Effective Advertising

Advertising materials that can be adapted to local market needs will be provided to you. In many areas, there are cooperative advertising associations in which you can meet with other franchisees along with Converters™ representatives to discuss and implement marketing strategies.

Initial Investment

The initial investment for a Converters™ service center at a leased site is estimated to be between $214,000 and $273,000 with the following components:

•Franchise Fee: $35,000

•Equipment, signs and fixtures: $80,000 - $110,000*

•Initial inventory: $18,000*

•First month's rent and security deposit: $10,000 - $20,000*

•Opening marketing expenses: $15,000 - $20,000*

•Insurance: $10,000 - $20,000*

•Training: $1,000 - $5,000*

•Working capital and prepaid expenses: $45,000*

Total: $214,000 - $273,000*

*Estimated amount.

In addition to the franchise fee, a royalty fee of up to 5% of gross sales is required. Franchisees must spend 5% of the gross sales at your franchised service center on advertising, in some cases through a regional cooperative association.

Qualifications

Our most successful franchisees are those who give their businesses their personal attention. Consequently, Converters™ is looking for franchisees that will be personally involved in the operation of their service centers, not those who simply have money to invest.

Minimum Qualifications

To be considered for a Converters™ franchise, you should have a net worth of at least $450,000, not including your personal residence. You should have liquid assets of at least $150,000. We are looking for individuals who are committed and conscientious. Our franchisees must have the ability - and the desire - to learn and follow a franchise format. Our business requires individuals with strong interpersonal skills who can manage and motivate their employees and expand their customer base.

Preferred Site Guidelines

The following are guidelines in selecting freestanding sites and shopping center pad sites for Converters™ service centers:

•Location - the most desirable site is a corner lot. Sometimes cost considerations dictate an "inside" lot, in which case we prefer sites near shopping centers, major food stores, other successful service businesses or fast food restaurants with good visibility from both directions and accessible with a left turn (a left turn into the site shouldn't be obstructed by a median or other traffic barrier)

•Property Size - a lot about 125 feet wide and 160 feet deep is optimal for most Converters™ service centers. We'll consider smaller sites with adjoining common space. Our standard building is about 60 feet long and 40 feet wide.

•Zoning - sites must be zoned for uses that include automotive repair operations or you would be required to get a change or a variance.

•Traffic and Area - 20,000 or more vehicles should pass the site each day. We look for sites on undivided streets with 2-way traffic and with traffic speeds of 60 Kph or less. There should be a population of at least 50,000 within a 5-Kilometer radius of the site, and within that radius there should be at least 42,000 automobiles and median household annual incomes of $50,000 to $70,000.

Due to zoning and permitting requirements, the time from signing a franchise agreement to opening a store varies from market to market.

•Training - prior to opening your service center, you'll work at a Converters™ center and meet other franchisees in the Converters™ organization. You and your service center manager will also attend a classroom-training course to familiarize you with various aspects of the Converters™ system. Before your center opens, our field staff will help you train your initial personnel. You'll also receive detailed policies and procedures manuals and other written operating, marketing and training materials.

•Marketing - Converters™ works with you to keep your business growing by implementing marketing programs such as fleet maintenance and database marketing. We also conduct research and develop procedures for offering additional services to our customers.

•Technology - you'll receive a point-of-sale computer system that enables our franchisees to record customer and marketing data, to identify automobile service requirements and identify strengths and weaknesses in their operations.

Commercially Available Now:

In Development:

www.HGenerators.com

www.HGasStations.com

www.SolarHydrogenVillages.com

www.PeaceRiverVillas.com

www.HFleets.com

www.HConverters.com

www.HAuxiliaryPowerUnits.com

www.HTurbineCHP.com