|
|
Amount
Estimated Range
|
Method of Payment
|
When Due
|
To
Whom Payment is Made
|
|
|
Oiiening Supplies
|
S50Oi�$],50O
|
Lump sunt
|
As incurred
|
Supplier
|
|
|
Additional Funds(0-6 mos.)
|
$35,000 to $55,000
|
As incurred
|
As incurred
|
Employees,
Suppliers and other third party vendors.
|
|
|
Approximate
|
Low = $ 66^ 60
|
|
Approximate
|
Low = $204,599
|
|
|
totals it''you Lease your
|
H.gh = $U2�90
|
|
totals
if your equipment is
|
High =$251,029
|
|
|
equipment:1''
|
|
|
purchased outright:8
|
|
|
(�NOTE: Your estimated initial
investment will be $20,000 lower if you are acquiring a second or additional
EmbroidMe franchise (the difference between an initial franchise fee of $42,500
and $22,500.)
(*NOTE: Your estimated initial
investment tor a conversion franchise will be significantly lower if you can
continue to use your existing location and equipment and convert the business
to an EmbroidMe store. The total estimated initial investment for a conversion
franchise is approximately $2^7,500 to_ ^35,000, which includes the $22,500
initial franchise fee and an amount for signage and other improvements to fit
the EmbroidMe image. Your initial investment for a conversion franchise may be
higher and may include most or all of the expenses noted in the Item 7 table if
you are unable to use your existing location and equipment in the conversion.)
(Except where noted otherwise,
all amounts that you pay lo us are nonrefundable Third party lessors and
suppliers will decide if payments to them are refundable.)
''The initial franchise lee is
discussed in detail in Item 5 of this^isclosure Document. We do not offer
financing for the initial franchise fee.
2 We provide one round trip
airfare to our Florida Corporate Headquarters where we hold our training. We
also provide your hotel accommodations and one daily meal. The only costs that
yon will incur will be for your other daily meals, local transportation and
your entertainment. Of course, these costs will vary depending upon your
requirements.
3 A typical new EmbroidMe Store
generally occupies 1,000 to 1,500 square teet of interior space with HVAC.
lighting fixtures, electrical outlets and telephone wiring installed for your
business. Cost per square foot of leasing commercial space varies grcaUy
depending on your location and the market conditions effecting commercial
property at the time of your lease We will help you find your location and then
you and EME must both agree that it is the right place for you lo open up your
new business. Certain leasehold improvements are included in the Equipment
Package described in Note 4. Normally, no additional investment for leasehold
improvement*; should be necessary.
4���� Leasing your equipment reduces your initial
investment by spreading out monthly payments for the use of your Store''s
equipment, rather than paying an initial lump sum for the purchase. You may
lease the equipment package through an outside leasing or finance company
rather than paying the lump sum amount of $144,839 foi purchase. Leasing the
equipment does reduce youi initial investment but likely will result in higher
payments over the term of the lease because of interest payments and other
charges. You and the lessor will determine the precise amount of any initial or
periodic payments at the time of the transaction.�� The payments ordinarily arc
not refundable.�� Market fmcc^ will determine loan
repayment totals and interest
rates. We are not obligated to offer directly or indirecdy any arrangements
tor financing of your initial investment, your
equipment or the continuing operation of your franchise.
We do not guarantee your note, lease or any other
obligation. We have arranged for equipment leasing
through Brother International Corporation 100 Somerset Corporate Boulevard, Bridgewater. NJ 08807..
If you choose to lease through this company, you will
pay approximately $,1,000 monthly (Payment������� -(Deleted: 2,955
factors and terms are subject lo change without
notice.), plus any applicable sales and use tax. There is a
"buyout" or residual in the amount t>f 10% of (he original financed
amount due at the end of the
payment term.��� The leasing company will require you
to place a down payment equivalent to two
monthly payments as first month payment and a last
month payment security deposit.� It also will
require you and your spouse to personally guarantee
your lease.�� A copy of the equipment lease is
included with this J>isclosure Document as Exhibit
_B. Your lease may be prepaid at any time. However. _ , - - { Deleted: ottering Circular you will
still be responsible to pay the full amount ol lease payments and, therefore,
may not realize a savings by prepaying.
s�� The Software Conversion Fee
of $200 is only paid by a buyer of an
existing EmbroidMe Store in the ______________________
event thai the seller is not
using at the time of the sale the EMeUOSSj>oint of sale soft ware.�������������� ,
- - 4 Deleted:
ur Fast Manager
*��� You are obligated under
the Franchise Agreement to hold certain business insurance policies including
comprehensive general liability policy, a policy covering "all risk"
of physical Joss and additional policies as may be required under your local
laws or ordinances. The amount listed in this table reflects our estimate of
basic insurance for your first six months of operation. Your expenses will vary
depending on your exact requirements as dictated by your landlord and/or local
insurance rates.
7��� You will need to provide deposits for your real
estate and your utilities. The amounts of these deposits will vary depending on
the practices of your landlord and/or utility company. You must also register
your business with the local county along with a fictitious name and other
requirements of your local or state government. Each of these entities may
charge a fee for your registration and/or certain taxes.
8��� Yuu will need capital In
support your on going expenses, e.g. payroll and utilities, to the extent thai
these costs are not covered by sales revenue when you first open. This figure
does not include sums necessary for living or personal expenses nor payments
for your debt service. New businesses often generate a negative cash flow for a time. We estimate the
amount given will be sufficient to cover on�going expenses for the start-up phase of your business that we calculate to be up to 6 months. However, this is only an
estimate and we cannot assure you that additional capital will not be necessary
during your start-up phase. Your costs will depend on factors such as how much you follow our systems and procedures, your management skills and experience, your business skills, local economic conditions, the prevailing
wage rate, the local market for the EmbroidMe Business, competition and sales
levels reached during the -nart-up phase.
*�������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� This
total is an estimate of your initial investment and is based on our estimate of
average costs and _____________________________________________
market conditions prevailing as of the date of
uHis^isclosure Pocumentand nurji^ years of cxDeriencein^ , . - - { Deleted: Offering Circular the
business. We encourage you to seek the advice of your business advisor,
accountant or attorney to
help formulate a business plan
and a methodology of your business operation. Remember: A Business PUm is an
important step in understanding your financial needs. You arc cautioned to allow lor
inflation, discretionary expenditures, fluctuating interest rates and other
costs of financing, and other local market conditions, which can be highly
variable. You must bear any deviation or escalation in costs fnmi the estimates
in diis Item 7.
, \ Deleted: FTCEME07
