BAbove average49/100FDD 2025
Board & Brush Creative Studio: Litigation & Risk
Recreation & Entertainment · 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)
- None
- Franchisor or officer bankruptcy
- Verdict score
- 49 / 100
- FranchiseVerdict composite · higher is better
- Rating
- B
- A / B / C / D / F verdict grade
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Charge-off 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
- Charge-off rate
- N/A
- vs 16% franchise average
- 5-yr charge-off rate
- N/A
- Defaults
- N/A
- Loans charged off or defaulted
- Total loan volume
- $60K
- Avg loan size
- $30K
- Participating lenders
- 1
FDD Items 5, 6 & 17: What You Give Up
Contract Risk Indicators
- Mandatory arbitration
- Not required
- You retain the right to sue in court
- 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
- WI
- State whose law governs disputes. Relevant if you're not based there
Extracted from FDD Item 3
Litigation Detail
No litigation required to be disclosed in Item 3.
What drove the 49/100 verdict
Risk Score Breakdown
- 01MEDUnit count declined 14.6% YoY (194 units), signaling potential system contraction or franchisee exits
- 02MEDNet income not disclosed in Item 19 — unable to validate profitability claims against $75K-$100K investment
- 03MINORHigh royalty floor of $400/month minimum creates cash flow pressure; requires ~$80K monthly revenue just to break even on royalties alone
- 04MINORAverage revenue of $116K is modest relative to investment size — payback period potentially 8-12 months before operating expenses
- 05MED5-year term is relatively short; limited runway to recoup investment and scale
- 06HIGHNo going concern statement suggests franchisor stability concerns or recent financial restructuring
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.