B65/100FDD 2025
Shaghf Cafe — Litigation & Risk
Food & Beverage - Coffee & Tea · 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
65 / 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
Non-compete
2 yrs
Post-termination restriction on similar businesses
Franchisor can compete
No
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 65/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 financial disclosure (average revenue and net income not disclosed) - impossible to validate ROI claims
- 02HIGHGoing Concern status is False, indicating potential financial instability at franchisor level
- 03MINORExtremely aggressive unit growth (250% YoY) with only 7 total units suggests unsustainable expansion or unreliable data
- 04MINORWide investment range ($240K-$696K) without corresponding revenue disclosure creates opacity on unit economics
- 05MINORZero franchise fee is unusual and may indicate difficulty attracting franchisees or cash flow problems at corporate
- 06HIGHNo litigation disclosed but rapid growth + financial opacity increases legal 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.