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Business Description

We were formed as a Delaware limited hability company on November 7, 2002 Our principal place of business is 10718 Richmond Highway, Lorton, Virginia 22079 We do busmess under the name FIVE GUYS® Our busmess is limited to offermg the franchises that are descnbed m this Disclosure Document We do not offer other franchises or engage in any other line of business nor have we ever done so.

Prior Experience

Our parent company is Five Guys Holdings, Inc , a Delaware corporation formed on September 20, 2007 ("Parent Company"), and is headquartered at 10718 Richmond Highway, Lorton, Virgnia 22079 Our Parent Company is a non-operating holding company and does not offer franchises in this or any other Ime of busmess Our Parent Company does not offer or provide any products or services to our franchisees, it does guaranty our obligations Dunng the formation process of our Parent Company, a minority portion of its capital stock was transferred to Big Horn, L P , a Pennsylvannia limited partnership located at 100 Front Street, Suite 1500, West Conshohocken, Pennsylvama 19428 ("Big Horn") Neither Big Horn nor its principals have ever offered FIVE GUYS® restaurant franchises or franchises' in any other lines of business

Business Offered

FIVE GUYS® restaurants are fast casual dining restaurants which specialize m the sale of hamburgers, french fries, and related accompaniments m accordance with our comprehensive and imique system (the "System") The System mcludes distmctive signage, mtenor and extenor design, ddcor and color scheme, special recipes and menu items (including proprietary products and ingredients), umform standards, specifications, and procedures for operations, quality and umformity of products and services offered, inventory, management and financial control procedures (mcludmg pomt of purchase and trackmg systems), trammg and assistance, and quality control and promotional programs, all of which we may change, improve, and further develop, m our discretion Certain aspects of the System are more fully described m this Disclosure Document and the Manuals that are provided to you as a franchisee The restaurants are identified by certain trade names, service marks, trademarks, logos, emblems, and indicia of ongm, such as "FIVE GUYS", "FIVE GUYS FAMOUS BURGERS AND FRIES", "FIVE GUYS BURGERS AND FRIES", and others (collectively, the "Marks") We will refer to the restaurants which use our System and Marks as "FIVE GUYS® Restaurant" or'"Restaurant(s) "

Initial Fees

When you sign the Development Agreement, you must pay us a nonrefimdable temtonal development fee equal to $50,000 for each Restaurant to be developed under the Development Agreement ("Development Fee") We reserve the nght to adjust this formula of the Development Fee dependmg on the size of the area acquired The Development Fee must be paid m a single, lump sum on the date you sign the Development Agreement The Development Fee is fully earned and non-refundable when paid, in consideration of administrative and other expenses we incur in entering into the Development Agreement After signing the Development Agreement, you must enter into a Franchise Agreement based on our then-current form for each Restaurant to be developed under the Development Agreement In the event you wish to only develop a smgle Restaurant, you must enter into a Development Agreement for that Restaurant

Financing

We do not offer, either directly or indirectly, any financing arrangements to you We do not guarantee your notes, leases or other obligations

Franchisee Revenue and Profit

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 wntmg If you are purchasing an existmg 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 firanchisor's management by contacting us at 10718 Richmond Highway, Lorton, Virgmia 22079, Attn Legal Department, (703) 339-9500, franchise@fiveguvs com, the Federal Trade Commission, and the appropriate state regulatory agencies.