Coverall

The franchise fee of $15,570 is significantly below the typical range of $30,000-$60,000 for cleaning franchises. What specific training, equipment, or support services are included in this lower initial investment compared to competitors?

What additional costs or mandatory purchases are required beyond the stated $15,570 franchise fee to begin operations, and are these detailed in Item 7 of the FDD?

The 5.0% royalty rate is below the typical 6.0%-8.13% range. Are there performance incentives, volume discounts, or circumstances where royalty rates increase or are calculated differently?

The system has lost 919 units over 3 years (CAGR of -4.95%) despite recent improvement in closure rates. What strategic changes has management implemented to reverse this trend, and what are the projected unit counts for the next 12-24 months?

Can you provide detailed information about the 2 pending litigation cases currently against the franchisor? What are the allegations, expected resolution timelines, and potential financial exposure?

What specific actions have been taken in response to the 6 total litigation cases filed against Coverall? Have any resulted in settlements, judgments, or changes to franchise policies?

The 20-year initial term is significantly longer than the typical 5-10 year term for cleaning franchises. What happens to a franchisee's business if Coverall is sold, undergoes significant leadership changes, or modifies core business practices during this 20-year period?

What is the renewal process after the 20-year initial term? Are renewal options automatic, discretionary, or does the agreement terminate without renewal?

The territory structure offers non-exclusive, undefned territories with no encroachment protection. How many franchisees can Coverall assign to the same geographic area, and what mechanisms exist to prevent internal competition between nearby units?

Of the 729 units that closed in 2022, approximately 318 ceased operations for reasons other than explicit closure or termination. What circumstances led to these 'ceased other' exits, and are franchisees required to notify the franchisor?

Item 19 financial performance data is available. What percentage of franchisees achieve the median or average gross sales figures disclosed, and what is the distribution range (top 25%, median, bottom 25%)?

The litigation data shows the franchisor was the defendant in 5 cases over the period reviewed. Were any of these cases related to recruitment practices, earnings claims, or franchisee termination disputes?

Can Coverall provide references from franchisees who have been in the system for 10+ years? What have their unit economics, renewal experiences, and relationship with the franchisor been like?

The termination clause allows immediate termination for 22 non-curable defaults. Can you provide the complete list of these non-curable defaults, and has Coverall ever terminated a franchisee under each category?

All disputes require binding arbitration with a class action waiver. What have been the historical outcomes of arbitration disputes between Coverall and franchisees, and what are typical attorney and arbitration costs?

Personal guarantees from shareholders/members are required. If Coverall terminates a franchise or the business fails, are shareholders personally liable for amounts beyond the franchise fee investment?

The non-renewal rate of 0.2% suggests very few franchisees choose to renew. Is this because renewal rates are low, or does this data reflect a different calculation methodology?

What support and training services does Coverall provide, and why does the Support & Training score of 72 fall below the typical range of 76-90 for this franchise category?

Can you clarify the $0 renewal fee listed in the agreement? Are there any ongoing costs, restocking charges, or system upgrades required to renew the franchise?

Given the 23.1% 3-year turnover rate versus the typical 1.85%-16.2% range, what percentage of closures are attributed to franchisees unable to generate sustainable revenue versus operational or support issues with Coverall?