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B59/100FDD 2025

Re-Bath — Litigation & Risk

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

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Moderate — Review

4 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
4
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
21
Government-backed loans issued
Default rate
20.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$9.2M
Avg loan size
$437K
Participating lenders
16

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

What drove the 59/100 rating

Risk Score Breakdown

  1. 01MINORPending 2025 arbitration case regarding technology fees suggests current operational disputes and potential for unexpected cost increases
  2. 02HIGHHistory of litigation (4 cases including 2018 contractual breach arbitration award) indicates pattern of franchisor-franchisee conflicts and enforcement issues
  3. 03HIGHNo Item 19 financial disclosures (Going Concern: False) prevents verification of actual franchisee profitability claims; stated $382,615 net income cannot be independently validated
  4. 04MEDModest unit growth of 6.6% YoY with only 145 units suggests limited brand momentum and potential market saturation concerns
  5. 05MINORHigh investment-to-net-income ratio (initial investment of $275,875-$606,925 vs. average net of $382,615) creates extended payback period and elevated risk exposure

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.