FranchiseVerdict
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D69/100FDD 2023

Elite Tutoring Place — Litigation & Risk

Education - Tutoring & Test Prep · FDD Items 3, 4 & 5

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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
69 / 100
FranchiseVerdict composite
Rating
CAUTION
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
No
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Illinois
State whose law governs disputes — relevant if you're not based there

What drove the 69/100 rating

Risk Score Breakdown

  1. 01MINORUnit count declining 16.7% YoY (6 units total) indicates system contraction and weak franchisee retention
  2. 02MINORNo average revenue or net income disclosure (Item 19) prevents ROI validation and suggests franchisor may lack compelling financial data
  3. 03MINORAggressive royalty structure ($300→$600/month) on small revenue base may create unsustainable unit economics
  4. 04MINORMinimal franchise fee ($25k) relative to total investment ($46.8k–$92.7k) suggests high proportion in startup costs with unclear ROI timeline
  5. 05MINORExtremely small system (6 units) limits peer support network and indicates early-stage/struggling franchisor

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.