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
50 / 100
FranchiseVerdict composite
Rating
STRONG
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
Delaware
State whose law governs disputes — relevant if you're not based there
What drove the 50/100 rating
Risk Score Breakdown
- 01MEDOnly 4 existing units with unknown growth trajectory suggests early-stage/stagnant system with limited proven scalability
- 02MEDNo Item 19 financial performance representations disclosed despite $736K average revenue claim — cannot independently verify earnings
- 03MINORHigh initial investment range ($137K-$330K) relative to only 4 franchisees limits reference pool and increases validation difficulty
- 04MINOR5-year term is relatively short and may indicate franchisor uncertainty or franchisee concerns about long-term viability
- 05MINORFranchise fee ($49K) represents 36-64% of low-end investment, creating significant sunk cost before operations begin
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.