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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
65 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID
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 65/100 rating
Risk Score Breakdown
- 01MINOROnly 3 existing units with unknown growth trajectory suggests minimal system validation and unproven scalability
- 02MEDNo average revenue or net income disclosure (missing Item 19) prevents ROI assessment against $149k-$228k investment
- 03MEDHigh initial investment ($149k-$228k) combined with 6% royalty creates significant break-even burden without disclosed profitability benchmarks
- 04MINORMicro-franchisee base (3 units) increases risk that franchisor lacks operational infrastructure, training systems, or crisis management protocols
- 05MED10-year term with $49k upfront fee locks capital into unvalidated business model with limited exit flexibility
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.