Business Description

C2SNF is a Michigan limited liability company formed on August 14, 2015. We operate under the name City2Shore National Franchises, LLC, City2Shore Real Estate, and City2Shore. Our principal business address is 6501 Balsam Drive, Hudsonville, Michigan 49426. We offer franchises (“City2Shore Franchises” or “Franchises”) for City2Shore Businesses and have done so since March 2016.

Prior Experience

We do not conduct business under any other name or in any other line of business and we do not offer franchises in any other line of business. We do not conduct, and have never conducted, a business of the type described in this Franchise Disclosure Document. We have no predecessor or parent entities. We have two affiliates. City2Shore Distribution, LLC (“C2SD”), is a Michigan limited liability company that was formed on December 17, 2015. Its principal address is 6501 Balsam Drive, Hudsonville, Michigan 49426. C2SD is the designated supplier of our proprietary software and all of our proprietary real estate agent educational modules and courses through our online educational platform. City2Shore Real Estate, Inc. (“C2SRE”) operates three businesses similar to the type offered in this Franchise Disclosure Document and has operated a similar business since 2011. Nether of our affiliates has offered franchises in this or any other line of business. Our agent for service of process in Michigan is Shelley Frody, 6501 Balsam Drive, Hudsonville, MI 49426. Our agents for service of process for other states are identified by state in Exhibit D. If a state is not listed, we have not appointed an agent for service of process in that state in connection with the requirements of franchise laws. There may be states in addition to those listed above in which we have appointed an agent for service of process. There may also be additional agents appointed in some of the states listed.

Business Offered

City2Shore franchisees operate real estate brokerage businesses that assist with the purchase, sale, or exchange of residential and commercial property. City2Shore Businesses operate under our system (“System”) using City2Shore's trademarks, service marks, trade names, and logos (the “Marks”) from an approved retail location. You will operate your City2Shore Business from an approved retail location, typically a small office located in an office complex, shopping center, shopping mall, or free-standing structure (“Office”). Each City2Shore Franchise will implement our proprietary multi-tiered real estate agent compensation program (the “Real Estate Advantage Plan” or “REAP” program). We require you to maintain a minimum number of real estate agents, which increase until the end of your third year of operation (see Item 12). You must sign our standard franchise agreement attached to this Franchise Disclosure Document as Exhibit A (“Franchise Agreement”). You may operate one City2Shore Business for each Franchise Agreement you sign. We also offer conversion opportunities (“Conversion Franchise(s)”) to existing independent businesses that provide services and products similar to those offered by City2Shore Businesses (“Conversion Owners”). Conversion Owners will sign a Franchise Agreement that will include an “Addendum for Conversion Owners,” which is attached to this Franchise Disclosure Document in Exhibit H. Conversion Owners must modify their business premises to our design plans and specifications, use the Marks, and complete our training.

Initial Fees

Initial Franchise Fee The “Initial Franchise Fee” for a single City2Shore Business or Conversion Franchise is $25,000. Each Franchise Agreement will grant you the right to operate one City2Shore Business. The Initial Franchise Fee is payment for the pre-opening assistance that we provide to you to allow you to open your City2Shore Business and also offsets some of our franchisee recruitment expenses. The Initial Franchise Fee is due when you sign the Franchise Agreement, is uniform and non-refundable. Option Fee We may allow you to enter into an “Option Agreement” with us (see Exhibit H) before you sign the Franchise Agreement. The Option Agreement will require you to make a non-refundable deposit payment of $2,500 (“Option Fee”) to reserve a general area for your City2Shore Business for six months. If you sign a Franchise Agreement during the six month period, we will apply the $2,500 payment towards the Initial Franchise Fee. You will only be able to pay the Option Fee and sign the Option Agreement after you have waited the prescribed federal and state waiting periods (generally 14 calendar days after you have received our Franchise Disclosure Document). The Option Fee is uniform and nonrefundable, even if you do not open a City2Shore Business. Initial Franchise Fee The “Initial Franchise Fee” for a single City2Shore Business or Conversion Franchise is $25,000. Each Franchise Agreement will grant you the right to operate one City2Shore Business. The Initial Franchise Fee is payment for the pre-opening assistance that we provide to you to allow you to open your City2Shore Business and also offsets some of our franchisee recruitment expenses. The Initial Franchise Fee is due when you sign the Franchise Agreement, is uniform and non-refundable. Option Fee We may allow you to enter into an “Option Agreement” with us (see Exhibit H) before you sign the Franchise Agreement. The Option Agreement will require you to make a non-refundable deposit payment of $2,500 (“Option Fee”) to reserve a general area for your City2Shore Business for six months. If you sign a Franchise Agreement during the six month period, we will apply the $2,500 payment towards the Initial Franchise Fee. You will only be able to pay the Option Fee and sign the Option Agreement after you have waited the prescribed federal and state waiting periods (generally 14 calendar days after you have received our Franchise Disclosure Document). The Option Fee is uniform and nonrefundable, even if you do not open a City2Shore Business. Financial Assurances: Some states have imposed financial assurance requirements on the franchisor. Please refer to the Addendum in Exhibit G to the Franchise Disclosure Document.

Financing

We do not offer direct or indirect financing. We do not guaranty your note, lease, or obligation.

Franchisee Revenue and Profit

As of December 31, 2018, there were three affiliate-owned City2Shore Businesses (“Affiliate Locations”) and three franchised City2Shore Businesses (“Franchise Locations”). The financial information provided in the following tables represents the actual performance of these six City2Shore Businesses (“2018 Reporting Group”) for the fiscal year 2018 (“2018 Reporting Period”). The following tables show the monthly and annual total revenue earned by each location in the 2018 Reporting Group during the 2018 Reporting Period and the monthly number of agents. The total revenue is broken down by “Cap from Agents” revenues (which is described in Note 2 below) and the “Transaction Management Fee” revenues (which is described in Note 3 below). The tables are ordered based on the length of time each City2Shore Business has been in operation, beginning with the oldest location. While some of the representations below relate to the performance of Affiliate Locations, Franchise Locations will share some of the same characteristics, including degree of competition, method of operations, and services provided. Affiliate Locations pay the Royalty and Technology Fee, but do not pay Brand Fund Contributions or Transaction Fees (see Item 6). We have not audited these amounts but have no reason to doubt the accuracy of the information. Some outlets have earned this amount. Your individual results may differ. There is no assurance that you'll earn as much. Other than the preceding financial performance representation, City2Shore National Franchises, LLC does 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 Shelley Frody, 6501 Balsam Drive, Hudsonville, Michigan 49426, (616) 662-9664, [email protected], the Federal Trade Commission, and the appropriate state regulatory agencies.