CMIT SOLUTIONS - FDD UFOC ITEM 1 Detail

Item 1. THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS AND AFFILIATES

To simplify the language in this Offering Circular, "CMIT" and "we" mean CMIT Solutions, Inc., the Franchisor. "You" means the Franchisee: the person(s), partnership, Limited Liability Company, corporation, or other legal entity that buys the Franchise and includes your partners, shareholders, associates, spouse, officers, directors, and other employees in the same organization.

We incorporated under the laws of the State of Texas in October 1996 with the na me "computer moms international corporation", and in January 2004 changed our name to CMIT Solutions, Inc. We maintain our principal place of business at 1701 Directors Boulevard, Suite 300, Austin, TX 78744, and our telephone number is (512) 692-3710.

Since March 1998, we have offered franchises to establish and operate computer support businesses. From 1998 to January 2004 our franchisees operated under the primary trademark "computer moms?". As of January 2004 our new franchisees began operating under the primary trademark "CMIT Solutions". Although we do not own or operate any franchised offices, we have the right to do so.

We do not have a parent, predecessor or an affiliate. However, our Founder, Georgia Jones has sold and assigned the System and Marks (as these terms are defined below) to us. See Item 13 for a description of the assignment.

The CMIT Solutions Franchise program includes the common use and promotion of the trademark "CMIT Solutions''" and other marks we specify for use with the CMIT Solutions franchised business (the "Marks"); standards, specifications and procedures for the offering of our specialized IT Professional and Managed Services (Managed services is the practice of transferring day-to-day information technology management responsibility to an outside provider as a strategic method for improved effective and efficient operations) franchises; distinctive and uniform standards; quality and uniformity of services and products offered; procedures for financial control; training and assistance; and advertising and promotional programs.

You may operate your CMIT Solutions Franchise from an office in your home. However, at your option you may lease office space outside of your home. If you sign an Area Development Agreement or a Multi-Unit Agreement for the development of more than one franchised business we recommend that you establish a suitable leased office outside of your home, although it is entirely your option to do so. We have no obligation to help you locate this space or help you in negotiating the lease. We have no requirements with regard to type of space, square footage, or office layout.

In granting you a franchise to operate a CMIT Solutions franchised business, we retain all rights not expressly granted to you; and we expressly retain ownership of all customers and customer data generated in your business operations.

We offer an Area Development Agreement ("ADA"), which grants the right to develop multiple CMIT Solutions businesses and serve as our area representative providing services to franchisees in a specified territory. As an Area Developer you may not sell or negotiate the sale of franchises on our behalf; we will do that ourselves directly. If you sign an ADA you will assist in recruiting and qualifying prospective franchisees, as well as providing support services, regular meetings and guidance to franchisees in your development territory. This ADA provides exclusive rights to a defined territory for a period of time (usually 10 years, with a right of renewal for an additional term of the same length) while the Developer undertakes to establish an agreed upon number of CMIT Solutions businesses in the territory, adhering to a development schedule. The Developer pays a lump sum of money at the time the ADA is entered, as detailed in Item 5, and receives as compensation a portion of the initial franchise fees and royalties generated by CMIT Solutions businesses in the development territory. You will find a copy of the form of ADA at Exhibit F.

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We also offer a Multi-Unit Agreement by which you may commit to the development of more than one CMIT Solutions business in a defined territory. You will find a copy of the form of the Multi-Unit Agreement at Exhibit F.

We may require your employees to be certified by us, or a third party we specify, in order to provide our customized IT Services.

You may offer CMIT Solutions? services to both businesses and individuals. We expect the primary market to be small and medium sized businesses, with opportunity to support home-based business owners, as well as, at your option, recreational home computer users. You will compete with independent, national, and franchised IT support services companies, hardware and software manufacturers, independent consultants, and other businesses that offer technical support, services and products.

Our Beliefs

All of our current franchise, Multi-Unit and Area Development agreements contain important statements of "Our Beliefs" and our "Core Expectations." We consider these statements to be the essence of our business. The values described below constitute "Our Beliefs" in the CMIT Solutions System, and that conducting business according to these fundamental values is key not only to CMIT Solutions'' and your success, but also to the success of all other developers and franchisees in the CMIT Solutions network. "Our Beliefs" are as follows:

WE BELIEVE:

IN A FOUNDATION BASED UPON CHARACTER AND INTEGRITY

IN A PASSIONATE COMMITMENT TO OUR CLIENTS; ALL ELSE IS SECONDARY

IN BEING DEDICATED TO CONTINUOUS PERSONAL GROWTH AND

PROFESSIONAL IMPROVEMENT

IN BEING DEVOTED TO ONE ANOTHER, FAMILY AND COMMUNITY

THAT A SPIRIT OF FUN AND SENSE OF HUMOR ARE ESSENTIAL

IN ACKNOWLEDGING THIS AWESOME RESPONSIBILTYAND PRIVILEGE

These values form the cornerstone of the CMIT Solutions franchise program. In our agreements you will acknowledge that the operation of your business under the Agreement will affect directly both the ft" service experiences of CMIT Solutions clients and their overall perception and acceptance of the CMIT Solutions System, CMIT Solutions trademarks, and the members of the CMIT Solutions network of businesses. Accordingly, you must operate your franchised business in a manner consistent with the values contained in Our Beliefs.

CMIT Solutions represents and in the Agreement you acknowledge and agree that (1) the CMIT Solutions Franchise Program and the CMIT Solutions services are integral parts of a highly interrelated System, and (2) the successful operation of each CMIT Solutions business is critical to CMIT Solutions'' overall business objectives and plans.

Core Expectations

CMIT Solutions is committed to the success and fulfillment of the highest expectations of our developers and franchisees. At every level, our organization is driven to enhance the value of the information we provide and improve the quality of the developer and franchisee support we offer. A healthy franchised network takes a similar commitment from each of its developers and franchisees to enhance its own performance in the operation of each franchised business. We therefore have adopted the following Core Expectations for each franchisee in the CMIT Solutions network:

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(1)   Each developer and franchisee must follow as carefully and as completely as commercially possible the CMIT Solutions business operations guidelines that are such an important part of the franchised business granted to them;

(2)   Each developer and franchisee must participate in the CMIT marketing campaign, and implement and execute all aspects of the sales and marketing system. To that end each developer and franchisee must spend sufficient sums on promotion and advertising; must use our CMIT Solutions alliance partners; and participate in our national accounts program and projects where feasible; and

(3)   Each franchised business must meet the performance goals and minimums we adopt in the CMIT Solutions System.

If, in our judgment, the business of a franchisee or developer does not meet one of these Core Expectations, CMIT Solutions may call for a Territory Review and Improvement Program. The owner''s participation and cooperation in this program is mandatory. The process is a multi-step program by which we provide intense, individually tailored counseling and assistance, additional training, and coaching in the successful operation of a CMIT Solutions business. A Territory Review and Improvement Program generally lasts for up to 4 months. During this period, the franchisee or developer must cooperate and follow recommendations, including recommendations for the reasonable expenditure of money on advertising and promotion, and for the expense of any recommended training.

Business Regulation

We are unaware of any states that have any specific regulations or licensing requirements for offering IT professional services. However, you will have to comply with a number of laws that apply generally to the operation of businesses, including home-based businesses. These laws include those relating to zoning, permits and licensing. There may be other laws, rules or regulations that affect your Franchise. You may wish to consult with your attorney to understand these laws.