CLUB CAT

CLUB CAT 12 Franchise Disclosure Document ǀ 2024 We may impose and collect a Marketing Fee of up to 2% of Gross Revenue, currently, however, we do not collect the Marketing Fee. The Marketing Fee compensates us for certain marketing and promotional activities such as the creation and production of promotional materials, third party marketing supplier expenses, or supporting in-house marketing efforts, including salary expenses. While we have no contractual obligation to do so, it is our intent to spend Marketing Fee monies, or an equivalent amount, on regional and national brand development. We do not guarantee that you will benefit from the Marketing Fee in proportion to your Marketing Fee payments. Marketing Fee payments are not contributions to a fund as we do not maintain, nor do we require any contribution, to a marketing fund. Marketing Fee monies will not be held in a trust or escrow account, nor do we have any contractual obligation to account for Marketing Fee monies separately, and we will not have any fiduciary obligations to you with respect to the Marketing Fee. We will determine the use of the Marketing Fee monies. If Marketing Fee monies are not spent in the fiscal year in which they accrue then, as these amounts are general operating funds, we may spend such monies as we deem appropriate. We will not be required to spend any particular amount on marketing, advertising, or promotion in your Hotel’s market area, nor any pro rata amount based upon your Marketing Fee payment. Marketing Fee monies are not used to solicit new franchise sales. As Marketing Fee payments are not contributions to a fund, and we do not maintain or administer any such marketing related fund, we have no fund to audit nor do we disclose fund expenditure breakdowns by percentage in the categories of production, media placement, administrative expenses, and other uses. Also, as we have no fund, company owned stores are not required to contribute to a fund, however, company owned stores do contribute to system marketing expenditures. Local Advertising Each calendar quarter you must spend at least 2% of Gross Revenue on local advertising that conforms to our standards and specifications. This includes engaging our designated vendor to provide search engine optimization (SEO) services and a minimum spend threshold for Google Ads. Any amounts contributed to an Advertising Cooperative, described below, will be credited toward satisfaction of your local advertising expenditure requirement. We reserve the right to require you to participate in specific events that we may designate from time to time, which may require the payment of additional fees and coordination with other franchisees (including Businesses owned by us or our affiliates) and will include utilizing our designated materials and media for each event. Advertising Council There currently is no advertising council composed of franchisees that advise us on advertising policies. Website You may not establish or maintain a web site or other online presence that reflects any of the Marks or any of our copyrighted works. If we permit you to own your own domain, your domain name may not include the term “Club Cat.” Training Program Within 60 days after the franchise agreement is signed, your Managing Owner must attend and complete our initial training program to our satisfaction. Currently, training is held on an as needed basis at our headquarters in Irvine, California, but portions of the training program may be administered virtually. We do not currently maintain a formal training staff. The initial training program will be conducted by or under the direction of Shana Martin who founded the CLUB CAT concept. Ms. Martin has been with us since our inception in January 2023 and has operated a CLUB CAT Hotel since 2019. Training materials include written materials and hands-on experience. The following is a summary of our initial training program:

There is no charge for the first two individuals to attend the initial training program. At your request, we may permit additional individuals to attend the same training program, subject to space availability and payment of reasonable tuition. You are responsible for all costs and expenses of complying with our training requirements including tuition and registration costs and salary, travel, lodging, and dining costs for all employees who participate in the training. Computer Requirements You will need to purchase two laptop computers, an iPad, and printer/scanner, and will need access to high- speed internet. The cost for this hardware ranges from $1,235 to $2,000. You also will need to maintain a subscription license for our reservation software, which provides an online booking portal appointment scheduling, and payment processing, and currently charges a license fee which ranges from $170 to $190 per month. You also must purchase and use our required accounting software, which currently is QuickBooks online and currently between $30 to $200 per month. You must also engage our designated bookkeeping services vendor who currently charges between $250 to 500 per month. We will have independent access to the information generated and stored in these programs. There are no contractual limitations on our right to access this information. We are not required to provide any ongoing maintenance, repairs, upgrades or updates to any computer hardware or software program. Security System and Webcam Requirements You will need to purchase, install, maintain, and monitor (remotely and professionally) a security system that meets our minimum specifications. We estimate that there will be no initial hardware or installation costs related to the security system, however, your ongoing fees will range between $75 to $100 per month. You will also purchase webcams for each suite per our minimum specifications and monitor the same through our designated application which currently charges $209 per month. Site Selection and Opening When you sign the Franchise Agreement, we will agree on a “Site Selection Area” within which you may locate the Hotel. You must acquire an acceptable site for the Hotel within this area within 180 days from the effective date of the Franchise Agreement. We reserve the right to approve or disapprove your proposed