Mosquito Authority

The franchise agreement lists 19 non-curable defaults under Section 17.1. Can you provide the complete list and clarify which circumstances would result in immediate termination without a cure period?

You have 5 litigation cases on record with the franchisor named as defendant. What were the nature of these cases, the outcomes, and what has been implemented to prevent similar disputes?

Unit closures doubled from 2 to 12 between 2022 and 2024. What factors do you attribute to this increase, and are you tracking any leading indicators of closure risk?

The transfer rate of 6.8% exceeds typical benchmarks for this category. What percentage of transfers are voluntary franchisee-initiated sales versus franchisor-encouraged or facilitated transfers?

Your royalty rate of 10% and ad fund of 3% (combined 13%) exceed typical home services benchmarks. How do you justify these rates, and what additional value or support do these higher fees provide compared to competitors?

The technology fee of $100/month is below typical but you require all products and services from designated suppliers. What are the total monthly supplier costs a franchisee can expect, and how does this compare to your technology fee?

You require spouse guarantees in addition to personal guarantees from 5%+ owners. What is the business justification for spouse liability, and can this requirement be waived or modified in any circumstances?

All disputes must be arbitrated in North Carolina under binding arbitration. How many disputes have been filed, what were the outcomes, and what are the typical costs for a franchisee to arbitrate a dispute?

You have 5 litigation cases against the franchisor but 0 cases in the past 3 years. Does this indicate the issues have been resolved, or are there ongoing disputes that haven't yet resulted in formal cases?

The agreement contains 19 non-curable defaults. Are any of these defaults related to sales performance, and if a franchisee fails to meet sales targets, what support or remediation do you provide before termination?

Transfer rate is unusually high at 6.8%. What is the typical reason franchisees transfer their units, and do you have any data on franchisee satisfaction or profitability by cohort?

Your initial franchise fee of $35,000 is $10,000-$24,900 below typical. What is included in this fee, and what are the startup costs a franchisee should expect in the first year beyond the franchise fee?

The non-compete restriction is 2 years within 25 miles. Has this restriction been enforced, and what specific mosquito control and related pest control services are covered by this non-compete?

You offer 1 renewal option for 5 years with only 5 renewal conditions. What are these conditions, are they performance-based, and what is the likelihood of non-renewal or inability to meet renewal terms?

Item 19 financial performance data shows median gross sales of $450,722. How many units reported this data, what was the profit margin, and what percentage of franchisees exceeded or fell below median?

Your system grew from 530 to 547 units over 3 years while closures increased. What strategies are you implementing to reduce closure rates and improve long-term unit stability?

The termination rate is only 0.5%, indicating minimal franchisor-initiated terminations. Does this reflect high franchisee satisfaction, or are there performance issues being addressed through transfers rather than terminations?

You require all products from designated suppliers with 5 categories of restrictions. What is the markup or profit margin on these supplied products, and how transparent is the supplier pricing compared to market alternatives?

Can you provide a breakdown of the 5 litigation cases by type (employment, contract, property, regulatory, other) and explain whether any involved franchisee claims or customer complaints?