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
58 / 100
FranchiseVerdict composite
Rating
MODERATE
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
Arizona
State whose law governs disputes — relevant if you're not based there
What drove the 58/100 rating
Risk Score Breakdown
- 01MINORHigh royalty burden: 15% + 15% + 5% creates complex multi-tier fee structure that could exceed 35% of total revenue in high-event locations
- 02MINORWide investment range ($1.9M–$6.5M) suggests inconsistent unit economics or significant geographic/format variability with unclear ROI drivers
- 03MEDModest unit growth of only 10% YoY with just 20 total units indicates slow franchise expansion and limited proven scalability
- 04MINORHigh initial franchise fee ($100K) combined with $1.9M+ startup cost creates significant downside risk if unit underperforms
- 05MEDNo Item 19 Financial Performance Representations disclosed — cannot independently verify the stated $4M revenue and $1.1M net income figures
- 06MINORExperiential venue model is location-dependent and vulnerable to post-pandemic traffic volatility, economic downturns, and tourism cycles
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.