A47/100FDD 2025
Freshslice Pizza — Litigation & Risk
Food & Beverage - Pizza · FDD Items 3, 4 & 5
Elevated Risk
15 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
15
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
47 / 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
169
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
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
Washington
State whose law governs disputes — relevant if you're not based there
What drove the 47/100 rating
Risk Score Breakdown
- 01HIGHMultiple pending and past litigation involving rebranding breaches, franchise agreement violations, and unpaid promissory notes—primary concern is franchisor enforcement inconsistency and franchisee disputes over obligations
- 02MINOR46% YoY unit growth appears unsustainable and may mask underlying franchisee churn; typical mature pizza franchises grow 5-15% YoY, suggesting aggressive recruitment or accounting anomalies
- 03MINOR10% royalty on non-core items only is vague and suggests potential revenue recognition disputes; unclear what constitutes 'non-core' and how franchisor audits compliance
- 04HIGHNo 'Going Concern' disclosure is FALSE—this is a critical red flag indicating potential financial instability at the corporate level or accounting irregularities
- 05HIGHHigh initial investment ($235k-$511k) combined with litigation history and unclear royalty structure creates elevated franchisee default risk
- 06MINORUnknown franchise term length is unusual and suggests either unstable agreement terms or lack of transparency in franchise disclosure
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.