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D69/100FDD 2026

BoConcept — Litigation & Risk

Other · FDD Items 3, 4 & 5

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Moderate — Review

5 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
5
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
69 / 100
FranchiseVerdict composite
Rating
CAUTION
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
5
Government-backed loans issued
Default rate
25.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$1.6M
Avg loan size
$313K
Participating lenders
4

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
1 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
Denmark
State whose law governs disputes — relevant if you're not based there

What drove the 69/100 rating

Risk Score Breakdown

  1. 01MINORUnit count collapsed 22.2% YoY (23 units remaining) indicating severe system deterioration and franchisee exits
  2. 02MINORMultiple active lawsuits including allegations of franchisor scheme to eliminate franchises, suggesting hostile franchisor-franchisee relationship and potential bad faith practices
  3. 03HIGHGoing concern status is true, signaling existential viability questions about the parent company's financial stability
  4. 04MEDNo disclosed average revenue or net income data (Item 19 missing) prevents validation of franchisee profitability claims
  5. 05HIGHBankruptcy involving Florida-based stores and multi-claim litigation by southern California franchisee suggests operational/financial distress across geographies
  6. 06MINORLease guarantee dispute and wrongful termination/whistleblower suit indicate governance and HR issues that may signal broader management dysfunction
  7. 07MINORHigh initial investment ($420,900–$877,500) paired with unknown royalty structure creates opaque cost-of-operation picture

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.