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B59/100FDD 2026

IMAGE Studios — Litigation & Risk

Personal Services - Beauty & Salon · 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
59 / 100
FranchiseVerdict composite
Rating
MODERATE
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
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
Utah
State whose law governs disputes — relevant if you're not based there

What drove the 59/100 rating

Risk Score Breakdown

  1. 01MEDNo Item 19 financial performance representations disclosed — cannot independently verify claimed $145,909 average net income
  2. 02MINORAggressive unit growth of 35.1% YoY raises sustainability concerns; rapid expansion often precedes market saturation or quality degradation
  3. 03MINORHigh initial investment ($773k–$1.7M) with modest average net income ($145,909) suggests 5–12 year payback period at best
  4. 04MINORDual royalty structure ($300/week minimum) creates unpredictable cash flow burden, especially in early ramp-up phases
  5. 05HIGHGoing Concern flag is FALSE but absence of explicit franchisor financial health disclosure is concerning given high franchisee investment

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.