Welcome to Simply Fondue Restaurant, a one-of-a-kind dining experience.

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1 Welcome to Simply Fondue Restaurant, a one-of-a-kind dining experience. Fondue is a fun, relaxed, and entertaining way to dine. Fondue dining has spanned the decades, from the late Sixties to the present, as a wonderful way to dine and visit with friends. The new millennium has brought changes and modernization, making fondue easier to prepare and easier to enjoy. Built-in electric burners, sleek granite tables, and unique art pieces create an upscale ambiance perfect for today s dining public. Simply Fondue s modern approach, unique style, and favorable return on investment make it an excellent choice for a restaurant franchise. Our authentic cheeses, fresh seafood, top quality meats and vegetables, complimented by our signature sauces and batters, allow us to be unsurpassed by traditional restaurants. Also, in keeping with the public s concern for good health and fine dining, we offer a light and low-fat broth fondue as a substitute to cooking with oil. Our chocolate fondues alone will ensure repeat customers and excellent word-of-mouth advertising. Now another generation can explore a whole new dining experience the way it was meant to be. Becoming a Simply Fondue franchisee We have made Simply Fondue s success easy to duplicate. We will make it work for you from helping you select a site, to the marketing and training. We will provide the tools you need to make the Simply Fonde System a success for you. Our interior floorplans, equipment and operating package gives you all the essentials to begin operating your own Simply Fondue Restaurant as smoothly and as quickly as possible. We will also show you how to increase customer awareness through the use of advertising programs that have been effective for us over the years. We will provide you with comprehensive management training. Whether you are a novice in the food service business or an experienced franchise operator, we will provide you the solid foundation you need to open and operate your own Simply Fondue franchise.

2 Our training program begins with you and/or your managers learning the essential elements of implementing the Simply Fondue System, such as * Recipes and food preparation * Identifying and locating quality ingredients * Maintaining consistent quality, service and cleanliness * Simply Fondue s formula for Customer Service * Achieving food cost and inventory goals * Obtaining maximum productivity from your employees and facility * Recruiting and evaluation personnel * Effective advertising On-the-job training will take place at our corporate training restaurant, where we will teach you how to implement our methods of administrative procedures, time management and food preparation. During your training, you will receive a complete set of Simply Fondue manuals, customdesigned computer software and other important operating aids, creating a valuable reference library as a source of information for you and your managers. And even after you have completed your training, you will always have the support of Simply Fondue s experienced staff. If all this sounds like the business opportunity you have been looking for, we would love to hear from you. Whether you are interested in a single unit or multi-unit franchise, we invite you to call Lance Wilson, We look forward to making you a member of the growing Simply Fondue family. Frequently Asked Questions Simply Fondue offers a prospective franchisee an unusual and unique opportunity to become part of an up-and-coming and very efficient restaurant system. Our program will help you become successful, but it is clearly your personal efforts that will be the determining factor. You must be prepared to work hard, follow our format and guidelines, and work to meet the goals and performance objectives set for your restaurant. The following questions and answers are designed to help you accurately assess our franchise package and make a fully informed decision about our business opportunity. What type of franchise is available? * Simply Fondue offers both single and multi-unit franchises. * In order to qualify for a multi-unit franchise, a franchise prospect must be able to demonstrate previous management responsibilities as well as have the financial resources necessary to develop a market. * Single-unit franchisees may qualify for an additional location once their first Simply Fondue restaurant has operated successfully over an agreed-upon period of time.

3 How much is the initial investment? * The initial franchise for a single unit is $25,000, payable at the time the agreement is signed. * The multi-unit franchise fee is $25,000 for the first unit, $15,000 per unit thereafter. * Depending on the location and size of the restaurant, the total initial investment (excluding the franchise fee) can be $175,000 to $500,000. How much of the total investment can be financed and does Simply Fondue offer financial assistance? * Simply Fondue does not offer any financing services to its franchisees. * However, we will provide you information about lenders and finance companies who, depending on your financial statement, may offer financing directly to you. * Of the total investment, we have found that the equipment, fixtures and signage can be leased or financed, generally over a 24 to 48 month period. * Simply Fondue cannot guarantee you will receive any financing. Is the price for equipment, furniture, fixtures, and signage packaged at a competitive price? * Yes. All the equipment, furniture, fixtures and signage have been carefully researched and priced. Our approved suppliers are selected based on their ability to offer competitive pricing and excellent service. What about leasehold improvements? * Leasehold improvements will, of course, vary with each location. * Some landlords will be willing to absorb some or all of the costs and may factor the costs of improvements into your monthly rent, thereby reducing the amount of upfront payments. What is the typical size of a Simply Fondue Restaurant? * Our locations vary in size. * However, based on our experience, we recommend 3,500 to 6,000 square feet. Our floorplans have been designed for efficient and smooth operations, and can be adapted to fit your specifications. If you are based in Texas, how do I obtain my inventory? * To ensure the quality of our ingredients, Simply Fondue has established relationships with some of the finest purveyors available. * During your initial training program, you and/or your managers will be introduced to our vendor representatives and they will make the arrangements for you to receive your inventory at your location. What type of inventory controls, business and management aids does Simply Fondue provide to its franchisees? * As a Simply Fondue franchisee, you will receive a sales reporting form, along with operational guides and tools for efficient control over daily business operations. * During your training, you will receive a complete set of Simply Fondue manuals, custom-designed computer software and other important operating aids, creating a valuable reference library as a source of information for you and your managers. * And even after you have completed your training, you will always have the support of Simply Fondue s experienced staff. * All these materials are included in your franchise fee.

4 How do I select a location? * Through our experience, we have learned what demographic criteria (population, competition, income brackets, rent, etc) contribute to a successful location decision. * Once your site selection has been approved, you will be provided with the standard store layout and design plan that you will use to build your Simply Fondue Restaurant. What type of training will I receive? * Because of our commitment to your success as a Simply Fondue franchisee, we have designed a thorough franchise training program. This program consists of both private, one-on-one training and on-the-job restaurant training at the corporate restaurant location. * We will provide on-location opening assistance at the restaurant for two weeks this training is included as part of your franchise fee. * However, you are responsible for any expenses incurred for transportation, food, lodging and employee salaries, as applicable. What form of continuing operational guidance will I receive from Simply Fondue? * During your training, you will receive a complete set of Simply Fondue manuals, custom-designed computer software and other important operating aids, creating a valuable reference library as a source of information for you and your managers. * And even after you have completed your training, you will always have the support of Simply Fondue s experienced staff. * In addition, periodic visits will be made to your store(s) by our experienced representatives. They will be available to work with you and your personnel on such issues as operational procedures, customer relations, purchasing, merchandising, inventory control, advertising and any other issue in which you believe you need assistance. How long does a franchise last? * The initial term is for ten (10) years. What is the ongoing fee or royalty payment? * The franchisee will pay a monthly royalty fee of 4% of gross sales to Simply Fondue Restaurants, Inc. What about advertising contributions? * There is no financial contribution from Simply Fondue Restaurants for advertising at this time. Each store will provide its own advertising budget under our guidance to fit is own needs. * At a later date, if broad-based advertising is agreed upon, then each store s contribution will be based upon a mutually-agreed percentage. Is my territory protected? * Yes. Your protected or exclusive territory will be determined prior to the signing of the Franchise Agreement and will vary depending upon the marketing area involved. Can I sell my Simply Fondue franchise? * In general, the answer is Yes, as it is a business with equity that can be purchased. * However, just as Simply Fondue reserves the right to approve you as an original franchisee, we reserve the right to approve any subsequent buyer.

5 How soon can my franchise be in operation once I have been approved as a franchisee? * Once you have been approved, and the Agreement has been fully executed, together with the payment of the franchise fee, there are three factors which will determine the timetable to open your Simply Fondue restaurant. * The first factor is the length of time it takes to select a location, the second is the length of time it takes for construction or remodeling, and the third is the length of time it takes to successfully complete our training program. * We expect this total period of time to be approximately three to six months. I m interested in learning more about the Simply Fondue franchise program. What is the next step? * Please call me directly Lance Wilson, or me at , with any additional questions and to set up an appointment to learn about the Simply Fondue franchise opportunity. General questions Before you make the decision to become a Simply Fondue franchisee, there some important questions you must ask yourself Financial * Are you financially qualified to open and operate a Simply Fondue Restaurant? * Are you certain you are willing to sacrifice the benefits of company employment to pursue self-employment? * Can you pursue additional sources of capital if it becomes necessary? * If you are married, is your spouse supportive of your new venture? Personal * Are you temperamentally suited to spend your life working, together with the Simply Fondue franchise system, to follow the standards and guidelines that will help make the Simply Fondue system work for you? * Are you in good health? Can you handle the strees a new business venture can create? * Do you have the personality that lends itself to meeting and doing business with the public on a daily basis? * Have you reached the conclusion that you are committed to being in the foodservice industry? It is important to remember that even though you may own your own business as a Simply Fondue franchisee, you will sacrifice a certain degree of independence and personal recognition that you may otherwise possess as a completely independent owner. Rules * Will you past business experience help you in learning to manage your own business? * Do you thoroughly understand the Simply Fondue difference? In other words, what makes Simply Fondue different from other food-service concepts. * Are you convinced there are customers who will patronize a Simply Fondue restaurant in your area?