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Elevated Risk
7 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
7
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
85 / 100
FranchiseVerdict composite
Rating
AVOID
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
6
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
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
Delaware
State whose law governs disputes — relevant if you're not based there
What drove the 85/100 rating
Risk Score Breakdown
- 01MINOROnly 4 units systemwide with unknown growth trajectory — suggests minimal brand traction and market validation
- 02HIGHChief Development Officer Anthony Geisler faces multiple active lawsuits involving fraud, failure to disclose, and securities litigation from his Xponential Fitness tenure — raises serious integrity and leadership concerns
- 03MINORNo average revenue or net income disclosure (no Item 19) — impossible to assess unit economics or franchisee profitability
- 04HIGHGoing concern status is FALSE — indicates potential financial instability at corporate level
- 05MINORHigh initial investment ($191k-$378k) combined with 8% royalty creates significant financial burden with unproven business model
- 06MEDExtremely small unit count (4) means limited franchisee network to validate claims and minimal corporate resources
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.