FranchiseVerdict
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F90/100FDD 2025

Proforma — Litigation & Risk

Other · 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
—
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
90 / 100
FranchiseVerdict composite
Rating
AVOID
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
2
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$387K
Avg loan size
$194K
Participating lenders
2

What drove the 90/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern warning indicates franchisor financial distress or viability questions
  2. 02MEDZero disclosed investment range suggests either data unavailability or extreme opacity
  3. 03MINORNo unit count, growth rate, or system size data available — transparency red flag
  4. 04MINORRoyalty rate unknown — unable to assess profitability model or franchisor sustainability
  5. 05MEDAverage revenue and net income not disclosed — no Item 19 financial performance representations
  6. 06MINORTerritory not protected — franchisees face internal competition and encroachment risk
  7. 07MINORFranchise fee $0 suggests either non-traditional model or inability to command fee
  8. 08MINORContract term unknown — unclear commitment length and renewal/exit conditions
  9. 09HIGHNo disclosed litigation but combined with going concern warning suggests potential hidden issues
  10. 10MEDLack of basic franchise disclosure data indicates either new/unstable franchisor or severe decline

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.