A37/100FDD 2025
EverLine Coatings and Services — Litigation & Risk
Other · FDD Items 3, 4 & 5
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
37 / 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
88
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
$19.7M
Avg loan size
$224K
Participating lenders
12
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
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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 37/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 (Average Unit Volume) disclosed despite $614,560 claimed average revenue — inability or unwillingness to substantiate earnings claims is a major transparency concern
- 02HIGHActive litigation with former franchisee alleging wrongful termination raises questions about franchise agreement enforcement, support, and dispute resolution fairness
- 03MINORHigh unit growth rate (45.5% YoY) on a small base (80 units) suggests either aggressive recruiting or potential for rapid contraction if growth momentum slows
- 04MINORRoyalty structure with 2.5% rate for subcontracted work creates incentive misalignment and makes true profitability opaque for franchisees relying on subcontractors
- 05HIGHGoing concern flag indicates franchisor financial stress despite growth claims, raising sustainability questions
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.