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
46
Government-backed loans issued
Default rate
10.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
4 loans
Loans charged off or defaulted
Total loan volume
$6.3M
Avg loan size
$137K
Participating lenders
31
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
New York
State whose law governs disputes — relevant if you're not based there
What drove the 70/100 rating
Risk Score Breakdown
- 01MINORUnit count declining 3.7% YoY (129 units) indicates contracting system during economic recovery period
- 02MEDNo Item 19 financial disclosure (avg revenue/net income not disclosed) prevents ROI validation and comparability to investment
- 03MINOR5-year term is shorter than industry standard (10 years typical), creating higher renewal/relocation risk
- 04MINORSliding scale minimum royalty structure is opaque—actual effective rate and breakeven thresholds unknown
- 05MINORHigh initial investment ($168K-$199K) relative to unknown revenue potential creates unfavorable risk-reward ratio
- 06MINORProtected territory scope undefined—geographic size and customer density unspecified
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.