Under the Closet Storage Concepts franchise, what activities will I perform as a franchisee?

plement. If you purchase a Closet & Storage Concepts franchise, you will design, market, construct and install custom storage spaces including in closets and garages in customer's homes (the "Franchised Business"). These custom storage design systems will be designed and installed to fit certain available styles and to meet particular customer preferences, needs and decors. Depending upon the level of your investment you will either manufacture the custom storage design systems or purchase the manufactured products from other companies or other Closet & Storage Concepts franchisees. You may operate a retail showroom in connection with the custom storage space business. In addition, as a Closet & Storage Concepts franchisee, you will sell accessories related to custom storage space distributed under the Closet & Storage Concepts name and logo. These accessories may be manufactured by us or third party suppliers that we designate. The related accessories include various types of doors, closet hangers, tie and belt racks, closet rods, shoe keepers, garment racks, baskets and other related accessories. In certain circumstances, if we feel demand requires it, we may allow you to operate the Franchised Business out of more than one (1) location under your existing franchise agreement within your granted Territory.

Applicable Regulations

If required by state or local law, you must obtain your own contractor's license or any other license or registration necessary to conduct business including zoning and business operation permits and registration of salespeople selling to residential consumers. You must not begin to conduct the Franchised Business until all of these licenses have been obtained. There may be other specific laws in your state or municipality that apply to the Franchised Business relating to labor, health and safety, construction licensing, zoning, privacy or other matters. You and your advisors should examine these laws before entering into the Franchise Agreement. You must investigate, keep informed of and comply with these laws.

Competition

The market for the products and services sold is rapidly developing, includes all age groups, economic levels, geographic areas, and includes both retail and commercial sales potential. You will compete with other businesses selling similar products and services, including retail and non-retail operations, department stores, furniture stores, or specialty stores that sell our type of

products, including custom and modular closet and storage space design and installation services and other products that utilize the concepts of vertical storage and space-saving systems. Our marketing efforts are guided towards certain economic demographics and some areas of the country can experience seasonal sales trends.

ITEM 2 - BUSINESS EXPERIENCE

President, Secretary and Sole Director: Robert Lewis

Mr. Lewis is our founder.

Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 9–11)