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B62/100FDD 2026

Nexus Property Management — Litigation & Risk

Automotive - Repair & Service · 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
62 / 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
1
Government-backed loans issued
Default rate
—
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$150K
Avg loan size
$150K
Participating lenders
1

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
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
Rhode Island
State whose law governs disputes — relevant if you're not based there

What drove the 62/100 rating

Risk Score Breakdown

  1. 01MINOROnly 5 franchised units with unknown growth trajectory indicates extremely small, unproven system with minimal track record
  2. 02MINORNo Item 19 (Average Unit Volume) disclosure means franchisor won't share revenue/profitability data—cannot validate ROI claims
  3. 03MINORDual royalty structure (6% + 2%) totaling 8% on blended revenue is relatively high without transparency on what franchisees actually earn
  4. 04MEDHigh initial investment ($50k-$106k) paired with 5-year term and no disclosed average revenue creates uncertain payback period
  5. 05MINORTiny unit count (5) makes territory protection claim difficult to validate and raises questions about franchisor's ability to support growth

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.