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
59 / 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
Kentucky
State whose law governs disputes — relevant if you're not based there
What drove the 59/100 rating
Risk Score Breakdown
- 01MINORNo Item 19 disclosure (average revenue/net income) — impossible to validate ROI claims on $312.5K-$529K investment
- 02HIGHGoing Concern status is FALSE — indicates potential financial instability at franchisor level despite unit growth claims
- 03MINOR15% royalty on Gross Profit (not revenue) is unusually high and creates ambiguity around profit calculation methodology
- 04MINORExplosive 200% YoY unit growth (from ~10 to 29 units) is atypical and raises sustainability/quality concerns
- 05MINORFranchise fee ($50K) is low relative to total investment range, suggesting high ongoing costs or hidden fees
- 06HIGHNo litigation disclosed, but Going Concern flag suggests undisclosed franchisor financial distress
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.