What were the specific reasons for the 10 unit closures over the past 3 years, and did any relate to operational support deficiencies or system-wide issues?
#1
Given the 20.0% one-year closure rate and -15.0% net unit growth, what steps is the franchisor taking to improve unit retention and system stability?
#2
Why does the franchise charge a $500 monthly advertising fund when the typical range for casual dining is $1.0-$3.0 monthly, and how is this fund allocated?
#3
The technology fee is $8 monthly compared to a typical range of $90-$500. What technology services and support are included at this reduced rate?
#4
With a 4.0% royalty rate at the lower end of the typical 4.5-6.0% range, what ongoing support and services does this royalty fund, given the franchise's current system challenges?
#5
What is the detailed breakdown of the 14 non-curable defaults that trigger immediate termination, and how frequently have these been invoked in the past 3 years?
#6
The initial contract term is 5 years versus a typical 10-15 years. Why is the term shorter, and what protections does this provide franchisees versus shorter renewal cycles?
#7
With no Item 19 financial performance disclosures available, can the franchisor provide actual unit-level financial performance data for operating locations?
#8
How many of the 5 unit closures in 2022 were attributed to the opening period versus mature unit underperformance, and what was the average time-to-closure for failed units?
#9
Given the System Health score of 0/100, what specific operational, financial, or support issues contributed to this rating, and what remediation efforts are underway?
#10
Can the franchisor provide documentation of franchise litigation history beyond the past 3 years, including any class actions or regulatory complaints?
#11
What is the average unit volume (AUV) and profitability for current operating locations, and how does this compare to units that have closed?
#12
The transfer fee and renewal fee are both $7,500. How many transfers have been approved in the past 3 years, and what is the franchisor's approval process?
#13
With exclusive territory granted, how does the franchisor define territory boundaries, and have there been any encroachment disputes or territory adjustments?
#14
What is the franchisor's policy on non-renewal of expiring franchises, and have any franchisees been denied renewal at the end of their initial 5-year term?
#15
Given the requirement for personal guarantees and spouse consent forms, what recourse do franchisees have if the franchisor pursues personal liability claims?
#16
How many franchise units are company-owned versus franchisee-operated, and what are the performance metrics for company-owned locations?
#17
What training, ongoing support, and marketing assistance does the franchisor provide, and how is this reflected in the relatively low royalty rate of 4.0%?
#18