Can the franchisor clarify the Ad Fund Rate of 999.99? This appears to be an outlier and significantly exceeds the typical 1.0-2.5% range—what specific marketing and advertising services does this cover, and how is the fund managed and allocated?
#1
The Technology Fee of $100/month is below typical for this category. What specific technology systems, software platforms, or digital tools does this fee provide access to, and are there additional technology costs not included in this fee?
#2
What were the specific reasons for the 2 unit closures in 2021, and were these franchisor-initiated terminations, voluntary closures, or other circumstances?
#3
With a Bottom Quartile Sales figure of $82,705 significantly below the typical range, what is the sales performance distribution across your current 19 units, and what support does the franchisor provide to underperforming locations?
#4
The Item 19 data shows Average and Median Gross Sales as not available—can the franchisor provide detailed financial performance metrics including average unit volume and median sales for the current unit base?
#5
Given the 14.3% 3-year turnover rate exceeds typical benchmarks, what specific challenges or market conditions contributed to this higher-than-average turnover, and what changes have been implemented to improve retention?
#6
Can you provide the complete breakdown of the 2 units that 'ceased other' in 2021—were these bankruptcies, owner retirements, or other reasons, and did the franchisor provide transition support?
#7
The non-compete clause restricts franchisees for 2 years within 25 miles of their territory or 'any other protected territory licensed by the franchisor'—does this mean the non-compete applies to all territories the franchisor licenses nationwide, or only those within the franchisee's region?
#8
Late payment penalties are $100 per day plus 18% annual interest—what is the franchisor's historical practice regarding collection, and are there any payment plans or hardship provisions available?
#9
You mention required participation in advertising cooperatives 'if established'—which marketing cooperatives currently exist, what are the cost structures, and can franchisees opt out of specific cooperatives?
#10
The renewal agreement requires completion of 'all necessary maintenance, refurbishing' and 8 other conditions—can the franchisor provide the specific list of 9 renewal conditions and any associated costs?
#11
Personal guarantees are required from all shareholders and their spouses—are there any circumstances under which this requirement can be waived or modified, and what recourse do spouses have if guarantees are enforced?
#12
With zero terminations to date but specific termination language in the agreement, what specific actions or performance failures would trigger franchisor termination rights?
#13
Can the franchisor provide historical data on franchisees exercising their renewal options—how many units have renewed, and what percentage chose not to renew after their initial 10-year term?
#14
The franchisor's indemnification clause requires franchisees to defend and hold harmless the franchisor—are there any caps on indemnification obligations, or could franchisees be required to cover unlimited franchisor legal costs?
#15
What specific training, ongoing support, and field support programs are included in the initial investment and ongoing fees, given the 84/100 Support & Training score?
#16
Of the 1 transfer in 2023, what was the transfer fee amount, and what was the franchisor's approval process and any conditions imposed on the new franchisee?
#17
The agreement specifies no minimum performance standards—does the franchisor have any informal performance expectations, and under what circumstances might a franchisee be at risk of non-renewal despite meeting contractual obligations?
#18