2021 Program Overview

S E CT I ON 2 . 0

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A. BROKEN CARTON CHARGES There are over 140,000 unique items in stock in at least one of our 15 Retail Support Centers. More than 77% of these items can be filled by a warehouse in single selling-unit quantities. Ace does not assess broken carton charges. B. FREIGHT CHARGES Deliveries from the RSCs to Ace stores are made via Ace Hardware’s private fleet. Freight charges are calculated as a fixed percentage of stores’ RSC purchases plus a fuel surcharge. WAREHOUSE PROGRAM

C. WAREHOUSE PURCHASE PAYMENT TERMS

Ace statements are issued on Friday every two weeks: payment terms are Net 10 Days from the statement date.

D. WAREHOUSE DELIVERIES Ace’s distribution network is an industry leader, continually innovating new methods to provide unequaled service, accuracy and cost-saving efficiencies to Ace retailers. All merchandise is scanned on and off the truck, thus assuring near-perfect accuracy. The merchandise is palletized or containerized at no additional charge. Our trucks are equipped with power liftgates and pallet jacks, enabling trucks to be unloaded in a just a few minutes.

E. FILL RATES

Ace Fill Rates Averaged:

96.7% 2015 96.3% 2019

96.1% 2014 96.3% 2018

97.1% 2013 96.2% 2017

96.5% 2016 96.9% 2012

71.27% *

2020

*2020 Global Pandemic

F. HANDLED PATRONAGE REBATE HISTORY

Handled Patronage Rebate in:

6.32% 2020 $

4.71% 2014 5.13% 2019

3.83% 2013 4.26% 2018

2.87% 2012 4.99% 2017

5.18% 2016 2.90% 2011

4.89% 2015 2.75% 2010

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