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B57/100FDD 2025

PrimoHoagies — Litigation & Risk

Food & Beverage - Full Service · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
57 / 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
60
Government-backed loans issued
Default rate
19.2%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
5 loans
Loans charged off or defaulted
Total loan volume
$16.3M
Avg loan size
$272K
Participating lenders
30

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
New Jersey
State whose law governs disputes — relevant if you're not based there

What drove the 57/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth of only 2.8% YoY with 118 units suggests mature/declining system momentum
  2. 02MINORNo Item 19 (average net income) disclosure limits transparency on actual profitability despite ~$924K average revenue
  3. 03HIGHLitigation history including fraud and RICO allegations with $134,472 arbitration award raises franchisor credibility concerns
  4. 04HIGHGoing Concern status of 'False' is ambiguous—clarification needed on financial health of parent company
  5. 05MEDHigh initial investment ($388K-$668K) combined with 6% royalty creates elevated break-even threshold with undisclosed margins

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.