B61/100FDD 2025
Ritual Hot Yoga — Litigation & Risk
Health & Fitness · FDD Items 3, 4 & 5
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
61 / 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
1
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
$1.7M
Avg loan size
$1.7M
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
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
Illinois
State whose law governs disputes — relevant if you're not based there
What drove the 61/100 rating
Risk Score Breakdown
- 01MINOROnly 5 units in system with 100% YoY growth suggests extremely small franchise network and unproven scalability
- 02MINORNet income of $47,288 on $633,015 revenue (7.5% net margin) is razor-thin after 7% royalty obligation, leaving minimal profitability
- 03MINORHigh initial investment range ($297k-$490k) paired with modest unit count indicates franchisor may be reliant on franchise fees for revenue rather than proven unit economics
- 04HIGHNo disclosed going concern statement is positive, but microscopic unit base (5 locations) provides insufficient performance data to validate model
- 05MINORFranchise fee of $40,000 represents 13.5-23.6% of total startup cost, typical for new/unproven systems rather than established brands
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.