ITEMI
THE FRANCHISOR, AND ANY PARENTS.
PREDECESSORS AND AFFILIATES
The Franchisor
GarageTek, Inc.
("we", "our" or "us") is a Delaware corporation
that was formed in October 2000 and has its principal place of business at 5 Aerial Way, Suite 200, Syosset, New York 11791. We do business under our corporate and
under our trade name "GarageTek." We will refer to the person who
buys this franchise as "you" throughout this Disclosure Document. If
the franchise purchaser is a business entity, "you" also includes
each partner, shareholder and/or other owner of that entity.
We are offering franchises for the operation of retail
and/or industrial facilities operating under the "GarageTek" name
(the "Facility" or "Franchised Business") which sell
customized garage organization systems and installation services together with
specifically designed accessories and related products. The actual organization
products are specifically manufactured and designed by and for us for the
purpose of selling these branded products exclusively though our patented
"TekPanel" system, including TekPanel, TekTrack, Modular Flooring and
Polyaspartic Floor Coating ("Branded Product"). We are also offering
a "GarageTek Express" franchise, which is operated from a home or
small warehouse space, or it is an add-on to an existing business.
We do not own a business of the
type being franchised. We have never offered franchises in any other line of
business. We began offering franchises in December of 2000. Our agents for
service of process are listed in Exhibit A.
Our Parents,
Predecessors and Affiliates
We have a predecessor, but no
parent or affiliates. Our predecessor is International Visual Corporation of
N.Y., a New York corporation currently located at our headquarters
("Predecessor"). Our Predecessor developed the Branded Product which
we acquired from it via assignment. Our Predecessor has never sold, nor does it
intend to sell, franchises.
The System
Our system includes interior
design, layout, color scheme, fixtures and furnishings; Branded Product,
materials and supplies; methods, uniform standards, specifications and
procedures for operations; procedures for management control; training and
assistance; and merchandising, marketing and promotional programs, all of which
may be changed, improved and further developed (the "System").
The System is identified by
certain trade names, service marks, trademarks, logos, emblems and indicia of
origin, including the mark "GarageTek" as is now designated and may
in the future be designated by us in writing for use with the System (the
"Proprietary Mark").
We will offer
"GarageTek" Facility franchises to operators, who will operate a
Facility at new locations, and we will offer "GarageTek Express"
Facility franchises to existing skilled tradespeople such as electricians,
plumbers, carpenters, and existing, independent closet organizers, who will add
to their existing operations our Branded Product and offer our approved
services according to our requirements for "GarageTek" Facilities.
Existing operators who add a "GarageTek Express" franchise to their
existing operations might have a lower initial investment than those who
construct new Facilities (see Item 7).
We may offer people the
opportunity to develop more than one Facility within a given area. This area
may be multiple cities or an entire state. Whether this happens will depend on
the experience and financial capabilities of the particular developer.
The Franchise
Offered
We offer you a franchise
agreement (the "Franchise Agreement") which gives you the right to
establish and operate one Facility at a location mutually approved by you and
us (the "Approved Location"). The Franchise Agreement gives you the
right to use the Proprietary Mark and the System solely with the operation of
the Franchised Business, and solely at the Facility''s Approved Location. If you
purchase a GarageTek Express franchise, you will also sign an Addendum to the
Franchise Agreement, which is attached to the Franchise Agreement as Exhibit I.
In general, the storage area
customization business is very competitive. Your competition will come
primarily from other storage space specialty businesses. In some markets, these
businesses are locally based and other markets may include regional or national
chains as competitors. There will likely be a sharply increasing number of
entrants in this market over the next decade which will significantly intensify
competition.
Industry
Specific Laws
The Franchised Business may be
subject to state and local licensing requirements, permitting and certification
laws and ordinances. For example, in certain states franchisees will be
required to obtain a state contracting license in a specified class. Also,
franchisees may be required to comply with regulations of state home
improvement commissions which require the submission of an application
evidencing prior experience in the home improvement field, the completion of an
exam and/or the payment of fee for a license. In some instances, state
contracting and home improvement licenses are only available with proof of
several years prior relevant industry experience by an individual applicant or
the employee of a corporate applicant. The operation of the Franchised Business
is affected by OSHA regulations and state and local laws which govern dust
collection processes. You should seek counsel or contact your state and local
agencies as well as OSHA for detailed information about these laws and
regulations. There are other laws of general applicability that could impact
your operation.
If you are purchasing a
GarageTek Express franchise that you intend to operate from your home, you
should determine if there are any restrictions in your town related to
home-based businesses. You may need a special permit to operate a home-based
business.
The United States enacted the
"Uniting and Strengthening America by Providing Appropriate Tools Required
to Intercept and Obstruct Terrorism Act of 2001" (the "USA Patriot Act").
We are required to comply with the USA Patriot Act. To help us comply with the
USA Patriot Act, we ask you in the Franchise Agreement to confirm for us that
neither you nor your directors, officers, shareholders, partners, members,
employees, or agents are suspected terrorists or persons associated with
suspected terrorists or are under investigation by the U.S. government for criminal activity. You may review the Patriot Act and related regulations at:
http://www.treasury.gov/offices/enforcement/ofac/sdn
Market
Conditions
