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B65/100FDD 2024
Broadway Pizza — Litigation & Risk
Food & Beverage - Pizza · 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)
—
Franchisor or officer bankruptcy
Overall risk score
65 / 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
5
Government-backed loans issued
Default rate
20.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$1.8M
Avg loan size
$358K
Participating lenders
3
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
Not waived
Non-compete
0.8 yrs
Post-termination restriction on similar businesses
Franchisor can compete
No
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Minnesota
State whose law governs disputes — relevant if you're not based there
What drove the 65/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 (average unit volumes) disclosed — impossible to assess ROI or profitability
- 02MEDOnly 12 units system-wide indicates extremely limited scale and unproven business model
- 03HIGHGoing Concern status is FALSE — suggests potential financial instability of franchisor
- 04MINORHigh initial investment ($860k–$1.35M) with no revenue/income benchmarks to justify it
- 05MED4.5% royalty on undisclosed revenues creates opacity around actual franchisee net earnings
- 06MINORNo unit growth data provided — suggests stagnant or declining franchise system
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.