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Lower Risk
No litigation cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
63 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
2 yrs
Post-termination restriction on similar businesses
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Montana
State whose law governs disputes — relevant if you're not based there
What drove the 63/100 rating
Risk Score Breakdown
- 01MINOROnly 6 units in system with unknown growth trajectory suggests minimal scale and unproven model
- 02MEDNo Item 19 (Financial Performance Representations) disclosed — cannot verify if $254K avg net income is accurate or achievable
- 03HIGHGoing Concern = False indicates potential financial instability in franchisor operations
- 04MEDWide investment range ($182K-$695K) suggests inconsistent unit economics or hidden costs not disclosed upfront
- 05MINOR6% royalty on $1.16M revenue = $69,660 annually to franchisor from average unit — sustainability unclear with only 6 units
Severity inferred from FDD text — not a regulatory or legal classification
Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.