BOSTONS GOURMET PIZZA RESTAURANT AND SPORTS BAR - FDD UFOC ITEM 7 Detail

ITEM 7

ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT*¹ *

NOTES:

Except as described above, none of the expenses described in this chart are refundable.

(1)                U.S. Dollars. All dollars specified in this Item are in U.S. currency.

(2)                Basis for Estimates. Costs are based on 9 prototypical ground up restaurants opened between May 2006 and February 2008. There were an additional 7 non-prototypical restaurants built that were excluded from this analysis because the scope of work varied dramatically from prototypical restaurants. Costs included were based on open shop bidding practices with no premium built in for the cost of union labor.

(3)                Initial Franchise Fee. See Item 5 for a description of the initial franchise and additional franchise fees.

(4)                Site Investigation Report. This report addresses a wide range of site specific variables that may impact the performance of the Restaurant. Variables evaluated and measured under this report include, but are not limited to, zoning, public works/engineering, sign requirements, building setbacks, landscape requirements, parking requirements, exterior building architecture, site grading requirements, adjacent street conditions, smoking and liquor laws and similar variables.

(5)                Geotechnical Report. This report determines soil conditions (e.g. sand, clay, water) at the site on which the Restaurant will rest and identifies what action, if any, should be taken to ensure that the Restaurant is built upon a solid physical foundation.

(6)                Civil Engineer. This range represents the estimated consultant and professional design fees and building permit costs associated with the development of your Restaurant. These costs are representative of the most common consulting and design services required to develop the information necessary for the production of the civil and architectural drawings required to permit your Restaurant. Expanded services such as extensive planning and zoning meetings, city council presentations/meetings, artistic renderings, traffic impact analysis, environmental impact reviews, and other extensive services are not included in these estimates.

(7)                Architectural Services. You will be provided a prototypical set of drawings for a Restaurant. These drawings must be site adapted to each individual site as required to meet local and state building codes. This range represents the estimated cost you will pay for the architectural services required to "site adapt" the prototype drawings for your location as required to receive a building permit. Extensive revisions to the prototype which might be required by a municipality or other government officials are not included in this range. We provide the architect with a "site adapt" scope of work which identifies the level of services included in this range.

(8)                Land Costs. Land costs will vary depending upon the area in which your Restaurant is located.

(9)                Building Permits, Aids to Construction, and Liquor Licenses. This range is representative of Building permit cost only and is only an average estimate. Aids to construction fees (tap/pro-rata fees, the costs of which are distributed to participants based on the authority of each city for items such as water and sewer usage fees, meter fees, environmental impact fees, electrical service fees, utility deposit fees, etc.) and liquor licenses are not included. These costs vary too widely to provide an accurate range. You should contact your state and local governmental agencies to inquire as to the amount and requirements of these items.

You must comply with federal, state and local licensing requirements for the sale of . alcoholic beverages and for the operation, if any, of gaming and lottery equipment. This range applies only to the average locality; however, some areas operate under a quota system for permits and the costs associated with obtaining a license in these areas can be extremely expensive and time consuming. Other permits may be required before you may open your Restaurant.

(10)            Building Costs. This range represents the estimated construction and interior improvement costs for the shell building. The average building costs for the 9 Restaurants referenced in footnote 2 above was approximately $1,311,000.

(11)            Site Work/Improvements. This estimate includes the costs for site preparation and pre-construction work. These costs may vary greatly depending on the condition of the land, environmental factors and whether or not you will buy or lease the site.

(12)            Signage. This amount includes the costs of building signs and monument signs.

(13)            Furniture, Fixtures & Equipment. This entry represents the cost for the purchase of furniture, fixtures, and equipment for your Restaurant. It includes items such as kitchen equipment, smallwares, televisions and sound systems, security, decorative package, furniture, uniforms, fountain dispensers, draft beer dispensers, phone system and other miscellaneous fixtures and equipment.

(14)����� Mill work. This represents the cost of all woodwork within the Restaurant. This includes,
but is not limited to, wood trim, booths, booth walls, railings, bar, bar back, etc.

(15)�� POS Equipment & Computer. You will be required to purchase a point-of-sale system in
" accordance with BPR''s specifications from an approved supplier.

(16)            Initial Training Expenses. This amount represents the estimated cost to hire and train a management team and hourly employees who will staff the Restaurant. This entry includes expenses associated with the attendance at BPR''s initial training program as well as with the on-site training provided by BPR employees during the opening of your Restaurant. See ITEM 11 for more information on BPR''s initial training program.

(17)            Legal & Accounting. This item is the estimated cost of basic legal and accounting services provided to you by legal and accounting firms.

(18)            Inventory. You will be required to purchase an initial inventory of food products, beverages and restaurant supplies according to BPR''s specifications.

(19)            Manager''s Salary. This is an estimate of the Manager''s salary during training and before opening your Restaurant.

(20)            Additional Funds. Since there is likely to be a cash shortfall during the initial operating phase of the Restaurant (approximately the first three months of operation), you will need to have additional funds available for your use. These additional funds will be needed for expenses such as marketing costs, the ongoing costs listed in ITEM 6, working capital needs, Managers'' salary after opening, debt service and additional miscellaneous costs not listed in this ITEM 7.

(21)            Total. BPR is unable to calculate the exact investment required of each franchisee for a Restaurant due to the many factors that influence the total project costs. The figures above are estimates only and may vary depending on location. These figures do not include shipping, installation or any applicable federal or state sales tax. Your initial investment will also vary considerably depending on the method and amount of financing that you use. You will incur additional costs if you purchase the land on which your Restaurant is built. The Initial Franchise Fee and other items are shown in full, although they may be financed or leased by third parties. These ranges are estimates only. You should review these figures carefully with a business advisor before making a final decision.