FranchiseVerdict
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D73/100FDD 2025

Steak Escape Sandwich Grill — Litigation & Risk

Food & Beverage - Quick Service · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
73 / 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
1
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
Total loan volume
$111K
Avg loan size
$111K
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
Ohio
State whose law governs disputes — relevant if you're not based there

What drove the 73/100 rating

Risk Score Breakdown

  1. 01MINORUnit count collapsed 17.4% year-over-year (23 units remaining), indicating severe system contraction and franchisee failure rate
  2. 02HIGHGoing Concern designation = franchisor questioned ability to continue operations, suggesting financial distress at corporate level
  3. 03HIGHActive litigation (2022) by franchisor against franchisees for royalty collection indicates cash flow desperation and potential franchisor-franchisee conflict
  4. 04MINORNo financial disclosure (Item 19): no average unit volumes, net income, or profitability data provided—impossible to model ROI
  5. 05MINORUnprotected territory creates cannibalization risk; franchisor could open competing units nearby without restriction
  6. 06MINORWide investment range ($239.5K–$828.5K) with no clarity on what drives variance—suggests hidden costs or inconsistent support
  7. 07MINOR6% royalty on unknown revenue base is unquantifiable; combined with declining units, suggests royalty collection is strained

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.