FranchiseVerdict
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B61/100FDD 2024

Eight Turn Crepe — Litigation & Risk

Food & Beverage - Full Service · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
61 / 100
FranchiseVerdict composite
Rating
MODERATE
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
$335K
Avg loan size
$335K
Participating lenders
1

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
Jury trial waiver
Not waived
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
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 61/100 rating

Risk Score Breakdown

  1. 01MINOROnly 4 units in system with 50% YoY growth suggests extremely early-stage franchise with unproven model scalability
  2. 02MEDNet income not disclosed in Item 19 prevents ROI validation; franchisees cannot benchmark profitability against $205k-$397k investment
  3. 03HIGH2019 New York Attorney General litigation for unregistered franchise sales indicates compliance/governance issues in predecessor entity
  4. 04MINORHigh initial investment ($40k franchise fee + $165k-$357k total) relative to only 4 operating units creates concentration risk
  5. 05MED6% royalty on gross sales with undisclosed net income makes it impossible to calculate actual franchisee take-home profit
  6. 06HIGHNo 'Going Concern' status (False) is ambiguous—unclear if franchisor has adequate capitalization to support 4 franchisees

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.