Notes

1. A Franchisee will have to lease an appropriate site to operate a PLANET SUB Restaurant. Generally the leases extend for a period of 5 years with one or more five-year options to renew. The amounts specified for leasehold improvements, security deposit/first months rent, permits and architects fees and fixtures and equipment are based on estimates. These costs may vary depending on the size, condition and location of the leased premises, the landlord's contribution to leasehold improvements, if any, supply and demand for materials and labor in the local area, local building and fire code requirements and requirements of the lease regarding such matters as construction, signage and inflation. Most leasing agents determine monthly rental by the value of the property x 10% divided by 12 plus taxes and insurance (triple net lease). If Franchisee chooses to purchase or construct its own building, Franchisees initial costs will be higher. Newly constructed Restaurants will vary in size from 1,500 to 2,500 square feet. The above assumes you will lease your property.
2. Franchisee must purchase menus and certain point of sale advertising and promotion materials from Franchisor or from a supplier approved by the Franchisor. Except for these items, the Franchisee may purchase or lease original equipment and supplies, signs and opening inventory meeting our standards and specifications from any source approved by us, subject to our rights to be the sole source of supply or sole designation of suppliers as described in Item 8 in the Franchise Disclosure Document (FDD). The lower limit is for initial lease expenses and monthly fees will follow. The higher limit is for the outright purchase of the registers.
3. The cost of insurance may be significantly higher than the estimate depending on such factors as particular state coverage requirements, store location and the Franchisees loss history. Workers Compensation insurance, owned auto insurance and delivery insurance are not included in the above estimate.
4. We recommend that you have additional funds available for miscellaneous initial start-up expenses for the first 3 months of operation. These expenses include payroll costs, deposits for installation of telephones, deposits for gas, electricity and related items, costs for initial point of sale advertising and promotion materials, and initial working capital. These are paid as incurred to various utilities, suppliers, employees (not including you) and, with respect to point of sale advertising and promotion materials, to Franchisor. These figures are only estimates and we cannot assure you that you will not have additional expenses starting the business. Your actual costs will vary according to your approach to the business; your management skills, experience and business acumen; local economic conditions; the prevailing wage rate in your market; competition; and the growth of your business.

No allowance has been made in the chart referred to in the above for the costs of implementing an off-site sub delivery program pursuant to the terms of a delivery agreement. The need for this outlay will depend on whether a Franchisee elects to offer such off-site delivery services. If so, the additional costs required to implement off-site delivery services will vary depending on such factors as whether the Franchisee elects to purchase or lease a delivery vehicle, and whether additional telephones, ovens and other capital items will be required to accommodate anticipated larger volumes.

As discussed in Item 10 in the Franchise Disclosure Document (FDD), we do not offer, either directly or indirectly, financing to Franchisees for any items. However, the initial investment may be financed in part through a financial institution or directly from suppliers of specific items. Financing availability and terms will vary with the availability of financing generally, the creditworthiness of the Franchisee, loan security available from the Franchisee, lenders policies regarding financing the type of business for which financing is sought and similar considerations.

We have relied on our experience and the experience of our affiliates in the sandwich restaurant business since 1998 to compile these estimates.

This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington and Wisconsin. If you are a resident of one of these states, or a country whose laws regulate the offer and sale of franchises, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your jurisdiction.