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A49/100FDD 2025

Ginger Ale's — Litigation & Risk

Food & Beverage - Full Service · 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
49 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID

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
Illinois
State whose law governs disputes — relevant if you're not based there

What drove the 49/100 rating

Risk Score Breakdown

  1. 01MEDNet income not disclosed in FDD Item 19 — cannot verify actual profitability despite $657,787 average revenue
  2. 02MINORExtreme investment range ($174,851–$1,321,627) suggests inconsistent unit economics or high variability in startup costs
  3. 03MEDAggressive 33.3% YoY unit growth with only 12 total units indicates very small franchise system with limited track record
  4. 04MINOR5% royalty on gross (not net) revenues reduces margins and creates ongoing cash flow pressure for franchisees
  5. 05MINORWide revenue dispersion likely — average of $657,787 masks potential underperforming locations

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.