Arby's

Can you provide details on the 4 litigation cases initiated against the franchisor, including the nature of disputes, current status of the 2 pending cases, and outcomes of any settled cases?

Why has the royalty rate been set at 4.0% when the typical range for quick service restaurants is 5.0-6.0%, and are there circumstances under which this rate could increase?

The ad fund rate of 5.0% exceeds the typical 2.0-4.0% range for this category. How is this fund allocated, what specific marketing initiatives does it support, and how is spending transparency provided to franchisees?

The technology fee of $59 monthly is significantly lower than the typical range of $110-$408. What specific technology services and systems does this cover, and are there any additional technology costs not included in this fee?

The transfer fee of $17,500 exceeds the typical range of $5,000-$15,000. What does this fee cover, and is it refundable or applied to other obligations if the transfer is denied?

Your contract specifies a 20-year initial term and 20-year renewal options, both above typical ranges. What is the rationale for these extended terms, and what flexibility exists for early termination or renewal negotiations?

The non-compete clause is 1 year, below the typical 2-year range. Does this vary by location or market conditions, and how is compliance monitored post-exit?

Unit closures increased from 45 in 2022 to 81 in 2024. What factors are contributing to this acceleration, and what support does the franchisor provide to struggling locations?

With 2 litigation cases currently pending against the franchisor, what are the general categories of these disputes (contract interpretation, royalty disputes, operational issues, etc.) and what could be the potential impact on franchisee obligations?

Territory is protected but not exclusive. Can you clarify the boundaries of protection and whether the franchisor or other franchisees can operate similar concepts in close proximity?

The median gross sales of $1,193,215 suggest strong performance, but can you break down how many units achieved above-median sales and what percentage of units operated below breakeven in the past year?

How many of the 63 units that ceased operations in 2024 were due to profitability issues versus external factors (owner retirement, relocation, family circumstances), and what is the average lifespan of a unit before closure?

The transfer rate of 2.4% annually is notable. What are the primary reasons franchisees are transferring units, and how often are transfer requests denied by the franchisor?

Has the franchisor taken any actions to reverse the net unit decline of 48 units over the past year, such as revising support programs, adjusting royalty rates for struggling locations, or enhancing marketing support?

Are there any active or recently settled class-action lawsuits or regulatory investigations involving Arby's franchisees that should be disclosed but may not appear in individual litigation cases?

The risk factors score of 52 is below the typical range of 60.0-78.0. What specific operational or financial risks has the franchisor identified, and what mitigation strategies are in place?

Investment costs score of 57 is below typical. What is the total initial investment requirement including real estate, equipment, inventory, and working capital, and how does this compare to competitor brands?

Can you provide Item 19 data segmented by store age, location type (urban/suburban/highway), and format (traditional/smaller format) to better understand performance variability?

The pending litigation includes 2 cases. Would the franchisor be willing to disclose the general nature of these disputes (e.g., payment disputes, operational compliance, property-related) and provide a timeline for resolution?

Given the 1-year non-compete restriction, what are the practical limitations on franchisees' post-exit business activities, and has the franchisor enforced this clause in recent cases?