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F80/100FDD 2026

Lapels — Litigation & Risk

Cleaning - Commercial & Janitorial · FDD Items 3, 4 & 5

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Moderate — Review

2 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
2
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
80 / 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
26
Government-backed loans issued
Default rate
21.4%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
3 loans
Loans charged off or defaulted
Total loan volume
$6.1M
Avg loan size
$234K
Participating lenders
14

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

What drove the 80/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth of only 2.5% YoY with 83 units suggests market saturation or franchisee dissatisfaction
  2. 02MEDNet income not disclosed in FDD Item 19 prevents accurate ROI calculation on $40,900–$1.7M investment range
  3. 03HIGHRecent litigation with franchisees (Barros case) over breach of contract and unconscionability indicates franchisor-franchisee disputes
  4. 04MINORWide investment range ($40,900 to $1.7M) with average revenue of only $423K suggests inconsistent unit economics
  5. 05MED6% royalty on gross revenue (not net) combined with undisclosed profitability creates cash flow risk

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.