FARRELL'S EXTREME BODYSHAPING®

Given the 6.8% termination rate (4 times the category typical range), what specific operational or financial issues have led the franchisor to terminate franchisee agreements, and are these documented in franchisee agreements available for review?

Can you provide details on the 3 terminations that occurred in 2024? Were these for non-payment, non-compliance with brand standards, or other reasons, and were franchisees given the stated 5-30 days notice?

The system declined from 52 to 44 units over 3 years (-5.4% CAGR). What is the franchisor's strategy to reverse this decline, and what support or incentives are offered to improve franchisee profitability?

With a 13.6% transfer rate (more than double the typical range), what percentage of transfers represent struggling locations being handed off versus normal ownership transitions, and what vetting process applies to new owners?

Why does the transfer fee of $20,000 exceed the typical range by 16.5%, and is this fee waived or reduced if the franchisor approves the transfer or if the outgoing franchisee locates a buyer?

The ad fund rate of 1.5% is below the typical 2.0%. How is this difference reflected in marketing support provided to franchisees, and has this lower rate been sufficient to drive membership growth?

Can you provide a sample of actual franchisee income statements or unit-level financial data for the past 3 years to understand typical revenue, operating costs, and profitability by unit age and location type?

Given the System Health score of 19/100 (well below the typical 50.0-75.0 range), what metrics or operational issues contributed to this low score, and what corrective actions is the franchisor implementing?

What are the 6 conditions required to renew the franchise at the end of the initial 10-year term, particularly regarding facility remodeling costs and timeline, and are there guarantees that renewal will be approved if conditions are met?

The non-compete clause restricts activity within 10 miles of any system location for 2 years post-termination. How strictly is this enforced, and has the franchisor initiated litigation against franchisees who violated this clause?

Are there any pending disputes or complaints filed with state attorneys general, the FTC, or industry regulatory bodies that are not reflected in the litigation data, and can you provide references from franchisees who have exited in the past 3 years?

What happens if a franchisee cannot meet the remodeling and modernization requirements at renewal—is the franchise automatically terminated, or is there flexibility or franchisor funding available?

The franchisor requires all goods, equipment, and services to be purchased from franchisor-approved suppliers and prohibits pricing below published minimums. Can you provide a detailed list of required suppliers and typical annual costs for equipment and service purchases?

How are disputes between franchisor and franchisee typically resolved given the binding arbitration requirement in Monmouth County, New Jersey, and what is the average cost and timeline for arbitration cases?

With 3 terminations in 2024 (6.8% rate), what percentage of current franchisees are at risk of termination based on current performance metrics, and does the franchisor provide early warning systems or improvement plans before termination?

Can you provide the franchise agreement (Item 1 of the FDD) and all exhibits, including sample agreements with suppliers, to verify the exact terms, fees, and conditions that apply to franchisees?

What is the franchisee survival rate at 1-year, 3-year, and 5-year milestones, and what is the primary reason franchisees cite for closure or transfer (profitability, personal reasons, system support, competition, etc.)?

The renewal fee is $20,000. Are there additional mandatory reinvestment amounts for remodeling, and what is the total estimated cost to renew a franchise at the end of the initial 10-year term?

Have there been any material changes to the franchise model, fee structure, supplier requirements, or support systems in the past 3 years, and how have these changes affected existing franchisees' profitability?

Given the low System Health score and declining unit count, what is the franchisor's long-term strategic plan for the brand, and is there any risk of system-wide restructuring or insolvency?