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
55 / 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
Illinois
State whose law governs disputes — relevant if you're not based there
What drove the 55/100 rating
Risk Score Breakdown
- 01MEDNet income not disclosed in Item 19 — unable to verify actual profitability despite $887K average revenue claim
- 02MINOROnly 3 units in system with 100% YoY growth appears artificially inflated (1→2→3 is small sample size, not market validation)
- 03MINORRoyalty structure is unusually low ($300/week) initially then doubles ($500/week) — incentivizes early exit after year 1
- 04HIGHGoing Concern flag is FALSE but typically franchisors disclose this voluntarily — lack of transparency raises questions
- 05MINORFranchise fee ($25K) is low relative to investment range ($178-330K) — suggests high capex with unclear ROI
- 06HIGHNo litigation disclosed but only 3 units limits exposure history and complaint visibility
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.