Closets By Design

2026 CBDF FDD -29- at or from your Location; retrieve from your computer system all information that it considers necessary, desirable or appropriate at the times it designates; and require you, at any time, upon notice, to grant it access to your business computer and computer systems (see sections 5.05 and 8.07 of the Franchise Agreement). You may purchase the computer equipment from any reputable vendor and you are solely responsible for the support, ongoing maintenance, repairs or upgrades to your computer system. You do not need cash registers or point of sale systems to operate your Business. You must install the AIM (Account Interaction Manager) sales management portal (the “AIM Sales Management Portal”) to be used in connection with the operation of your Business. The AIM Sales Management Portal is a web-based portal that designers will use to communicate the status of every client interaction with your Location and CBD Manager. The AIM Sales Management Portal is intended to ensure that all appointments are delivered to designers at a designated time, and all outcomes are reported back to our Sales Management team in a timely fashion. Currently, we do not charge you a fee for the use of the AIM Sales Management Portal, but we reserve the right to do so but we reserve the right to do so. If we elect to impose a fee for your use of the AIM Sales Management Portal, you will be required to pay our then-current fee, you will be required to pay our then-current fee not to exceed $25 per user per month. You must, at your expense, keep your Computer in good maintenance and repair. We may mandate that you add memory, ports, accessories, peripheral equipment and additional, new or substitute software. If we run tests and determine that it will prove economically or systemically beneficial to you and to us, you must install at your own expense the additions, modifications, substitutions and/or replacements to your Computer hardware, software, telephone and power lines and other computer facilities as we direct, on the dates and within the times we specify in our Confidential Manuals or otherwise. In addition, we may require you, at your expense, to purchase, install and utilize in your Closets By Design Business and at your Location such hereafter developed modes of computerization, communication, media and/or interfaces as we, in our sole business judgment, determine to incorporate into the System. You will be required to do so at such time and in such manner as we designate, in our Confidential Manuals or other written notices. CBDF alone may establish, maintain, modify or discontinue all internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn or X (formerly Twitter). Franchisees and their employees are not allowed to establish their own profiles on any social media page reflecting the Closets by Design brand, nor are they allowed to establish any Closets by Design related web page. CBDF will provide you with a “click through” subpage on any general Closets By Design web site it maintains. If CBDF establishes one or more websites or other modes of electronic commerce and if it provides a “click through” subpage at each such website for the promotion of your Closets By Design Business, you must provide CBDF with updated copy, photographs and news stories about your Closets By Design Business suitable for posting on your “click through” subpage, the content, frequency and procedure of which will be specified in our Confidential Manuals. Any websites or other modes of electric commerce that CBDF establishes or maintains may – in addition to advertising and promoting the programs, products, or services available at Closets By design business – also be devoted in part to offering Closets By Design business franchises for sale and be utilized by CBDF to exploit the electronic commerce rights which it alone reserves. You may not, without our prior written consent, establish or maintain any other websites or social media page; otherwise maintain a presence or advertise on the internet, through social media or in any other 2026 CBDF FDD -30- mode of electronic commerce in connection with your Closets By Design Business, including through the use of a page or profile on a social media website such as Facebook, Instagram, LinkedIn or Twitter; establish a link to any website CBDF establishes at or from any other website or page; or, at any time establish any other website, social media or electronic commerce presence which in whole or in part incorporates the “Closets By Design” name or any name confusingly similar thereto. By way of example, and without limiting the generality of the previous sentence; you may not exchange or communicate pricing or other information relating to System services or products via e-mail or any other electronic means (including but not limited to newsgroups or internet web sites); without CBDF’s prior written permission, list or link your Closets By Design Business, Location or any web site of CBDF or its Affiliates to any other webs site, or to any local internet advertising service, “yellow pages,” portal or search site, without CBDF’s prior written permission; or, promote System services or products and/or use the Proprietary Marks via direct e-mail solicitation, web sites, newsgroups, or any similar electronic means. You must open your franchised Closets By Design Business within 120 days after the effective date of the Franchise Agreement. CBDF estimates the typical length of time between the signing of the Franchise Agreement and beginning of your operations as a Closets By Design franchised business will be 90 days. Factors that may affect this length of time include the satisfactory completion of initial training by your designated attendees and availability of a retail location ready to begin operations.

On July 22, 2025, The Stow Company ("Stow"), a Michigan corporation, filed a Complaint in the U.S. District Court, Western District of Michigan against Home Organizers, Inc., Closets By Design, Inc., and CBDF (the "CBD Parties"). Stow's Second Amended Complaint asserts causes of action for: 1) Federal Unfair Competition under 15 U.S.C. § 1125(a); 2) Federal Trademark Infringement under 15 U.S.C. § 1114; 3) Violation of the Michigan Consumer Protection Act (MCL 445.901 et seq.); and 4) Michigan Common-Law Unfair Competition. Stow alleges that the CBD Parties deliberately incorporated Stow's federally registered INSPIRED CLOSETS® and EASYCLOSETS® trademarks into the headlines of paid Google search advertisements to divert consumers searching for Stow's products and services. Stow seeks injunctive relief, an accounting of Defendants' profits, actual damages (up to treble damages for willful conduct), attorneys' fees, and costs under the Lanham Act. The CBD Parties deny all claims. The CBD Parties maintain that the phrases at issue were descriptive in nature and were auto-generated by Google's Dynamic Search Ad platform as part of a national advertising campaign, not specifically targeted at Michigan. The CBD Parties' primary defense is descriptive fair use under 15 U.S.C. § 1115(b)(4), as the ad headlines used phrases such as "Custom Inspired Closet Design" and "Organize With Easy Closets," which describe qualities of closet design services and were not used as source identifiers. The CBD Parties further contend that the complained-of advertising generated only 12 estimated leads nationwide over seven months, with only 1 lead in the relevant Michigan geographic market, and that none of these leads has been connected to any actual lost sale by Stow. Upon receiving Stow's cease-and-desist letter on July 22, 2025, CBDF promptly restricted the complained-of phrases from its Google Ads campaign, and CBD Parties' counsel confirmed this remediation in writing on August 6, 2025. On August 27, 2025, the CBD Parties filed a Motion to Dismiss for Lack of Personal Jurisdiction. Rather than opposing the motion, Stow filed an Amended Complaint. The CBD Parties then filed a renewed Motion to Dismiss. On November 14, 2025, the Court denied the CBD Parties' Motion to Dismiss without prejudice to refiling after discovery, and dismissed Stow's state-law claims without prejudice, declining to exercise supplemental jurisdiction. On December 29, 2025, Stow filed a Second Amended Complaint reasserting the Lanham Act claims and adding state law claims under diversity jurisdiction. On January 12, 2026, the CBD Parties filed their Answer to the Second Amended Complaint, denying all claims and raising eighteen affirmative defenses, including lack of personal jurisdiction, descriptive fair use, nominative fair use, no likelihood of confusion, lack of secondary meaning, and no willful infringement. Discovery is ongoing, with a completion deadline of July 15, 2026. Dispositive motions are due August 31, 2026.

2026 CBDF FDD -29- at or from your Location; retrieve from your computer system all information that it considers necessary, desirable or appropriate at the times it designates; and require you, at any time, upon notice, to grant it access to your business computer and computer systems (see sections 5.05 and 8.07 of the Franchise Agreement). You may purchase the computer equipment from any reputable vendor and you are solely responsible for the support, ongoing maintenance, repairs or upgrades to your computer system. You do not need cash registers or point of sale systems to operate your Business. You must install the AIM (Account Interaction Manager) sales management portal (the “AIM Sales Management Portal”) to be used in connection with the operation of your Business. The AIM Sales Management Portal is a web-based portal that designers will use to communicate the status of every client interaction with your Location and CBD Manager. The AIM Sales Management Portal is intended to ensure that all appointments are delivered to designers at a designated time, and all outcomes are reported back to our Sales Management team in a timely fashion. Currently, we do not charge you a fee for the use of the AIM Sales Management Portal, but we reserve the right to do so but we reserve the right to do so. If we elect to impose a fee for your use of the AIM Sales Management Portal, you will be required to pay our then-current fee, you will be required to pay our then-current fee not to exceed $25 per user per month. You must, at your expense, keep your Computer in good maintenance and repair. We may mandate that you add memory, ports, accessories, peripheral equipment and additional, new or substitute software. If we run tests and determine that it will prove economically or systemically beneficial to you and to us, you must install at your own expense the additions, modifications, substitutions and/or replacements to your Computer hardware, software, telephone and power lines and other computer facilities as we direct, on the dates and within the times we specify in our Confidential Manuals or otherwise. In addition, we may require you, at your expense, to purchase, install and utilize in your Closets By Design Business and at your Location such hereafter developed modes of computerization, communication, media and/or interfaces as we, in our sole business judgment, determine to incorporate into the System. You will be required to do so at such time and in such manner as we designate, in our Confidential Manuals or other written notices. CBDF alone may establish, maintain, modify or discontinue all internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn or X (formerly Twitter). Franchisees and their employees are not allowed to establish their own profiles on any social media page reflecting the Closets by Design brand, nor are they allowed to establish any Closets by Design related web page. CBDF will provide you with a “click through” subpage on any general Closets By Design web site it maintains. If CBDF establishes one or more websites or other modes of electronic commerce and if it provides a “click through” subpage at each such website for the promotion of your Closets By Design Business, you must provide CBDF with updated copy, photographs and news stories about your Closets By Design Business suitable for posting on your “click through” subpage, the content, frequency and procedure of which will be specified in our Confidential Manuals. Any websites or other modes of electric commerce that CBDF establishes or maintains may – in addition to advertising and promoting the programs, products, or services available at Closets By design business – also be devoted in part to offering Closets By Design business franchises for sale and be utilized by CBDF to exploit the electronic commerce rights which it alone reserves. You may not, without our prior written consent, establish or maintain any other websites or social media page; otherwise maintain a presence or advertise on the internet, through social media or in any other 2026 CBDF FDD -30- mode of electronic commerce in connection with your Closets By Design Business, including through the use of a page or profile on a social media website such as Facebook, Instagram, LinkedIn or Twitter; establish a link to any website CBDF establishes at or from any other website or page; or, at any time establish any other website, social media or electronic commerce presence which in whole or in part incorporates the “Closets By Design” name or any name confusingly similar thereto. By way of example, and without limiting the generality of the previous sentence; you may not exchange or communicate pricing or other information relating to System services or products via e-mail or any other electronic means (including but not limited to newsgroups or internet web sites); without CBDF’s prior written permission, list or link your Closets By Design Business, Location or any web site of CBDF or its Affiliates to any other webs site, or to any local internet advertising service, “yellow pages,” portal or search site, without CBDF’s prior written permission; or, promote System services or products and/or use the Proprietary Marks via direct e-mail solicitation, web sites, newsgroups, or any similar electronic means. You must open your franchised Closets By Design Business within 120 days after the effective date of the Franchise Agreement. CBDF estimates the typical length of time between the signing of the Franchise Agreement and beginning of your operations as a Closets By Design franchised business will be 90 days. Factors that may affect this length of time include the satisfactory completion of initial training by your designated attendees and availability of a retail location ready to begin operations.

2026 CBDF FDD -29- at or from your Location; retrieve from your computer system all information that it considers necessary, desirable or appropriate at the times it designates; and require you, at any time, upon notice, to grant it access to your business computer and computer systems (see sections 5.05 and 8.07 of the Franchise Agreement). You may purchase the computer equipment from any reputable vendor and you are solely responsible for the support, ongoing maintenance, repairs or upgrades to your computer system. You do not need cash registers or point of sale systems to operate your Business. You must install the AIM (Account Interaction Manager) sales management portal (the “AIM Sales Management Portal”) to be used in connection with the operation of your Business. The AIM Sales Management Portal is a web-based portal that designers will use to communicate the status of every client interaction with your Location and CBD Manager. The AIM Sales Management Portal is intended to ensure that all appointments are delivered to designers at a designated time, and all outcomes are reported back to our Sales Management team in a timely fashion. Currently, we do not charge you a fee for the use of the AIM Sales Management Portal, but we reserve the right to do so but we reserve the right to do so. If we elect to impose a fee for your use of the AIM Sales Management Portal, you will be required to pay our then-current fee, you will be required to pay our then-current fee not to exceed $25 per user per month. You must, at your expense, keep your Computer in good maintenance and repair. We may mandate that you add memory, ports, accessories, peripheral equipment and additional, new or substitute software. If we run tests and determine that it will prove economically or systemically beneficial to you and to us, you must install at your own expense the additions, modifications, substitutions and/or replacements to your Computer hardware, software, telephone and power lines and other computer facilities as we direct, on the dates and within the times we specify in our Confidential Manuals or otherwise. In addition, we may require you, at your expense, to purchase, install and utilize in your Closets By Design Business and at your Location such hereafter developed modes of computerization, communication, media and/or interfaces as we, in our sole business judgment, determine to incorporate into the System. You will be required to do so at such time and in such manner as we designate, in our Confidential Manuals or other written notices. CBDF alone may establish, maintain, modify or discontinue all internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn or X (formerly Twitter). Franchisees and their employees are not allowed to establish their own profiles on any social media page reflecting the Closets by Design brand, nor are they allowed to establish any Closets by Design related web page. CBDF will provide you with a “click through” subpage on any general Closets By Design web site it maintains. If CBDF establishes one or more websites or other modes of electronic commerce and if it provides a “click through” subpage at each such website for the promotion of your Closets By Design Business, you must provide CBDF with updated copy, photographs and news stories about your Closets By Design Business suitable for posting on your “click through” subpage, the content, frequency and procedure of which will be specified in our Confidential Manuals. Any websites or other modes of electric commerce that CBDF establishes or maintains may – in addition to advertising and promoting the programs, products, or services available at Closets By design business – also be devoted in part to offering Closets By Design business franchises for sale and be utilized by CBDF to exploit the electronic commerce rights which it alone reserves. You may not, without our prior written consent, establish or maintain any other websites or social media page; otherwise maintain a presence or advertise on the internet, through social media or in any other 2026 CBDF FDD -30- mode of electronic commerce in connection with your Closets By Design Business, including through the use of a page or profile on a social media website such as Facebook, Instagram, LinkedIn or Twitter; establish a link to any website CBDF establishes at or from any other website or page; or, at any time establish any other website, social media or electronic commerce presence which in whole or in part incorporates the “Closets By Design” name or any name confusingly similar thereto. By way of example, and without limiting the generality of the previous sentence; you may not exchange or communicate pricing or other information relating to System services or products via e-mail or any other electronic means (including but not limited to newsgroups or internet web sites); without CBDF’s prior written permission, list or link your Closets By Design Business, Location or any web site of CBDF or its Affiliates to any other webs site, or to any local internet advertising service, “yellow pages,” portal or search site, without CBDF’s prior written permission; or, promote System services or products and/or use the Proprietary Marks via direct e-mail solicitation, web sites, newsgroups, or any similar electronic means. You must open your franchised Closets By Design Business within 120 days after the effective date of the Franchise Agreement. CBDF estimates the typical length of time between the signing of the Franchise Agreement and beginning of your operations as a Closets By Design franchised business will be 90 days. Factors that may affect this length of time include the satisfactory completion of initial training by your designated attendees and availability of a retail location ready to begin operations.

2026 CBDF FDD -29- at or from your Location; retrieve from your computer system all information that it considers necessary, desirable or appropriate at the times it designates; and require you, at any time, upon notice, to grant it access to your business computer and computer systems (see sections 5.05 and 8.07 of the Franchise Agreement). You may purchase the computer equipment from any reputable vendor and you are solely responsible for the support, ongoing maintenance, repairs or upgrades to your computer system. You do not need cash registers or point of sale systems to operate your Business. You must install the AIM (Account Interaction Manager) sales management portal (the “AIM Sales Management Portal”) to be used in connection with the operation of your Business. The AIM Sales Management Portal is a web-based portal that designers will use to communicate the status of every client interaction with your Location and CBD Manager. The AIM Sales Management Portal is intended to ensure that all appointments are delivered to designers at a designated time, and all outcomes are reported back to our Sales Management team in a timely fashion. Currently, we do not charge you a fee for the use of the AIM Sales Management Portal, but we reserve the right to do so but we reserve the right to do so. If we elect to impose a fee for your use of the AIM Sales Management Portal, you will be required to pay our then-current fee, you will be required to pay our then-current fee not to exceed $25 per user per month. You must, at your expense, keep your Computer in good maintenance and repair. We may mandate that you add memory, ports, accessories, peripheral equipment and additional, new or substitute software. If we run tests and determine that it will prove economically or systemically beneficial to you and to us, you must install at your own expense the additions, modifications, substitutions and/or replacements to your Computer hardware, software, telephone and power lines and other computer facilities as we direct, on the dates and within the times we specify in our Confidential Manuals or otherwise. In addition, we may require you, at your expense, to purchase, install and utilize in your Closets By Design Business and at your Location such hereafter developed modes of computerization, communication, media and/or interfaces as we, in our sole business judgment, determine to incorporate into the System. You will be required to do so at such time and in such manner as we designate, in our Confidential Manuals or other written notices. CBDF alone may establish, maintain, modify or discontinue all internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn or X (formerly Twitter). Franchisees and their employees are not allowed to establish their own profiles on any social media page reflecting the Closets by Design brand, nor are they allowed to establish any Closets by Design related web page. CBDF will provide you with a “click through” subpage on any general Closets By Design web site it maintains. If CBDF establishes one or more websites or other modes of electronic commerce and if it provides a “click through” subpage at each such website for the promotion of your Closets By Design Business, you must provide CBDF with updated copy, photographs and news stories about your Closets By Design Business suitable for posting on your “click through” subpage, the content, frequency and procedure of which will be specified in our Confidential Manuals. Any websites or other modes of electric commerce that CBDF establishes or maintains may – in addition to advertising and promoting the programs, products, or services available at Closets By design business – also be devoted in part to offering Closets By Design business franchises for sale and be utilized by CBDF to exploit the electronic commerce rights which it alone reserves. You may not, without our prior written consent, establish or maintain any other websites or social media page; otherwise maintain a presence or advertise on the internet, through social media or in any other 2026 CBDF FDD -30- mode of electronic commerce in connection with your Closets By Design Business, including through the use of a page or profile on a social media website such as Facebook, Instagram, LinkedIn or Twitter; establish a link to any website CBDF establishes at or from any other website or page; or, at any time establish any other website, social media or electronic commerce presence which in whole or in part incorporates the “Closets By Design” name or any name confusingly similar thereto. By way of example, and without limiting the generality of the previous sentence; you may not exchange or communicate pricing or other information relating to System services or products via e-mail or any other electronic means (including but not limited to newsgroups or internet web sites); without CBDF’s prior written permission, list or link your Closets By Design Business, Location or any web site of CBDF or its Affiliates to any other webs site, or to any local internet advertising service, “yellow pages,” portal or search site, without CBDF’s prior written permission; or, promote System services or products and/or use the Proprietary Marks via direct e-mail solicitation, web sites, newsgroups, or any similar electronic means. You must open your franchised Closets By Design Business within 120 days after the effective date of the Franchise Agreement. CBDF estimates the typical length of time between the signing of the Franchise Agreement and beginning of your operations as a Closets By Design franchised business will be 90 days. Factors that may affect this length of time include the satisfactory completion of initial training by your designated attendees and availability of a retail location ready to begin operations.