Barry Kurtz dark logoFranchise First and Foremost
August 2011
 

21650 Oxnard Street

Suite 500
Woodland Hills, CA 91367
818-827-9229

CLIENT IN THE NEWS:  BEEF 'O' BRADY'S IS COMING TO CALIFORNIA

 

Beef 'O' Brady's, the 213-unit franchise of sports pubs, recently announced the signing of its first California franchise agreement. "California creates a world of opportunity for us, and we're on a mission to make Beef 'O' Brady's a household name throughout the state," said James Walker, Chief Development Officer of Beef 'O' Brady's. In addition to California, the company is targeting other domestic and international markets for future development. Beef 'O' Brady's expects to open between 15 - 20 new restaurants in 2011.

FRANCHISOR 101:   MODEL EXEMPTIONS RECENTLY PROPOSED 

 

The North American Securities Administrators Association, Inc. (NASAA) recently authorized the release for comment of proposed Model Exemptions to state franchise registration and disclosure laws.The proposal adopts four types of franchise exemptions: (1) a fractional franchise exemption; (2) an experienced franchisor exemption; (3) a set of three sophisticated purchaser exemptions; and (4) a discretionary exemption. The adoption of these Model Exemptions by registration and disclosure states that do not currently offer these exemptions will be of substantial benefit to franchisors. Click here for the full text of the Model Exemptions.

 

FRANCHISEE 101: FRANCHISEE RETURN ON INVESTMENT  

 

As a follow-up to last month's article on the failure rate of franchisee-borrowers in paying back SBA-backed loans, a franchise buyer should always calculate the projected cash-flow of the business that will be required to pay operating expenses and to service debt as well as the anticipated return he or she can earn on his or her investment before signing on the dotted-line.

 

Attempt to determine the average earnings of a typical franchised business during the first 3 years of operation by reviewing Items 7, 19 and 20 of the franchisor's Franchise Disclosure Document (FDD). Item 7 details the investment of capital necessary to get the business open and operating. Item 19 may include financial results of franchisee or company-owed units, or better yet, an analysis of a franchisee's potential return on investment if the franchisor chooses to list this information. A careful analysis should result in a reliable projection of income and expenses and a determination of an average return on investment. If the franchisor does not include Item 19 information in the FDD, the franchisee candidate should contact as many of the current and former franchisees listed in Item 20 as another source of financial information. Click here to see an example of an Item 19 disclosure for a franchisor with a low required initial investment of capital.

BARRY KURTZ CO-FOUNDER OF NETWORKING GROUP

 

Barry Kurtz, a member of the Board of Directors of the Southwestern Law School Alumni Association, recently co-founded a San Fernando Valley networking group for graduates of Southwestern Law School with estate and tax planning attorney Doron Tisser. The group's initial meeting was on July 15, 2011 and the next meeting will be held on October 13, 2011. If you are a graduate of Southwestern and either work or live in the San Fernando Valley, contact Barry at bkurtz@barrykurtzpc.com if you would like attend the October 13 meeting.

IN CASE YOU MISSED IT, WE'VE MOVED!

 

Our new address and telephone numbers are:

 

21650 Oxnard Street, Suite 500

Woodland Hills, CA  91367

Telephone:  818-827-9229

Fax:  818-986-4474

This communication published by Barry Kurtz, APC is intended as general information and may not be relied upon as legal advice, which can only be given by a lawyer based upon all the relevant facts and circumstances of a particular situation.

Copyright Barry Kurtz, A Professional Corporation 2010 
All Rights Reserved.

 
In This Issue
Client in the News
Franchisor 101: Model Exemptions Recently Proposed
Franchisee 101: Franchisee Return on Investment
Southwestern Law School - San Fernando Valley Networking Group
Contributing Expert - Mario Altieri

Contributing Expert

 

Mario Altieri, CFE

Upside Group Franchise Consulting  

 

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Barry Kurtz
Barry Kurtz is a prolific writer on the subject of franchise law. From due diligence to franchise appraisal, his articles are a valuable resource to any franchisee and franchisor.  He has been named a Certified Specialist in Franchise and Distribution Law by the State Bar of California Board of Legal Specialization.



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21650 Oxnard Street, Suite 500
Woodland Hills, CA 91367
818-827-9229
www.barrykurtzpc.com
bkurtz@barrykurtzpc.com