FranchiseVerdict
LeKream logo
D75/100FDD 2025

LeKream — Litigation & Risk

Food & Beverage - Ice Cream & Desserts · FDD Items 3, 4 & 5

Back to overview

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
75 / 100
FranchiseVerdict composite
Rating
CAUTION
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
California
State whose law governs disputes — relevant if you're not based there

What drove the 75/100 rating

Risk Score Breakdown

  1. 01MINOROnly 1 existing unit with unknown growth trajectory — effectively unproven system
  2. 02MINORNo average revenue or net income disclosure (Item 19) prevents ROI validation
  3. 03HIGHGoing Concern flag indicates franchisor financial/operational distress
  4. 04MINORWide investment range ($199.5K–$464.5K) suggests unclear cost structure or inconsistent unit economics
  5. 05MINORUnprotected territory creates direct competition risk from other franchisees
  6. 06MINOR5-year term is shorter than industry standard, increasing renewal uncertainty
  7. 07MED3% royalty seems low but meaningless without disclosed revenue baselines
  8. 08MINORSingle unit makes franchisee validation impossible — no peer network to reference

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.