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Goddard School

Goddard Systems, Inc. (GSI) is expanding The Goddard School® network throughout the United States. Headquartered in King of Prussia, PA, Goddard Systems currently licenses 320+ franchised schools in 37 states. Goddard School buildings are custom designed and planned to provide safe, healthy and stimulating environments for children from six weeks to six years old. Goddard franchisees share a common entrepreneurial spirit and an interest in providing first-rate childcare in their communities, as evidenced by each School’s on-site management.

Goddard Systems is committed to providing an unsurpassed level of quality in the childcare industry. With a successful system in place and dedicated franchisees, GSI is an acknowledged leader in franchised childcare – with its sights set on becoming the premier childcare provider in the United States.

Operating Units	12/31/2005	12/31/2006	12/31/2007
Franchised	206	234	278
% Change	--	13.6%	18.8%
Company-Owned	1	0	0
% Change	--	-100.0%	0.0%
Total	207	234	278
% Change	--	13.0%	18.8%
Franchised as % of Total	99.52%	100.00%	100.00%

Investment Required

The fee for a Goddard School franchise is $135,000

The Goddard School provides the following range of investments required to open your initial franchise. The range assumes that all items are paid for in cash. To the extent that you choose to finance any of these expense items, your front-end investment could be substantially reduced.

Item	Established Low Range	Established High Range
Franchise Fee	$135,000	$135,000
Initial Training and Opening Assistance Fee	$35,000	$35,000
Initial Advertising Contribution	$35,000	$35,000
Real Estate Assistance and Support Fee	$30,000	$30,000
Background Check	$5,500	$5,500
Furniture, Fixtures, and Equipment Package	$131,000	$146,000
Stationery, Forms, Curriculum and Frames	$18,000	$18,000
Sign Package	$8,500	$8,500
Computer Software Package	$700	$700
Computer Hardware, Telephone and Digital Signage Package	$12,500	$12,500
Initial Promotional Package	$3,000	$3,000
Security System Package	$10,000	$10,000
Lease Deposit, Miscellaneous Equipment	$68,500	$68,500
Initial Working Capital	$200,000	$200,000
Total Investment (does not include applicable taxes or shipping costs)	$692,700	$707,700

On-going Expenses

Goddard School franchisees pay royalty fees equal to 7% of gross receipts and a monthly advertising contribution equal to the greater of 4% of gross receipts or $2,000. Other fees payable by the franchisee include telephone service charges, directory advertising and convention registration fees and expenses.

What You Get—Training and Support

Goddard School franchisees complete a comprehensive training program covering all aspects of operations, customer service, marketing, and staff hiring and training. Goddard School owners attend annual conferences in meetings to enhance the initial training with current research.

Goddard Systems provides ongoing support in all aspects of managing and marketing a Goddard School. Franchisees receive support before their school opens in the form of site selection, demographic analysis, lease negotiation, construction management, and equipment and furniture installation. Goddard Systems continues to support franchisees after the opening of the school with on-going professional development for teachers, sales, marketing, and advertising guidance, and budget and expense control.

Territory

The Goddard School does not grant exclusive territories, but controls the density of schools so that it does not exceed one per 10,000 households in the county in which the school is located.



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