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
50 / 100
FranchiseVerdict composite
Rating
STRONG
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 Jersey
State whose law governs disputes — relevant if you're not based there
What drove the 50/100 rating
Risk Score Breakdown
- 01MEDUnit count declined 25% YoY (6 units) — indicates systemic franchisee struggles or franchisor recruitment failure
- 02MINORHigh franchise fee ($49,500) combined with wide investment range ($96,800–$314,000) suggests unclear startup costs and potential hidden expenses
- 03MINORSignificant gap between average gross revenue ($2.87M) and net income ($893.6K) — 68.8% expense ratio warrants scrutiny on franchisor claims vs. reality
- 04MINORSmall franchise base (6 units) limits statistical reliability — average financials may not reflect typical franchisee experience
- 05HIGHNo litigation disclosed but rapid contraction raises questions about non-disclosure or settlements
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.