B59/100FDD 2023
ASI Sign Systems — Litigation & Risk
Business Services - Printing & Signs · FDD Items 3, 4 & 5
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
59 / 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
2
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$645K
Avg loan size
$323K
Participating lenders
2
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
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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 59/100 rating
Risk Score Breakdown
- 01MEDNo disclosed net income (Item 19) prevents ROI validation despite $2.7M avg revenue claim
- 02MEDSmall unit base (24 units) with unknown growth trajectory suggests limited system scale and stability
- 03HIGHGoing Concern status is False — indicates potential financial distress at franchisor level
- 04MINORHigh initial investment ($308.5K-$328.5K) with $3,250/month royalty creates significant breakeven burden without profit transparency
- 05MINOR5-year term is shorter than industry standard (10 years typical), suggesting franchisor risk or low franchisee retention confidence
- 06HIGHNo litigation disclosed may indicate unreported disputes or inadequate FDD detail
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.