Item 1:����������� The
Franchisor and any Parents. Predecessors, and Affiliates
To simplify the language in
this Franchise Disclosure Document, "Lilr Pals" means Lil*
Pals Pet Photography, Inc., the franchisor. Throughout this Offering Circular,
''Sve" and "our" may be used to refer to Lil'' Pals.
"You" means the person who buys the Lil'' Pals franchise. Further,
Lil'' Pals� is a registered mark of Lil'' Pals Pet Photography, Inc.
Lil* Pals is a Tennessee corporation that was formed on May 11, 2004. Lil'' Pals does business as Lil'' Pals Pet
Photography. Our principal business address is 4041 Hatcher Circle, Memphis, Tennessee 38118.
There is no parent or any
affiliate that offers franchises in any line of business or provides products
or services to our franchise owners. However, the approved photo processing lab
for all Lil'' Pals franchise owners is United Color Lab, Inc. {hereinafter
referred to as United Color Lab). Daniel G. Wilmoth, Chairman of the Board of
Lil'' Pals, has not only a minority ownership interest in Lil'' Pals, but also
the sole ownership interest in United Color Lab, which is a Tennessee corporation that was formed in September 1992. Its principal business address is 4041 Hatcher Circle, Memphis, Tennessee 38118. The business of United Color Lab is to process
images submitted by its customers throughout the United States. It has not
conducted a business of the type to be operated by the franchise owner.
Further, it has not offered franchises for the same type of business as that to
be operated by the franchise owner. Finally, it has not offered franchises in
other lines of business.
The predecessor to Lil'' Pals
was TYNO Enterprises, LLC, whose principal place of business was located at 4822 Paige Drive, Olive Branch, MS 38654. Mike Sondag, current President of Lil'' Pals Pet
Photography, Inc., together with his wife, Corrine Sondag, helped develop the
Lil'' Pals pet photography system through the operation of this limited
liability company.
The registered agent for
service of process is Daniel G. Wilmoth, 4041 Hatcher Circle, Memphis, Tennessee 38118.
Franchisor''s Business.
We grant franchises for the
right to provide mobile photography services for all kinds of pets. We operated
a business of the type to be operated by the Franchise Owner from September
2004 to September 1, 2005. We have offered Lil'' Pals franchises since June
2005. We have not offered franchises for the same type of business as that
offered in this Disclosure Document. Further, we have not offered franchises in
any other lines of business and do not offer franchises in any other lines of
business and do not offer franchises under names other than Lil'' Pals. We do
not have other business activities.
Franchised Business.
You will contact
veterinarians, pet groomers and other pet businesses to take pictures of the
pets of their clients in your mobile studio. There is a growing and developing
market for quality pictures of pets.
Normally, veterinarians and
pet groomers help organize the appointment time for pictures and dates
throughout the year for taking pictures of their client''s pets.
After you have taken the
pictures of the pets, you will assist the owners of the pets in deciding which
pictures to purchase and collect their payment. Then you will have the images
developed by photo processing labs approved by Lil'' Pals. Once the photo lab
has processed the pictures, they will be delivered to the host location
(groomer, veterinarian clinic, pet store or other pet location) to be
distributed to the pet owners.
Daniel G. Wilmoth, Chairman of
the Board of Directors of Lil'' Pals, has not only an ownership interest in Lil''
Pals, but also the sole ownership interest in United Color Lab. Further, he
also has a minority ownership interest in Lil* Angels, LLC, a Tennessee limited
liability company that grants franchises for the right to provide photography
services to child day care centers and other child organizations. Mr. Wilmoth
has not conducted a business of the type to be operated by the Franchise Owner.
Further, he has not offered franchises for the same type of business as that to
be operated by the Franchise Owner. Finally, except for his interest in Lil''
Angels, LLC, he has not offered franchises in other lines of business.
In addition to the charge by
the photo lab for processing each picture unit, you will pay to us a Weekly
Franchise Fee of 6% of the gross receipts from the operation of your Lil'' Pals
business, with a minimum payment each quarter of $1,500.
In the operation
of your business, you will be competing with regional and local portrait and
photography studios and photographers that offer the same or similar services.
Regulations Specific to Franchised Business.
There are no regulations that
specifically govern the taking of pet pictures. In addition, you and your
employees are not required to have prior photography experience. However, you
will be required to obtain local and state business licenses and permits.
Factors
to Consider
In
considering whether to purchase a Lil'' Pals franchise, you should consider the
following factors: (a) you should research the number of photography and
portrait studios already in your exclusive area that take pictures of pets (see
Item 12); (b) you should contact as many franchise owners listed in this
Document as possible; (c) you should contact any person with whom we have been
involved in litigation, as disclosed in Item 3; (d) you should have this entire
Franchise Disclosure Document, reviewed by your attorney and accountant; (e)
you should be aware that any investment, particularly in a franchise, involves
a degree of risk, and you should not rely on any estimates of costs, revenues
or other operating results other than as contained in this Franchise Disclosure
Document.
