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D70/100FDD 2026

Bricks 4 Kidz — Litigation & Risk

Other · FDD Items 3, 4 & 5

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Elevated Risk

9 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
9
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
70 / 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
6
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$222K
Avg loan size
$37K
Participating lenders
6

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

What drove the 70/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth at 1.5% YoY indicates a mature or declining system with minimal expansion
  2. 02HIGHSerious inherited litigation involving SEC financial disclosure violations and Virginia governmental actions suggests systemic compliance and transparency issues
  3. 03MINORNo Item 19 (Average Unit Volume) disclosure prevents validation of the $101,813 avg revenue claim and obscures true unit economics
  4. 04MINORRoyalty floor of $700/month ($8,400 annually) creates negative cash flow risk for units generating <$120,000 in annual sales
  5. 05MEDHigh initial investment range ($34.2K-$110.5K) combined with undisclosed net income data prevents ROI analysis
  6. 06MINOR5-year term is relatively short and suggests franchisor may not be committed to long-term franchisee success
  7. 07HIGHSEC/financial disclosure litigation raises questions about accuracy of current financial representations to franchisees

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.