A licensing relationship with Penthouse is very different than other licensing relationships you might have had or with which you might have been familiar; so much so that in 2005 we received the “Industry Innovator of the Year Award” at the Gentlemen’s Club Expo.

Unlike organizations whose sole goal is to sign up new licensees and wish them luck, Penthouse takes an active role in working with our licensees to help them succeed. Since our success depends on the success of our licensees, it makes sense to us to use the resources and media available to us to help, something our competitors either do not do or cannot do.

Successful brand development starts with the licensor – not the licensee -- and involves three key components:

• A good understanding of the brand name -- past, present and future
• Strong cross-promotion of the brand between and among the licensor and licensees in all categories
• Good licensor management that is creative, experienced in a variety of disciplines and able to see both the big picture of brand development as well as the specific application of the brand in a particular field

Whether you are interested in a Club, Lounge, Beach Club, Resort or the truly unique Penthouse Key Suites, as a licensee you receive support and resources not available from anyone else.

Marketing Support
Criteria for a licensee
General license terms
Contact

Overall and On-Going Support:

No one else in the industry takes your success seriously enough or is willing to invest the resources to offer what we can provide. Following is a list of some of the services we offer and provide to our hospitality licensees. While they are subject to details and some restrictions, they are generally available and will give you an idea of what to ask when comparing a Penthouse license to other opportunities you may have.

• One of the most important things you get is our Team. Penthouse is the ONLY company in our industry that has a full-time staff dedicated to helping our licensees be more successful
• Creative and Promotions Department Support
• Free trial subscription promo - every guest is eligible to receive a free trial subscription to Penthouse Magazine

Complimentary advertisements in Penthouse Magazine

• Pet Appearances
• Pet Searches
• Promotion through Penthouse websites
• Discounted individual magazine copies for promotional use
• Reciprocal Membership/VIP program at all participating Penthouse venues
• Licensee conferences to develop better communication and ideas
• Preferred Vendor Discounts
• Complimentary use of Penthouse Magazine data base for promoting club to subscribers
• “On the Road” in Penthouse Magazine to promote future activities as well cover past activities
• Monthly club feature in a 2-page spread in the magazine

Grand opening support:

A successful opening is critical. We can offer our experience with many facilities throughout the world to help create the appropriate environment and facility. We then coordinate marketing efforts within Penthouse – from public relations to photographers and Pets. Following is what we do for you to help make your Grand Opening a success, both for the short term and the long term. As with all Penthouse Club promotions, items may be added or suggested based on input from our licensee.

The following are provided at no additional cost:

• Pre-opening publicity
• Penthouse Magazine
• Penthouse Clubs
• Penthouse Clubs advertising
• Penthouse web sites
• Press releases
• Penthouse Pet Appearances
• 2 Page spread in Penthouse Magazine covering the opening
• Public relations assistance
• Promotional merchandise for give-away (items vary, subject to discussion)
• Complimentary Penthouse subscriptions (may overlap with other promotions)

There are differences betweens clubs, lounges, beach clubs and hotels, but many of the concepts and goals are the same. Following are some of the criteria for an adult club. There are exceptions to almost every rule, so the following are some general goals of where we would like to be in our club program.

As you read the following, please keep in mind that our goal is not only to make money, but also to build and present the brand in a fashion consistent with the upscale men’s lifestyle that Penthouse has represented for more than 40 years.

The first and most important criterion is the owner/operator (O/O). An O/O who wants to run a first class business – even better, one who has already run a first class business – is who we are looking for.

Small clubs in smaller markets can be excellent investments, but we tend to focus on A or B markets. A small Penthouse Club is 8,000 square feet (743 square meters), while our largest club is 25,000 square feet (2323 square meters).

While there are exceptions, we believe quality food is an important element to a successful upscale adult club. Consequently, a full-service kitchen is a positive element; keeping in mind that quality food does not require a big kitchen, just a properly equipped kitchen and a good staff.

Local laws may create some restrictions, but in an ideal world and to be the most profitable, we like to see 4 public areas in the club: the main floor, a VIP area/room, private dance booths and champagne rooms. If you have questions or doubts about your ability to have any of these areas, we would be happy to discuss this with you.

Our licenses are very simple; and the business terms are all very similar if not identical, subject to variations for market size and some other considerations.

There is a royalty on sales, with a minimum that we establish based on the market size. There is also an initial fee which is ½ the annual minimum, though it is a separate fee not an advance against the royalty. Last, the term is 5 years, renewable at the licensee’s (your) option provided the total sales minimum for the 5 year term is satisfied.

The balance of the agreement addresses issues relating to the usage and protection of our brand names and trademarks.

For more information or to discuss the possibilities of becoming part of the Penthouse family, contact:

Jeff Stoller
Director, Global Club Licensing
6800 Broken Sound Parkway, Suite 100
Boca Raton, Florida 33487
Tel 561-912-7022
Cell: 561-542-6399
Fax 561-912-1746
jstoller@ffn.com

Cheryl Gomez
Manager, Club Licensing Operations
6800 Broken Sound Parkway, Suite 100
Boca Raton, Florida 33487
Tel 561-912-7032
Fax 561-912-1757
cgomez@ffn.com