FranchiseVerdict
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B59/100FDD 2025

Primos Mexican Food & Cantina — Litigation & Risk

Food & Beverage - Full 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
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
California
State whose law governs disputes — relevant if you're not based there

What drove the 59/100 rating

Risk Score Breakdown

  1. 01MEDNo Item 19 financial disclosure (Avg Revenue and Net Income not disclosed) — impossible to validate ROI on $100K-$595K investment
  2. 02HIGHGoing Concern status is FALSE — franchisor may be experiencing financial distress or operational instability
  3. 03MINORAggressive unit growth of 28.6% YoY with only 20 total units suggests rapid scaling without proven profitability model
  4. 04MINORDual royalty structure ($3,000/month floor) means marginal operators subsidize franchisor regardless of performance
  5. 05MINOROnly 20 units system-wide limits ability to absorb franchise failures; high concentration risk
  6. 06HIGHNo litigation disclosure provided; inability to verify franchisor's legal history

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.