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D72/100FDD 2025

Osmow’s — Litigation & Risk

Food & Beverage - Quick 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
72 / 100
FranchiseVerdict composite
Rating
CAUTION
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
Delaware
State whose law governs disputes — relevant if you're not based there

What drove the 72/100 rating

Risk Score Breakdown

  1. 01MEDOnly 4 units in system indicates extremely early stage or stalled growth with no disclosed unit trajectory
  2. 02MINORNo Item 19 financial disclosures (avg revenue/net income) prevents ROI validation and suggests potential franchisor reluctance to disclose performance
  3. 03HIGHGoing Concern = FALSE indicates potential financial instability or operational concerns at franchisor level
  4. 04MINORUnprotected territory creates direct competition risk from other franchisees and franchisor-opened units
  5. 05MEDHigh investment range ($453k-$815k) with no disclosed profitability metrics creates severe ROI uncertainty
  6. 06MINOROnly 4 existing franchisees available for reference checks limits due diligence validation pool
  7. 07MINOR10-year term locks capital with no clear exit strategy or buyback provisions mentioned

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.