ITEM 1
THE FRANCHISOR, ITS
PREDECESSORS AND AFFILIATES
Marble Slab Franchising, LLC. Marble Slab Franchising, LLC
("MSF") offers the franchises we describe in this Offering Circular.
We refer to NexCen Franchise Management, Inc., the franchise manager, as
"NexCen Management." For simplicity, we refer to MSF as "Marble
Slab," or by a first person plural pronoun ("we", "us"
and "our"). "You" means the individual or business entity
(corporation, partnership, etc.) that buys a franchise. Except for sole
proprietorships, "you" does not include a business entity''s owners.
MSF is a Delaware limited
liability company with its principal business address at 1346 Oakbrook Drive,
Suite 170, Norcross, Georgia 30093. MSF was formed on January 21, 2007. MSF
does business under its corporate name and does not operate any Stores under
the Marble Slab Creamery trade name. MSF does not operate or conduct business
under any other name. The agents for service of process for MSF are listed in Exhibit
G to this Offering Circular.
MSF has never conducted the
business of a Marble Slab Creamery. MSF has offered franchises for the Marble
Slab Creamery business since March 1, 2007. MSF has never offered franchises in
any other line of business.
Our
Predecessor
Marble Slab Creamery, Inc., a Texas corporation ("MSC"), conducted the business of franchising the Marble Slab
Creamery system from April 16, 1986 until February 28, 2007. Its home office
was located at 3100 S. Gessner, Suite 305, Houston, Texas 77063. On February 14, 2007, MSC entered into an agreement with an indirect, wholly-owned
subsidiary of NexCen Brands, Inc., a Delaware corporation and publicly-held
company whose stock is traded on the NASDAQ National Market System
("NexCen Brands"), providing for a series of transactions that were
consummated on February 28, 2007.
Those transactions resulted in
Marble Slab Franchise Brands, LLC, a Delaware limited liability company, and
indirect, wholly-owned subsidiary of NexCen Brands ("MSFB"),
acquiring all of the intellectual property assets (trademarks, service marks,
trade dress, trade secrets and the System), franchise agreements with the
franchisees of the Marble Slab Creamery system and certain agreements with the
vendors and suppliers to the franchisees of the Marble Slab Creamery system. In
addition, those transactions resulted in NexCen Management acquiring
substantially all of the other assets of MSC contemporaneously with those
transactions. MSFB entered into a Master License Agreement with MSF under which
MSF was licensed to use the intellectual property assets held by MSFB to
conduct the business of franchising the Marble Slab Creamery system world-wide.
In addition, MSFB transferred to MSF all of the existing franchise agreements
with the franchisees of the Marble Slab Creamery system and the agreements with
the vendors and suppliers to the Marble Slab Creamery system. The result of
these transactions is that MSF and NexCen Management, together, hold all of the
rights necessary for the conduct of the business of franchising the Marble Slab
Creamery system that were formerly owned by MSC.
MSF and NexCen Management
entered into a Management Agreement under which NexCen Management agreed to
provide all of the franchise management services (e.g., training, support and
administration) that were formerly provided by MSC. NexCen Management hired
certain of the persons who had previously served as the management and
operations personnel of MSC in order to be able to provide the management
services to MSF.
Our
Affiliates
MSFB, MSF and NexCen
Management are direct, wholly-owned subsidiaries of NexCen Brands. MSF is a
direct, wholly-owned subsidiary of MSFB. For your convenience, a corporate
structure chart containing a graphic depiction of the relationships among MSF
and the other affiliates of NexCen Brands is attached as Exhibit A to
this Offering Circular.
The principal place of
business of NexCen Brands is 1330 Avenue of The Americas, 34th Floor, New York, New York 10019. Neither NexCen Brands own or operate any franchises like the
franchise it is offering to you nor has it NexCen Brands or NexCen Acquisition
Corp. ever offered franchises in any line of business. Neither NexCen Brands
does not provide franchise support services to franchisees.
The principal place of
business of NexCen Management is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. NexCen Management has never owned or operated any franchises like
the franchise it is offering to you. NexCen Management has never offered any
franchises of any kind.
NexCen Management will now
conduct business employing the persons who had previously served as the senior
management and operations personnel of Marble Slab Creamery, Inc. The agent for
service of process for each of MSF and NexCen Management is listed in Exhibit G to this Offering Circular.
Athlete''s Foot Brands, LLC, a
Delaware limited liability company and indirect, wholly-owned subsidiary of
NexCen Brands ("AFB"), franchises the right to operate stores which
specialize in selling quality athletic footwear and footwear accessory products
including merchandise related to athletics and physical and mental well-being
under the trademark and service mark "THE ATHLETE''S FOOT�." The
principal business address of AFB is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. AFB offers a specialty retail athletic footwear store that may be
located in storefronts, strip shopping centers or regional malls. AFB has
approximately 602 franchisees at the present time. NexCen Management
participates with AFB in establishing franchised stores by providing the sales,
marketing, administration, training and support services to be provided under
the franchise agreements that AFB enters into with franchisees. NexCen
Management''s role in the franchise relationship is limited to acting as the
franchise manager and providing the services described above. All licensing of
the trademarks, service marks, trade dress and other intellectual property
rights and all other aspects of the franchise relationship are the
responsibility of AFB. Franchises for stores operating as THE ATHLETE''S FOOT�
have been offered since 1972 and AFB has been offering the franchises since
August, 2003.
MaggieMoo''s Franchising, LLC,
a Delaware limited liability company and indirect, wholly-owned subsidiary of
NexCen Brands ("MMF"), franchises the right to operate specialty ice
cream stores under the trademark and service mark MAGGIEMOO''S� and MAGGIEMOO''S
ICE CREAM & TREATERY� (together, the "MAGGIEMOO''S Marks") that
are substantially similar to the franchises offered by MSF. The principal
business address of MMF is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. MMF has approximately 178 franchisees at the present time. NexCen Management
participates with MMF in establishing franchise stores by providing the sales,
marketing, administration, training and support services to be provided under
the franchise agreements that MMF enters into with franchisees. NexCen
Management''s role is limited to acting as the franchise manager and providing
the services described above. All licensing of the trademarks, service marks,
trade dress and other intellectual property rights and all other aspects of the
franchise relationship are the responsibility of
MMF. Franchises for stores operating as MAGGIEMOO''S
Marks have been offered since 1989 and MMF has been offering the franchises
since March, 2007.
PM Franchising, LLC, a Delaware limited liability company and indirect, wholly-owned subsidiary of NexCen Brands
("PMF"), franchises the right to operate specialty pretzel stores
under the trademark and service mark PRETZELMAKER�. The principal business
address of PMF is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. PMF has approximately 128 franchisees at the present time. NexCen Management
participates with PMF in establishing franchise stores by providing the sales,
marketing, administration, training and support services to be provided under
the franchise agreements that PMF enters into with franchisees. NexCen
Management''s role is limited to acting as the franchise manager and providing
the services described above. All licensing of the trademarks, service marks,
trade dress and other intellectual property rights and all other aspects of the
franchise relationship are the responsibility of PMF. Franchises for stores
operating as PRETZELMAKER� have been offered since 1992 and PMF has been
offering the franchises since August 2007.
PT Franchising, LLC, a Delaware limited liability company and indirect, wholly-owned subsidiary of NexCen Brands
("PTF"), franchises the right to operate specialty pretzel stores
under the trademark and service mark PRETZEL TIME�. The principal business
address of PTF is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. PTF
has approximately 167 franchisees at the present time. NexCen Management
participates with PTF in establishing franchise stores by providing the sales,
marketing, administration, training and support services to be provided under
the franchise agreements that PTF enters into with franchisees. NexCen
Management''s role is limited to acting as the franchise manager and providing
the services described above. All licensing of the trademarks, service marks,
trade dress and other intellectual property rights and all other aspects of the
franchise relationship are the responsibility of PTF. Franchises for stores
operating as PRETZEL TIME� have been offered since 1992 and PTF has been
offering the franchises since August 2007.
GAC Franchising, LLC, a Delaware limited liability company and indirect, wholly-owned subsidiary of NexCen Brands ("GACF"), franchises the right to operate
specialty cookie and dessert stores under the trademark and service mark GREAT
AMERICAN COOKIE COMPANY�. The principal business address of GACF is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093.
GACF has approximately________ franchisees at the
present time. NexCen Management participates with
GACF in establishing franchise
stores by providing the sales, marketing, administration, training and
support services to be provided under the franchise agreements that GACF enters
into with franchisees.
NexCen Management''s role is limited to acting as the franchise manager and
providing the services
described above. All licensing of the trademarks, service marks, trade dress
and other intellectual
property rights and all other aspects of the franchise relationship are the
responsibility of GACF.
Franchises for stores operating as GREAT AMERICAN COOKIE COMPANY� have been
offered since
_____ and GACF has been offering the franchises since February 2008.
Shoe Box Franchising, LLC, a Delaware limited liability company and indirect, wholly-owned subsidiary of NexCen Brands ("SBF"), franchises the right to
operate specialty multi-brand designer retail footwear and related accessory
stores under the trademark and service mark SHOE BOX�. The principal business
address of SBF is 1346 Oakbrook Drive, Suite 170, Norcross, Georgia 30093. SBF
has one franchisee at the present time. NexCen Management participates with SBF
in establishing franchise stores by providing the sales, marketing,
administration, training and support services to be provided under the
franchise agreements that SBF enters into with franchisees. NexCen Management''s
role is limited to acting as the franchise manager and providing the services
described above. All licensing of the trademarks, service marks, trade dress
and other intellectual property rights and all other aspects of the franchise
relationship are the responsibility of SBF. Franchises for stores operating as
SHOE BOX� have been offered by SBF since February 2008.
None of MSF, NexCen
Management, AFB, MMF, PMF, PTF, GAC or SBF operates any specialty ice cream
stores or any franchises like the franchise MSF is offering. Neither MSF nor
NexCen Management is presently involved in any other line of business or any
other line of business in which either of them offers franchises. Neither MSF
nor NexCen Management has ever offered franchises in other lines of business.
Marble Slab''s Business and
Description of the Franchise. Our only business is the sale and servicing of Marble
Slab Creamery franchises. We do not engage in or franchise any other line or
type of business.
MSF will enter into a
Franchise Agreement with you under which MSF will license to you the right to
use the trademark and service mark MARBLE SLAB CREAMERY� and the related trade
dress and system for the operation of the specialty ice cream stores. NexCen
Management will perform all of the administrative, training and support
services which are provided for in the Franchise Agreement. Thus, together, MSF
and NexCen Management will provide you with the full complement of licenses and
franchise services provided for in the Franchise Agreement.
The management agreement
between MSF and NexCen Management provides for NexCen Management to perform all
of the franchise sales, marketing, administration, training and support
services required under Franchise Agreements with franchise owners in the same
manner as Marble Slab Creamery has historically performed such services. The
Management Agreement has been negotiated on an arm''s-length basis and NexCen
Management is being compensated by MSF for the performance of the services. In
the event of the expiration or termination of the Management Agreement, MSF has
the right to substitute a replacement manager to perform the services
previously provided by NexCen Management.
Marble Slab Creamery stores
("Stores") are distinctive retail outlets that operate under the
Marble Slab Creamery� trade name. They sell our proprietary brand of superior
grade ice cream, which customers can order in combination with nuts, fruit and
other "mixins." Store personnel blend the Mixins into our ice cream
on a chilled marble or granite slab, which is the centerpiece of our Stores.
Stores also offer freshly baked cones, frozen yogurt and soft drinks; some
offer baked goods and gourmet coffee drinks.
A Marble Slab franchise
entitles you to operate one Store at an approved location. You must operate
your Store under the business system and operating procedures we developed, as
described in our Operations Manual. You must sell our proprietary brand of ice
cream and may only sell other menu items that we specify or approve.
Stores are designed to be
located in shopping centers and malls. They typically occupy from 650 to 1,400
square feet of leased retail space. Stores provide limited customer seating,
because most customers purchase our products for off-premises consumption. We
also encourage our franchisees to offer catering services for parties, school
functions, fairs and other short-term events.
Premium grade ice cream and
frozen yogurt appeal primarily to adult consumers, ages 25 to 49. These
consumers, as well as families with children, make up our primary market.
Because Stores sell primarily frozen desserts, their sales are affected by
seasonal changes, especially in areas that experience cold, inclement winters.
Stores compete with other retail frozen dessert stores (including stores
identified as MAGGIEMOO''S�) and, to a lesser degree, with supermarkets and
fast-food outlets that sell frozen desserts.
Co-Branding Program
We offer a co-branded
franchise comprised of the Marble Slab Creamery� trade name as the primary
brand co-branded with other food franchise concepts offered by one or more of
our affiliates ("Co-Branded Stores"). The affiliated entities described in Item 1 above that
license or franchise the other food franchise concepts in Co-Branded Stores are
referred to as "Co-Brand Partners."
There are two types of
Co-Branded Stores: (i) a Store adjacent to and side-by-side with an affiliated
food franchise store sharing a common storefront and/or kitchen and offering
the Products and the products of the other affiliated franchise systems under
both the Marks and the marks of the other affiliated franchise systems in an
essentially equal manner ("Adjacent Stores"); and (ii) counters or display
cases offering the Products and operating under the Marks located within a host
store already owned by you that is primarily branded with the marks of, and
primarily offering the products of, other affiliated franchise systems (a "Counter Store").
We offer Franchise Agreements
for Co-Branded Stores (Adjacent Store Franchises and Counter Stores) only to
the franchisees of our Co-Brand Partners who are in good standing under their
franchise agreements.
In addition, under the
Franchise Agreement, we authorize you to enter into a separate franchise
agreement with one or more of our Co-Brand Partners to open and operate an
Adjacent Store under the affiliated food franchise brand and, in the Store, to
host a Counter Store bearing the marks, and offering the products, of one or
more of our Co-Brand Partners under their franchise system(s). These separate
franchise agreements are offered under the Offering Circulars of our Co-Brand
Partners.
Co-Branded
Franchise Finance Program
As of the date of this
Offering Circular, we are offering certain qualified franchisees (the "Eligible
Franchisees") the opportunity to purchase the right to operate an
Adjacent Store or Counter Store on the premises of their existing ice cream
franchise (a "Co-Branded
Franchise") at a discounted for an initial franchise fee of $10,000. We are also
offering Eligible Franchisees a financing program to cover a portion of the
granting and initial franchise fee for a Co-Branded Franchise. See Item 5 and Item 10 for more details.
If you are a franchisee of one
of our Co-Brand Partners'' franchise system, your eligibility to purchase a
Co-Branded Franchise and participate in our financing program will be
determined by us, in our sole discretion. In making such determination, we will
consider the following factors, among others: (a) your compliance with
franchise agreements and other agreements between you and our Co-Brand
Partners, (b) the size and layout of your existing ice cream franchise
location, (c) your credit history and demonstrated financial need; and (d) any
other factor deemed relevant to us (the "Eligibility Criteria").
If you are an Eligible
Franchisee under the Eligibility Criteria and would like to purchase a
Co-Branded Franchise, you would sign the Franchise Agreement attached to this
Offering Circular as Exhibit C, along with the Co-Branding Addendum that is attached
to the Franchise Agreement.
Legal
Compliance
You must comply with all
local, state, and federal laws that apply to your Store operations, including
health, sanitation, no smoking, EEOC, OSHA, discrimination, employment, and
sexual harassment laws. The Americans with Disabilities Act of 1990 requires
readily accessible accommodations for disabled people and therefore may affect
your building construction, site elements, entrance ramps, doors, seating,
bathrooms, drinking facilities, etc. You must also obtain real estate permits
and licenses and operational licenses.
We do not believe that there
are any laws or regulations that are applicable specifically or exclusively to
ice cream stores, that do not apply to other businesses generally, or to other
food service establishments. The U.S. Food & Drug Administration has issued
regulations concerning food labeling, nutrition, and health claims (for
example, what products may be labeled as "low fat"), and the U.S.
Federal Trade Commission enforces rules and regulations regarding deceptive
advertising that include nutrition and health claims. These laws and
regulations apply to a variety of businesses and industries, and may apply to
the operation of your Stores. There may be similar state, county, or local laws
or regulations.
You should consult with your
attorney concerning these and other local laws and regulations that may affect
your Store.
