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New Horizons Computer Learning Centers Franchise Costs & Fees

Date of Incorporation: 1991
Franchising Since: 1991
Headquarters: Anaheim, California

Business Description: New Horizons Franchising Group, Inc. is the franchisor. Franchisees sell and deliver training to businesses and individuals who use any type of computer device, whether a desktop terminal or a laptop, tablet, or computer, other mobile devices, on how to use, manage and program computer-related software applications and how to use, build, manage, secure and repair computer hardware and related equipment.

Franchise Offer: The franchisor offers franchises for the operation of computer-related learning centers to independent operators throughout the United States and other countries.

Financial Assistance: If franchisees meet the franchisor’s credit standards, it may finance up to 50% of the initial franchise fee payable by a startup or conversion franchisee at an APR of 10% (or the highest rate permitted by law, whichever is lower), using our standard form initial franchise fee promissory note. Neither the franchisor nor any agent or affiliate of its guarantees any note, lease or obligation that franchisees may enter into with a third party.

Training and Assistance: The franchisor will train the franchisee’s designated General Manager and other principals in the New Horizons system at its Initial Franchise Training (IFT), a comprehensive 9-day classroom-based instructional course that combines formal presentations by its instructors and other NH staff with role-play and case studies. Like most of the franchisor’s training, IFT is handled through New Horizons University (NHU), at its franchisee training center in Anaheim, California. IFT, which is mandatory for your General Manager and highly recommended for all owners of the franchisee’s company, must be completed to the franchisor’s satisfaction before the franchisee begins operating the Franchised Business. Once each year, the franchisor will hold a conference (typically not more than 3 days in length). Topics may include industry trends, sales techniques, personnel training, accounting and reporting policies, performance standards, advertising programs and merchandising procedures. The franchisor may provide periodic assistance, but the nature, frequency and duration of this assistance is at its discretion.

Territory: In determining the boundaries of the Territory that the franchisor assigns to franchisees, it considers the general population count on the date that franchisees sign the Franchise Agreement as determined by the latest census data compiled and published by the United States Census Bureau in Washington, D.C. The franchisor describes the boundaries of the Territory that encompasses the population by listing zip codes in an exhibit to the Franchise Agreement. Franchisees must locate their Center within the Territory. For as long as franchisees are in compliance with their obligations under the Franchise Agreement, the franchisor will not locate another Affiliate Owned or franchisee owned Center within the Territory.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years. The franchisor grants franchisees an unlimited number of 5-year renewal options if franchisees are in good standing and achieve a market penetration level equal or greater than 25% of the Centers in their Market Category.

Obligations and Restrictions: While the Franchise Agreement does not specifically require franchisees or their principals to personally participate in the direct operation of the Center, it is the franchisor’s intention to select as franchisees only those persons or business entities whose principals plan to actively participate in the daily operations of the Center. The franchisor is not seeking franchisees that merely want a passive investment. Additionally, franchisees must employ, on a full time basis, at least one General Manager for the Center. All instruction provided at the Center will be according to a published schedule of training which franchisees will prepare and publish on a quarterly or trimester basis. During the term of the Franchise Agreement and any renewal term, franchisees may not engage in activities that fall within the Franchise Agreement’s definition of “Acting as a Computer Learning Center” which means directly or indirectly engaging in any business other than the Franchised Business, owning or operating any computer instructional business in any capacity other than the Franchised Business without our prior written consent.

Estimated Number of Units: 300

Investment Tables:
Initial Investment
Name of Fee Low High
Initial Franchise Fee $60,000 $150,000
Travel and Living Expenses $2,000 $5,000
Computer Hardware and Software (including NH Extranet) $85,000 $175,000
Inventory and Supplies $1,500 $3,000
Student Courseware Fee $3,000 $13,000
Leasehold Improvements $2,500 $5,250
Exterior Signs $2,000 $5,000
Rent (including real estate and other taxes) $2,500 $20,000
Business Insurance $1,000 $4,000
Training Employees on NH System $0 $10,000 Usage Fee $515 $3,800
Additional Funds (first 3 months) $100,000 $100,000
ESTIMATED TOTAL $296,015 $653,800
Other Fees
Type of Fee Amount
Monthly Continuing Royalty Fee The Monthly Continuing Royalty Fee is the greater of 6% of the monthly Gross Revenues, or the minimum royalty fee.
eLearning Delivery Fee: Online Live Greater of (i) $600/month or (ii) $1.25 per student per day.
eLearning Delivery Fee: Monitored Learning Greater of (i) $600/month or (ii) $1.25 per student per day.
eLearning Delivery Fee: Mentored Learning Content $30 per student per day.
eLearning Delivery Fee: Labs on Demand Per day fee varies based on type of class. Can range from $7-$40 per student per day.
VMware Administration Fee $25 per student per VMware class.
eLearning Delivery Fee: Online Anytime 50% of our suggested retail sales price.
Monthly Marketing and Advertising Fee 1% of Gross Revenues.
Corporate Sales Manager $3,500/week and travel costs.
Public or Private Offering Review Fee $25,000
Transfer Fee $5,000 Usage Fee (optional program) $515.40/month (0-10 users);
$1,152/month (11-20 users;
) $1,949/month (21-40 users);
$2,920/month (41-60 users);
$3,802/month (61-80 users);
+ $45 / additional user over 80 users. Training If franchisees elect to use, the franchisor will provide franchisees with basic software training once without charge before they deploy If franchisees desire additional training in after deployment, the franchisor schedules additional training by mutual agreement and impose a training fee based on the then-current training fee, which at this time is $500/day. If franchisees ask the franchisor to provide training at the Center, then the franchisor will additionally charge franchisees for its time and travel.
Audit Fee Cost of audit (ranges from $1,500 to $3,000) plus interest on under-payment at annual percentage rate (APR) of 10%
COM Fee $5,000
Renewal Fee $7,500
Annual System Meeting The franchisor may charge reasonable attendance fees, not to exceed $750 per person.
Extranet License Fee $25 monthly.
TROC Violation Fine Not to exceed $5,000
Satellite Fee (optional program) The franchisor negotiates the amount.
Interest The franchisor imposes interest on late payments at annual percentage rate (APR) of 10% (or the highest rate permitted by law, whichever is lower).

The above information has been taken from the FDD of New Horizons Computer Learning Centers. Year of FDD: 2016

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