The Coven

Given the 44.2% three-year CAGR and 50% one-year growth rate, far exceeding industry norms, what is driving this rapid expansion and is this growth rate sustainable?

The franchise has zero reported closures, terminations, and transfers since 2022. Can you provide details on whether all original franchisees remain active, and if so, for how long have they been operating?

Why is the technology fee of $850/month more than double the typical range of $100-$500 for business service franchises, and what specific technology and services does this cover?

The transfer fee of $25,000 exceeds typical ranges by approximately 28-377%. What factors justify this elevated fee and how does it compare to renewal fees?

The franchise agreement requires binding individual arbitration with class action waivers. How many disputes, if any, have been arbitrated in the past 3 years, and what were the typical outcomes?

Personal guarantees are required from all principal owners and potentially spouses, with indemnification for all franchisor losses. Can you clarify the extent of personal liability exposure and provide examples of what franchisees have been required to indemnify?

Renewal conditions require 7 specified conditions to be met, with a renewal fee equal to 25% of the then-current initial franchise fee. What are these 7 conditions, and what percentage of existing franchisees have successfully renewed or do you anticipate will renew?

The renewal fee would be approximately $12,500 based on the current $50,000 franchise fee. Will this fee increase if the initial franchise fee increases, and how will renewal requirements be assessed?

With only 6 total units currently operating, what is the breakdown of these units by location, opening date, and current operational status?

Can you provide names and contact information for existing franchisees who have been operating for at least one full year so that independent due diligence and reference calls can be conducted?

What specific support, training, and ongoing services are provided to justify the 8% royalty and 2% advertising fund, and are these rates fixed or subject to increase?

Given the very early stage of the system (only 4 units existed one year ago), what contingency plans exist if the franchise growth slows or if units unexpectedly fail?

The agreement includes a 2-year, 25-mile non-compete. If a franchisee exits at the end of the initial 10-year term without renewing, are they required to adhere to this non-compete, and how is it enforced?

Can you provide a detailed breakdown of the average gross sales figure of $519,416? How many units reported this data, over what time period, and what is the range of sales across units?

Have any franchisees received communications about potential termination, non-renewal, or had disputes regarding territory, fees, or operational standards, even if no formal litigation has been filed?

The franchise investment score is significantly below typical for the category (51 vs. typical 75). What is the total investment required including franchise fee, buildout, equipment, and working capital?

The ongoing fees score is slightly below typical (61 vs. typical 62), despite relatively standard royalty and ad fund rates. What additional fees or costs may franchisees encounter beyond the stated royalty, technology, and ad fund?

Why does the Risk Factors score (80) exceed the typical range (60-78)? What specific risk factors in the franchise agreement or business model are driving this elevated score?

The System Health score (75) exceeds the typical range (46-70). What metrics or factors contribute to this above-typical score, and what indicators suggest the system's stability given its very recent inception?