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Business Description

The name of the franchisor is Phocatox Technologies, LLC. In this Franchise Disclosure Document, Phocatox Technologies, LLC is referred to as “we”, “us”, “our”, or “Phocatox.” In this Franchise Disclosure Document, the Franchisee is referred to as “you”, “your”, “Franchisee”, “Franchise Owner” or the person or legal entity who is buying the BIOSWEEP franchise (such “legal entity” includes a corporation, partnership, LLC or other type of organization and its owners, officers and directors). We do business under the name “Phocatox.” We do not do business under any other names. We maintain our principal business address at 160 W. Carmel Drive, Suite 204, Carmel, IN 46032. We are an Indiana limited liability company organized on February 16, 2007.

Prior Experience

OFFICERS AND MANAGING MEMBERS MARK BRODOWICZ Mr. Brodowicz is an Officer, Managing Member and Co-Founder of Phocatox (February 2007- present). He was Vice President of Bio-Sys, Inc., Austin, TX, a manufacturer of microbial cleaning products (January 1996-March 2010). HARPER JONES Mr. Jones is an Officer, Managing Member and Co-Founder of Phocatox (February 2007- present). 4 BILL MCDANIEL Mr. McDaniel is an Officer and Managing Member of Phocatox (May 2007 - present). He was President and Chief Operating Officer for Heritage Environmental Services, Indianapolis, IN (1991-2012). TODD SCHNITZIUS Mr. Schnitzius is an Officer, Managing Member and Co-Founder of Phocatox (February 2007 - present). He is also President of TAS Services, Inc., Indianapolis, IN (July 2004-present), a management consulting firm.

Business Offered

We are in the odor removal and indoor air and surface decontamination business. We developed and manufacture a specialized device called the BIOSWEEP to eradicate odors from fire smoke, cigarette smoke, skunk oil, animal urine, sewage and other odor nuisances. The BIOSWEEP is also used for surface decontamination of viruses and bacteria. The BIOSWEEP is based on an advanced version of a technology called photocatalytic oxidation (PCO). We first introduced the BIOSWEEP in 2007. We developed operational procedures to deploy the BIOSWEEP in residential homes, multifamily housing, commercial buildings and automobiles. We began selling the BIOSWEEP Service Provider Franchise in October 2009. We sell the BIOSWEEP device exclusively to our BIOSWEEP Service Provider franchises who provide BIOSWEEP services to their own residential and commercial customers within protected geographic territories. In 2015, we expanded our business by offering BIOSWEEP services directly to the insurance industry for fire smoke odor removal on insurance claims. We offer nationwide services to insurance companies for residential, commercial and industrial fire losses. This business program is called the BIOSWEEP Restoration Services Program (RSP) and is governed by the RSP Agreement (Franchise Agreement, Exhibit D). We process all insurance losses through our 24/7 national call center. We directly manage large commercial fire and catastrophic losses and include field service participation from our BIOSWEEP Service Provider franchisees. We directly assign residential losses to our BIOSWEEP Service Provider franchises who perform these services on our behalf. We franchise the right to provide odor removal and indoor air and surface decontamination services using our technology, proprietary operational methods, trademarks, procedures and sales and marketing techniques we have developed over the past 11 years.

Initial Fees

In consideration for the license granted in Section 1, the Franchise Owner agrees to pay the Initial Franchise Fee, and to purchase the initial equipment and supplies described below in Part B. A. Initial Franchise Fee. The Initial Franchise Fee of $25,000 shall be paid in a lump sum in U.S. funds and is in payment for administrative and other expenses we incur in granting this franchise and territory to you and for our lost or deferred opportunity to franchise others. It is fully earned and nonrefundable, except, as this Agreement otherwise states: 1) If, you die, or you become physically or mentally disabled to the extent that you cannot pursue the operation of a BIOSWEEP® franchise under this Agreement, we will refund the full initial franchise fee paid to us if death or disability occurs before we have expended time and money to train you. If death or disability occurs after you have completed training, but before you open for business, the franchise fee will be refunded minus $5,000 to reimburse us for the costs involved to grant you the franchise and provide training. Once you begin operations, the initial franchisee fee has been fully earned and is not refundable for any reason. 2) In the unlikely event you are unable to successfully complete training, after the initial training period, or at least one further training period, and it is our belief that you will not be able to follow the BIOSWEEP® System we have developed, the initial franchise fee will be refunded minus $5,000 to reimburse us for the costs involved to grant you the franchise and provide training. B. Initial Purchase of BIOSWEEP Machines and Related Equipment and Supplies. The Franchise Owner shall place a binding purchase order with Phocatox upon signing this Agreement for the six (6) BIOSWEEP Model 900 and/or Model 1100 machines, and one (1) ESS XT-3 Electrostatic Sprayer as is set forth in Exhibit B, such number being determined at the signing of this Agreement, based on the schedule in Exhibit B. The purchase price for each BIOSWEEP machine is Six Thousand Five Hundred Ninety-Five Dollars ($6,595) plus sales tax where applicable. The purchase price for the ESS XT-3 Electrostatic Sprayer is Three Thousand One Hundred Thirty Dollars ($3,130.00) plus sales tax where applicable. Such purchase prices shall be paid in full at such time as the machines, electrostatic sprayer (and the safety and testing equipment and application chemicals listed below in this Part A and the Operations Manual) have been received and inspected at the Franchise Owner's location in the United States (freight and insurance paid by Phocatox) and the Initial Training (see Section 4, Part J below) has been scheduled. At the time the Franchise Owner places the purchase order for the BIOSWEEP machines and electrostatic sprayer, the Franchise Owner shall also place a binding purchase order for the appropriate safety and testing equipment and Phocatox application chemicals in an amount to reasonably stock the Franchise Owner for 3 months of operation, the purchase price of which will be at Phocatox's standard prices. The Franchise Owner acknowledges that it is Phocatox's policy to mark up the price for the equipment and supplies that it sells to the Franchise Owner to return to Phocatox such profit as Phocatox deems reasonable. There is an additional cost for freight for which you are responsible. The cost of freight for one BIOSWEEP machine ranges from $150 to $225 in the continental U.S. For the six units you must purchase, the cost of shipping will range from $900 to $1,350. If the Franchise Agreement is terminated before you begin operations, and you have already purchased the machines and related equipment and supplies you are required to purchase from us, upon return of all the items you have purchased, we will refund the amount you paid for those items, but we will not refund the shipping costs.

Financing

We do not offer direct or indirect financing for your Initial Franchise Fee or initial equipment order. We do not assist in providing financing for you. We do not guarantee any notes or financial obligations you may incur in setting up and operating your Franchise. We do offer in-house equipment financing for additional BIOSWEEEP machine purchases after your Initial Equipment Order has been completed. Financing terms are for 24, 30 or 36 fixed monthly payments at 5.00% APR until paid in full. A 10% down payment plus freight expense are required to be paid upon receipt of goods. If you choose to finance for 24, 30 or 36 months, then we will finance 90% and none of the freight. If we finance additional BIOSWEEEP machine purchases after your Initial Equipment Order has been completed, we will hold the note, and will not sell, assign or discount any part of it to a third party. Our security for the note will be the BIOSWEEEP machine you purchase. There are no provisions in the note that will require you to waive defenses or other legal rights, or that bar you from asserting a defense against us as the lender.

Franchisee Revenue and Profit

The FTC's Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if there is a reasonable basis for the information, and if the information is included in the disclosure document. Financial performance information that differs from that included in ITEM 19 may be given only if: (1) a franchisor provides the actual records of an existing outlet you are considering buying; or (2) a franchisor supplements the information provided in this ITEM 19, for example, by providing information about possible performance at a particular location or under particular circumstances. We do not make any representations about a franchisee's future financial performance or the past financial performance of company-owned or franchised outlets. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting Mark Brodowicz at Phocatox Technologies, LLC, 160 W. Carmel Drive, Suite 204, Carmel, IN 46032.