The Little Gym

What were the specific reasons for the 4 litigation cases filed in the past 3 years, and what were the outcomes or settlements?

As the franchisor, what specific breaches or defaults led to the 2 cases you initiated against franchisees, and how were they resolved?

Your transfer fee of $29,750 is nearly 50% higher than the typical range for this category. What services and support are included in this fee, and are there any payment plan options?

The ad fund rate of 2.5% exceeds the typical range. How is this fund allocated annually, and can franchisees request an accounting or audit of these expenditures?

Your franchise fee of $59,500 is above the typical range. What additional value or services does this higher fee provide compared to competitors?

The technology fee of $119 monthly is below typical, but what specific services are included, and are there plans to increase this fee in the foreseeable future?

With 32 termination causes listed, what are the most commonly invoked reasons for terminating franchisee agreements, and what is the typical cure period provided?

Your termination rate of 0.9% is slightly above average. How many of the terminated units in 2023-2024 were due to performance issues versus other factors, and what percentage were cured?

The transfer rate of 10.1% is notably high. What is driving these transfers—are they primarily sales to new operators, buybacks by the franchisor, or transfers between existing owners?

Item 19 financial performance data shows median gross sales of $565,172. What percentage of franchisees achieve or exceed this figure, and what is the typical break-even point?

The non-compete clause restricts activity within 25 miles for 2 years post-termination. How is this radius measured, and has the franchisor enforced this clause in previous disputes?

With a 2-year non-compete in place, what guidance does the franchisor provide franchisees on permitted business activities or career transitions after exiting?

The renewal fee is $14,875 (25% of current franchise fee). Will this increase if the initial franchise fee increases, and what renewal conditions are most frequently unmet by franchisees?

All disputes must be resolved through binding arbitration in Texas. Why was Texas chosen as the arbitration location, and what are the typical costs and timelines for arbitration?

The mandatory minimum royalty is $2,500 monthly (or 8% of gross sales, whichever is greater). For franchisees with lower sales, what support does the franchisor provide to help reach higher revenue levels?

With 18% annual interest on late payments, what is the typical delinquency rate, and does the franchisor offer any payment accommodations or hardship programs?

You must purchase from franchisor or designated suppliers across 13 categories. What percentage markup or profit does the franchisor realize from these mandatory purchases?

The system requires automatic membership in advertising cooperatives when formed. How often are these cooperatives established, and what are the typical annual costs beyond the 2.5% ad fund?

Given the strong system health score (85) but lower investment cost score (25), what specific financial or operational challenges have historically faced franchisees that scores don't capture?

How many of the 33 net unit additions in the past year were new franchises versus transfers, and what was the average selling price for transferred units?