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D70/100FDD 2025

City2Shore Real Estate — Litigation & Risk

Real Estate · 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
1
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
$139K
Avg loan size
$139K
Participating lenders
0

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
1 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

What drove the 70/100 rating

Risk Score Breakdown

  1. 01MEDSystem contracting sharply: -12.5% YoY unit decline (11 units) suggests franchisees are failing or leaving
  2. 02MINORNo Item 19 financial disclosure: Franchisor refuses to disclose average unit volumes or profitability — major transparency red flag
  3. 03HIGHGoing concern status is FALSE: Franchisor itself may have financial viability issues
  4. 04MINORHigh initial investment ($61,450–$161,550) relative to unit count and declining trajectory creates breakeven risk
  5. 05MED6% royalty on gross commissions is punitive if real estate commission splits are tight; no net revenue guarantee

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.