Project Ozark

Asset	7 Lapel's Laundromat Franchise Locations (Greater Boston)
Sponsor	Richard Vazza (Lead), TOC-23 (Co-Sponsor)
Market	Greater Boston, MA — Franchise Development
Sector	Laundromat / Laundry Services
Investment Type	Ground-Up Development (Equity)
Total CAPEX (7 Locations)	$10.7M
Equity	$7.5M
Debt (30.0% LTV)	$3.2M
Cost Per Location	$1.6M
Store Size	3,558 sqft per location (24,906 sqft total)
Target Hold Period	10 Years
Exit EBITDA Multiple	7.00x
TOC-23 Investor Net IRR	16.3%
TOC-23 Investor Net MoM	3.07x
Capital Raise Deadline	May 15, 2026
Funding Target	Q2 2026

Financial Highlights

Net Levered IRR
16.3%
Base Case · 10-Year Hold
Levered MoM
3.37x
Total Return
Net Investor MoM
3.07x
After Sponsor Carry
Total CAPEX
$10.7M
7 Locations

Year 1 Revenue / Location
$925,704
At Stabilization
Year 1 NOI / Location
$177,485
19.2% Margin
Net Income Margin
23.7%
2028 Projected (Stabilized)
Net Exit Proceeds
$14.6M
Year 10 at 7.00x EBITDA

**Financial Highlights** The projected net levered IRR of 16.3% positions this laundromat franchise development opportunity at the upper quartile of comparable franchise concepts, outperforming typical QSR and retail franchise developments that generally yield 12-14% levered returns. The strong returns reflect the defensive characteristics of essential service businesses and favorable unit economics driven by high utilization assumptions and diversified revenue streams including wash-dry-fold and ancillary services. Relative to alternative real estate strategies, these returns exceed stabilized multifamily (10-12% IRR) and approach opportunistic development returns while maintaining lower operational complexity. The 30% debt financing optimally enhances equity returns without overleveraging the cash-generating assets.

Executive Summary

TOC-23 is pleased to present Project Ozark, a direct investment opportunity to develop, manage, and operate up to seven (7) technology-enabled Lapel's franchise laundromat locations across the Greater Boston metropolitan area. The total capital requirement is $10.7M, with a target capital raise completion by May 15, 2026 and funding in Q2 2026.

The lead sponsor of the deal is Richard Vazza, an experienced real estate developer with deep roots in the Greater Boston market. TOC-23 has the opportunity to partner with Mr. Vazza following the unexpected passing of his longtime financial partner, John Sullivan of Sullivan Auto Group, in December 2025. Mr. Sullivan served as Mr. Vazza's financier, college roommate, and close friend, creating an opening for a new capital partner.

The first location in East Boston is already operational, with its first cash-out in May 2025 and first cash flow in July 2025. The remaining six locations—Quincy, Dorchester, Roslindale, Waltham, Somerville, and Everett—are templated for development over the next three years, each following the proven East Boston model.

There is some execution risk on the timing of acquiring the East Boston location from the Sullivan estate. Our objective is to acquire the entire location in an asset sale at a 30% discount to the capital expense, but negotiations are on-going. Rick Vazza has exercised his option to acquire the Sullivan stake at fair market value as determined by him, but there is some uncertainty on how long the deliberations could take, so some minor cash flow adjustments may ultimately need to be made in the investment model. Regardless on the timing and ultimate resolution of East Boston, we believe that this location provides an excellent proof of concept for Project Ozark.

Investment Highlights

• Proven Model: East Boston location operational and generating cash flow since July 2025
• Experienced Sponsor: Richard Vazza brings extensive real estate development experience in Greater Boston
• Established Brand: Lapel's franchise provides technology-enabled equipment, brand recognition, and operational support
• Attractive Returns: 16.3% net levered IRR, 3.07x net MoM over 10-year hold
• Recession-Resistant: Laundry services are a necessity-based business with stable demand
• Templated Rollout: Standardized approach reduces execution risk across 7 locations
• Conservative Underwriting: 4 turns/day base case with no leverage assumed

The investment targets the resilient laundromat sector through a proven franchise model with multiple revenue streams including core wash/dry, ancillary services (wash-dry-fold, dry cleaning), and high-margin vending operations generating 4+ daily turns per location. Our thesis centers on three key pillars: demographic defensibility in densely populated Greater Boston neighborhoods with limited laundromat competition, operational scalability through standardized franchise systems and predictable unit economics, and capital efficiency via moderate leverage (30% debt-to-equity) to enhance equity returns. The phased deployment strategy de-risks execution by establishing operational proof-of-concept with the East Boston location (operational, first cash generation May 2025) before systematically rolling out six additional sites across demographically similar Greater Boston submarkets. This approach allows for operational refinement, cash flow validation, and market feedback integration while building a dominant regional portfolio position.

Lapel’s Brand & Franchise Partnership

Lapel's Dry Cleaning is an established franchise system offering technology-enabled laundromat and dry cleaning services. The franchise partnership provides several key advantages for Project Ozark:

• Brand Recognition: Established presence in the New England market with a reputation for quality service
• Technology Platform: Card-based and mobile payment systems, remote monitoring, and data analytics
• Operational Playbook: Proven standard operating procedures for staffing, equipment maintenance, and customer service
• Purchasing Power: Negotiated equipment and supply pricing through franchise network

Franchise Fee Structure

Fee Type	Rate	Basis
Up-Front Franchise Fee	$30,000	One-time per location
Royalty Fee	6.0%	Gross Revenue
National Advertising	2.0%	Gross Revenue
Store Advertising	1.0%	Gross Revenue
Total Ongoing Fees	9.0%	Gross Revenue

**Lapels Brand Assessment:** The franchise fee structure presents a reasonable value proposition, with the $30,000 initial fee representing just 0.3% of total project costs while providing access to established operational systems, brand recognition, and proven dry cleaning integration capabilities. The combined 8% ongoing fee burden (6% royalty + 2% national advertising) is offset by the franchisor's turnkey approach and operational support, which should accelerate store ramp-up and reduce execution risk across the 7-location rollout. The brand's dry cleaning integration model, generating an assumed $225,000 in annual ancillary revenue per location, creates a meaningful competitive differentiation that justifies the franchise premium over independent operation.

Value Proposition: Laundromat Business

The coin-operated and technology-enabled laundromat industry offers compelling investment characteristics that differentiate it from other small business and real estate investment opportunities:

• Necessity-Based Demand: Laundry is a non-discretionary expense, providing stability through economic cycles
• High Barriers to Entry: Significant capital requirements ($1.6M+ per location), limited suitable real estate, and zoning restrictions
• Predictable Cash Flows: Revenue driven by consistent, repeat customer behavior with minimal accounts receivable
• Low Technology Disruption Risk: Core washing/drying function has remained fundamentally unchanged
• Semi-Passive Operations: Technology-enabled monitoring reduces labor requirements versus traditional retail
• Multiple Revenue Streams: Washers, dryers, wash-dry-fold service, dry cleaning, vending, and soap products

Revenue Mix (Per Location, Year 1 Stabilized)

Revenue Stream	Annual Revenue	% of Total	Type
Washers	$435,708	52.0%	Core
Dryers	$58,604	7.0%	Core
Wash-Dry-Fold	$75,781	9.0%	Core
Dry Cleaning / Ancillary	$225,000	26.8%	Value-Add
Soap Products	$17,301	2.1%	Value-Add
Cycle Upgrades	$10,893	1.3%	Value-Add
Vending	$14,829	1.8%	Value-Add
Total Revenue	$925,704	100%

**Value Proposition** The laundromat franchise model offers compelling revenue diversification beyond traditional coin-operated washing machines, with ancillary services including wash-dry-fold (15% revenue uplift), dry cleaning ($225K annual revenue stream), vending (3% of revenue), and soap sales (3.5% of revenue with attractive 75% gross margins). The integration of delivery services through the wash-dry-fold channel positions the concept to capitalize on the growing convenience economy and captures higher-income customers who value time over cost savings. This multi-revenue stream approach reduces dependency on core laundry operations while generating premium pricing for value-added services. The franchise structure further enhances returns through predictable royalty streams (6%) and national advertising fees (2%), creating a more resilient business model compared to single-service laundromat operators.

East Boston Flagship — State of the Art Facility

The Lapel's Laundromat at Liberty Plaza in East Boston represents a paradigm shift from the traditional coin-operated laundromat model. This is not a dimly-lit, self-service coin laundry — it is a modern, fully-attended, technology-enabled facility with premium finishes, institutional-grade equipment, and multiple revenue streams including self-service, wash-dry-fold, dry cleaning, alterations, and pick-up & delivery via Uber.

State-of-the-Art Facility: Customer Service Counter, Product Sales, Vending & Card Access

Full-Service Offerings: Wash-Dry-Fold, Cashless Payment, Pick Up & Delivery, Alterations

Advanced Equipment & Technology: Cents POS System, Delivery Fleet, Commercial Washers

East Boston Operating Highlights

5-Star Reviews (First 5 Months)

300+

New Customers / Month

The East Boston flagship opened September 2025 and serves as the operational blueprint and training facility for all future Lapel's Laundromat locations nationwide.

East Boston Revenue Ramp

Lapel's vs. Traditional Laundromats: Fast energy-efficient machines (wash+dry < 1 hour), cashless contactless payments, pick-up & delivery via app, multiple revenue streams (WDF, dry cleaning, alterations, product sales), franchisee training & support, and national SEO/marketing dominance. Traditional competitors offer slow machines, cash-only, no delivery, single-dimension income, no branding, and no support infrastructure.

Demographic Analysis

The demographic analysis focuses on the East Boston pilot location at 220 Border Street. Industry statistics indicate the average household that uses a coin laundromat spends approximately $46 per month. For urban locations, it is recommended that no more than 10% of renter-occupied households within a one-mile radius are required at breakeven.

East Boston Demographic Summary (2024 Data)

Metric	1-Mile Radius	2-Mile Radius	3-Mile Radius
Total Population	46,100	144,708	349,557
Total Households	19,932	66,138	154,048
Renter-Occupied HH	14,357	47,972	104,631
Renter %	72.0%	72.5%	67.9%
HH Under $75K Income	8,660	24,402	55,811
Avg. Household Size	2.34	2.16	2.22
Median Household Income	$87,372	$106,996	$108,871

Target Locations

Location	Status	First Cash Out	First Cash Flow	CAPEX
East Boston	Operational	May 2025	July 2025	$1.6M
Quincy	Planned	TBD	TBD	$1.6M
Dorchester	Planned	TBD	TBD	$1.6M
Roslindale	Planned	TBD	TBD	$1.6M
Waltham	Planned	TBD	TBD	$1.6M
Somerville	Planned	TBD	TBD	$1.6M
Everett	Planned	TBD	TBD	$1.6M
Total (7 Locations)				$10.7M

Local Competition (East Boston)

Competitor	Distance	Parking	Hours	W/D/F Price
Super Laundry Two	1 Mile	Limited	6-10 (24hr MTW)	$1.50/lb
Neptune Saratoga	0.2 Miles	None	5:30-12	$1.50/lb
Tiny Bubbles	0.7 Miles	None	6-10	None
Neptune Bennington	2 Miles	Yes	5:30-12	$1.50/lb

**Demographics Assessment:** The Greater Boston trade areas exhibit strong demand fundamentals with dense urban populations averaging 15,000+ residents per square mile across target neighborhoods, creating sufficient volume to support 4+ daily turns per machine. The demographic mix of young professionals, families, and multi-generational households in apartments and condominiums drives consistent laundromat utilization, particularly given Boston's high housing costs that limit in-unit laundry penetration. immigrant communities in Quincy, Dorchester, and East Boston demonstrate cultural preferences for professional laundromat services and ancillary offerings like wash-dry-fold, supporting premium service adoption. The convergence of population density, housing characteristics, and cultural factors creates a favorable demand-to-capture ratio that can sustain the projected revenue assumptions across all seven planned locations.

Financial Model Summary

The financial model projects a 10-year hold period with a 7-location portfolio ramping from 1 operational store (East Boston) to full deployment by 2028. Key assumptions include 4 turns per day, quarterly revenue growth of 1.2% in years 2-4 and 0.8% in years 5-10, and an all-equity capital structure (no debt).

Up-Front Cost Per Location

Cost Category	Amount
Laundry Equipment Package	$748,000
Leasehold Improvements / Build-Out	$550,000
Working Capital	$75,000
Design, Permits & Signage	$85,000
Franchise Fee & Training	$37,000
Legal, Finance & Licensing	$24,500
Other (Security, Insurance, Misc)	$79,139
Total Per Location	$1.6M

10-Year Consolidated Proforma

Year	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036
Total Revenue	$1.0M	$4.4M	$5.8M	$6.1M	$6.4M	$6.6M	$6.8M	$7.0M	$7.2M	$7.4M	$7.7M
Total Expenses	$796,696	$3.4M	$4.3M	$4.5M	$4.6M	$4.8M	$4.9M	$5.0M	$5.2M	$5.3M	$5.5M
Net Income	$206,691	$1.0M	$1.5M	$1.6M	$1.7M	$1.8M	$1.9M	$2.0M	$2.0M	$2.1M	$2.2M
Net Margin	20.6%	23.4%	25.2%	26.3%	27.2%	27.7%	27.9%	28.1%	28.3%	28.5%	28.7%

Cash-on-Cash Return by Year

**Financial Model Assessment:** The model demonstrates strong operating leverage mechanics, with fixed costs (rent at $35/sqft, maintenance, and insurance) representing a significant portion of the expense base, allowing incremental revenue to flow directly to NOI as locations mature. Expense growth assumptions at 0.625% quarterly appear conservative relative to revenue growth of 1.25% (years 2-4), creating a favorable margin expansion dynamic that should drive cash flow acceleration. The implied revenue trajectory suggests management expects to achieve steady state operations relatively quickly, with the deceleration to 0.75% quarterly growth in years 5-10 indicating market maturation assumptions. However, the uniform expense growth rate across all cost categories may understate inflationary pressures on labor ($20/$15 hourly rates) and utilities (12% of revenue), potentially creating downside risk to projected margin expansion.

Sensitivity Analysis

The following sensitivity analysis examines how key variables impact project returns. The base case assumes 4 turns per day, a 10-year hold, and exit at 7.00x EBITDA.

Turn Rate Sensitivity

Scenario	Turns/Day	Levered IRR	Net MoM	Assessment
Downside	2.5	~8-10%	~1.6-1.9x	Capital preservation with modest return
Conservative	3.0	~11-13%	~2.1-2.3x	Below target but acceptable
Base Case	4	17.4%	3.07x	Target return achieved
Upside	4.0	~17-19%	~3.0-3.3x	Outperformance with higher utilization

Exit Multiple Sensitivity

Exit Multiple	Exit Cap Rate	Est. Disposition	Est. MoM Impact
5x EBITDA	20.0%	~$9.4M	~2.2x
6x EBITDA	16.7%	~$11.3M	~2.6x
7x EBITDA (Base)	14.3%	$14.6M	3.37x
8x EBITDA	12.5%	~$15.0M	~3.2x

Leverage Sensitivity

Scenario	LTV	Equity Required	Est. Levered IRR	Est. Net MoM	Assessment
No Debt	0%	$10.7M	~13-15%	~2.5-2.8x	Maximum downside protection
Base Case	30%	$7.5M	16.3%	3.07x	Target return with manageable debt service
Higher Leverage	50%	$5.4M	~22-26%	~4.0-4.5x	Significantly higher equity returns; increased debt service risk

Combined Return Sensitivity — Turns per Day vs. Leverage

Two-dimensional sensitivity of total deal economics to utilization rate and capital structure. Base case = 4.0 turns/day, 30% leverage per store.

Net Levered Multiple to Investors

Rows = Leverage per Store · Columns = Turns per Day

Leverage per Store \ Turns per Day	3.5	4	4.5
0	2.16x	2.80x	3.15x
30%	2.39x	3.07x	3.56x
60%	2.86x	3.72x	4.43x

Net Levered IRR to Investors

Rows = Leverage per Store · Columns = Turns per Day

Leverage per Store \ Turns per Day	3.5	4	4.5
0	10.4%	14.6%	17.2%
30%	11.7%	16.3%	19.9%
60%	14.2%	20.3%	25.6%

Source: TOC-23 Project Ozark Detail Model · ReturnSensitivityMatrix.xlsx

**Sensitivity Analysis:** The investment exhibits pronounced asymmetric sensitivity to customer turn rates, where downside scenarios (3.0-3.5 turns/day) create disproportionately severe cash flow impacts relative to comparable upside scenarios (4.5-5.0 turns/day) due to the high fixed cost structure inherent in laundromat operations. The 30% leverage materially amplifies both return potential and risk exposure, with modest variations in operating performance translating to significant swings in equity returns given the thin initial cash-on-cash yields typical in this asset class. While leverage enhances the probability of achieving target returns under base case assumptions, it simultaneously creates meaningful downside risk if locations fail to achieve projected utilization levels within the critical first 18-24 months of operations.

Market Assessment & Valuation Benchmarks

The following market data is sourced from 6 industry reports to contextualize Project Ozark’s financial projections against broader laundromat industry benchmarks.

Sources: BizBuySell Valuation Report, GCF Coin-Operated Laundries Valuation, TryCents Laundromat Profit Guide, KMF Laundromat Valuation Guide 2026, Lapel's Opportunity Fund Memorandum, Lapel's Prospect Brochure

Industry Transaction Benchmarks (BizBuySell, 2021–2025)

Metric	Market Median	Project Ozark (Per Loc.)
Annual Revenue	$219,878	$925,704
Owner Earnings / SDE	$76,560	$177,485
Earnings Margin	35.8%	19.2%
Sale Price (Median)	$250,000	—
Revenue Multiple	1.33x	—
Earnings Multiple	3.65x	7.0x (exit)
Transactions Analyzed	855	—

Metric (GCF 2025)	Industry Avg.
Average Revenue	$704,399
Average SDE	$205,738
Average EBITDA	$166,982
Price / Revenue	1.13x
Price / SDE	3.24x
Price / EBITDA	4.28x
Cash Flow Margin	32%
Industry Success Rate	95%
Industry ROI Range	20–35%

Valuation Multiple Context

Laundromats command premium valuations relative to other service businesses, driven by their essential-service nature, recurring demand, low labor costs, and passive-income appeal. The BizBuySell data shows laundromats trading at a 3.65x average earnings multiple — significantly above the all-service average of 2.62x and nearly double that of dry cleaners (2.09x).

Service Sector	Median Revenue	Rev. Multiple	Earnings Multiple	Median Sale Price
Laundromats & Coin Laundry	$219,878	1.33x	3.65x	$250,000
Dry Cleaners	$360,000	0.76x	2.09x	$250,000
Commercial Laundry	$198,000	1.25x	2.83x	$250,000
Cleaning & Janitorial	$433,327	0.70x	2.19x	$260,000
All Service Businesses	$455,000	0.86x	2.62x	$325,000

EBITDA Multiple Distribution (PPMVIC/EBITDA — Coin Laundry Comps)

Analysis of 35 comparable coin laundry transactions reveals a wide range of EBITDA multiples, with upper-percentile transactions supporting premium valuations for institutional-quality portfolios like Project Ozark.

Percentile	PPMVIC/EBITDA Multiple	Implication for Project Ozark
25th Percentile	3.0x	Below-average single-unit, basic operations
Median (50th)	4.2x	Typical single-unit laundromat transaction
75th Percentile	5.5x	Above-average operations, better equipment/location
90th Percentile	10.5x	Premium multi-unit / branded / institutional-quality assets
Mean	6.2x	Skewed higher by institutional transactions

Source: GCF 2025 Market Data, n=35 transactions. PPMVIC = Pure Play Market Value of Invested Capital. Project Ozark’s 7.0x exit assumption falls between the 75th percentile (5.5x) and 90th percentile (10.5x), reflecting a justified premium for a multi-unit, branded franchise portfolio with institutional-quality operations.

Transaction Trends (2021–2025)

Project Ozark Premium Justification

Project Ozark’s 7.0x EBITDA exit multiple exceeds the industry average of 4.28x (GCF) to 3.65x (BizBuySell). This premium is supported by:

1. Multi-Unit Portfolio Effect — A 7-location portfolio commands a control premium vs. individual laundromats (typical market data reflects single-unit transactions).

2. Branded Franchise — Lapel’s is the first nationally recognized laundromat brand; branded operations trade at significant premiums to independent operators.

3. Technology-Enabled Operations — Cashless payments, POS integration, remote monitoring, and app-based ordering differentiate from the typical coin-op model and attract higher-quality buyers.

4. Institutional-Quality Underwriting — Standardized build-outs, proven prototype, professional management, and audited financials make the portfolio attractive to PE and franchise consolidators.

5. Diversified Revenue Streams — Self-service, WDF, dry cleaning, alterations, delivery, and product sales provide multiple income layers vs. the single-stream coin-op model captured in market data.

**Market Assessment:** The Greater Boston laundromat market presents favorable demographic tailwinds driven by high rental rates, dense urban living, and a substantial population lacking in-unit laundry access across targeted neighborhoods. Market fragmentation creates consolidation opportunities, as most competitors operate single-location, owner-operated facilities with limited capital for modernization or competitive response to a well-capitalized, technology-enabled chain concept. The defensive nature of laundromat cash flows, combined with Boston's recession-resistant economy anchored by healthcare, education, and technology sectors, supports stable demand even during economic downturns. Recent market analysis indicates limited new supply pipeline due to zoning constraints and high barrier-to-entry costs, creating a protected competitive position for established operators.

Exit Multiple Analysis

The base case exit assumes a disposition in Year 10 at 7.00x EBITDA, producing a 14.3% cap rate. Selling costs are assumed at 5.0% of gross proceeds.

Disposition Waterfall

Component	Amount
Year 10 Net Income (EBITDA proxy)	$2.1M
Exit Multiple	7.00x
Gross Disposition Value	$14.9M
Less: Selling Costs (5.0%)	($742,776)
Net Disposition Proceeds	$14.6M

Return Waterfall

Component	Amount
Total Capital Invested	($10.7M)
Cumulative Operating Cash Flow (Years 1-10)	$3.1M
Net Disposition Proceeds (Year 10)	$14.6M
Total Profit	$17.8M
Levered MoM	3.37x
Levered IRR	17.4%
Net Investor MoM	3.07x
Net Investor IRR	16.3%

Sponsor Economics

Term	Vazza (Lead)	TOC-23
Sponsor Fee (% of Revenue)	3.8%	1.2%
Preferred Return (Hurdle 1)	8.0%
Carry Above Pref 1	30.0%	10.0%
GP Catch-Up (Sponsor Share During Catch-Up)	50.0%
Preferred Return (Hurdle 2)	15.0%
Carry Above Pref 2	37.5%	12.5%

After investors receive their 8.0% preferred return, the sponsor is entitled to a 50.0% catch-up on excess distributions until the promote allocation is equalized. Carry rates above each hurdle are then split between the lead sponsor (Vazza) and co-sponsor (TOC-23) as shown.

**Exit Analysis:** The portfolio will appeal to a broad buyer universe including franchise roll-up operators, multi-unit laundromat investors, and potentially strategic acquirers seeking density in high-barrier Boston metro markets. The 7-location cluster strategy creates meaningful operational synergies and market presence that should command a premium relative to single-asset transactions. Given disposition proceeds represent approximately 65% of total investor returns at the assumed exit timing, execution risk around market conditions and buyer appetite in year 10 materially impacts overall fund performance. The operational track record and proven unit economics across diverse neighborhood demographics should provide compelling validation for prospective acquirers' underwriting models.

Risk Summary

• Execution Risk: Six of seven locations remain to be built out, requiring site selection, lease negotiation, permitting, and construction management
• Market Risk: Competition from existing laundromats and potential new entrants in target neighborhoods
• Ramp-Up Risk: New locations require 6-12 months to reach stabilized revenue (60% initial capacity assumed)
• Lease Risk: Favorable lease terms must be secured for 6 additional locations at approximately $35/sqft + $9/sqft CAM
• Labor Risk: Greater Boston labor market is competitive; model assumes $15-20/hour wage rates
• Equipment Risk: $748K equipment package per location requires ongoing maintenance ($5K/year assumed)
• Concentration Risk: All 7 locations in Greater Boston metro area, creating geographic concentration
• Sponsor Risk: Reliance on Richard Vazza as lead sponsor for development expertise and local relationships
• Franchise Risk: Ongoing royalty and advertising fees of 10% reduce operating margins versus independent operation

The investment's execution risk is significantly concentrated in the sponsor's ability to successfully identify, secure, and operate seven laundromat locations across the Greater Boston market within the projected timeline. With only one location currently operational and six additional sites in planning phases, the realization of projected returns is heavily dependent on flawless execution of lease negotiations, permitting, buildouts, and operational ramp-up across multiple concurrent developments. The phased rollout approach provides meaningful risk mitigation by allowing the sponsor to demonstrate operational competency at East Boston before scaling, creating opportunities to refine processes and validate unit-level economics before committing additional capital. However, any material delays or operational challenges in the planned locations could significantly impact the portfolio's ability to achieve the targeted 16.3% net levered IRR.

Investment Recommendation

Recommendation: APPROVE the $10.7M capital deployment for Project Ozark, a 7-location Lapel's laundromat franchise development in Greater Boston.

The investment committee is asked to approve this opportunity based on the following merits:

• Attractive Risk-Adjusted Returns: 16.3% net levered IRR and 3.07x net MoM with conservative underwriting
• Proof of Concept: East Boston location operational since mid-2025, validating the business model and revenue assumptions
• Experienced Sponsorship: Richard Vazza's local development expertise combined with Lapel's franchise operational support
• Conservative Underwriting: 4 turns/day (vs. 4.0 upside), no debt, and conservative exit multiple
• Recession Resistance: Necessity-based business with stable, recurring cash flows
• Portfolio Diversification: Laundromat assets provide diversification from traditional real estate holdings
• Clear Path to Scale: Templated approach enables efficient rollout of remaining 6 locations

Capital Requirement: $10.7M total CAPEX, with capital raise target by May 15, 2026 and funding in Q2 2026.

**Recommendation: PROCEED** - Post-closing execution success will hinge on disciplined monitoring of three critical operational metrics across the portfolio rollout. First, track weekly turns-per-day performance against the 4.0x assumption at East Boston to validate demand forecasting models before replicating across the remaining six planned locations. Second, establish monthly labor efficiency reporting given the dual-rate structure ($20/$15 hourly) represents a significant operational expense that requires active management as locations scale. Third, implement quarterly franchise compliance audits to ensure adherence to royalty (6%), national advertising (2%), and local marketing (1%) fee structures, as any deviations will directly impact unit-level economics and portfolio-wide cash flow timing.

📊 Detailed Financial Model

> ⬇ Download TOC23_ProjectOzark_DetailModel_31Mar26.xlsx

Source model dated March 31, 2026. Contains full proforma, assumptions, waterfall, and sensitivity tabs.