H&R BLOCK

One H&R Block Way

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H&R Block Tax Services LLC, a Missouri limited liability company, is the franchisor in all states in which Franchises are granted. All business is conducted under the name of H&R Block. They maintain their principal place of business at One H&R Block Way, Kansas City, Missouri 64105. Since July 1,2008, they have offered franchises for establishment of offices which offer to the general public income tax return preparation, related services and income tax return preparation training courses conducted for a fee. They also own and operate such businesses.

We offer a franchise agreement, the Franchise License Agreement (“FLA”), attached as Exhibit F-1 to this disclosure document, that grants you the right to operate the Franchised Business using the Proprietary Marks and the System in a given territory for a specific term. You may operate the Franchised Business from any location approved in writing by H&R Block (“Approved Location”) within your Franchise Territory. There are various ways you may become an H&R Block franchisee, all of which are subject to our sole discretion and approval. The various ways to become a franchisee are described below. One franchise opportunity is to open a new retail office located within a defined Franchise Territory. We will provide training and support for you to open and operate your Franchised Business. With our approval and support, you will: (1) select an office location, (2) hire and train your staff, and (3) set up your office with furnishings, signage, computers, and other office equipment according to our specifications and requirements. Our marketing materials will be available to help you welcome and attract new clients to this new location. Another franchise opportunity that may be available is to purchase a furnished and equipped, companyowned, retail office that is currently operated by our affiliate. The Franchise Territory may be offered as a defined or mapped area or as a specific office address. If you purchase a former company-owned, retail office, you will be: (1) authorized to solicit and serve H&R Block’s previously established client base for that office, and (2) provided a list of trained tax professionals previously employed in that office to consider when making your own hiring decisions. Offices available for purchase may change over time, and we may discontinue offering company-owned offices for sale. If you purchase an office formerly operated as a company-owned retail office, we may not be able to assign the lease for that location. We cannot guarantee that the landlord will consent to assigning the lease for the same space where the company formerly operated the office or that the terms of the lease will be acceptable to you. You are ultimately responsible for negotiating and complying with the terms of your own lease. A third type of franchise opportunity that may be available is the conversion of an existing tax preparation business to an H&R Block Franchised Business. This type of transaction includes our purchase of all right, title, and interest in your existing client list and all associated Client Data through our Franchise Conversion Agreements that are attached as Exhibit G-1 Franchise Conversion Agreement and G-2 Franchise Conversion Agreement with Option to Sell to this disclosure document. This type of franchisee is referred to as a “Conversion Franchisee.” The Conversion Franchisee will receive compensation from H&R Block in exchange for the sale of their client list and other assets associated with the existing business. At the time of conversion, all Client Data and any other assets purchased by H&R Block will become H&R Block’s trade secrets and proprietary information. As a Conversion Franchisee, you may be granted the right to continue operating a tax preparation business under the terms and conditions specified in your FLA and Conversion Agreement. If we approve you as a Conversion Franchisee, in addition to executing the FLA, you may also sign an Addendum to Franchise License Agreement Conversion Royalty Credit, attached as Exhibit F-6 to this disclosure document. Since this opportunity will be offered at our discretion only to prospects currently operating independent tax return businesses, your eligibility for this amendment is not guaranteed. Subject to conditions described in the amendment, we will credit you for royalties you would otherwise owe on revenue received from clients that you previously prepared and filed a tax return for prior to converting to an H&R Block franchisee, if these clients return to your Franchised Business in subsequent years. This credit is not transferrable and will expire at the end of your FLA term. At our sole discretion, H&R Block may provide certain computer equipment at no cost to the Conversion Franchisee as a condition of converting the existing business to an H&R Block Franchised Business. Your eligibility to qualify for computer equipment is not guaranteed, and we are under no obligation to provide you with this offer. If you are offered a franchise opportunity as a Conversion Franchisee and you operate a bookkeeping or payroll business in addition to tax return preparation, H&R Block may purchase all right, title, and interest in your existing bookkeeping or payroll business client lists and all associated Client Data. See below for more details regarding the H&R Block Small Business program. In addition to any Approved Location in which we authorize you to operate a Franchised Business, you may also be offered an opportunity to operate an H&R Block office in certain national or regional retail stores or military bases or installations located within your Franchise Territory under any applicable agreements between H&R Block and national or regional retail businesses or military or other government installations. We may offer an assisted acquisition program to existing franchisees that we determine in our sole discretion to be qualified. Under the assisted acquisition program, we provide financial assistance to franchisees that purchase existing, independent tax return businesses. Your Franchised Business will prepare federal, state, and local tax returns, principally during the period from the first weekday after January 1 through April 15 (or the last date on which individual federal income tax returns may be filed without receiving an extension of time or incurring any penalty for late filing) of each year (“Tax Season”). Preseason hours will be required and, under certain circumstances, you may be required to sign an amendment to extend your Preseason office hours. The Amendment to Franchise License Agreement Extension of Preseason Hours is attached as Exhibit F-3 to this disclosure document. The tax preparation business is well developed. You may have to compete with national and local tax return preparation firms including other H&R Block offices, Block Advisor offices, bookkeeping services, accountants, and lawyers, and with the Internal Revenue Service and governmental agencies in certain states that offer free assistance to some individuals in the preparation of their federal or state tax returns. In addition, a substantial number of people prepare their own tax returns using software, the internet, or other means including software and internet services offered by us or our affiliates.