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Item 7

 

YOUR ESTIMATED INITIAL INVESTMENT

 

 

 

 

Initial

Franchise Fee (Note 1)

 

Travel And Living Expenses While Training (Note 2)

 

Real Estate And Improvements

 

Furniture, Fixtures And Equipment (Note 4)

 

Decor (Note 4)

AMOUNT���� METHOD OF��� WHEN DUE PAYMENT

 

 

$60,000������ Lump Sum

As Incurred����� As Incurred

 

 

 

(Note 3)����� (Note 3)������������������������������ (Note 3)

 

 

$ 190,500 to As Incurred As Incurred $500,000

 

 

$ 15,000 to As Incurred As Incurred $80,500

TO WHOM PAYMENT IS TO BE MADE

 

OPHF

 

 

 

Airlines, Hotels, Motels, Restaurants

(Note 3) Suppliers

 

 

 

Suppliers

 

 

Signs

 

 

Opening Inven�tory, Smallwares And Supplies (Note 5)

 

Miscellaneous Opening Expenses (Note 6)

 

Additional funds-6 months (Note 7)

$8,000 to As Incurred As Incurred $30,250

 

$19,500 to As Incurred As Incurred $45,500

 

 

 

$20,000 to As Incurred As Incurred $100,000

 

 

$52,500 to As Incurred As incurred $125,000

Suppliers Suppliers

 

 

 

 

Third Parties

 

 

 

Third Parties

 

Total (Note 8)

 

Notes to Item 7

$372,500 to (Does not include real estate and improvement costs) $966,250

(1)           OPHF does not offer you financing, directly or indirectly, for any part of the fee, or your initial investment. You may not use your franchise or any assets of the Restaurant to secure a loan, without OPHF''s prior written approval.

(2)           OPHF offers training for up to four people, including you. Your cost will vary depending upon how many individuals you have trained, and the salary you may pay them during training, and their travel, hotel/motel and food costs.

(3)           Typically, a Restaurant will be approximately 3,500 to 4,000 square feet, with 110-120 seats. Costs will vary significantly depending on whether you are building your own premises, or are leasing, whether there is an existing restaurant facility to be converted to a Restaurant, or a non-restaurant facility requiring conversion, the property owner/landlord participation in build-out of the premises, the extent of conversion required, and your choices on the extent of the build-out ($110,000 to $700,000). The difference between low and high range is also attributable to various factors including size, configuration and condition of the premises, construction, labor and installation costs, geographic location, price differences between various suppliers and contractors and shipping distance from suppliers. If you lease the premises, monthly rent is estimated to be between $6,250 and $12,500. The difference between low and high range is attributable to various factors including size, condition and location of the premises, and the demand for the site and premises among prospective lessees.

OPHF does not estimate the cost of your buying land and/or constructing your own building for the Restaurant. The land would have to be situated on a well traveled thoroughfare, and be of sufficient size to have not less than fifty (50) parking spaces, and a structure of approximately 3,500 to 4,000 square feet.

(4)           Typically, a Restaurant will be approximately 3,500 to 4,000 square feet. The difference between the low and high range is attributable to various factor including size, configuration and condition of the premises, installation costs, geographic location, quality of furniture, fixtures and equipment you select, price differences between various suppliers and shipping distances from suppliers, and style of decor chosen.

(5)           The difference between the low and high range is attributable to the size of the Restaurant and price differences between various suppliers and shipping distances from suppliers.

(6)           These expenses include estimated payroll costs before opening, which will vary greatly depending on the number of employees you train, and the length of training before opening. These expenses also cover such miscellaneous costs and expenses as installation of telephones and hook up charges for gas, electricity and related items, legal and accounting expenses, yearly insurance premiums as well as other initial opening costs.

(7)           This estimates your need for additional working capital for expenses for the first six months of operation. These figures are estimates, and OPHF cannot guarantee that you will not have additional expenses starting the business, or that you will not need additional working capital for a period of greater than six (6) months. Your costs will depend on factors such as: how much you follow OPHF''s methods and procedures; your management skill, experience and business acumen; local economic conditions; the site and premises of the Restaurant and the time of year during which the Restaurant is opened; the local market for our product; the prevailing wage rate; competition; and the sales level reached during the initial period. OPHF relied on its experience

in the restaurant business, and information from franchisees to estimate the amount of additional funds required.

(8)           OPHF relied on its experience in the restaurant business, and information provided by franchisees, to compile these estimates. You should review these figures carefully with a business advisor before making any decision to purchase the franchise. These payments are non-refundable.