What specific events or circumstances constitute each of the 22 non-curable defaults listed in the termination clause, and which are most commonly cited in disputes?
#1
Given the 5-year initial term is shorter than typical for this category, what is the renewal rate history, and what percentage of franchisees have renewed at the end of their initial term?
#2
The bottom quartile of franchisees reported sales of $563,688, which is above typical for the category. What operational factors or market conditions explain this higher performance in lower-tier units?
#3
Can you provide performance data broken down by unit age, location type, or other segments to understand which franchisees are achieving the $1.2M average and which are in the lower quartile?
#4
What percentage of franchisees are required to purchase equipment, fixtures, and supplies exclusively from franchisor-designated suppliers, and what is the typical markup or pricing premium compared to open market alternatives?
#5
Since the franchise has 7 current units with zero closures in 3 years, what is the average unit volume and profitability for units at different stages (first year, second year, mature)?
#6
The non-compete clause restricts activity within 2 years and 20 miles post-exit. How has this been enforced in practice, and are there documented cases of franchisees violating or challenging this restriction?
#7
What is included in the mandatory arbitration process, what are typical costs and timeframes, and how many disputes have been arbitrated versus settled in the past 3 years?
#8
Can you explain the discrepancy between the scoring data that flags ongoing fees at 61/100 (below typical 62.0) and the actual 9.0% total ongoing rate (8% royalty + 1% ad fund)?
#9
What spouse guaranty obligations exist, and are both spouses equally liable for all franchise obligations, or are there limitations on spousal liability?
#10
How frequently does the franchisor modify the list of approved/designated suppliers and contractors, and can franchisees request additions or exceptions to the approved vendor list?
#11
What is the breakdown of the $17,500 transfer fee, and does this fee apply if a franchisee transfers the unit to a spouse or family member?
#12
Given the 5-day cure period for both monetary and non-monetary defaults, what documentation or process must a franchisee follow to demonstrate compliance, and who determines sufficiency of the cure?
#13
Are there any historical disputes or claims related to the encroachment protection policy, and how is territory protected if a dispute arises about protected area boundaries?
#14
What support, training, and ongoing operational guidance is included in the franchise agreement, and what additional costs exist for training beyond initial onboarding?
#15
Can you provide references to at least 3-5 franchisees across different unit ages and markets, and confirm whether they will discuss financial performance, growth challenges, and satisfaction with franchisor support?
#16