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Elevated Risk
17 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
17
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
51 / 100
FranchiseVerdict composite
Rating
STRONG
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
151
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$76.9M
Avg loan size
$509K
Participating lenders
46
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
Tennessee
State whose law governs disputes — relevant if you're not based there
What drove the 51/100 rating
Risk Score Breakdown
- 01HIGHActive multi-franchisee litigation alleging fraud and misrepresentation of semi-absentee model — core business claim is disputed
- 02MINORAffiliate (BIO-One) regulatory settlements for unregistered franchise sales suggest compliance and disclosure issues across related entities
- 03HIGHGoing concern status despite 41% YoY unit growth indicates profitability/cash flow problems at corporate level despite expansion
- 04HIGH7% royalty on $679k avg revenue ($47.6k annually) combined with $480k+ initial investment creates extended payback period with litigation risk overhang
- 05MINORLack of Item 19 (financial performance representations) in disclosure despite franchisor publishing average revenue figures ($679,601) — potential UFOC violation
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.