The system has declined from 99 units to 84 units over 3 years. Can you provide specific reasons for the 16-unit contraction, including which markets were most affected and whether unit closures were voluntary or franchisor-driven?
#1
Nine units closed in 2025 compared to 7 total closures in 2023-2024 combined. What operational or market conditions changed to accelerate closures in the most recent year?
#2
The monthly technology fee of $605 exceeds the typical range of $200-$500 for fast casual restaurants. What specific technology services and platforms are included in this fee, and is it subject to annual increases?
#3
Median gross sales of $769,415 fall below the category typical range. Can you provide Item 19 profitability data showing net operating income for median, bottom quartile, and top quartile performing units?
#4
Bottom quartile units report only $389,632 in gross sales. At what sales threshold do franchisees typically become unprofitable, and how many current units fall below breakeven?
#5
The System Health score of 21/100 is significantly below the typical range of 50-75. What specific metrics or operational benchmarks contribute to this low score, and what remediation efforts are underway?
#6
The franchise agreement references 25 termination causes compared to a typical range of 15-23. Can you provide a detailed list of all termination causes and clarify which are curable with specific cure periods?
#7
The renewal fee is $5,000 for a 10-year renewal. Are there any material changes to fees, operational requirements, or territory rights upon renewal that current franchisees should expect?
#8
Post-term non-compete restrictions prevent involvement in businesses offering 'entrée salads' and 'made-to-order salads' for 2 years within 10 miles. How broad is the definition of competing businesses, and have disputes arisen over non-compete enforcement?
#9
Personal guarantees are required from all principals and spouses without limitation. In cases of franchise failure, have you pursued personal guarantee enforcement against individual franchisees, and what was the recovery rate?
#10
The total potential term of 10,000 years appears to result from 999 renewal options of 10 years each. Is this accurate, or is there a practical limit to the number of renewal options available to a franchisee?
#11
Transfer fee is $12,500. How many transfers have occurred in the past 3 years, and what percentage of transfer applicants were approved versus denied?
#12
Territory is protected but not exclusive. How does the franchisor define protected territory, and has encroachment by corporate-owned locations or other franchisees occurred?
#13
No litigation was reported over 3 years, but the system experienced 16-unit contraction. Have there been any disputes, complaints, or regulatory actions against the franchisor that did not result in formal litigation?
#14
The Ongoing Fees score is 60/100, slightly below the typical range of 61-62. Beyond the stated royalty, ad fund, and technology fees, are there any other recurring fees or mandatory purchases franchisees must pay?
#15
The termination rate is only 1.1% while the closure rate is 9.9%. This suggests most closures are voluntary or non-renewal rather than franchisor-initiated. What percentage of franchisees are choosing not to renew their agreements?
#16
Can you provide a breakdown of the 'Ceased Other' category, which represents 17 of the 32 total unit exits over 3 years? What reasons are classified under this category?
#17
Support & Training scored 98/100, the highest category score. What specific support services and training programs are provided, and how frequently are they updated as operational challenges emerge?
#18
Given the 3-year CAGR of -5.3%, what growth targets or unit expansion plans does the franchisor have for the next 3-5 years, and what investments are being made to reverse the contraction trend?
#19
Have there been any changes to the menu, supply chain, or operational model in the past 2 years that contributed to the increased closure rate in 2025?
#20