The franchise has only 1 unit currently. Can you provide details on how long this unit has been operating and whether it represents a newly launched system or a significantly contracted one?
#1
With a 30-year total potential term (10 + 2×10), this exceeds typical franchise agreements in your category. What is the rationale for this extended term structure, and are there performance conditions tied to renewal options?
#2
The transfer fee of $5,000 is substantially below the typical range of $7,500-$20,000 for similar franchises. Are there restrictions or conditions on transfers that justify this lower fee?
#3
Item 19 financial performance data is included. Does the $825,710 average gross sales figure represent data from the current single operating unit, or does it include historical data from when the system was larger?
#4
The Investment Costs score of 69 is below the typical range of 74.0-75.0. What specific investment categories fall outside the typical range, and are there factors unique to Delta Crown that affect initial investment requirements?
#5
What is the minimum weekly royalty fee of $250 based on—is this calculated on a percentage basis, and at what sales volume does the percentage royalty exceed this minimum?
#6
The franchise agreement includes personal guarantees from all owners and their spouses regardless of ownership interest. What circumstances would trigger enforcement of these guarantees?
#7
All disputes must be submitted to binding arbitration with class action waivers. What is the typical cost of arbitration proceedings under this franchise agreement, and has this clause been invoked?
#8
The franchisee must purchase Service Integrity products from designated sources. What is the price relationship between these designated suppliers and market alternatives, and how frequently are pricing reviews conducted?
#9
With an 18% per annum interest rate on late royalty payments, what is the payment schedule and grace period structure before interest accrues?
#10
The territory is protected but not exclusive. How does the franchisor define and enforce protection against encroachment by other franchisees?
#11
Can you explain why the system has remained at exactly 1 unit for 3 consecutive years? Has unit growth been attempted, and if not, what are the franchisor's expansion plans?
#12
The cure period for payment failures and insurance issues is 10 days. How many terminations in the past 3 years have resulted from failure to cure within these timeframes?
#13
The 2-year, 20-mile non-compete is imposed post-termination. Are there circumstances where this non-compete would be waived or reduced?
#14
The renewal fee is $3,000. Are there other associated costs for renewal beyond this fee (e.g., system updates, retraining, equipment upgrades)?
#15
Given the $250 minimum weekly royalty, what are realistic profit margins for a franchisee operating at the average gross sales level of $825,710?
#16
Has the franchisor initiated any legal actions against current or former franchisees regarding operational standards, product sourcing, or non-compete violations?
#17
What support and training resources are provided initially and ongoing, given the Support & Training score of 88/100?
#18