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
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
3
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
$450K
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
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
No
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
North Carolina
State whose law governs disputes — relevant if you're not based there
What drove the 59/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 (Average Revenue/Net Income) disclosed — impossible to assess unit-level profitability or ROI
- 02HIGHGoing Concern status is FALSE — indicates potential franchisor financial distress or operational instability
- 03MINORHigh franchise fee ($55,900) combined with wide investment range ($42,919–$128,320) suggests unclear startup costs and poor cost transparency
- 04MINORAggressive royalty structure (10% of sales OR $100/week minimum) creates cash flow pressure on low-revenue units
- 05MEDRapid unit growth (24.3% YoY) without disclosed revenue metrics raises questions about franchisee quality and sustainability
- 06MINORSmall system size (48 units) limits network stability and support infrastructure capacity
- 07MINORProtected territory language is vague — no specifics on territory size, density limitations, or enforcement mechanisms
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.