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
72 / 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
—
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$170K
Avg loan size
$170K
Participating lenders
1
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
Wyoming
State whose law governs disputes — relevant if you're not based there
What drove the 72/100 rating
Risk Score Breakdown
- 01MINORZero existing franchise units with unknown growth trajectory indicates brand has never successfully scaled or is in early/failed stage
- 02MINORNo average revenue or net income disclosure prevents realistic ROI assessment and suggests franchisor cannot demonstrate unit economics
- 03MINORHigh initial investment ($102k-$124k) combined with $75k franchise fee (73% of total) creates steep entry cost with no performance data to justify it
- 04MINORUnprotected territory creates direct competition risk from other franchisees and franchisor's own corporate locations
- 05MINORRoyalty structure with $600/month minimum means monthly fee exceeds 6% of gross sales unless franchisee generates $10k+ monthly revenue—burden on struggling units
- 06MINOR5-year term is relatively short, reducing franchisee's ability to recoup investment and build equity
- 07MINORLack of Item 19 financial performance data is material gap preventing due diligence on realistic earnings expectations
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.