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D77/100FDD 2026

Signarama — Litigation & Risk

Business Services - Printing & Signs · FDD Items 3, 4 & 5

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Moderate — Review

5 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
5
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
77 / 100
FranchiseVerdict composite
Rating
CAUTION
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
137
Government-backed loans issued
Default rate
35.4%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
28 loans
Loans charged off or defaulted
Total loan volume
$45.5M
Avg loan size
$332K
Participating lenders
62

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

What drove the 77/100 rating

Risk Score Breakdown

  1. 01MINORStagnant unit growth (0.4% YoY) suggests market saturation or franchisee dissatisfaction
  2. 02MINORNo average net income disclosure prevents ROI validation; with $500/month minimum royalty, profitability is unclear
  3. 03MINORMultiple regulatory actions (1993 FTC, 1996 Maryland, 2021-2022 California) indicate systemic compliance issues and earnings claims problems
  4. 04MINORUnprotected territory creates direct competition risk; franchisees can cannibalize each other's revenue
  5. 05MINORHigh investment range ($245K-$638K) with flat revenue trajectory raises payback period concerns
  6. 06HIGHCurrent litigation for non-payment suggests franchisee financial distress within the system
  7. 07MED35-year term with $49,500 upfront fee locks franchisees into long commitment with limited exit flexibility

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.