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B63/100FDD 2023

Ani — Litigation & Risk

Business Services - Tax & Financial · FDD Items 3, 4 & 5

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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

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
1
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted

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
Nevada
State whose law governs disputes — relevant if you're not based there

What drove the 63/100 rating

Risk Score Breakdown

  1. 01MINORNo average revenue or net income disclosure (Item 19) — impossible to validate investment ROI claims
  2. 02HIGHGoing Concern status is FALSE, suggesting potential financial instability at corporate level
  3. 03MINORMinimal unit growth (7.7% YoY) with only 15 total franchises — system appears stalled
  4. 04MINOREscalating royalty structure (10% → 15% → 20%) heavily penalizes long-term franchisees and creates cash flow pressure
  5. 05MEDZero territory protection in commission-based model increases direct competition between franchisees
  6. 06MINORSmall franchise fee ($25,000) relative to total investment suggests thin corporate margins and support resources
  7. 07MEDCommission-based revenue model is highly volatile and dependent on macroeconomic conditions

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.