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F87/100FDD 2025

Lime Painting — Litigation & Risk

Home Services - Painting · 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
87 / 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
27
Government-backed loans issued
Default rate
66.7%
vs <3% typical · system-wide
5-yr default rate
66.7%
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$3.7M
Avg loan size
$135K
Participating lenders
7

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 87/100 rating

Risk Score Breakdown

  1. 01MEDNet income not disclosed in FDD Item 19 — unable to validate $126.7K-$277K investment ROI claims
  2. 02MINORExtremely slow unit growth (2.5% YoY) suggests market saturation or franchisee satisfaction issues
  3. 03MINORHigh royalty floor ($500-$3K/month minimum) creates cash flow risk for sub-$1M revenue locations
  4. 04MINORAverage revenue of $1.006M is modest relative to $126.7K-$277K all-in investment; breakeven timeline unclear
  5. 05MINORTiered royalty structure incentivizes growth but penalizes early-stage franchisees with 7% on first $2.5M in sales

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.