FranchiseVerdict
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B65/100FDD 2024

Native Grill and Wings — Litigation & Risk

Food & Beverage - Full Service · 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
65 / 100
FranchiseVerdict composite
Rating
MODERATE
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
7
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$6.8M
Avg loan size
$975K
Participating lenders
5

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

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MEDUnit decline of 4.8% YoY (20 units) indicates contracting franchise system and weak unit economics or support
  2. 02MEDNet income not disclosed in Item 19 — cannot verify profitability claims; average revenue of $2.6M does not guarantee positive returns after 6% royalty, labor, COGS, and rent
  3. 03HIGHParent company FAT Brands settled $3M securities litigation in 2023 for allegedly false/misleading statements; raises credibility concerns about franchisor disclosures
  4. 04HIGHAffiliate litigation for unregistered franchise sales in Virginia (2023) suggests compliance and legal risk within corporate structure
  5. 05MEDHigh capital requirement ($1M–$2.9M) paired with shrinking unit base and undisclosed profitability creates significant downside risk
  6. 06MINOR10-year term with $50K fee in a declining system suggests weak franchisee attraction and retention

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.