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
65 / 100
FranchiseVerdict composite
Rating
MODERATE
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
Colorado
State whose law governs disputes — relevant if you're not based there
What drove the 65/100 rating
Risk Score Breakdown
- 01MINORUnit count declining 1.8% YoY indicates system contraction and potential market saturation or franchisee dissatisfaction
- 02MINORNo Item 19 (average unit volumes) disclosure means no transparency on actual franchisee profitability—critical red flag for ROI assessment
- 03MEDHigh initial investment ($124K-$193K) combined with 5% royalty burden without disclosed revenue benchmarks creates uncertainty on payback period
- 04MED10-year term length locks franchisees into long commitment with limited exit flexibility in a declining system
- 05MINORFranchise fee of $49,999 is substantial relative to total investment and raises questions about support quality
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.