B63/100FDD 2025
NexGen Fitness — Litigation & Risk
Health & Fitness · FDD Items 3, 4 & 5
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
63 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID
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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 63/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 (Average Revenue/Net Income) disclosed - impossible to assess actual profitability or ROI
- 02MINOROnly 18 units systemwide with unknown growth trajectory - suggests struggling or very early-stage system
- 03MINORWide investment range ($208.5K-$856.4K) indicates unclear cost structure or high variability in build-out
- 04MINORMinimum royalty of $1,750/month ($21K annually) creates break-even pressure on low-revenue locations
- 05HIGHGoing Concern status is FALSE (ambiguous wording) - potential financial instability at franchisor level
- 06HIGHNo litigation disclosed but 18-unit size makes this less meaningful than established brands
- 07MINORHigh royalty rate (7%) combined with unknown average revenue creates unpredictable profitability
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.