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B68/100FDD 2022

Awakenings — Litigation & Risk

Retail · 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
68 / 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
Nebraska
State whose law governs disputes — relevant if you're not based there

What drove the 68/100 rating

Risk Score Breakdown

  1. 01MINOROnly 3 units in system with unknown/stagnant growth trajectory indicates weak franchise model scalability
  2. 02MINORNo territorial protection creates direct competition risk and cannibalization of franchisee revenue
  3. 03HIGHGoing Concern status is FALSE — suggests franchisor may have solvency or operational sustainability questions
  4. 04HIGHNo litigation disclosed but only 3 units limits statistical significance of this metric
  5. 05MINORHigh investment-to-net-income ratio ($179,845-$310,500 investment against $260,592 avg net income) yields 0.84-1.19x payback period with no cushion for underperformance
  6. 06MEDExtremely small franchise system (3 units) means limited data, operational maturity, and replicability validation

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.