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F80/100FDD 2022

Ceiling Guru — Litigation & Risk

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
80 / 100
FranchiseVerdict composite
Rating
AVOID
STRONG / MODERATE / CAUTION / AVOID

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 80/100 rating

Risk Score Breakdown

  1. 01MINORZero existing franchise units with unknown growth trajectory indicates unproven system and market validation
  2. 02MINORNo average revenue or net income disclosure (Item 19) prevents realistic ROI assessment and profit benchmarking
  3. 03HIGHGoing concern status is FALSE, suggesting potential financial instability or operational uncertainty at franchisor level
  4. 04MINORHigh franchise fee ($54,900) relative to total investment and lack of unit growth creates high risk of unit failure
  5. 05MED7% royalty begins in month 7, but without disclosed average revenue, franchisees cannot estimate actual royalty burden or break-even timeline
  6. 06MINOR10-year term with protected territory is standard, but provides little comfort without proven unit economics

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.