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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
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
20
Government-backed loans issued
Default rate
16.7%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$2.7M
Avg loan size
$134K
Participating lenders
7
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
3 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
- 01MEDNo Item 19 (Financial Performance Representations) disclosed — cannot independently verify the $114,372 average net income claim
- 02HIGHGoing Concern status is FALSE, suggesting potential financial instability or disclosure issues at corporate level
- 03MINORHigh royalty burden: $120/week ($6,240/year) plus franchise fee creates 5.4% annual royalty drag on $114k net income
- 04MINORRapid unit growth (84.2% YoY) may indicate unsustainable expansion, recruitment-driven model, or inflated unit count
- 05HIGHProtected territory and low litigation history provide limited differentiation in due diligence — could mask operational issues
- 06MINORThin margin between investment ($161,940–$216,980) and year-one net income ($114,372) leaves minimal cushion for underperformance
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.