OpenWorks

Given that 257 franchisees were terminated in 2024 compared to 123 in 2022, what specific performance or compliance standards led to these terminations?

The termination rate of 41.8% is nearly 5 times the industry norm. Can you provide the specific contractual or operational reasons cited for terminations in the past 2 years?

15 litigation cases initiated against OpenWorks is substantially above the typical 0-2 cases for cleaning franchises. What were the primary legal claims in these cases, and how have they been resolved?

With 1 case currently pending, what is the nature of that litigation and what are the potential financial or operational impacts?

The royalty rate of 15% is nearly double the industry average of 6-8%. How does this rate compare to competitor franchises, and is it adjusted based on unit performance or territory?

Can you explain why transfer fees are only $2,500 when the industry standard is $5,500-$15,000, and what transfer restrictions apply?

The non-compete clause specifies 0 years post-termination with only a 75-mile radius. Would a terminated franchisee be able to operate a competing cleaning business in their former territory immediately upon termination?

Item 19 financial performance data is not provided. Can you provide unit-level financial data showing average gross sales, operating costs, and net profits for franchisees in different markets?

How many of the 201 units lost in the past year were due to franchisor terminations versus franchisee non-renewal or voluntary closure?

Given the 41.8% annual turnover, what support or corrective actions are offered to struggling franchisees before termination?

The $300 minimum monthly royalty applies regardless of revenue. How many franchisees are currently paying this minimum, and what percentage of units operate below breakeven before royalties?

Can you provide details on the 10 litigation cases filed in the past 3 years—specifically whether they involve franchisee disputes, employment claims, or regulatory violations?

With a potential 30-year contract term (exceeding the typical 10-20 years), what renewal conditions must be met and are there automatic termination provisions for underperformance?

The territory is non-exclusive with no encroachment protection. Can OpenWorks place new franchisees directly adjacent to or overlapping existing franchisee territories?

Support training scored 68, below the typical 76-90 range. What specific training and ongoing support are provided to new franchisees, and for how long?

Why does the franchise investment score 93 (well above typical 73-77) when the system is losing units at such a high rate?

Can you explain the 0/100 scores for System Health and Risk Factors and what specific factors contributed to these ratings?

Of the units remaining (414), what percentage are currently profitable before and after franchisor fees?

What is driving the ongoing legal challenges, and are there documented systemic issues with the business model or franchisor operations?

Given the 32.7% year-over-year unit loss, what concrete steps is OpenWorks taking to stabilize the franchise system and improve franchisee retention?