r
Please completethe enclosedCONFillENTIAL FRANCHISE APPLICATION form providedand
returnto:
Cheese Steak Franchise Corporation
Alfred Nobel
734 Cheese Drive Franchise Corporation
Steak
Hercules, CA 94547
13925 (tele)
510-724-7100San Pablo Avenue,Suite 200
510-724-7103 (fax)
San Pablo, Ca 94806
It is importantthat the FranchiseApplication is completedaccuratelyandcompletely.Upon review of your
application,we will contactyou to discussthe next steps.
SteakShops.
Thank you for your interestin the Cheese
Training
Our greatest operations. beginto build this strengthby providing a thoroughand
strengthis our restaurant We
intensivefour weektraining program.This comprehensive programcombines and
both classroom on-the-job
training in an operatingCheese It
SteakShoprestaurant. coversbasicprinciplesof management, scheduling,
food preparation, detailsvital to the success the operation
customerservice,sanitationand other necessary of
of a Cheese SteakShoprestaurant.
Purchasing Support
The Cheese SteakShopFranchise Corporationhasmajor competitiveprogramswith someof the largest
purveyorsin the country.All food and suppliesmust be purchased throughour franchisor-approvedvendors.
All proprietaryitems, specificallyrolls and approvedsteak,to logo printed papersuppliesandrequireddecor
items will be madeavailableat the lowest contracted prices.
On-Going Support
Our business successdependson the successof our franchisees. Regular visits by CheeseSteak Shop Franchise
consultants goes beyond quality control inspections. We will assist you in evaluating all aspectsof your business.
We will have a "Fresh Eyes" objective to help you improve sales and profits and also to attain maximum use of
your assets.In addition refresher courses on operations, customer service, inventory control, staff management,
and accounting will be held periodically at the corporate headquarters.
Designand Construction
will in
Franchisees be providedwith corporateassistance planning,designingandbuilding your restaurant.
information,suchasprototypeblueprints,equipmentlists and sign
We will provide all of the comprehensive
details.
Marketing Support
and We
We believein aggressive innovativepromotionsas well ascommunityinvolvement. will provide you
with:
Point-of SalesSupport Local StoreMarketing Programs
New ProductPromotions Local Advertising
individuals who are willing to devotetheir full time and
whetherit is in their own business, working
in peoplewith a proventrack recordof success, or
- background preferred.
andmanagerial is
Capability
aredemanding to.
and stringentlyadhered A franchisee the
mustdemonstrate financial
The estimatedinitial investmentfor a
to
franchisees havea
which $75,000must be liquid capital.
Skill
and
individuals who havean ability to relatewell with customers employees.
skills and dedication.
to
be prepared operatewithin a standard and
management operational
to
Theseguidelinesarenecessary
throughoutthe entire franchisesystem.
INTRODUCTION
Theessential for
prerequisites acquiringa new or existing Cheese are
SteakShoprestaurant setforth in
Franchisor'sUniform FranchiseOffering Circular and Franchise Agreement. The purpose of this
writing is to describehow we actuallygo aboutapprovingor disapprovingapplicants.
You will seethat we do not detail herespecific criteria, suchas a "net worth of $000.00."The process
is so particularizedto individual applicantsand specific transactionsthat it is counter-productiveto
attemptto articulateabsoluterules.
Most simply stated,our objectiveis to determine:
i) whether the applicant (sometimes referred to as the "Franchisee,"
or
'1ransferee," "buyer") payshis/herbills regularly and on time~
ii) what easily availablecashshe/hehasin verifiable accountsand whetherit is
sufficient to supportthe proposedacquisition~
iii) up
whethercredit information matches with buyer's financial statements/tax:
and
returns~
iv) whether there's a reasonablelikelihood the businesswill work on a long-
term basis, both as a personal investment for the franchisee and as a
of
component our franchisingsystem.
WHAT WE ACTUALLY DO
In the end, our "approval" or "disapproval" of an applicant is necessarilysubjective. However. by
strictly adhering to the process,which is outlined below, it is the Company's purpose to be as
consistent and fair in its decision-makingprocessas is humanly possible. While we believe that the
ability to effectivelycommunicate and
with both employees the public is a very important qualifier for
in
success our business,Franchisor does not discriminateon the basis of race, religion, gender, or
nationalorigin.
How does the processstart? Normally we expect to receive a fully complete application package
(which is providedin this brochure)that, amongotherthings, includesthe applicant's currentfinancial
statement and authorizesus to investigatethe applicant's credit. If the application is to acquire an
existinglocation(a '1ransfer"),we normally requirethe following additionaldocumentation:
. business
a descriptionof the essential temISof the proposedtransaction~
. a recentstorefinancials(one to two years)~
. the currentand/orproposed premises lease~
. buyer'sbusiness plan/profomIafor the business.
Promptly following receipt of the application ( and authorizationto do so) we obtain a copy of the
applicant's credit report. The report may very well be the linchpin that determineswhether we go
we
forward. Assumingthe report is minimally acceptable, may ask for additional financial information
the
(in order that we can clearly understand natureof the applicant's assets and obligations).We also
askfor the applicant'stwo most recentyear's federaltax returns.Going forward, we contactreferences
andverify (telephonicallyand in writing) both in-housedatalinks and outsideproviders.
At the sametime that we make our financial analysis,we also look at any number of "intangibles"-
amongother things, we look at:
. grossbusiness skills;
. "hospitality" skills-vis-a-vis both servingthe public and managingemployees;
. "access"to additionalcapital-non-conventional aswell as institutional sources;
. if applicable,time in the systemand prior credit andoperationalperformance~
. storepotential-trends in local storemarket;
. food serviceexperience-training requirements;
. any equitableconsiderations amongclose-byfranchisees.
It is not unusual for there to be on-going conversationswith the applicant and we may ask for
additional documentation and/or a visit to our companyheadquarters.An applicant should anticipate
that the processwill take from 35 to 45 daysfrom inceptionto completio~ at which time we notify the
applicant in writing of his or her approval (including any conditions or limitations and/or further
or
requirements) our declinationof the application.
COMPLETION
Again, in the normal course,the following completes and
new store acquisitions transfers:
. (on a transfer) receipt of paymentof any moniesdue and owing by the selling franchisee(out of
escrowor by other paymentarrangements)~
. executionof all franchise-relateddocuments~
. deliver executed copy of leaseor leasetransferdocuments~
. and
deliver articlesof incorporationandother formation documents certificate(s)of good standing~
. deliver copies of shareholdersagreements,partnership agreementsand other agreementsor
to
documentsthat affect the disposition of the FranchiseAgreement,and all amendments such
agreements~
. that
confirm receiptof personalguarantees may be required~ and
. and as
confirm receiptof shareholders confidentiality agreements may be required.
Cheese Steak Franchise Corporation
734 Alfred Nobel Drive
Hercules, CA 94547
510-724-7100 (tele)
510-724-7103 (fax)