouquets Marketing Fund an amount equal to 2% of your Fruit Bouquets Gross Sales each month. The Fruit Bouquets Marketing Fund has not yet been established, so no money has been collected or spent by this fund. The Fruit Bouquets Marketing Fund will be for the benefit of all franchisees offering Fruit Bouquets and is intended to maximize general public recognition in all media, of the Fruit Bouquets Marks, patronage of retail outlets participating in the Fruit Bouquets Program, and the availability of fruit bouquets offered at Flowerama Centers and elsewhere. (Franchise Agreement, Section 22C).

If established, the Fruit Bouquets Marketing Fund will be maintained as described below;

National and regional marketing programs can include the use of television and radio campaigns, yellow pages advertising, public relations activities, the use of toll-free telephone numbers, telemarketing systems, on-line computer networks and services, the Internet, interactive television and other technological advances for local and regional coverage. We can direct the activities of the Fruit Bouquets Marketing Fund directly and can utilize the services of advertising and public relations agencies to assist in these activities. We

can, but have no obligation to, make expenditures that directly benefit you or your Center. If established, any portions of the Fruit Bouquets Marketing Fund that are not spent during the fiscal year in which they accrue will be spent during the following year. If established, we will make contributions to the Fruit Bouquets Marketing Fund equal to the amounts required of comparable Centers for each of our or our subsidiaries 'or affiliates' company-owned units operating in any market or region in which there are 5 or more Centers in operation. (Franchise Agreement, Section 22 D).

During the term of your Franchise Agreement, if established, we will provide you, at your written request, with an annual statement within 120 days after the end of our fiscal year summarizing the expenditures of the Fruit Bouquets Marketing Fund. The Fruit Bouquets Marketing Fund will not be audited. 1-800-Flowers Marketing and Finance Departments administer all Advertising and Marketing Funds under the direction of the Director of Marketing. (Franchise Agreement, Section 22D).

Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 38–52)