$574

Business Description

Our corporate parent is Jackson Hewitt Tax Service Inc. (“JHTS”), a Delaware corporation incorporated on February 20, 2004. On May 31, 2018, under the terms of an Agreement and Plan of Merger, Assist Parent LLC (“Assist Parent”), a Delaware limited liability company, became the owner of JHTS. The parent of Assist Parent is Assist TopCo LLC, a Delaware limited liability company; the parent of Assist TopCo LLC is Assist Holdings L.P., a Delaware limited partnership; the majority owner of Assist Holdings L.P. is Corsair Assist, L.P., a Delaware limited partnership, the majority of which is owned by investment funds. One of our Affiliates, Jackson Hewitt Technology Services LLC (“JH Technology”), provides various technology services for our system. The principal business address for us, TSA, and JHTS is 10 Exchange Place, 27th Floor, Jersey City, New Jersey 07302. The business address for JH Technology is 501 N. Cattlemen Road, Suite 300, Sarasota, Florida 34232. The principal business address for Assist Parent and its parents is 717 Fifth Avenue, 24th Floor, New York, New York 10022. Our agents for service of process are listed on Exhibit B. From 1994 through 1996, we also operated and offered franchises for copy and related services businesses under the name “Copy, Pack & Ship.” Other than the franchises described in this paragraph, neither we, nor any of our Affiliates, have operated or offered franchises in any other line of business.

Prior Experience

We are a Virginia corporation incorporated on December 24, 1985. We and our wholly owned subsidiary, Tax Services of America, Inc. (“TSA”), do business under the name Jackson Hewitt Tax Service® . We have operated and offered franchises for Jackson Hewitt Tax Service businesses since 1986. We engage only in franchising and supporting franchisees of businesses relating to tax return preparation and other financial and related products and services. We have no predecessors and no affiliates (“Affiliates”) that offer any franchises for tax preparation or related services.

Business Offered

We offer franchises for the operation of Jackson Hewitt Tax Service businesses that provide tax return preparation and other financial and related products and services under the service marks “JACKSON HEWITT® ” and “JACKSON HEWITT TAX SERVICE® ” and such other trademarks, service marks, trade dress and logos that we designate (the “Marks”). Each Franchised Business is governed by a Franchise Agreement and must be operated in accordance with our plan and system for preparing, checking and electronically filing income tax returns using our software, accounting methods, merchandising, equipment selection, advertising, promotional techniques, personnel training and quality standards that feature the Marks (the “Operating System”). The Operating System includes the “Operating Standards,” “Marks Standards,” and “Technology Standards” as defined in the Franchise Agreement. Each Franchise Agreement will describe a defined territory (“Territory”) and will specify the number and types of offices you will be require to open within the Territory. We may enter into arrangements with organizations that permit you and/or us to operate a facility in locations open to the general public (“National Account”) as well as places that are not open to the general public, such as within a business, organization, labor union, or government employer (an “Affinity Location”). We may negotiate special rates and/or services for providing tax preparation services at a National Account location (“National Account Location”) or an Affinity Location. We are not required to allow you to service Affinity Accounts or National Accounts or operate in Affinity Accounts or National Account Locations, but if we do, you and we will execute an addendum to the Franchise Agreement to reflect the non-traditional nature of the location as well as the specific requirements that are imposed by the particular National Account or Affinity Account. Our current form of addendum is attached as Schedule D to the Franchise Agreement (see Exhibit C to this Disclosure Document), but the form you would sign would be an adaptation of that form to incorporate terms and conditions specific to the particular Affinity Account or National Account and the operation of Jackson Hewitt Businesses at their locations. Depending on the arrangement we negotiate with the National Account or Affinity Account, many of these locations may only operate during one or more Tax Seasons. A “Tax Season” is the period beginning on January 2 and ending on the last date that individual federal income tax returns are due under the Internal Revenue Code of 1986, as amended (the “Code”), without extension (typically, April 15th or the next business day if this day falls on a weekend or federal holiday). We currently have National Account arrangements with national and large regional retailers and under those arrangements, we and our Franchisees operated facilities in approximately 3,000 National Account Locations in the 2018 Tax Season. There are presently no Affinity Locations. We also offer qualified new franchisees the right to participate in our Build-Out Advance Program (the “Build-Out Advance Program”). If you qualify, and participate in the Build-Out Advance Program, you must sign a Franchise Agreement as well as the Build-Out Advance Program Amendment attached as Exhibit D (the “Build-Out Advance Program Amendment”). Under the Build-Out Advance Program, we will advance on your behalf certain costs toward technology, furnishings, and signage that are required for the development and operation of a Jackson Hewitt Tax Service business. We will forgive the amounts advanced on your behalf if you operate for at least three Tax Seasons and meet the other program criteria. We intend to use the Build-Out Advance Program primarily for new franchisees. Not all new franchisees will meet our Build-Out Advance Program criteria, and we have no obligation to provide the Build-Out Advance Program to any franchisee. We may discontinue the Build-Out Advance Program at any time. We also offer to qualified operators of other tax-preparation businesses a franchise for the conversion of their business to a Jackson Hewitt Tax Service business (the “Conversion Program”). If you qualify, and participate in the Conversion Program, you must sign a Franchise Agreement as well as the Conversion Program Amendment attached as Exhibit E (the “Conversion Amendment”). Under the Conversion Program, we will not require you to pay royalty or advertising and marketing fees on revenues you generate from your existing customers, and we will advance on your behalf certain costs toward technology, furnishings, and signage that are required for the development and operation of a Jackson Hewitt Tax Service business. We will forgive the amounts advanced on your behalf if you operate for at least three Tax Seasons and meet the other program criteria. Not all new franchisees will meet our Conversion Program criteria, and we have no obligation to provide the Conversion Program to any franchisee. We may discontinue the Conversion Program at any time. We also offer qualified franchisees the right to participate in our New Storefront Expansion Program (the “New Storefront Expansion Program”). If you qualify, and participate in the New Storefront Expansion Program, you must sign a Franchise Agreement as well as the applicable New Storefront Promissory note attached as Exhibit F (an “Expansion Promissory Note”). Under the New Storefront Expansion Program, we will lend you an amount of money we determine for expenses related to the development of a new storefront (for instance, exterior signage, furniture, and fixtures). We will forgive the amounts lent to you if you operate for at least three Tax Seasons and meet the other program criteria. We intend to use the New Storefront Expansion Program for current franchisees. Not all current franchisees will meet our New Storefront Expansion Program criteria, and we have no obligation to provide the New Storefront Expansion Program to any franchisee. We may discontinue the New Storefront Expansion Program at any time.

Initial Fees

Application Fee. We charge a non-refundable application fee of $500, payable in a lump sum upon your submission of an application for a Franchised Business. Except in connection with certain sales programs and promotions, the application fee is uniformly charged to all new franchisees. Initial Franchise Fee. If you sign a Franchise Agreement to operate a franchise from a standard office, you will be required to pay us a $25,000 initial franchise fee, payable in two or three installments, depending on when you sign the Franchise Agreement. If you sign the Franchise Agreement before October 31, 2018, then $10,000 is due when you sign the Franchise Agreement, $5,000 is due October 31, 2018, and the remaining $10,000 is due and payable no later than February 15 of your first Tax Season. If you sign the Franchise Agreement on or after October 31, 2018, then $15,000 is due when you sign the Franchise Agreement, and the remaining $10,000 is due and payable no later than February 15 of your first Tax Season. The initial franchise fee is not refundable under any circumstances. If you commit any default that would give rise to our right to terminate the Franchise Agreement, in addition to any other remedy available to us, at our option, any unpaid installments of the initial franchise fee that remain outstanding at the time of the default will become immediately due and payable. Despite the installment payments described in the preceding paragraph, if you sign the Build-Out Advance Program Amendment, you will be required to have paid us the entire $25,000 initial franchise fee before we will advance on your behalf certain costs toward technology, furnishings, and signage that are required for the development and operation of a Jackson Hewitt Tax Service business. The initial franchise fee is uniformly charged, but we reserve the right to reduce or waive it in our discretion. For instance, we may offer a reduced initial franchise fee for existing franchisees who are purchasing new territories. We may also, from time to time, reduce the initial franchise fee or provide other incentives or accommodations in connection with specific Affinity Accounts or National Account Locations, often depending on the nature of the Affinity Account or National Account, the deal terms we are able to negotiate with the particular Affinity Account or National Account, or whether you are a new or existing franchisee. Our best estimate of the reductions described in this paragraph could cause the initial franchise fee to be $15,000, or possibly even lower in certain circumstances. In addition, we offer a program that provides incentives to existing tax preparers who already have a Preparer Tax Identification Number (PTIN) issued by the IRS. If you qualify under this program, the initial franchisee fee would be payable in four installments, rather than two or three, with the first two installments each equal to 20% of the initial franchise fee and the second two installments each equal to 30% of the initial franchise fee for a standard franchise agreement. If you have a PTIN and are also applying for a franchise for an Affinity Account, we would elect to collect the initial franchise fee in four installments, with the first installment equal to 33.3% of the initial franchise fee, the second installment equal to 16.7% of the initial franchise fee, and the last two installments each equal to 25% of the initial franchise fee. We may discontinue this program at any time.

Financing

If you sign the Build-Out Advance Program Amendment or the Conversion Amendment, we will advance on your behalf certain costs toward technology, furnishings, and signage that are required for the development and operation of a Jackson Hewitt Tax Service business. We will forgive the amounts advanced on your behalf if you operate for at least three Tax Seasons and meet the other program criteria. This advancement may be considered a financing arrangement. If you sign an Expansion Promissory Note, we will lend you an amount of money we determine for expenses related to the development of a new storefront (for instance, exterior signage, furniture, and fixtures). We will forgive the amounts lent to you if you operate for at least three Tax Seasons and meet the other program criteria. The terms of these financing arrangements are as follows: We do not intend, but are not prohibited from, selling or assigning the Expansion Promissory Note to a third party. However, if we did sell or assign the Expansion Promissory Note to a third party, you may lose all your defenses against us as a result of the sale or assignment. Other than as disclosed above, we do not offer direct or indirect financing. We do not guarantee your note, lease, or obligation.

Franchisee Revenue and Profit

Table 1: Unit Level Revenue The table below reflects the average revenue for franchised offices during our fiscal year ended April 30, 2018 (“Fiscal Year 2018”) for the 3,726 franchised Jackson Hewitt offices that were reported on our systems as active and having generated revenue during each of the 2017 Tax Season and the 2018 Tax Season (the “Covered Offices”). As noted in Item 1, a “Tax Season” is the period beginning on January 2 and ending on the last date that individual federal income tax returns are due under the Internal Revenue Code, without extension (typically, April 15th or the next business day if this day falls on a weekend or federal holiday). The Covered Offices represent 95% of the 3,903 offices that were operating as of April 30, 2018. As is common for new businesses generally, Jackson Hewitt Businesses typically experience revenue volatility during their first two years of operation. Their results are not reflective of and would artificially impact the results of businesses that have passed through the initial opening phase and have achieved more operational stability. As a result, we have eliminated from the data set those offices that were not reported on our systems as active and having generated revenue during both the 2017 Tax Season and the 2018 Tax Season (the “Covered Seasons”). 177 franchised Jackson-Hewitt offices have not been included because they were not reported on our systems as active and having generated revenue during the entirety of the Covered Seasons. In the table below, “Revenue” is calculated in the same manner as you will calculate your “Gross Volume of Business” for purposes of calculating your royalty payments under the Franchise Agreement. The Revenue disclosed in the following table is for the entire 2018 fiscal year (from May 1, 2017, to April 30, 2018), not for a Tax Season. Table 2: Franchised Business Performance The table below reflects the total revenue, EBITDA, and margin for our franchisees related to their entire Jackson Hewitt businesses, including all of the offices that they operate, during our fiscal year that ran from May 1, 2016 to April 30, 2017 (“Fiscal Year 2017”). This information is derived from a report that we collect from our franchisees after the end of each fiscal year referred to as “Schedule D.” Schedule D aggregates the revenue and expenses for all offices operated by each franchisee (even if operated by affiliated entities) and does not include any unit-specific data. As of the date of this Disclosure Document, franchisees are still submitting Schedule Ds for our most recently completed fiscal year. As a result, the information contained in this Table 2 is based on the Schedule Ds submitted by franchisees for Fiscal Year 2017. For Fiscal Year 2017, we received Schedule Ds from 478 franchisee entities that were operating as of April 30, 2017 (the “Schedule D Franchisees”), which represented 81.2% of the 588 franchisee entities in existence at April 30, 2017. 110 franchisee entities (19.8%) that were in operation as of April 30, 2017 did not submit complete Schedule Ds and are not included in the Schedule D Franchisees. We have no reason to believe that the results of the 110 franchisees who did not complete Schedule Ds (and thus are not included within the Schedule D Franchisees) would differ materially from the Schedule D Franchisees. The amounts shown on the Schedule Ds submitted by the franchisees reflected a wide array of amounts, types and calculations for owner compensation and benefits. To eliminate those wide variations in how franchisees reported what they paid themselves from their businesses, we have disregarded in the data and from the information presented below any items that were reported on the Schedule Ds as ownership compensation or benefits. You will want to determine how and on what basis you will pay yourself and factor that into your evaluation of the information presented below. Notes to Item 19 1. We have not audited or verified the data submitted by the franchisees. However, we are aware of no reason to question the reliability of the data. 2. Factors such as the number of Jackson Hewitt franchisees and locations in the market, their length of operation, and the number of units operated by each franchisee may impact the results (through, among other things, greater consumer awareness and brand acceptance) compared to what you might achieve in markets where, for example, consumers might not have already had the opportunity to experience the brand. Your experience and results may also be negatively impacted by a myriad of other factors, including, among others: the amount and types of compensation you pay and benefits you provide to yourself from your business; your failure to comply with all of our System Standards; less efficient, less adequately trained or less strictly managed labor; your inability to hire and retain employees at similar compensation levels (including due to local available employee pools and minimum wage requirements); your inability to achieve the same level of volume-based discounts and savings on the purchase of insurance and similar types of items; the location of your Jackson Hewitt businesses and your inability to negotiate as favorable lease terms; the competition and the brand’s reputation in the market; your management and business skills; the amount of money you spend to promote your businesses; the length of time you operate; your inability to achieve the same level of market share; and the extent of any existing consumer awareness of the brand. 3. New franchisees’ financial results are likely to differ from the financial information contained in this Item 19. Actual results vary from business to business, and we cannot estimate the results of any particular location. We strongly urge you to consult with your financial advisor or personal accountant concerning the financial analysis that you should make in determining whether or not to purchase a Jackson Hewitt franchise. 4. Some Jackson Hewitt franchisees have earned this amount. Your individual results may differ. There is no assurance that you’ll earn as much. 5. Written substantiation for these financial performance representations will be made available to the prospective franchisee upon reasonable request. Other than the preceding financial performance representation, we do not make any financial performance representations. 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 Victoria McShane, Jackson Hewitt, Inc., 10 Exchange Place, 27th Floor, Jersey City, New Jersey 07302, (973) 630-0905, the Federal Trade Commission, and the appropriate state regulatory agencies.