Realty Executives

Can you provide details on the 8 cases where the franchisor was plaintiff? What were the primary reasons for legal action against franchisees?

What are the specific circumstances of the 3 pending litigation cases, and what outcomes are anticipated?

The system lost 41 units over 3 years (13.7% decline). Can you explain the primary reasons franchisees are being terminated or exiting?

Why did unit closures spike to 38 in 2024 compared to 21-26 in prior years? Were these related to a specific issue, market condition, or policy change?

The ad fund of $325 annually is substantially higher than typical for real estate franchises (1-3% of revenue). What specific marketing and technology services does this fund cover?

How is the $325 annual ad fund calculated and allocated? Is it based on a percentage of revenue, per-unit fee, or other metric?

Of the 38 units terminated in 2024, how many were terminated for cause versus non-renewal or voluntary exit?

What are the 20 non-curable defaults that trigger immediate termination? Are these clearly defined in the franchise agreement?

Can you provide data on franchisee profitability and average unit volumes for the past 3 years to help assess viability?

The support and training score (67) is below typical range. What specific training and ongoing support do franchisees receive?

Why is the non-compete restriction 0 years and 0 miles? How does this protect franchisees' territories after exit?

The franchise agreement requires personal guarantees from all LLC members and their spouses with joint and several liability. How often has this indemnification clause been invoked?

Can you identify any commonalities among the 85 units closed or terminated over 3 years (geographic region, time in system, size)?

What is the average tenure of closed/terminated units? Are franchisees typically exiting before or after their initial 10-year term?

The franchisor initiated 8 lawsuits over 3 years. Were these collection actions, breach of contract, or other types of disputes?

How does the 10-day cure period for payment defaults work in practice? What percentage of franchisees cure payment defaults versus face termination?

Are there renewal options available after the 10-year initial term, and what are the associated costs and conditions?

Can you provide references from franchisees who have operated for more than 5 years, particularly those in competitive markets?

What marketing and lead generation support does the franchisor provide given the substantial $325 annual ad fund?

How is commission or revenue structured between the franchisor and franchisees? Are there tiered fee structures based on volume?