Given that the franchise system has only 1 operating unit as of 2024, what is the franchisor's growth plan and timeline for unit expansion?
#1
Why are there 2 pending litigation cases against the franchisor, and what are the nature and potential outcomes of these disputes?
#2
The agreement provides 0 renewal options at the end of the 20-year initial term. What happens to franchisees who wish to continue operations after year 20?
#3
Can you clarify why the territory score (35) is significantly below the typical range (50-75) for hospitality franchises, and what territory protections or exclusivity rights are provided?
#4
The agreement provides no territorial exclusivity and no encroachment protection. Can the franchisor open competing units in your market area during your franchise term?
#5
What was the outcome of the 1 case where the franchisor was plaintiff, and does this represent a pattern of franchisor enforcement actions against franchisees?
#6
Given the contract terms score (65) is below the typical range (68-80), what specific contract provisions are less favorable to franchisees compared to industry standards?
#7
The termination clause allows cure periods of 10 days for monetary defaults and up to 90 days for quality issues. Are there any defaults that are non-curable and result in immediate termination?
#8
Personal guarantees are required from all owners. If the business fails, what personal assets would be at risk beyond the franchised business?
#9
The renewal fee is $50,000 and the transfer fee is also $50,000. Are these fees separate from and in addition to the initial $75,000 franchise fee?
#10
Can you provide details on the 1 case initiated by the franchisor—was this related to franchisee non-compliance, collection, or another matter?
#11
What specific indemnification obligations are franchisees required to assume, and are there any limitations on the franchisor's liability to franchisees?
#12
How is the $734 technology fee calculated and what services/systems does it cover? Does this fee increase annually?
#13
Are there any guarantees or performance benchmarks the franchisor must meet, or are obligations primarily one-sided favoring the franchisor?
#14
What causes or disputes led to the 2 cases initiated against the franchisor in the past 3 years?
#15
Given the franchise fee is $75,000 but the system only has 1 unit currently operating, how will the franchisor use franchise fees to develop infrastructure and support?
#16
Are there any exit costs or obligations beyond the contract term that franchisees should be aware of (e.g., property restoration, equipment removal)?
#17
In a 20-year term with zero renewal options, how are disputes or non-performance issues resolved if they arise in year 18-20 when renewal is not an option?
#18
Can you provide references from the existing franchisee or previous franchisees (if any have exited) to discuss their actual experience with support and operations?
#19