Given the 3-year compound growth rate of 30.4%, which substantially exceeds the typical range, what specific strategies has Pure Green used to support such rapid expansion, and how does your support infrastructure scale with this growth?
#1
Your total potential contract term of 10 years is below the typical 15-20 year range for this category. Why does the franchise agreement not include renewal options beyond the initial 10-year term, and what happens if a franchisee seeks to extend beyond year 10?
#2
The non-compete radius of 25 miles exceeds the typical range. Can you clarify how this 25-mile restriction is enforced geographically, and are there circumstances where franchisees can negotiate a smaller territory or radius?
#3
With 21 termination causes listed in the agreement, which specific breaches beyond the 3 curable categories (payment defaults and operational breaches with 30-day cure) are considered non-curable, and what is your enforcement history on these?
#4
The franchise agreement requires personal guarantees from all principals and spouses. How frequently has Pure Green enforced personal guarantees against principals, and are there any circumstances where this requirement can be waived?
#5
Your data shows 1 unit closing annually over the past 3 years. Can you provide details on why these units closed - were they voluntary sales/closures by franchisees or exits related to performance issues?
#6
The renewal fee is listed as both $5,000 and $2,500 in different sections of the agreement. What is the correct renewal fee, and does it include mandatory refurbishment costs, or are refurbishment expenses separate?
#7
The non-compete clause restricts former franchisees from operating businesses offering 'cold pressed juices, smoothies, acai bowls, or any other' similar products. How broadly is 'any other' interpreted, and what specific product categories would trigger a violation?
#8
With a 59.38% net unit growth over 1 year, how many of the new 19 units opened in the past year are franchisee-owned versus company-operated, and what is the performance data on newly opened franchised locations?
#9
Your royalty structure includes a $1,000 monthly minimum. For franchisees with lower monthly revenues, does this minimum ever exceed 6% of gross revenue, and if so, how frequently does this occur across your system?
#10
Late payment penalties include $100 fees plus 15% annual interest on overdue amounts. Are these penalties charged cumulatively, and have any franchisees had payment plans or restructuring options approved during financial hardship?
#11
The agreement requires 'mandatory refurbishment to current trade dress standards' for renewal. What are the estimated costs for this refurbishment, and how often are standards updated to require additional investments?
#12
You list 21 non-curable default categories, including 'training' requirements. What specific training deficiencies would constitute a non-curable default, and how is franchisee compliance with training measured and documented?
#13
The territory is marked as 'protected but not exclusive' with 'no encroachment protection.' What does 'protected' mean in this context, and under what circumstances could Pure Green open a competing location or approve a franchisee in an existing franchisee's territory?
#14
Given zero terminations and zero non-renewals recorded, has every franchisee who has been with the system completed their initial term, or have some exited voluntarily before the 10-year term ended?
#15
The ad fund rate is 2.0%, and the agreement mentions mandatory 'participation in regional or local advertising.' Beyond the 2.0% fund contribution, what are typical additional advertising expenditure expectations franchisees must make?
#16
With only 0 litigation cases over 3 years and 0 currently pending, how many franchisee inquiries, complaints, or disputes does Pure Green typically handle informally through mediation or direct resolution, and what is your dispute resolution process?
#17
The financial data shows median gross sales of $563,651 and average of $612,658. How many units reported this data, and what is the range of reported sales across your franchisees - specifically, what percentage of units fall below the median?
#18