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A54/100FDD 2025

K9 Resorts — Litigation & Risk

Personal Services - Pet Care · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
54 / 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
2
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
New Jersey
State whose law governs disputes — relevant if you're not based there

What drove the 54/100 rating

Risk Score Breakdown

  1. 01MINORAggressive unit growth (41.7% YoY) suggests rapid expansion that may outpace quality control and franchisee support infrastructure
  2. 02HIGHLitigation history with breach of contract and conversion allegations indicates potential franchisor-franchisee relationship issues despite settlement
  3. 03MINORNo Item 19 (Financial Performance Representations) available, making it impossible to validate the $221,590 average net income claim independently
  4. 04MINORHigh initial investment range ($1.48M–$3.6M) combined with 7% royalty creates significant breakeven threshold requiring strong per-location performance
  5. 05MEDMargin compression risk: Average net income of $221,590 on $1.57M revenue (14.1% net margin) leaves limited buffer for 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.