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Business Description

The Franchisor is ShelfGenie Franchise Systems, LLC, a Georgia limited liability company formed on November 29, 2007. We do business only under our corporate name. Our principal place of business is 5500 Interstate North Parkway, Suite 250, Atlanta, Georgia 30328 and our agents for service of process are listed in Exhibit C to this Disclosure Document. We have no predecessors. We have not operated businesses of the type described in this Disclosure Document, and do not conduct any other business activities other than offering and supporting SHELFGENIE® Businesses. We have offered franchises for SHELFGENIE Businesses since May 2008 and have never offered franchises in any other line of business. We have, however, offered SHELFGENIE franchises in Canada under a separate form of disclosure document and franchise agreement.

Prior Experience

Cabinet Essentials Group, L.L.C. (“CEG”, also referred to as “Noble Brands”) is a Virginia limited liability company with a principal business address at 5500 Interstate North Parkway, Suite 250, Atlanta, GA 30328. CEG is the parent and sole member of SHELFGENIE, Manufacturing (as defined below), Management (as defined below), Customer Management Group, LLC ("CMG), and Outback GutterVac Franchising, LLC (“OBGV”). CEG has never offered franchises in any line of business, and has not operated a business of the type described in this Disclosure Document. CEG owns the service mark “SHELFGENIE” and has granted to SHELFGENIE a world-wide, non-exclusive, perpetual license to use and sublicense the SHELFGENIE trade name and trademarks. In April 2007, CEG purchased the membership interests of G-O Manufacturing, L.L.C. (“G-O Predecessor”), a Virginia limited liability company formed in July 2001, from a group of members. In September 2007, G-O Predecessor merged into a new Virginia limited liability company. This new Virginia limited liability company was considered the survivor and took on the name of the original entity “G-O Manufacturing, L.L.C.” (“Manufacturing”). Manufacturing is a fully owned subsidiary of CEG and an affiliate of SHELFGENIE. Manufacturing does business under the name “G-O Manufacturing L.L.C.” and “SimpleShelf.” Manufacturing's principal business address is 5500 Interstate North Parkway, Suite 250, Atlanta, GA 30328. Manufacturing has never offered franchises in any line of business. Manufacturing sells and distributes customized shelving solutions and other products. Manufacturing also sells some of these products on its SimpleShelf.com website (“SSWebsite”). See Item 12 regarding the SSWebsite. Manufacturing's products include customized shelving solutions and other products such as strip mounts and accessories that will be used by our franchisees (“Core Products”). Each of our franchisees will be required to enter into a supply agreement with Manufacturing. Manufacturing does not grant any franchises, although it is permitted to sell certain products (including the Core Products) directly to third parties. Prior to May 2008, Manufacturing signed certain dealer agreements for dealerships operating under the name “Shelf Conversions”. These dealerships distributed goods similar to those offered by our franchisees. Manufacturing no longer offers dealerships in the United States and, as of the date of this Disclosure Document, Manufacturing has no active dealership agreements in the United States. Manufacturing's dealers did not receive all the benefits of a franchisee owner of a SHELFGENIE Business offered under this franchise disclosure document and were not subject to all the same restrictions and obligations. Manufacturing has distributed its goods through dealers since the original G-O Predecessor was merged into Manufacturing, L.L.C. in September 2007. G-O Predecessor sold its goods through dealers from June 2003 to September 2007 (when it was merged into Manufacturing). G-O Management, LLC (“Management”), is a Georgia limited liability company owned wholly by CEG and whose principal business address is 5500 Interstate North Parkway, Suite 250, Atlanta, GA 30328. Management provides shipping logistics services to Manufacturing. Management is also the sole owner of two subsidiaries, Cabinet Components, LLC (“CC”) and Cabinet Components Real Estate, LLC (“CCRE”), both of which are Georgia limited liability companies who share Management's principal business address. CC manufactures products for Management, and CCRE provides business services support to Management. Management, CC, and CCRE have never offered franchises in any line of business, and have not operated a business of the type described in this Disclosure Document. CMG is a Virginia limited liability company. CMG provides employees, services and assistance to us with respect to the internal administration of, and support for, the SHELFGENIE franchise system. CMG has no predecessor. CMG's principal address is 5500 Interstate North Parkway, Suite 250, Atlanta, GA 30328. CMG has never offered franchises in any line of business, and has not operated a business of the type described in this Disclosure Document.

Business Offered

The franchise being offered is for a mobile business that markets, designs, sells and installs customized solutions for new and existing cabinets identified by the trade name and service mark “SHELFGENIE” as well as other trademarks, logos, designs, and indicia of origin we may designate from time to time for use in connection with the SHELFGENIE Business (“Proprietary Marks”). SHELFGENIE, as the result of the expenditure of time, skill, effort and money, has developed and owns a unique system relating to the management and operation of a business that markets, sells and installs products customized and built around homeowners' and business owners' needs for moving shelving or drawer systems, under the trade name and service mark “SHELFGENIE®”, for cabinets, counters, closets or other structures, under the Proprietary Marks (the “System”). The distinguishing characteristics of the System include, but are not limited to the following: uniform standards and procedures for business operations; training in operations and management; advertising and promotional programs; customer development and service techniques; centralized business support center; web based proprietary business system and other technical assistance, all of which may be changed, improved or otherwise developed by us from time to time. You will use a vehicle approved by us in the operation of your SHELFGENIE Business. Each SHELFGENIE Business will be operated in accordance with the terms and conditions of the Franchise Agreement which you will be required to sign if you qualify as a franchisee and decide to become one of our franchisees. A copy of the Franchise Agreement is attached as Exhibit A to this Disclosure Document. A separate Franchise Agreement must be entered into for each Assigned Territory in which you operate a SHELFGENIE Business and each Franchise Agreement. Currently, we categorize the franchise offered by the size of the Assigned Territory granted under your Franchise Agreement. The categories and characteristics are as follows: - Executive Franchise –This Executive Franchise model is our standard franchise offer under our standard form of Franchise Agreement. Each Assigned Territory under the Executive Franchise model is approximately 125,000 houses or households. The Assigned Territories under the Executive Franchise model are typically found and granted in more populated areas. The initial franchise fee and ongoing fees are the standard fees included in Items 5 and 6 of this Disclosure Document. - Owner/Operator Franchise – This Owner/Operator Franchise model is tailored for more sparsely populated areas. Each Assigned Territory under the Owner/Operator Franchise model consists of approximately 75,000 houses or households. Typically, although not always, areas adjacent to Assigned Territories under the Owner/Operator Franchise model do not contain a sufficient number of houses and households to form additional Assigned Territories. The initial and certain ongoing fees are less than those for an Executive Franchise, and are specifically outlined in Items 5 and 6 of this Disclosure Document. If your Assigned Territory size places the franchise you purchase in our Owner/Operator Franchise category, you will execute our form of Franchise Agreement as well as the Owner/Operator Franchise Addendum attached as Exhibit 10 to the Franchise Agreement, which modifies the applicable fees. Throughout this Disclosure Document, if a term, fee, or obligation is not applied expressly to either the Executive Franchise or Owner/Operator Franchise model, the term, fee, or obligation applies equally to both models. You may also sign an Option Amendment to Franchise Agreement, a copy of which is attached as Exhibit 9 of the Franchise Agreement, under which we will agree to hold and to not sell to other franchisees the Option Assigned Territories set out in Attachment 1 of the Option Amendment for a period of 12 months. You will enter into a separate Franchise Agreement for each Option Assigned Territory you elect to purchase and acquire franchise rights in, as set out under the terms of the Option Amendment. We grant option rights as set out in the Option Amendment for Assigned Territories whose size falls under our standard Executive Franchise model.

Initial Fees

Initial Franchise Fee Executive Franchise If you are entering into a Franchise Agreement with us for the operation of a SHELFGENIE Business in an Assigned Territory consisting of approximately 125,000 houses or households, then, at the time you sign the Franchise Agreement, you will pay to us an initial franchise fee (“Initial Franchise Fee”) equal to $25,000. If, at the same time you enter into your first Franchise Agreement with us you wish to purchase the franchise rights to additional Assigned Territories, the Initial Franchise Fee under your first, and each additional Franchise Agreement will equal: - $25,000 for your first Assigned Territory; - $20,000 for your second Assigned Territory (for a total Initial Franchise Fee of $45,000 if you purchase two Assigned Territories at once); - $15,000 for your third and any additional Assigned Territories (for a total Initial Franchise Fee of $60,000 if you purchase three Assigned Territories at once). The above-described discount applies only if all Assigned Territories are purchased and related Franchise Agreements are signed at the same time. Existing franchisees that are approved by us for the purchase of additional franchises, must pay an Initial Franchise Fee of $25,000 under their next Franchise Agreement with us. If such existing franchisees wish to purchase more than one additional franchise, the above fee scale will apply. Approval as a franchisee for your first SHELFGENIE Business does not guarantee that you will be approved as a franchisee for an additional SHELFGENIE Businesses. Owner/Operator Franchise If you are entering into a Franchise Agreement with us for the operation of a SHELFGENIE Business in an Assigned Territory which we determine will consist of approximately 75,000 houses or households, then, at the time you sign the Franchise Agreement you will pay to us an Initial Franchise Fee equal to $13,500. As we do not anticipate that there will be contiguous Assigned Territories under the Owner/Operator Franchise model, we do not have a graduated Initial Franchise Fee scale as outlined under the Executive Franchise model. If you qualify for the VetFran program sponsored by the International Franchise Association and were honorably discharged, the Initial Franchise Fee you pay under your first Franchise Agreement will be reduced by 15%. If you qualify for the VetFran program, were honorably discharged and have a disability that was incurred or aggravated in the line of duty in the active military, the Initial Franchise Fee you pay under your first Franchise Agreement will be reduced by 25%. The Initial Franchise Fee is due at the time you sign the Franchise Agreement. Franchise Disclosure Document | 2019 ShelfGenie Franchise Systems, LLC 7 Additional Purchases and Technology Fee In addition, before opening your SHELFGENIE Business, you must purchase from us or our affiliate demonstration mateirals for approximately $300. You are also required to license certain software or technology from us under the Software Agreement (defined below). The initial technology fee is $1,000. However, at this time we are waiving this fee. You may, but are not required to, purchase certain stationary, forms, labels and similar materials from us. If you purchase a package of these materials from us before opening, it will cost approximately $500. Option Fee Under our Option Amendment to Franchise Agreement, we will agree to hold and not sell to any other franchisee for a period of 12 months, the one or more agreed-upon Option Assigned Territories included in Attachment 1 of the Option Amendment. The Option Fee due on execution of the Option Amendment is $10,000 for each Option Assigned Territory you ask us to hold. The Option fee is uniform for all franchisees and is not refundable under any circumstance, regardless of whether you exercise any option, as compensation to us for our lost or deferred opportunity to franchise the Option Assigned Territory to others. You must exercise your option to purchase any or all of the Option Assigned Territories under your Option Amendment by the end of the 12-month term. When you exercise your option, you will enter into our then-current form of franchise agreement for the related Option Assigned Territory you wish to purchase and pay to us the initial franchise fee due, however, $10,000 of the Option Fee will be credited toward the initial franchise fee due under the franchise agreement for each Option Assigned Territory. All fees disclosed in this Item 5 are uniformly imposed, fully-earned when paid, and non-refundable.

Financing

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

Franchisee Revenue and Profit

The FTC's Franchise 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 the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if (1) 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 about possible performance at a particular location or under particular circumstances. The following tables present information regarding the (a) average order for certain franchise outlets in the System in 2018 and 2017, (b) closed order rates for certain franchise outlets in the System in 2018 and 2017 and (c) average cost of goods during 2018 calculated using Franchisee Cost (defined below). The data has been generated using sales and order information submitted by franchisees. We have not audited or verified the sales and order information nor have we asked questions of the submitting franchisees to determine whether they are in fact accurate and complete, although we have no information or other reason to believe that they are unreliable. For purposes of this Item 19, (i) the “2018 Summary Period” means the 12-month period from January 1, 2018 to December 31, 2018 and (ii) the “2017 Summary Period” means the 12-month period from January 1, 2017 to December 31, 2017.