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B55/100FDD 2025

Brightway Insurance — Litigation & Risk

Business Services - Tax & Financial · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
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

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
11
Government-backed loans issued
Default rate
18.2%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$1.5M
Avg loan size
$138K
Participating lenders
4

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 55/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth (0.9% YoY) indicates mature/declining system with minimal expansion
  2. 02MEDAsymmetrical commission split (50% renewal commission retention) heavily favors franchisor and reduces franchisee profitability on recurring revenue
  3. 03MEDNo average net income disclosed in FDD Item 19 — unable to verify ROI claims or validate $136,900 investment thesis
  4. 04HIGHPrior litigation (2019 Eurohold settlement) signals franchisor-franchisee disputes over agreement terms and scope creep
  5. 05MINORUnprotected territory creates direct competition risk within assigned area and cannibalization of book of business
  6. 06MINORHigh initial investment ($35,000 franchise fee + $23,325-$136,900 startup) with unclear payback period

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.