Frontier Adjusters, Inc.

The system lost 60 units in the past year alone. Can you provide specific reasons for the spike in terminations from 8 units in 2021 to 64 units in 2023? What performance metrics trigger termination?

Termination rates are 12.1%, more than double the typical range for this category. What are the 12 specific termination causes listed in the franchise agreement, and how frequently is each invoked?

Your technology fee of $1.0/month is substantially below the category typical of $225-586/month. Does this fee adequately cover all required software, systems, and digital tools, or are there additional technology costs franchisees should anticipate?

The transfer fee of $500 is significantly below the category typical of $5,000-25,000. What does this fee cover, and are there other costs or approval requirements for unit transfers that prospective buyers should understand?

Why is the non-compete radius 100 miles when the category typical is 21-25 miles? How does this impact franchisee ability to pursue other business opportunities after exit?

Renewal conditions are minimal (3 requirements vs. typical 5-8). What are these 3 renewal conditions, and what flexibility exists for franchisees to negotiate renewal terms after the initial 5-year period?

Your System Health score of 24 is significantly below the category range of 30-69. What specific operational or financial metrics are contributing to this low health score?

Territory is marked as protected but not exclusive. Can the franchisor place additional adjusters or competing units within my protected territory, and under what circumstances?

With zero litigation cases on record, how are disputes typically resolved between the franchisor and franchisees? The disclosure mentions binding arbitration in Cuyahoga County, Ohio—what percentage of disputes go to arbitration vs. informal resolution?

Item 19 financial performance data is available. What is the median gross revenue for active units, the number of units reporting, and what was the revenue range (top and bottom quartile)? How do current revenue figures compare to when these units opened?

Of the 106 terminated units over 3 years, how many were terminated for non-payment of fees vs. violation of specific operational standards? Are there written standards franchisees must meet to avoid termination?

The franchise fee is $15,000, and your Investment Costs score of 85 exceeds the typical range of 73-75. What is the total initial investment required (including equipment, inventory, training, and working capital), and what percentage goes to the franchisor vs. third parties?

Can you explain the discrepancy between transfer rate (11.0%) and non-renewal rate (0%)? If non-renewal rate is zero, why do so many franchisees transfer their units?

Personal guarantees are required from owners with 20% or more equity. If a franchisee defaults or is terminated, what personal assets can the franchisor pursue beyond the franchise business itself?

The ad fund rate is 1.0%, below the typical 1.5-4.0%. How is this fund used, what marketing support does it provide to individual franchisees, and is there an accounting of how these funds are spent annually?

Of the 64 terminated units in 2023, how many were located in specific geographic regions, and were there any common factors (economic downturn, market saturation, or franchisor policy changes)?

What support and training resources are provided to help franchisees succeed, especially given the high termination rates? Are there ongoing coaching, peer networks, or intervention programs before termination occurs?

The franchise agreement includes an indemnification clause requiring franchisees to defend the franchisor in legal actions. Can you provide examples of situations where franchisees were required to indemnify the franchisor, and what were the financial consequences?