UFOC

The original documents were scanned as an image. The original file can be downloaded at the link above.

Sample UFOC

; TABLE OF CONTENTS

ITEM PAGE

Item 1 The Franchisor, Its Predecessors and Affiliates...............................................................5

Item; 2 Business Experience.......................................................................................................6

Item| 3 Litigation.........................................................................................................................8

ItemJ4 Bankruptcy....................................................................................................................10

Item'5 Initial Franchise Fee......................................................................................................10

Item!6 Other Fees.....................................................................................................................11

Item|7 Initial Investment...........................................................................................................13

Iteml8 Restrictions on Sources of Products and Services........................................................23

Item 9 Franchisee's Obligations...........................................................................j....................25

Item 10 Financing......................................................................................................................26

Item|ll Franchisor's Obligations...............................................................................................27

Item 12 Territory........................................................................................................................32

Item 13 Trademarks...................................................................................................................33

Item 14 Patents, Copyrights and Proprietary Information.........................................................35

Item 15 Obligation to Participate in the Actual Operation of the Franchise Business...............36

Item 16 Restrictions on What the Franchisee May Sell.............................................................36

Item 17 Renewal, Termination, Transfer and Dispute Resolution..........................,...................37

Item 18 Public Figures................................................................................................................40

Item 19 Earnings Claims............................................................................................................40

Item 20 List of Outlets.....................................................................................43

Item 21 Financial Statements..............................................................................46

Item 22 Contracts........................................................................................................................46

Item 23 Receipt..............................................................................................46

EXHIBITS

Exhibit 1 - List of State Administrators

Exhibit 2 - Agents for Service of Process

Exhibit 3 - List of Franchisees

Exhibit 4 - List of Exited Franchisees

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Exhibit 5 - Financial Statements Exhibit 6 - Franchise Agreement

Exhibit A - Authorized Products and Services

Exhibit B - Approved Location and Territory Addendum

| Exhibit C - Guaranty Agreement and Acknowledgment by Guarantor

! Exhibit D - Rider to Lease

j Exhibit E - Confidentiality and Non-Competition Agreement

I Exhibit F - Conditional Assignment of Telephone Numbers

; Exhibit G - Statement of Prospective Franchisee

'. exhibit 7 - Multi-Unit Option Agreement Exhibit 8 - Table of Contents of Operations Manual Exhibit 9 - Confidentiality Agreement Exhibit 10 - State Tanning Regulators Exhibit 11 - State Specific Addenda Exhibit 12 - Information Relating to Franchise Brokers Exhibit 13 - Information Relating to Area Representatives Exhibit 14 - Construction Loan Agreement Exhibit 15 -Receipt

Planet Beach Franchising Corporation A

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Iteml The Franchisor, Its Predecessors and Affiliates

To simplify the language in this Offering Circular "PBFC," "us" and "we" mean Planet Beach Franchising Corporation, the franchisor. The term "you" means the person who buys the franchise, or the franchisee. The person buying the franchise may be a natural person, partnership, corporation, or limited liability company. If the franchisee is a partnership, corporation, or limited liability company the term "you" does not include the entity's partners, officers, directors, shareholders, members or managers unless otherwise stated.

The Franchisor. Its Predecessors and Affiliates

We were formed on September 26, 1996, as a Louisiana corporation, and do business under our corporate name and as Planet Beach Tanning Salons. Our principal business address is 5161 Taravella Road, Marrero, Louisiana 70072. Our agents for service of process are identified in Exhibit 2 of this offering circular.

We have been offering franchises of the type being offered in this offering circular since April 1996. We have never offered franchises in any other line of business.

We have been offering Area Representative development rights since January 1997. Area Representatives operate at least one spa and sell additional spas to others in their territories. Area Representative rights are offered through a separate registration as well as a separate Uniform Franchise Offering Circular.

Our affiliate, Planet Beach Real Estate, LLC ("PBRE") was formed on February 1, 2002 as a Louisiana limited liability company, with a principal place of business of 5161 Taravella Road, Marrero, Louisiana 70072. PBRE has never offered franchises in this or any other line of business nor has it ever operated a business of the type being franchised in this offering circular.

Our affiliate, Planet Beach Tanning Salons, Inc. was formed on April 1, 1996 as a Louisiana corporation. Its principal place of business is located at 5300 Tchoupitoulas Street, #F-7, New Orleans, Louisiana 70115. Planet Beach Tanning Salons, Inc. has never offered franchises in this or any other line of business nor has it ever operated a business of the type being offered in this offering circular. PBTS owns all of the Marks and has licensed the Marks to us and has given us the right to sublicense the Marks to our franchisees.

Our affiliate, Planet Beach Franchising, LLC ("PBF") was formed on August 20, 1998 as a Louisiana limited liability company. PBF is no longer engaged in business in any capacity. From August 1998 until June 1999, PBF sold 13 franchises of the type being offered in this offering circular. PBFC has assumed the obligations of PBF under the outstanding franchise agreements, and all renewals will be through PBFC.

Other than as set forth above we have no other predecessors or affiliates.

The Franchised Business

We grant franchises to qualified individuals for the right to operate a tanning Spa with a minimum of 7 pieces of equipment, a lesser amount of equipment may be approved at PBFC's sole discretion (the "Franchised Business" or "Spa"). You will operate the Franchised Business from an approved location ("Approved Location") using our proprietary business format (the "System") and the trade name "Planet

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Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Beach" and such other trademarks, service marks, logos and other indicia of origin (our "Proprietary Marks") as we may designate for use in connection with the Franchised Business. You will operate the Franchised Business according to the form of franchise agreement ("Franchise Agreement") included in this joffering circular as Exhibit 6, and our confidential operations manual (''Operations Manual"), described in Item 11 of this offering circular.

i Market Competition

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As a\ System franchisee, you will be offering and selling tanning and spa services and products. The

general market for the type of business that we are marketing is well developed!and competitive. The

Franchised Business will compete with other local, regional and national tanning sdons, spas, department

and retail stores for which the market is well developed and highly competitive.: We plan to continue

controlled expansion to improve name recognition and the reputation of the system.'

i Industry Specific Regulations

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Tanning Spas are regulated in certain states and counties and regulations are constantly being updated and revised. We urge you to research your state and county laws regulating the tanning industry. State regulators are identified in Exhibit 10 of this offering circular. You will also haw to comply with state and local laws and regulations applicable to health and safety. Further, the Franchised Business will be

subject to all laws and regulations that apply to businesses generally.

j Item 2

! Business Experience

President and Chief Executive Officer: Stephen P. Smith. CFE

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Mr. Smith is one of our founders. Since April 1996, Mr. Smith has served as President and CEO of

PBFCi Mr. Smith is a franchisee of one Planet Beach Spa in New Orleans.

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Senior Vice-President, Franchise Sales: Nancy M. Price, CFE

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Since April 1996, she has served as our Vice President of Franchise Sales. Ms. Pricejs a franchisee of one

PlanefBeach Spa in Marrero, Louisiana.

Senior Vice-President, Chief Operations Officer: Richard L. Juka. CFE

Since July 1996, Mr. Juka has served as our Vice President and Chief Operating Officer.

] Vice-President. Franchise Sales: David Mesa. Jr.. CFE

i Mr. Mesa was the Director of Business Operations for Allegis Group from February 1.995 until November 2003. He joined PBFC in December 2003.

Vice-President. Franchise Relations: Kathleen Moll. CFE

Ms. Moll began her career with Planet Beach while attending Tulane University in New Orleans as a salon associate in the fall of 1996. Upon graduating from Tulane she became the General Manager of the Planet Beach tanning salon in Marrero, LA in September of 1999. In March of 2000 she began working for PBFC and in February of 2003 she was promoted to the executive position she now holds.

Planet Beach Franchising Corporation f.

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Chief Information Officer: Toby R. Kendall

Mr. Kendall was the Director of Product Development for Interactive Design, Inc. in Atlanta, GA from July 1995 to September 1998. From September of 1998 until the present Mr. Kendall has been the Chief Information Officer for Planet Beach Franchising Corporation.

Director of Education & Executive Development: Kim H. Dowell, CFE

Ms, Dowell began working with Planet Beach in March 1998 as a Salon Manager, continuing on as a District Manager and Grand Opening Specialist. From February 2001 through January 2002, she worked as a Franchise Sales Representative for PBFC, and then resumed the position of Equipment & Lamp Specialist, which she held through December 2003. Ms. Dowell was the Director of Education & Research in 2004, Franchise Performance Director in 2005 and currently oversees the Education and Executive Development Departments for PBFC.

Director of Leasing: Chad Calongne

Mr. Calongne was employed by Property One, Inc. where he concentrated on leasing office and retail space for landlords from February 2000 to October 2001. From October 2001 until November 2002, Mr. Calongne was Director of Leasing and Property Management for Orthodontic Centers of America, Inc. There he focused on working with affiliated orthodontist and pediatric dentist to strategically locate their practices and maximize revenue. From November 2002 until October 2004, Mr. Calongne was hired by Sizeler Real Estate Management Company, Inc., subsidiary of Sizeler Property Investors, Inc., to lease two regional malls and seven strip centers consisting of over 1.5 million square feet of retail space. From October 2004 until August 2005, Mr. Calongne worked as Director of Leasing and Property Management for Orthodontic Centers of America, Inc. In August of 2005, Mr. Calongne became Planet Beach Franchising Corporation's Director of Leasing.

Franchise Finance Coordinator: Tracev S. Rogers

Prior to joining the PBFC family in June 2005 as Franchise Finance Coordinator, Ms. Rogers served as an Accounting/Finance Consultant for the Offshore Marine Service Association (OMSA), from September 2003 to August 2004. In addition, Ms Rogers served as the Finance Consultant for the retired President of OMSA for his personal business, Alario and Associates, LLC from September 2003 to May 2005. From August 1997 to January 2001, she worked as Senior Accountant for the Citizens Utilities Company, formerly known as Louisiana Gas Company. Ms. Rogers received her Bachelors of Science degree in Accounting from the University of New Orleans in May 1997. She also received her Masters of Business Administration (MBA) with a concentration in Human Resources from the University of New Orleans in May 2003.

Director of Product Sales and Development: Jo Marie Evans, CFE

Ms. Jo Marie Evans was employed by the New Orleans Metropolitan Convention and Visitors Bureau in membership sales until October 2000. She worked as a product sales representative with Planet Beach Franchising Corporation from October 2000 through December 2001. From December 2001 through the present Ms. Evans has held the position of Director of Product Sales and Development.

Marketing Manager. April Grandbouche

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Mrs. Grandbouche began her marketing career while attending Louisiana State University in Baton Rouge, Louisiana with Red Bull Energy Drink from 1999-2001. Upon graduating from Louisiana State University, she joined Simon Property Group, Inc. where she worked in a branch office marketing department from 2001-2003. Two years later, she became employed by Progressive Home Health Care and worked in marketing and sales from 2003-2004. Mrs. Grandbouche has served in the Planet Beach Marketing Department since April of 2004. She was hired as the Planet Beach Marketing Coordinator. In August of 2004 she was promoted to the executive position she holds now, Marketing Manager. i

Director of In House Franchise Performance: Jessica Matherne

Ms. Matherne started at Planet Beach Marrero, LA in 1998 as an associate and was promoted to assistant manager in October of 2000 and in December of 2001 she was again promoted to manager. In August 2002, ishe became the Grand Opening Specialist Director for PBFC. In April of 2004, Ms. Matherne became Director of In House Salon Performance. In September of 2004 Salon Performance was combined with the Education Department and the department was renamed to Franchise Performance and her title changed to Director of In House Franchise Performance.

We also employ independent franchise brokers ("Franchise Brokers"). Information about these Franchise

Brokers is attached to this offering circular as Exhibit 12.

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In certain regions, we have granted area development rights to qualified j individuals ("Area Representatives"). Area Representatives are often engaged in the sales process and are contractually required to perform certain support services to our franchisees. Information about these Area Representatives is attached to this offering circular as Exhibit 13.

1 Item 3

i Litigation

Seller and Associates. L.L.C. and Michelle Seiler, individually and d/b/a Planet Beach West Esplanade v. Stephen P. Smith. Nancy Price, Richard L. Juka. Planet Beach Franchising Corporation. Planet Beach Franchising. L.L.C. and Solarware, L.L.C, (No. 2002-649, Civil District Court for tl.e Parish of Orleans, State of Louisiana, Division "K"). In March 2001, PBFC discovered that Ms. jSeiler breached her fiduciary duty to PBFC as an Area Developer. PBFC terminated her as an Area Developer and sued for a temporary restraining order barring her from contact with PBFC and PBFC franchisees. In the fall of 2001, Ms. Seiler filed a counter suit claiming PBFC breached its contractual duties pursuant to the Area Development Agreement. PBFC holds claims for actual damages in excess of $150,000 for refunds that were made to franchisees that claimed Ms. Seiler made claims of misrepresentation. Ms. Seiler did not specify an amount of damages. This case is pending and the parties are currently engaging in discovery.

Stephen P. Smith and Planet Beach Franchising Corporation v. Kelly Langlev. Sun Mask Tanning. L.L.C. and Mandeville Tan, L.L.C. (No. 2002-10581, 22nd Judicial District Court foi the Parish of St. Tammany, State of Louisiana, Division "A"). Mr. Smith is 49% owner of the Mandeville tanning salon and Ms. Langley is the 51% owner. In the summer of 2001, Mr. Smith filed suit because of Ms. Langley's refusal to make any lease payments to PBFC for tanning equipment andlfor recovery of his 49% interest in the equity and profits of the salon. On September 24, 2002, Ms. Langley then filed a counter suit claiming 100% ownership. Unspecified amount of damages to be determined at trial. This case is pending and the parties are currently engaging in discovery.

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Bryce arid Neda Burk v. Planet Beach Franchising Corporation. (No. 017-190429-01, 17th District Court, Tarrant County, Texas). In the fall of 2001, Mr. and Mrs. Burk filed a breach of contract suit to recover a

Planet Beach Franchising Corporation O

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

$15,000 franchise fee paid for the right to open and operate a second Salon. Plaintiffs won summary judgment in the amount of $15,000 plus attorneys' fees, costs and interest. PBFC appealed this judgment and the Burks, on behalf of their corporation, Nani Kai, Inc., filed a subsequent suit alleging business disparagement, deceptive trade practices and civil conspiracy (Nani Kai, Inc. v. Planet Beach Franchising Corporation and Don Campbell, No. 048-196553-02, 48^th District Court, Tarrant County, Texas). PBFC filed an answer denying all allegations. The parties have settled all claims out of court. In May of 2003 PBFC paid to the Burks an amount of $12,000 and agreed that for a period of two years from December 23, 2002 not to open or operate or permit a PBFC franchisee to open or operate a tanning salon at any location within a three mile radius from the Burk's tanning salon.

Melissa Smith. Burnell Smith and Vita Amoure. L.L.C. v. Planet Beach Franchising Corporation. (No. 366-02108-01, 366th District Court, Collin County, Texas). In October 2001, plaintiffs filed suit to recover a $5,000 territory deposit fee paid for the right to open and operate a Salon. On April 1, 2001, PBFC defaulted and judgment was entered in favor of the plaintiffs in the amount of $16,879. In November of 2002, PBFC paid the judgment in full and an Order Granting NonSuit was filed. In January of 2003 a Release of Judgment was signed by Burnell Smith, Melissa Smith and Vita Amore acknowledging payment of the default judgment.

James R. Barnhill and Lara Barnhill v. Planet Beach Franchising Corporation (No. 04 CVS 011235, Superior Court Division in Wake County, State of North Carolina). On August 12, 2004, our franchisees, Mr. and Mrs. Barnhill filed an action in which they alleged breach of contract and specific performance arising from a purported award by PBFC of an Area Representative Agreement to the Barnhills. On November 24,2004, Mr. and Mrs. Barnhill dismissed the action without prejudice. Thereafter, on or about December 7 of 2004, the parties reached an amicable resolution in which PBFC awarded Mr. and Mrs. Barnhill an Area Representative Agreement and granted them an option to acquire an additional franchise at a discounted price.

Jeffrey A. Brewer, individually, Bert R. Struck, individually, Robert F. Struck, individually and Sun King, L.L.C. v. Planet Beach Franchising Corporation and Planet Beach Tanning Salon Inc., Stephen P. Smith and Ronald Simmons (No.CV0406488, Circuit Court of Jefferson County, State of Alabama). On October 28, 2004, our franchisees, Mr. Jeffrey R. Brewer, Mr. Bert R. Struck and Mr. Robert F. Struck filed an action in which they alleged that PBFC purposely excluded information from PBFC's UFOC to induce the franchisees to purchase a franchise. They further alleged that PBFC omitted corporate financial information and that PBFC purposefully omitted information relating to a "National Advertising" fee. On December 16, 2004, PBFC filed a demand for arbitration. On December 16, 2004, PBFC filed a Motion to Stay Proceedings, Compel Arbitration or Dismiss. On January 21, 2005, the Circuit Court of Jefferson County compelled this matter to arbitration and stayed the state action pending the outcome of the arbitration. Thereafter, the plaintiffs filed a demand for arbitration asserting a claim for breach of contract. On or about January 17 of 2006, the parties reached an amicable resolution in which PBFC purchased the assets and rights to Claimant's franchise location. On January 27, 2006 the state action was dismissed with prejudice in the Circuit Court of Jefferson County, Alabama.

Corporate Development Outsourcing L.L.C. v. Planet Beach Franchising Corporation (AAA No. 51 110 00110 05). On January 19, 2005, Corporate Development Outsourcing, L.L.C. ("CDO"), a project management firm, filed an arbitration with the American Arbitration Association against PBFC alleging that PBFC breached a Construction Management Agreement between the parties. PBFC filed a counterclaim on February 16, 2005 asserting that CDO breached the Construction Management Agreement. On August 23, 2005, the Arbitrator, with the American Arbitration Association, found that the contract could be construed according to its terms without finding a breach by either party and awarded CDO $18,400.00. The Arbitrator found that neither party was the "prevailing party" under the agreement.

Planet Beach Franchising Corporation Q

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

David Osgood and OZTX Enterprises. Inc. v. Planet Beach Franchising Corporation and Planet Beach Real Estate, L.L.C. (AAA No. 69 114 00180 05). On June 9, 2005, Mr. Osgood land OZTX Enterprises, Inc.,; a franchisee, filed arbitration with the American Arbitration Association against PBFC and Planet Beach Real Estate, L.L.C. (PBRE) alleging that PBFCand PBRE breached the franchise agreement between the parties and fraudulently induced Osgood to sign a sublease. PBFC and PBRE filed¹ an answer on July 5, 2005 asserting that Osgood's claims are without merit. .Osgood seeks damages as alresult of the alleged breach and fraudulent inducement in the amount of $237,500. This matter is presently scheduled for arbitration. On March 10, 2006, David Osgood filed bankruptcy under Chapter 13 of the United States Bankruptcy Code. On March 17, 2006, OZTX Enterprises^, Inc. filed bankruptcy under Chapter 11 of the United States Bankruptcy Code. Pursuant to the U.S. Bankruptcy Code, the case

is stayed pending resolution of plaintiffs bankruptcy.

Other than these 8 actions, no litigation is required to be disclosed in this offering circular. Information relating to Franchise Brokers and Area Representatives are attached as Exhibits 13 and 14 respectively.

' Item 4

Bankruptcy

No person previously identified in Items 1 or 2 has been involved as a debtor in proceedings under the U.S. Bankruptcy Code required to be disclosed in this Item. !

Information relating to Franchise Brokers and Area Representatives are attached as Exhibits 13 and 14

respectively. ^!

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¹ Item 5

I Initial Franchise Fee

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Single Unit Franchise Fee

Franchisees pay a lump sum initial franchise fee when they sign the franchise agreement. The initial franchise fee for a Traditional Planet Beach with a minimum of 7 pieces of equipment is $30,000. The initial:franchise fee for an Express Planet Beach with 5 to 6 pieces of equipment is $30,000. PBFC reserves the right to alter these prices as the market warrants at any time. This fee is deemed fully earned upon receipt and is non-refundable.

In honor of Planet Beach's 10 Year Anniversary, Franchisees may pay a lump sum] initial franchisee fee of $30!,000 for a Traditional or Express Planet Beach and get an option for $1,000. | Franchisees may be awarded 1 franchise license and 2 options for $51,000 and receive up to two more options for $1,000 each. Franchisees must have scheduled an appointment no later than May 11, 2006.

i Multi-Unit Option Agreement Fee

franchisees who sign a Multi-Unit Option Agreement will pay the following: for 3 Spas, they will pay the franchise fee of $30,000 for 1 Spas and at the same time, pay an option fee of $21,'000 for 2 additional Spas; for 5 Spas, they will pay the franchise fee of $30,000 for 1 Spas and at the samo time, pay an option fee of $35,000 for 4 additional Spas; and for 10 Spas, they will pay the franchise fee of $30,000 and at the same time, pay an option fee of $70,000 for 9 additional Spas. These fees are deemed fully earned upon receipt and are non-refundable.

Planet Beach Franchising Corporation j q

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Effective August 1, 2006 Franchisees who sign a Multi-Unit Option Agreement will pay the following: for 3 Spas, they will pay the franchise fee of $30,000 for 1 Spa and at the same time, pay an option fee of $29,000 for 2 additional Spas; for 5 Spas, they will pay the franchise fee of $30,000 for 1 Spa and the same time, pay an option fee of $43,000 for 4 additional Spas.

VetFran Program

PBFC participates in the VetFran Program and qualified franchisees may receive a discount in the initial franchise fee.

Area Representative Agreement

PBFC may offer Area Representative Agreements to accelerate the development of certain markets. The Representative Agreement may vary from market to market, depending on the population of the market and the number of salons that may be opened in a market. In some markets, the Area Representative will provide some or all of the services to be provided to you by PBFC. Information regarding our Area Representatives is attached as Exhibit 13 to this offering circular. An offer for an Area Representative Agreement can only be made by way of a separate UFOC.

Item 6 Other Fees (3)

The following table describes other recurring or isolated fees or payments that you must pay to us, or which we impose or collect on behalf of a third party, in whole or in part. All fees and payments are nonrefundable unless otherwise stated.

TYPE OF FEE	AMOUNT	WHEN DUE	REMARKS
Transfer (1)	35% of current franchise fee	On closing of transfer.	There is no transfer fee when an individual transfers to his/her corporation or L.L.C. Franchisee's may transfer only to existing Planet Beach Franchisees.
Education & Training Fees (1)	$69.95 per month per location	5 th of every month following lease execution	Payment will be made through the Autodraft System.
Royalty Fees (1) (2)	6% of Gross Sales	5^th of every month for the preceding month	Payment will be made through the Autodraft System.
Information Technology Fees (1)	$49.95 per month	5^th of every month for the preceding month	Payment will be made through the Autodraft System.
National Marketing Fees U)(2)	1 % of Gross Sales never to exceed 2% of Gross Sales	5^th of every month for the preceding month
Credit Card Processing Fees(1)	3%	5^lfl of every month for the preceding month	For any payments made by you to us or any purchases made by you from PBFC.

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

TYPE OF FEE	AMOUNT	WHEN DUE	(; REMARKS
Late Payment Fee (1) i	$100 per week	Whenever any of the above fees are late	Interest' is also charged on any overdue amounts at 18% per annum or the maximum rate permitted by state law, whichever is less.
NSFFee(l)	$100		i
Audit Fees (1) 1	Cost of audit plus interest on underpayment at 18% per annum or the maximum rate permitted by state law, whichever is less	When audit shows an understatement of 2% or more
Daily Production and Monthly Spa Financial Report Late Fees (1) l i	Upto $300	When PBFC does not receive DPR by the 3^rdof the month for the preceding month
Indemnification i 1 i l l	Amount of judgment or claim	When incurred	You must defend, indemnify and hold us harmless from all fines, suits, proceedings, claims, demands,¹ obligations or actions of any kind arising in whole or in part from the operation of your Franchised Business.
Annual Convention i Registration Fee i	$200 per person	When incurred	This fee does not include travel and lodging, only convention registration.
Annua) Convention i j i	$800-$2,000	When incurred	This includes cost of travel and lodging. It does not take into account r.iiscellaneous expenses such as food and entertainment. Prices may vary depending on where you are traveling from.

Notes:

Note 1: All fees are imposed by and are payable to PBFC. All fees are non-refundable. PBF,C is charged a credit card processing fee by various credit card companies. PBFC will charge you the credit card processing fee that it is required to pay to the credit card company when you make purchases from PBFC.

Note 2:j "Gross Sales" is defined as all revenues from sales including the sale of tanning sessions, prepaid tanning packages, memberships and any goods and services. PBFC refers to this as the sum of "Cash," "Net EFT" and

"Retail.V Gross Sales does not include sales tax imposed by any federal, state or governmental authority.

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Note 3:! Franchisor-owned outlets have no voting power on any fees imposed by franchisee cooperatives.

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Item 7 Initial Investment (1) (19)

DESCRIPTION	ESTIMATED AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	TO WHOM PAYMENT IS TO BE MADE
Initial Franchise Fee(2)	$30,000	Lump Sum	On signing	PBFC
Architectural Fee (3)	$2,500 to $8,000	As arranged	As arranged	Approved Architect
Planet Beach Tanning/Spa Equipment (4)	$68,168 to $182,191	Lump sum	As arranged	PBFC
Leasehold Improvements (5)	$15,000 to $120,000	As arranged	As arranged	General Contractor
Owner Furnished Items (6)	$45,800 to $70,000	As arranged	As arranged	Approved Vendors
Utility, phone and lease deposits (7)	$2,000 to $7,500	As arranged	As arranged	Landlord and Local providers
Insurance initial payment (8)	$600 to $1500	As arranged	As arranged	Insurance Provider
Computer and Software (9)	$3,500 to $4,200	Lump sum	Upon ordering	PBFC and Approved Vendor
Shipping and Handling of Equipment (10)	$3,695 to $8,045	As arranged	As arranged	PBFC
Equipment Set-up (11)	$2,100 to $5,650	As arranged	As arranged	PBFC
Timer System (12)	$1,250 to $1,650	As arranged	' As arranged	PBFC
Furniture	$1,450 to $4,400	As arranged	As arranged	Approved Vendor
Posters/Frames	$40 to $100	As arranged	As arranged	Approved Vendor
Banners	$200 to $400	As arranged	As arranged	Approved Vendor
Printing (13)	$1,000 to $1,500	As arranged	As arranged	Approved Vendor
Grand Opening Advertising (14)	$3,000	As arranged	As arranged	Various
Phone and Fax	$200 to $400	As arranged	As arranged	Local Provider
Office Supplies	$400 to $600	As arranged	As arranged	Local Provider
Wholesale Goods (15)	$2,900 to $4,700	Lump sum	Upon ordering	Approved vendor
Washer and Dryer (16)	$0 to $1,700	As arranged	As arranged	Local Provider

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

1 DESCRIPTION i	ESTIMATED AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	i i TO i WHOM PAYMENT is ■ TO BE ! MADE I
Permits, licenses and miscellaneous	$1,000 to $3,500	As arranged	As arranged	Various i !
Working Capital as);	$10,000 to $50,000	As arranged	As arranged	N/A
Totals (19) i	$194,803 to $509,036
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Notes:

Note 1. Estimates are based on a single unit, both Traditional and Express Spas. Traditional Spas feature 7-12 pieces of equipment. Express Spas feature 5-6 pieces of equipment.

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Note 2\ The initial franchise fee and certain expenses are discussed in detail in Item 5. This ;ee is non-refundable.

Note 3. The low estimate is for drawings prepared by PBFC only. The architectural fee jwill vary depending on your state and local municipality requirements. PBFC drawings consist of existing and proposed floor plans, reflected ceiling plans, fixture schedules and wall details. Any additional stamps or upgrades to the drawings that

the city or county requires will be the responsibility of the franchisee.

Note 4^ The low end represents a basic 5 unit mix for an Express Spa, including 1 Mystic Tan spray booth and 1 Spa unit. The high end represents a 12 unit mix, which includes 1 Mystic Tan spray booth, I Elite lay-down bed, 1 Elite stand-up bed and 2 Spa units. This estimated range does not include T-Max Timer system or wiring. All Express Spas are required to have a minimum of 1 Mystic Tan spray booth and 1 Spa unit. All Traditional Spas are required to have a minimum of 1 Mystic Tan spray booth, 2 Spa units (1 of each type of Plan 3t Beach approved Spa equipment). This does not include costs for set-up, shipping, handling and tax. This amount may vary depending on

unit mix and amount of equipment. You are responsible for any taxes due to your state.

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Note 5. The low estimate is based on an Express Spa with an estimated 600 to 800 square foot space with landlord participation and no demolition. This estimated range will vary depending on the location, necessary leasehold improvements and landlord participation.

i Note 6.1 Owner Furnished Items (OFIs) consist of interior modular wall and door system);, millwork (including retail fixtures, various shelving and counter), interior signage, exterior signage, flooring and lij'jht fixtures.

Note 7.. Some landlords may require a deposit of first and last month's rent. Deposits on utilities will also vary. Deposits will vary based on the market rental rates for your market.

Note 8.: You will need to obtain Commercial General Liability ($1 Million Minimum ■ Coverage) insurance, Worker's Compensation, Business Interruption insurance, Life insurance (equal to the amount borrowed) and Construction Coverage insurance.

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Note 9. ] This figure includes the costs for the monitor, keyboard, cash drawer, credit card machine, receipt printer, printer and the installation of PBFC's software and credit card software.

Note 10. Shipping is based on several factors, including weight of shipment and destination.

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Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Note 11. Set-up of equipment includes the crew meeting the delivery truck at your location, offloading and carrying equipment into your Spa and assembling the equipment. This price is based on the type of tanning and spa equipment.

Note 12. Timer System includes T-Max Manager, Communication Cables, RJ22 Couplers and UV Meter and price is based on the specific layout of your Spa.

Note 13. Printing includes Guest Passes, Lead Boxes, Sign-up slips, Membership contracts, Freeze Forms, Termination Forms, Boutique Bags, Business Cards, Postcards, Gift Cards, Gift Card Deluxe Package (Thank You Cards, PB Envelopes, Gift Cards, PB Gold Seals), and Tattoos.

Note 14. You are required to spend this amount on grand opening advertising. You may spend additional amounts with PBFC approval.

Note 15. You will be required to purchase a specified amount based on the size of your Spa for the initial inventory of products to be offered for sale. A selection of PBFC's proprietary lotion and national brand products must be stocked.

Note 16. Zero dollars as a "Low" because not all Spas can accommodate a utility room due to size or layout restrictions. Therefore, the washer and dryer are optional.

Note 17. This figure includes inspection fees, occupational licenses, and the costs for transportation, meals and other expenses associated with pre-opening training.

Note 18. PBFC suggests that your working capital be approximately 3 to 6 months worth of expenses. This figure may vary depending on the season in which your Spa opens. This 3 to 6 month period does not necessarily mean that you will "break even" or that you will reach any certain financial position. This figure may also change as required by a lender.

Note 19. PBFC relied on its 10 years experience in the tanning business to compile these estimates. You should review these figures carefully with a business advisor before making any decision to purchase the franchise.

Note 20. PBFC does offer indirect financing to franchisees for some of these items.

Item 7 Initial Investment for a 3 pack Multi Unit Option (1)(19)

DESCRIPTION

ESTIMATED

AMOUNT

LOW-HIGH

RANGE

METHOD

OF PAYMENT

WHEN DUE

WHOM

PAYMENT

TO BE

MADE

Multi-Unit Option Fee (2)

$10,500 After

August 1,2006

increases to

$14,500

Lump Sum

On signing

PBFC

Architectural Fee (3)

$2,500 to $8,000

As arranged

Approved Architect

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

1 1 } DESCRIPTION 1 i i	ESTIMATED AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	la , TO \|' whom; PAYMENT IS to be; MADE*
Planet Beach Tanning/Spa Equipment (4)	$68, 168 to $182,191	Lump sum	As arranged	PBFC
Leasehold Improvements (5)	$15,000 to $120,000	As arranged	As arranged	General j Contractor
Owner Furnished Items (6)	$45,800 to $70,000	As arranged	As arranged	Approved \| Vendors
Utility, phone and lease, deposits (7)	$2,000 to $7,500	As arranged	As arranged	Landlord and Local providers
Insurance initial payment (8)	$600 to $1500	As arranged	As arranged	Insurance Provider !
Computer and Software (9)	$3,500 to $4,200	Lump sum	Upon ordering	PBFC and, Approved ! Vendor
Shipping and Handling of Equipment (10)	$3,695 to $8,045	As arranged	As arranged	PBFC
Equipment Set-up (id :	$2,100 to $5,650	As arranged	As arranged	PBFC ;
Timer System (12)	$1,250 to $1,650	As arranged	As arranged	PBFC ^;
Furniture	$1,450 to $4,400	As arranged	As arranged	Approved Vendor ^;
j Posters/Frames	$40 to $100	As arranged	As arranged	Approved , Vendor ■
Banners	$200 to $400	As arranged	As arranged	Approved Vendor
Printing (13) i '	$1,000 to $1,500	As arranged	As arranged	Approved Vendor
Grand Opening Advertising (14)	$3,000	As arranged	As arranged	Various
! Phone and Fax	$200 to $400	As arranged	As arranged	Local Providei
Office Supplies	$400 to $600	As arranged	As arranged	Local Provider
Wholesale Goods 05) ;	$2,900 to $4,700	Lump sum	Upon ordering	Approved \ vendor
Washer and Dryer (16) !	$0 to $1,700	As arranged	As arranged	Local Provider i
Permits, licenses and miscellaneous d7) ;	$1,000 to $3,500	As arranged	As arranged	Various
Working Capital (18) !	$10,000 to _L $50,000	As arranged	As arranged	N/A '
Totals (19) 1	$545,409 to $1,488,108 After August 1,2006 increases to $553,409 to $1,496,108

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Notes:

Note 1. Estimates are based on a single unit, both Traditional and Express Spas. Traditional Spas feature 7-12 pieces of equipment. Express Spas feature 5-6 pieces of equipment. This Initial Investment range will be the same for your 2^nd Spa and 3^rd Spa.

Note 2. The multi unit option fee and certain expenses are discussed in detail in Item 5. This fee is non-refundable. This option fee will be the same for the 2^nd Spa and the 3^rd Spa. After August 1, 2006, the Multi-Unit Option fee will increase to $29,000 for two (2) additional spas.

Note 3. The low estimate is for drawings prepared by PBFC only. The architectural fee will vary depending on your state and local municipality requirements. PBFC drawings consist of existing and proposed floor plans, reflected ceiling plans, fixture schedules and wall details. Any additional stamps or upgrades to the drawings that the city or county requires will be the responsibility of the franchisee.

Note 4. The low end represents a basic 5 unit mix for an Express Spa, including 1 Mystic Tan spray booth and 1 Spa unit. The high end represents a 12 unit mix, which includes 1 Mystic Tan spray booth, 1 Elite lay-down bed, 1 Elite stand-up bed and 2 Spa units. This estimated range does not include T-Max Timer system or wiring. All Express Spas are required to have a minimum of 1 Mystic Tan spray booth and 1 Spa unit. All Traditional Spas are required to have a minimum of 1 Mystic Tan spray booth, 2 Spa units (1 of each type of Planet Beach approved Spa equipment). This does not include costs for set-up, shipping, handling and tax. This amount may vary depending on unit mix and amount of equipment. You are responsible for any taxes due to your state.

Note 6. Owner Furnished Items (OFIs) consist of interior modular wall and door systems, millwork (including retail fixtures, various shelving and counter), interior signage, exterior signage, flooring and light fixtures.

Note 7. Some landlords may require a deposit of first and last month's rent. Deposits on utilities will also vary. Deposits will vary based on the market rental rates for your market.

Note 8. You will need to obtain Commercial General Liability ($1 Million Minimum Coverage) insurance, Worker's Compensation, Business Interruption insurance, Life insurance (equal to the amount borrowed) and Construction Coverage insurance.

Note 9. This figure includes the costs for the monitor, keyboard, cash drawer, credit card machine, receipt printer, printer and the installation of PBFCs software and credit card software.

Note 10. Shipping is based on several factors, including weight of shipment and destination.

Note 11. Set-up of equipment includes the crew meeting the delivery truck at your location, offloading and carrying equipment into your Spa and assembling the equipment. This price is based on the type of tanning and spa equipment.

Note 12. Timer System includes T-Max Manager, Communication Cables, RJ22 Couplers and UV Meter and price is based on the specific layout of your Spa.

Note 13. Printing includes Guest Passes, Lead Boxes, Sign-up slips, Membership contracts, Freeze Forms, Termination Forms, Boutique Bags, Business Cards, Postcards, Gift Cards, Gift Card Deluxe Package (Thank You Cards, PB Envelopes, Gift Cards, PB Gold Seals), and Tattoos.

Note 14. You are required to spend this amount on grand opening advertising. You may spend additional amounts

Planet Beach Franchising Corporation i 7

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

with PBFC approval.

Note 15. You will be required to purchase a specified amount based on the size of your Spji for the initial inventory of products to be offered for sale. A selection of PBFC's proprietary lotion and national brand products must be stocked.

Note 16. Zero dollars as a "Low" because not all Spas can accommodate a utility room due to size or layout restrictions. Therefore, the washer and dryer are optional. ,

Note 17. This figure includes inspection fees, occupational licenses, and the costs for transportation, meals and other expenses associated with pre-opening training.

' i

Note 20. PBFC does offer indirect financing to franchisees for some of these items.

	Item 7 Initial Investment for a 5 pack Multi Unit Option (1)(19,) i
i DESCRIPTION	ESTIMATED ! AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	TO WHOM PAYMENT IS TO BE MADE	! . i
Multi-Unit Option Fee (2) i 1	$8,750 After August 1,2006 increases to $10,750	Lump Sum	On signing	PBFC	■
Architectural Fee (3) !	$2,500 to $8,000	As arranged	As arranged	Approved Architect
Planet Beach Tanning/Spa Equipment (4)	$68,168 to $182,191	Lump sum	As arranged	PBFC
Leasehold Improvements (5)	$15,000 to $120,000	As arranged	As arranged	General Contractor
Owner Furnished Items (6)	$45,800 to $70,000	As arranged	As arranged	Approved Vendors ,
Utility,¹ phone and lease deposits (7)	$2,000 to $7,500	As arranged	As arranged	Landlord and ' Local providers
Insurance initial payment (8)	$600 to $1500	As arranged	As arranged	Insurance Provider i
Computer and Software (9)	$3,500 to $4,200	Lump sum	Upon ordering	PBFC and Approved Vendor i

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

i I

DESCRIPTION	ESTIMATED AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	TO WHOM PAYMENT IS TO BE MADE
Shipping and Handling of Equipment (10)	$3,695 to $8,045	As arranged	As arranged	PBFC
Equipment Set-up 01)	$2,100 to $5,650	As arranged	As arranged	PBFC
Timer System (12)	$1,250 to $1,650	As arranged	As arranged	PBFC
Furniture	$1,450 to $4,400	As arranged	As arranged	Approved Vendor
Posters/Frames	$40 to $100	As arranged	As arranged	Approved Vendor
Banners	$200 to $400	As arranged	As arranged	Approved Vendor
Printing (13)	$1,000 to $1,500	As arranged	As arranged	Approved Vendor
Grand Opening Advertising (14)	$3,000	As arranged	As arranged	Various
Phone and Fax	$200 to $400	As arranged	As arranged	Local Provider
Office Supplies	$400 to $600	As arranged	As arranged	Local Provider
Wholesale Goods (15)	$2,900 to 54,700	Lump sum	Upon ordering	Approved vendor
Washer and Dryer (16)	$0 to $1,700	As arranged	As arranged	Local Provider
Permits, licenses and miscellaneous (17)	$1,000 to $3,500	As arranged	As arranged	Various
Working Capital (18)	$10,000 to $50,000	As arranged	As arranged	N/A
Totals (19)	$889,015 to $2,460,180 After August 1,2006 increases to $897,015 to $2,468,180

Notes:

Note 1. Estimates are based on a single unit, both Traditional and Express Spas. Traditional Spas feature 7-12 pieces of equipment. Express Spas feature 5 - 6 pieces of equipment. This Initial Investment range will be the same for your 2^nd Spa, 3^rd Spa, 4^,h Spa and 5^,h Spa.

Note 2. The multi unit option fee and certain expenses are discussed in detail in Item 5. This fee is non-refundable. This option fee will be the same for the 2^nd Spa, 3^rd Spa, 4^th Spa and 5^rd Spa. After August 1, 2006, the Multi-Unit Option fee will increase to $43,000 for four (4) additional spas.

Note 3. The low estimate is for drawings prepared by PBFC only. The architectural fee will vary depending on

Planet Beach Franchising Corporation i n

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

your i state and local municipality requirements. PBFC drawings consist of existing and proposed floor plans, reflected ceiling plans, fixture schedules and wall details. Any additional stamps or upgiades to the drawings that the city or county requires will be the responsibility of the franchisee.

Note;4. The low end represents a basic 5 unit mix for an Express Spa, including 1 Mystic Tan spray booth and 1 Spa unit. The high end represents a 12 unit mix, which includes 1 Mystic Tan spray booth, 1 Elite lay-down bed, 1 Elite ]stand-up bed and 2 Spa units. This estimated range does not include T-Max Timer system or wiring. All Express Spas are required to have a minimum of 1 Mystic Tan spray booth and I Spa unit. All Traditional Spas are required to have a minimum of 1 Mystic Tan spray booth, 2 Spa units (1 of each type of Planet Beach approved Spa equipment). This does not include costs for set-up, shipping, handling and tax. This amour'it may vary depending on unit mix and amount of equipment. You are responsible for any taxes due to your state.

I Note 6. Owner Furnished Items (OFls) consist of interior modular wall and door systems, mill work (including retail fixtures, various shelving and counter), interior signage, exterior signage, flooring and light fixtures.

Note 7. Some landlords may require a deposit of first and last month's rent. Deposits on utilities will also vary. Deposits will vary based on the market rental rates for your market.

i Note ?. This figure includes the costs for the monitor, keyboard, cash drawer, credit card machine, receipt printer,

printer!^ant*^tne installation of PBFC's software and credit card software. ^:

Note l|0. Shipping is based on several factors, including weight of shipment and destination.

Note 11. Set-up of equipment includes the crew meeting the delivery truck at your location, offloading and carrying equipment into your Spa and assembling the equipment. This price is based on the type of tanning and spa equipment.

Note 12. Timer System includes T-Max Manager, Communication Cables, RJ22 Couplers and UV Meter and price is based on the specific layout of your Spa.

I - \

Note 13. Printing includes Guest Passes, Lead Boxes, Sign-up slips, Membership contracts, Freeze Forms,

Termination Forms, Boutique Bags, Business Cards, Postcards, Gift Cards, Gift Card Deluxe Package (Thank You

Cards, PB Envelopes, Gift Cards, PB Gold Seals), and Tattoos.

Note 14. You are required to spend this amount on grand opening advertising. You may spend additional amounts

with PBFC approval.

I ^] ^!

I i

Note 15. You will be required to purchase a specified amount based on the size of your Spa ^or the initial inventory of products to be offered for sale. A selection of PBFC's proprietary lotion and national brand products must be stocked.

Note 16. Zero dollars as a "Low" because not all Spas can accommodate a utility room due to size or layout restrictions. Therefore, the washer and dryer are optional. ;

I i '

Note 17. This figure includes inspection fees, occupational licenses, and the costs for transportation, meals and

other expenses associated with pre-opening training. ,

Note 18. PBFC suggests that your working capital be approximately 3 to 6 months worth of expenses. This figure

P anet Beach Franchising Corporation 90 ^!

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

may vary depending on the season in which your Spa opens. This 3 to 6 month period does not necessarily mean that you will "break even" or that you will reach any certain financial position. This figure may also change as required by a lender.

Note 19. PBFC relied on its 10 years experience in the tanning business to compile these estimates. You should review these figures carefully with a business advisor before making any decision to purchase the franchise.

Note 20. PBFC does offer indirect financing to franchisees for some of these items.

Item 7 Initial Investment for a 10 pack Multi Unit Option (1)(19)

DESCRIPTION	ESTIMATED AMOUNT OR LOW-HIGH RANGE	METHOD OF PAYMENT	WHEN DUE	TO WHOM PAYMENT IS TO BE MADE
Multi-Unit Option Fee (2)	$7,777.77	Lump Sum	On signing	PBFC
Architectural Fee (3)	$2,500 to $8,000	As arranged	As arranged	Approved Architect
Planet Beach Tanning/Spa Equipment (4)	568,168 to $182,191	Lump sum	As arranged	PBFC
Leasehold Improvements (5)	$15,000 to $120,000	As arranged	As arranged	General Contractor
Owner Furnished Items (6)	$45,800 to $70,000	As arranged	As arranged	Approved Vendors
Utility, phone and lease deposits (7)	$2,000 to $7,500	As arranged	As arranged	Landlord and Local providers
Insurance initial payment (8)	$600 to $1500	As arranged	As arranged	Insurance Provider
Computer and Software (9)	$3,500 to $4,200	Lump sum	Upon ordering	PBFC and Approved Vendor
Shipping and Handling of Equipment (10)	$3,695 to $8,045	As arranged	As arranged	PBFC
Equipment Set-up (11)	$2,100 to $5,650	As arranged	As arranged	PBFC
Timer System (12)	$1,250 to $1,650	As arranged	As arranged	PBFC
Furniture	$1,450 to $4,400	As arranged	As arranged	Approved Vendor
Posters/Frames	$40 to $100	As arranged	As arranged	Approved Vendor
Banners	$200 to $400	As arranged	As arranged	Approved Vendor
Printing (13)	$1,000 to $1,500	As arranged	As arranged	Approved Vendor
Grand Opening Advertising (14)	$3,000	As arranged	As arranged	Various
Phone and Fax	$200 to $400	As arranged	As arranged	Local Provider
Office Supplies	$400 to $600	As arranged	As arranged	Local Provider
Wholesale Goods (15)	$2,900 to $4,700	Lump sum	Upon ordering	Approved vendor
Washer and Dryer (16)	$0 to $1,700	As arranged	As arranged	Local Provider

Planet Beach Franchising Corporation Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

	ESTIMATED	j
¹	AMOUNT			t
I 1	OR	METHOD		i	TO
	LOW-HIGH	OF	WIIEN		WHOM
] DESCRIPTION	RANGE	PAYMENT	DUE t h		PAYMENT IS TO BE MADE
Permits, licenses and miscellaneous (17)	$1,000 to $3,500	As arranged	As arranged		Various
Working Capital (18)	$10,000 to $50,000	As arranged	As arranged		N/A
Totals (19)	$1,748,029.90 to $4,890,035.99

Notes:

Note 1. Estimates are based on a single unit, both Traditional and Express Spas. Traditional Spas feature 7-12 pieces of equipment. Express Spas feature 5-6 pieces of equipment. This initial Investment range will be the same for your 2^ Spa, 3^rd Spa, 4^,h Spa, 5^Ih Spa, 6^,h Spa, 7^th Spa, 8^,h Spa, 9^th Spa and 10^th Spa.

Note 2. The multi unit option fee and certain expenses are discussed in detail in Item 5. This fee is non-refundable. This option fee will be the same for the 2^nd Spa, 3^rd Spa, 4^th Spa, 5^th Spa, 6^lh Spa, 7^th Spa, 8^th Spa, 9^th Spa and 10^,h

Spa. i

Note 3. The low estimate is for drawings prepared by PBFC only. The architectural fee! will vary depending on your state and local municipality requirements. PBFC drawings consist of existing anil proposed floor plans, reflected ceiling plans, fixture schedules and wall details. Any additional stamps or upgrades to the drawings that the city or county requires will be the responsibility of the franchisee.

Note 4. The low end represents a basic 5 unit mix for an Express Spa, including 1 Mystic Tan spray booth and 1 Spa unit. The high end represents a 12 unit mix, which includes 1 Mystic Tan spray booth,¹1 Elite lay-down bed, 1 Elite stand-up bed and 2 Spa units. This estimated range does not include T-Max Timer system or wiring. All Express Spas are required to have a minimum of 1 Mystic Tan spray booth and 1 Spa unit. All Traditional Spas are required to have a minimum of 1 Mystic Tan spray booth, 2 Spa units (I of each type of Plaiiet Beach approved Spa equipment). This does not include costs for set-up, shipping, handling and tax. This amountimay vary depending on

unit mix and amount of equipment. You are responsible for any taxes due to your state.

I ' '

Note 5. The low estimate is based on an Express Spa with an estimated 600 to 800 square foot space with landlord participation and no demolition. This estimated range will vary depending on the location, necessary leasehold improvements and landlord participation.

Note 6. Owner Furnished Items (OFIs) consist of interior modular wall and door systems, millwork (including retail fixtures, various shelving and counter), interior signage, exterior signage, flooring and light fixtures,

Note 7. Some landlords may require a deposit of first and last month's rent. Deposits on utilities will also vary.

Deposits will vary based on the market rental rates for your market.

I^Jote 8. You will need to obtain Commercial General Liability ($1 Million Minimum Coverage) insurance, Worker's Compensation, Business Interruption insurance, Life insurance (equal to the amount borrowed) and Construction Coverage insurance.

Note 9. This figure includes the costs for the monitor, keyboard, cash drawer, credit card machine, receipt printer,

printer and the installation of PBFC's software and credit card software.

Planet Beach Franchising Corporation 99

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

Note 10. Shipping is based on several factors, including weight of shipment and destination.

Note 12. Timer System includes T-Max Manager, Communication Cables, RJ22 Couplers and UV Meter and price is based on the specific layout of your Spa.

Note 14. You are required to spend this amount on grand opening advertising. You may spend additional amounts with PBFC approval.

Note 16. Zero dollars as a "Low" because not all Spas can accommodate a utility room due to size or layout restrictions. Therefore, the washer and dryer are optional.

Note 17. This figure includes inspection fees, occupational licenses, and the costs for transportation, meals and other expenses associated with pre-opening training.

Note 20. PBFC does offer indirect financing to franchisees for some of these items.

Item 8 Restrictions on Sources of Products and Services

You must purchase goods and materials, which adhere to our minimum standards and requirements. These items include start-up equipment, inventory, interior and exterior signs, insurance, grand opening advertising and on-going marketing, printing and supplies. Estimated costs for these items are described in Item 7 of this offering circular.

We formulate and modify our standards and specifications based upon our experience of operating businesses of the nature we are franchising, our offering of business and of our principals described in Item 2. Our standards and specifications are described in the Franchise Agreement, the Operations Manual, and other written documents. We issue our specifications only to our franchisees, and to certain approved and designated suppliers. We do not issue our standards and specifications to any other suppliers. We may change the standards and specifications which apply to the operation of the Spa, including standards and specifications for signs, furnishings, supplies, inventory and equipment, by providing you written notice of the change or by amending the Operations Manual and providing you the

Planet Beach Franchising Corporation ^ryi

Uniform Franchise Offering Circular 03/06 Registration and Non-Registration States

The original documents were scanned as an image. The original file can be downloaded at the link above.

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