FranchiseVerdict
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D72/100FDD 2024

Aqua Chill Drinking Water Systems — 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
72 / 100
FranchiseVerdict composite
Rating
CAUTION
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
3 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 72/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status is FALSE — indicates potential financial viability concerns at corporate level
  2. 02MEDNo Item 19 financial performance data disclosed — cannot validate $113k-$171k investment ROI claims
  3. 03MINOROnly 19 units system-wide with unknown growth trajectory — suggests stagnant or declining franchise
  4. 04MINORZero territory protection — franchisees compete directly with each other and company-owned locations
  5. 05MED7% royalty on undisclosed revenue creates blind spot for true cost burden on net profitability
  6. 06MINOR20-year term locks franchisees into long commitment with unproven business model transparency
  7. 07MINORHigh initial investment ($60k franchise fee alone) relative to tiny system size indicates poor scale economics

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.