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B65/100FDD 2025

Appell — Litigation & Risk

Other · 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
65 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
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
Governing law
New York
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01HIGHGoing concern warning indicates potential financial distress or viability questions at corporate level
  2. 02MEDCritical financial metrics completely undisclosed: no average unit revenue, net income, or royalty rate published
  3. 03MINORExtremely rapid unit growth (166.7% YoY from ~3 to 9 units) suggests either aggressive expansion or turnover; insufficient track record at scale
  4. 04MINORZero franchise fee is unusual and may indicate difficulty attracting franchisees through traditional means or aggressive market penetration strategy
  5. 05MINORUnknown term length and royalty structure prevent proper financial modeling and long-term commitment assessment
  6. 06MEDOnly 9 total units provides minimal comparable performance data and limited corporate stability/resources
  7. 07MINORNo Item 19 financial performance claims limits ability to validate earnings potential

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.