AFFILIATED CAR RENTAL - FDD UFOC ITEM 7 Detail

Item 7: Estimated Initial Investment.

YOUR ESTIMATED INITIAL INVESTMENT

Notes:

1.      The initial franchise fee is based on the population within the exclusive territory. See Section 12 for exclusive territory. The initial franchise fee is non-refundable. Affiliated does not offer financing.

2.      You may either purchase vehicle rental insurance on your own or through Affiliated. If you opt for Affiliated''s Insurance Program the minimum insurance premium deposit is $1,000, payable to Affiliated. However, the amount of the insurance premium deposit is based on 20% of your estimated annual premium and will be adjusted as your fleet size grows. The premium deposit is refundable. If you decide to purchase your own vehicle rental insurance, you may be required to pay an insurance premium deposit to your insurance company or broker.

3.      You may use your present existing auto related facility equipment. Your equipment consists of basic maintenance and cleaning equipment such as; small tools, a washer barrel, hoses, funnels, a shop vac and cleaning materials.

4.      You may use your present equipment, lifts, tools and other related items that are already being used at your auto related facility. The equipment required consists of basic maintenance and cleaning equipment, such as, wash barrel, 25" hose, funnels, a shop vac, and basic cleaning solvents.

5.      You may use the office fixtures and furniture presently in use in your auto related facility. You will need a desk, chair or counter desk, two customer waiting chairs, a file cabinet, computer, fax, phone and credit card machine.

6.      Affiliated will provide you, at no charge, with one inside illuminated sign and two windshield signs along with any required operating forms. Any external sign that you may decide to purchase is optional and at your sole expense and is available through Affiliated at a cost ranging from $900 to $1,200. After six months of operation, if you purchased an outside illuminated sign from a vendor approved by Affiliated, Affiliated will reimburse you up to 50% of the cost of the sign, excluding the costs of installation, delivery and taxes to a maximum reimbursement of $500.

7.      You are required to initially offer and have available for rental a minimum of five (5) mechanically certified new or used vehicles. Failure to offer for rental the required fleet size may result in a cancellation of coverage or non-renewal by Affiliated''s insurer. If you are an automotive dealer and have five vehicles that you already own, you may use them in your rental business. Affiliated estimates the average wholesale acquisition costs for used vehicles to range from $5,000 to $7,000 per vehicle. See Item #8 for vehicle types and Item #16 for vehicle restrictions.

8.      You are required to advertise in the display section of the yellow pages that services your exclusive territory. All advertisements must conform to Affiliated''s standards and must be sent to and approved by Affiliated for format and content prior to placement. The minimum required advertisement must be either a one-sixteenth (1/16) Page Display Ad or an in-column Trademark Listing. A line item does not fulfill your obligation for Yellow Page advertising. Affiliated recommends an eighth (1/8) Page Display Ad or larger, depending on the Franchisee''s advertising budget. These costs include yellow page advertising and some local advertising. Yellow Page costs vary from area to area.

9.      Affiliated Car Rental operates websites located at www.sensiblecarrental.com and www.affordablecarrental.com. The $164 website set-up fee includes your business in the appropriate company data base and provides you with a separate web page listing with all of your pertinent data; including a Reservation Module that you are responsible to manage on a daily basis.. The fee also includes website maintenance, web hosting and minimal web marketing. You must pay the set-up fee prior to opening for business. Thereafter, an annual website maintenance fee of $125 will be billed every August.. High speed Internet connections usually cost $50 per month.

10.  This estimates your initial start-up costs. These figures are estimates and based on five (5) vehicles in service. Affiliated cannot guarantee that you will not have additional expenses to start the business. Your costs will depend on factors such as: how much you follow Affiliated''s methods and procedures, your management skill, experience and business acumen, local economic conditions, the local market for our product, the prevailing wage rate, competition and the sales level reached during the initial period. Affiliated has relied on management''s twenty-five years of experience in the vehicle rental business to compile these figures. This sum does not include rent, equipment, fixtures, insurance on building and utilities, as you will be using your existing building, equipment, insurance and fixtures. Affiliated does not offer direct or indirect financing to franchisees for any items.

funnels, a shop vac and cleaning materials.

4.    You may use your present equipment, lifts, tools and other related items that are already being used at your auto related facility. The equipment required consists of basic maintenance and cleaning equipment, such as, wash barrel, 25" hose, funnels, a shop vac, and basic cleaning solvents.

5.    You may use the office fixtures and furniture presently in use in your auto related facility. You will need a desk, chair or counter desk, two customer waiting chairs, a file cabinet, computer, fax, phone and credit card machine.

6.    Affiliated will provide you, at no charge, with one inside illuminated sign and two windshield signs along with any required operating forms. Any external sign that you may decide to purchase is optional and at your sole expense and is available through Affiliated at a cost ranging from $900 to $1,200. After six months of operation, if you purchased an outside illuminated sign from a vendor approved by Affiliated, Affiliated will reimburse you up to 50% of the cost of the sign, excluding the costs of installation, delivery and taxes to a maximum reimbursement of $500.

7.    You are required to initially offer and have available for rental a minimum of five (5) mechanically certified new or used vehicles. Failure to offer for rental the required fleet size may result in a cancellation of coverage or non-renewal by Affiliated''s insurer. If you are an automotive dealer and have five vehicles that you already own, you may use them in your rental business. Affiliated estimates the average wholesale acquisition costs for used vehicles to range from $5,000 to $7,000 per vehicle. See Item #8 for vehicle types and Item #16 for vehicle restrictions.

8.    You are required to advertise in the display section of the yellow pages that services your exclusive territory. All advertisements must conform to Affiliated''s standards and must be sent to and approved by Affiliated for format and content prior to placement. The minimum required advertisement must be either a one-sixteenth (1/16) Page Display Ad or an in-column Trademark Listing. A line item does not fulfill your obligation for Yellow Page advertising. Affiliated recommends an eighth (1/8) Page Display Ad or larger, depending on the Franchisee''s advertising budget. These costs include yellow page advertising and some local advertising. Yellow Page costs vary from area to area.

9.    Affiliated Car Rental operates websites located at www.sensiblecarrental.com and www.affordablecarrental.com. The $164 website set-up fee includes your business in the appropriate company data base and provides you with a separate web page listing with all of your pertinent data; including a Reservation Module that you are responsible to manage on a daily basis.. The fee also includes website maintenance, web hosting and minimal web marketing. You must pay the set-up fee prior to opening for business. Thereafter, an annual website maintenance fee of $125 will be billed every August.. High speed Internet connections usually cost $50 per month.

10.This estimates your initial start-up costs. These figures are estimates and based on five (5) vehicles in service. Affiliated cannot guarantee that you will not have additional expenses to start the business. Your costs will depend on factors such as: how much you follow Affiliated''s methods and procedures, your management skill, experience and business acumen, local economic conditions, the local market for our product, the prevailing wage rate, competition and the sales level reached during the initial period. Affiliated has relied on management''s twenty-five years of experience in the vehicle rental business to compile these figures. This sum does not include rent, equipment, fixtures, insurance on building and utilities, as you will be using your existing building, equipment, insurance and fixtures. Affiliated does not offer direct or indirect financing to franchisees for any items.