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F84/100FDD 2025

MAACO — Litigation & Risk

Automotive - Repair & Service · FDD Items 3, 4 & 5

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Elevated Risk

12 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
12
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
84 / 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
79
Government-backed loans issued
Default rate
22.2%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
6 loans
Loans charged off or defaulted
Total loan volume
$55.1M
Avg loan size
$697K
Participating lenders
42

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
1 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
North Carolina
State whose law governs disputes — relevant if you're not based there

What drove the 84/100 rating

Risk Score Breakdown

  1. 01MINORDeclining unit count (-3.5% YoY) signals system contraction and market saturation concerns
  2. 02MINORNo average net income disclosure prevents ROI validation despite $196k-$4M investment range
  3. 03HIGHMultiple active litigations including shareholder derivative and securities class actions create franchisor stability uncertainty
  4. 04MINORNo protected territory combined with 363 competing units increases cannibalization risk
  5. 05MED8% royalty on $1.6M average revenue = $128k annual royalty burden with undisclosed profitability
  6. 06HIGHGoing concern status is FALSE but pending securities litigation suggests financial/operational stress at parent level

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.