$654

Business Description

We are a Delaware corporation incorporated on March 4, L996 and operate .under oUr corporate name and logos. Our principal business address is 6500 Greenville Avenue, Suite 400, Dallas, Texas 75206. We grant franchises for HomeVestors Business as described below. Webegan offering franchises on .September 19, 1996. We do not offer franchises in any other line of business. Operate a business of the type being franchised, or conduct aiiy other business.

Prior Experience

We have no predecessors required to be disclosed in thisdtem and, except as-described below, we have no parents or atfiliates required to be. disclosed in this Item. Our'ultimate parent is HVA Equity, LLC (“HVA Equity”), whose principal business address is 335 N. Maple Drive, Suite' 130, Beverly Hills, California 90210., OhApril 20^2017, HVA Equity, an affiliate of Levine Leichtman Capital Partners, Inc; (“LLCP”), a Beverly Hills, California-based independent investment firm, acquired control of us through intermediate holding companies. We are affiliated with, the following companies that either offer franchises or may provide goods, services, or both, to our franchisees; Our wholly owned subsidiary HomeVestors; Investments, Inc., a Texas corporation (“HVII”), whose principal business address^ is thessame as Ours, was incorporated on March 13, 2001 for'the purpose of arianging first lien mortgages for franchisees to be held or resold. HVH also buys and sells first lien mortgages and provides servicing and collection actiyities for first lien mortgages arranged by it for the benefit of approved lenders. HVII does not offer and has never offered franchises in any line of business, nor has it ever operated a business of the type to be operated by you. Through common ownership with investment funds controlled by LLCP, yyeiare affiliated with the franchise programs listed below. None of these affiliates have offered franchises in any line, of business other than as. listed below, and none of them have conducted a business similar to the Home Vestors Business that you will operate. (1) LD Parent, Inc. is the direct of indirect parent company to the followingffranchisors, all of which have a principal business address of 142 State Route, 34, Holmdel, New Jersey 07733: a. La\ynX)octbr, Inc. (‘‘LDI”) ffanchises the right to;operate busihesses;that establish, care for and maintain lawns.and .other vegetation and provide pest control services under the principal trademark and seryite mark LAWN DOCTOR® (“Lawn Doctor Businesses”), LDI has offered Lawn Doctor franchises since 1967. As of December 31, 203 7, there'were 545-Lawn Doctor Businesses in thei United States. LDI's principal place of business is located at 142 State Route 34, Holmdel, New Jersey 07733. b. Mosquito Hunters LLC (“MM”) franchises the right to operate businesses that provide: mosquito and pest controLseiwices through regular spraying applications and follow-up maintenance' and do so under the' trademark MOSQUITO HUNTERS®. MH has offered franchises since 20,13, As of December 3), 2018, there were 8 franchised units operating in the United States. (2) FASTSIGNS Intematibnal, Inc. (“FAS.TSIGNS”) bffers franchises to develop; and operate FASTSIGNS Centers that specialize in producing and marketing signs and graphics ^d other products. FASTSIGNS' address is 2542 Highlander Way, Carrollton, Texas 75006-2333 and it has offered FASTSIGNS franchises since 1986. As of December 31 „ 2018, there: were=620 units operating in the United Staltes. (3) Hand and Stone Franchise Cbrp. (“Hand and Stone”) franchises the right to operate Hand and Stone Massage ahd Facial ;Spas which are retail outlets that sell a comprehensive range of massage, facial and hair removal services along with complementai^ product offeri ngs. Hand and Stpne has offered franchises since 2007. As of December 31, 201:8„ there were 405 franchised units and 1 cornpany Operated unit operating, in the United States and Canada. Hand and Stone's principal place of business is located at 1210 Northbrook Drive, Suite 150; Trevose; PA 19Q53. (4) CBI Parent, L.P. is the direct or indirect parenf-eonipany to the following franchisors: a. lnterini.Healthcafe Inc. (“Interini”) franchises the right to operate home health care and .staffing agencies which.provide permanent placement and temporary services, of nursing and other health care personnel, non-medical support and companion care services and health carC'related horne medical equipment, products and/or isuppli'es under the name INTERIM HEALTHCARE. Interim; or its predecessors have offered Interim Healthcare franchises since 1968. As of December 3 l,, 201,8, there were 332 franchised Interim Healthcare offices in Operation in the United States. Interim's'principal place Of business is located at 1601, Sawgrass-Corporate Parkway,, Suite 220, Surtrise, Florida 33323. b- Bluebird Care Franchise Limited (“BCFL”) franchises the; right to operate home .care agencies which provide, primarily non-medical personal support and companion care services in the home under the name BLUEBIRD CARE. BCFL or its predecessors have offered Bluebird Care franehises since 2007. As of December 31,, 2018, there were 222 franchised Bluebird Care offi ces in operation in the United Kingdom and Ireland. BCFL's principal, place of business'is located at Charles House, Charles Street, Petersfield, Hampshire GU32 3EH. c. Just Better Care. Australia Pty Limited (“JBCA”) franchises the right to operate home health care agencies which provide primarily non-medical personal support and companion care: services in the home under the name JUST BETTER CARE. jBCA of its predecessors have offered Just Better Care franchises since 2006. As of December 31, 2018, there were 34 franchised Just Better Care offices in operation in Australia. JBGA's principal place of business is located at Suite A, Level 3, 43-45 East Esplanade, Manly NSW 2095. (5) Nothing Bundt Eranchisihg, LLC (“NBF”) franchises.the right to operate gourmet bakeries which offer and sell specialty bundt cakes, other food items, and retail merchandise under the “Nothihg Bundt Cakes®” mark. NBF has offered Nothing Bundt Cake franchisesisinCe 2006, As of December .31, 2018, there were 282 franchised Nothing Bundt Cake bakeries in qperationin the United States and Canada. NBF's principal place of business is located at 4560 Belt Line #350, Addison, Texas 75001.

Business Offered

We grant franchises for HomeVestors Businesses (the “HomeVestors Business”). We offer both a full franchise (“Full Franchise”) and an associate franchise;(“Associate Franchise”). The Full Franchise has a higher initial franchise fee but generally lovver ongoing fees than an Associate Franchise,, each of which may be operated gn a full-time or part-time basis. The primary activity of a HomeVestors Business is; to buy and sell and rehabilitate, residential and commercial properties and furnish certain services, to residential and commercial property buyers (the “Products and Services”); Rehabilitation includes all remodelingand repairs,necessary to make the property-marketable. The.Products and Services-are provided by the HomeNestors Business, which operates under distinctive' business formats, methods, procedures, standards and Specifications^ all of which we may improve, further develop or otherwise rnodify (the “System”). We use; promote and license certain trademarks in the operation of HomeVestors Businesses, including the service' marks “HomeVestors” and associated logos, which have acquired and continue to acquire goodwill, and we may create, use and license additional trademarks and service marks in the operation of HomeVestors Businesses (collectively, the “Licensed Marks”), We grant to certain persons who meet ouf qualifications, (“franchisees”) and are willing to undertake the investment and effort, a franchise to own and operate a HomeVestors Business offering the Products and Services and utilizing the System and the Licensed Marks under the tennS of our standard HomeVestors Franchise Agreement attached as Exhibit A-1 (the “Franchise Agreement”). Franchisees who purchase a franchise in certain franchise registration stateS; Puerto Rico or the U.S. Virgin Islands will also execute the applicable Amendment to Franchise Agreemenit attached as Exhibit A2. You will' use the System to purchase or acquire rights to, purchase real estate propertiesigeneralfy in need of repair, assign or resell the properties “as-iS'', or rehabilitate properties that you purchase to increase the appraised market value and resell or lease the properties.

Initial Fees

The initial franchise fee for a Full Franchise is $70,000, which is payable in a lump sum when yOu sign the Ffanchise. Agreement and is nonreflindable. The initial franchise fee for an Associate Ffanchise is $30,000, which is payable in a lump isum when you sign the Franchise Agreement and is honrefundable. If you are a qualified United States veteran, we will discount the initial ffanchise fee by 10%, Under this program, the initial franchise fee is reduced to $27,000 for an Associate Franchise and $63,000 for a Full Franchise., If you are a current franchisee and are purchasing an additional franchise, we will discount the initial franchise fee by 20%. Under this program, the initial franchise fee is reduced to $24,000 for an Associate Franchise and $56,000 for a Full Franchise. If you are a former franchisee, we may reduce or waive the initial franchise, fee, if you were in good standing with us af the time of your departure from our System. Except as described aboye, the initial franchise fee is; uniform to all new franchisees,, is deemed fully earned by us on receipt and is norefundable. There are no other payments to dr purchases from us or any affiliate of ours that you iiiust make before your HomeVestors franchise opens.

Financing

We dp not currently offer, directly or indirectly, any financing arrangements to you regarding the initial franchise fee. Our affiliate, HVII, is currently offering financing for real property acquisitions and repairs that meet its interim lending-financing criteria. This affiliate may apply standards to obtain loans in addition to those required by us for interim loans.. There is* no specific security interest required to be pledged except on the real property you acquire. There are no other lenders affiliated with us thatxurrently provide financing to our franchisees. We may arrange financing, for you for the purchase and/or repair of real properties, but \ye are not under any obligation to do so. All financihg is subject to market conditions. The terms of any loan extended by us or our affiliates are subject to change up until closing of the Acquisition property. A loan arrangement fee of upto 5%,(currently up to 3,%) of the loan amount is .charged, an interim loan: placement fee of $300'($100 if submitted using ValueChek on an iPad) is charged, and'thesinitial Second Eyestanalysis fee of $499, is charged. If the term of the loan is extended, a loan extension fee, of up to 5% (currently up. to 3%) of the, loan amount is charged. If repair funds are. included in the loan, for each repair draw there is a $90 Second Eyes analysis fee due at the time of the draw and a, $100 repair draw fee due at loan payoff. These fees may changempon-ten. days written notice to you. It is not our practice or intent to sell, assign or discount to a third party all or part of the financing arrangement. We dp'notguarantee any notes, leases dr obligations; The debt does.not, have to be guaranteed by anyone other than you (the franchisee). We may change, alter, restrict, limit, reduce'or cancel financing offered to you or any franchisee; based upon past payment records, current financial condition, current or past inventory status, number of loans outstanding, past reporting, timeliness, changes in local, state or federal laws affecting licensing and lending practices,;current collateral requirements or changes^ national, state, or local mafket'ConditiOns. All financing prpgrarns'we may offer in the future are subject to ehange or cancellation without notice. We'and our affiliates rnay offer cash or other incentives to our Development Agents to help arrange loans with our franchisees. You must,comply with all our Systerns and Standards in makingmortgage loans. If we notify you that we or our affiliates are interested in acting as broker for the sale of your mortgage loans and/or in purchasing your mortgage loans, you must offer to us the right to act as your broker and/Or negotiate in good faith to sell to us or our designated affiliates all mortgage loans thafyou make'to buyers of properties from you that you donot elect to retain. You must notify us and/or pur affiliates each week of the mortgage loans that you have available, providing all information with, respect to those mortgage loans that we require. If we or Our affiliates are unable to find a buyer on terms acceptable to you or to reach an :agreement with you on the: price and, terms of purchase of a mortgage loan within 15 days after yOu have notifiednsregarding the mortgage loan, you must retain or offer themortgage loan to other parties. We and our affiliates will have a right of first, refusal to purChase'any mortgage loan offered to another party at the sarne price and on the same terms as that party offers with, respect to the mortgage loan. We and our affiliates will ,exercise iour right of first refusal within 15 days after we have received the required copy of the price and terms offered by that party and yefifi'catioh of the offer in the form that we: periodically require. If we Or our affiliates purchase a mortgage loan frOm you and,you are not in default under your Franchise Agreement yoU will receive a credit.in an amount equal to $640 against the next Transaction Fee due.

Franchisee Revenue and Profit

The FTCs Franehise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/ or franchisor-owned outlets, if there is a reasonable basis for the information, and if the information is included in this Disclosure Document. Financial performance information that differs from that included In Item 19 may be given only if: (I) a franchisor provides the actual records of an existing outlet you are considering buying; Or (2) a franchisor supplements the information provided in this Item 19„ for example; by providing;information abolit possible performance at a particular location or under particular circumstances.; We do not:make apy 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 writing. If you are purchasing an existing outlet, ho.wever, we may provide you with actual records Of that outlet. If your receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting Bonnie DePasse; 6500 Greenville Avenue, Suite 400, Dallas, Texas 75206, Tel: 972-761-0046, the, Federal Trade; Commissidn, and the appropriate ;state regiilatdiy agency.