Marco's Pizza

The advertising fund rate of 5.5% is above the typical 2.0-4.0% range for quick service restaurants. How is this fund allocated, and can you provide a detailed breakdown of marketing spend by channel for the past 3 years?

13 litigation cases were filed in the past 3 years with 11 initiated by the franchisor as plaintiff. What are the primary categories of these cases (e.g., royalty disputes, non-compliance, breach of contract), and have any resulted in significant settlements or judgments?

Two litigation cases are currently pending. What are the nature of these pending cases, what are the potential financial exposures, and what is the expected timeline for resolution?

The transfer rate of 7.2% is at the upper end of the typical range. What percentage of transfers are owner-initiated vs. franchisor-approved changes in ownership, and what are the typical reasons franchisees request transfers?

Can you provide the specific details of the 19 unit closures in 2024, including whether any were in the same geographic market or attributable to specific operational issues?

What defines 'Good Standing' for renewal eligibility, and how many franchisees have failed to meet renewal conditions in the past 5 years?

The agreement requires 12 non-curable defaults. Can you explain each of these 12 defaults and provide examples of how franchisees have been terminated for non-curable violations?

Personal guarantees are required from all owners holding 5% or more. If a franchisee declares bankruptcy, what are the franchisor's collection procedures against personal guarantees?

Equipment and fixtures must be purchased from approved distributors only. How many approved distributors are available, what is the pricing structure relative to market rates, and can franchisees request exceptions?

The $6,250 renewal fee represents what percentage of a franchisee's annual profit based on the median gross sales figure of $885,934, and is this fee negotiable?

Can you explain the variance between the median gross sales of $885,934 and average of $934,318, and what percentile range of franchisees fall within each figure?

How many of the 1,159 current units are in their first term vs. renewal terms, and what is the renewal rate for franchisees reaching the end of their initial 10-year term?

The termination rate is 0.5%, but 13 litigation cases were filed in 3 years. How many of these cases involved threatened or actual termination, and how many were resolved without termination?

What is the average unit volume (AUV) for units in their first year, second year, and years 3-10 to understand the profitability trajectory?

The non-compete clause is 2 years and 5 miles. How is this enforced, and have there been legal cases challenging the enforceability of this restriction?

Can you provide details on the 30 days-to-cure provision for non-payment defaults? If a franchisee misses a royalty payment, what collection actions does the franchisor take during the cure period?

Of the units showing transfers in the past 3 years (254 total transfers from 2021-2024), how many involved a transfer to a new owner vs. transfer within an existing franchisee's portfolio?