ESTIMATED INITIAL INVESTMENT**

NOTES:

• 1. All payments and fees due to us or our affiliates in this Item are non-refundable under any circumstances, including if you do not open for business or terminate the franchise relationship. Payments to third parties may be refundable if you and the third party agree to allow for a refund. The availability and terms of financing for third parties will depend on factors such as the availability of financing generally, your creditworthiness, collateral you may have and lending policies of financial institutions from which you may request a loan.
• 1. The Franchise Fee is due when you sign the Franchise Agreement and is not refundable. The estimate is based upon a territory with a population of up to 150,000. You may purchase additional territory rights for areas with populations of up to 50,000 each for an additional fee of $15,000 per additional territory.
• 1. Currently you must lease or purchase the HydroDog Vehicle from an approved supplier. Your HydroDog Vehicle must be outfitted and wrapped in the colors, specifications and manner we specify. The low-end estimate assumes will lease the required HydroDog Vehicle for the business. The high-end estimate assumes you purchase the HydroDog Vehicle with certain fees and costs payable upon signing the purchase agreement and assumes that you have good credit. If you choose to lease the HydroDog Vehicle, the estimate for payments in the chart above does not include any deposit. You must maintain one (1) HydroDog Vehicle for every 100,000 population (or fraction thereof) in your Territory. If additional vehicles are required based on population, you must add each required additional HydroDog Vehicle within 6 months after commencing operations or within 6 months of any population increase that triggers the requirement for an additional vehicle. Failure to add required vehicles within these timeframes will constitute a default under the Franchise Agreement.
• 1. When you sign your franchise agreement, you must pay to us a non-refundable grand opening marketing fee of $5,000 per HydroDog Vehicle you intend to operate within the Territory. We will use this grand opening marketing fee to perform your grand opening marketing. The grand opening marketing fee is uniform, due in lump sum and is fully earned and non-refundable upon payment.
• 1. If you have less than 5 years' experience in grooming and/or you are not a certified groomer, you will pay us $2,500 for your Initial Tools Package. The Initial Tools Package will be customized for each franchisee based on the tools needed. The Initial Tools package is due in lump sum and is fully earned and non-refundable upon payment.
• 1. If you are not already a dog groomer, you must hire a lead groomer and complete our designated online grooming training program prior to Initial Training. The cost of the online training program is estimated to range between $1,000 and $3,000. If you are already a dog groomer, you must complete and pass a skills assessment administered by us prior to Initial Training. If you fail to meet our standards in the skills assessment, you will be required to attend a dog grooming academy of our choosing at your expense prior to Initial Training.

• 1. The Initial Training Fee covers our expenses in providing training to you. If you choose to bring additional trainees then you will incur an additional Initial Training Fee per person. You will still be responsible for your travel and living expenses. Any training required beyond the initial training will be at your expense and will incur additional fees.
• 1. Additional Funds is an estimate of the funds needed to cover business (not personal) expenses during the first 3 months of operation of your HydroDog Business. You will need capital to support on-going costs of your business. New businesses (franchised or not) often have larger expenses than revenues. As with most businesses, your costs will depend on factors such as how much you follow our recommended systems, your technical, marketing and general business skills, local economic conditions, the local market for your business, competition, local cost factors, location and the sales levels achieved by you. This is only an estimate, and we cannot guarantee that the amounts specified will be adequate.