El Pollo Loco

Of the 5 cases where the franchisor was defendant, what were the primary claims and have any resulted in judgments or settlements against the franchisor?

Can you provide details on the 7 unit closures that occurred in 2022 and explain what drove the significant reduction in that year?

The franchise fee of $40,000 and monthly technology fee of $1,050 are both above typical market rates for Quick Service Restaurants—what additional services or technology infrastructure justify these higher costs?

How is the 5.0% ad fund rate utilized, and can you provide documentation showing how ad spend benefited franchisees in the past 12 months?

Given the 20-year initial term (above the typical 10-15 year range), what flexibility does the franchise agreement provide if a franchisee needs to exit before term expiration?

Can you explain why there are only 6 renewal conditions compared to the typical 7-9 for this category, and what conditions are required to renew at the end of the initial 20-year term?

The renewal fee is listed at $20,000—is this in addition to the $16,000 transfer fee, and what costs would a franchisee expect to pay to renew after 20 years?

What is the approval process for purchasing from non-approved suppliers, and how often are exceptions granted to the required supplier list?

With 12 termination causes listed, can you identify which of these are most commonly cited in actual terminations, and what percentage of these are curable vs. non-curable?

Sales figures show significant variance (bottom quartile at $1.4M, top quartile at $3.2M)—what are the primary factors driving this 135% performance difference between top and bottom performers?

Can you provide a breakdown of the 2 litigation cases filed in the past 3 years and explain their current status and outcomes?

Are there any pending or threatened legal actions not yet disclosed that prospective franchisees should be aware of?

The non-compete clause restricts activity within 5 miles for 2 years post-exit—how is this enforced, and have there been disputes over compliance?

Personal guarantees are required—does this extend to spouses or only the primary franchisee entity, and are there scenarios where the guarantee can be released or limited?

What percentage of Item 19 financial data comes from franchisees in the top-performing locations versus average locations, and how representative is the median figure for a typical new franchisee?

Since territory is protected but not exclusive, what encroachment protections exist if the franchisor opens a company-operated location within your territory?

Can you provide details on the operating costs included in the reported sales figures, and what percentage of franchisees achieve the median gross sales of $2.1M?

Given the 5.0% royalty plus 5.0% ad fund plus $1,050 monthly technology fee, what is the typical total monthly cost structure for an operating unit generating $2M in annual sales?