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D70/100FDD 2024

C3 Wellness — Litigation & Risk

Health & Wellness - Other · FDD Items 3, 4 & 5

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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
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

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
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. 01MEDOnly 2 operating units indicates extremely limited system size and unproven scalability
  2. 02MEDNo disclosed net income despite $2.1M average revenue raises profitability concerns
  3. 03HIGHGoing Concern status of FALSE suggests potential financial instability at franchisor level
  4. 04MINORUnknown unit growth trajectory indicates lack of transparency or stagnant expansion
  5. 05MINORHigh initial investment ($652k-$858k) relative to only 2 franchises operating creates ROI uncertainty
  6. 06MINORAbsence of Item 19 (Financial Performance Representations) prevents income validation
  7. 07MINOR6% royalty on $2.1M average = $128,741 annual franchisor revenue from only 2 units is insufficient to support infrastructure

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.