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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
57 / 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
10
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
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
Missouri
State whose law governs disputes — relevant if you're not based there
What drove the 57/100 rating
Risk Score Breakdown
- 01HIGHGoing Concern status indicates potential financial instability at franchisor level despite healthy unit-level financials
- 02MINOROnly 9 units system-wide with unknown growth trajectory suggests minimal scale and market validation
- 03MINORWide investment range ($1.9M–$4.9M) lacks clarity on what drives 155% variance in startup costs
- 04MEDNo Item 19 (Financial Performance Representations) disclosed — cannot independently verify $4.96M average revenue claims
- 05MINOR7% royalty on $4.96M average = $347K annual fee creates high break-even threshold and cash flow pressure
- 06MINOR10-year term is longer than industry standard (typically 5-7 years) with unclear renewal/exit terms
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.