FranchiseVerdict
STORsquare logo
B65/100FDD 2025

STORsquare — Litigation & Risk

Other · FDD Items 3, 4 & 5

Back to overview

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

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MINOROnly 5 units in system with unknown growth trajectory suggests early-stage or stagnant franchise with minimal proven scalability
  2. 02MEDNo Item 19 financial performance representation disclosed — cannot verify if $88,219 average net income is accurate or achievable
  3. 03HIGHGoing Concern status is False, indicating potential financial instability at franchisor level that could impact support and viability
  4. 04MEDHigh investment range ($166k–$438k) against only 5 existing units creates survivorship bias risk and limited peer validation
  5. 05MINOR7.5% royalty on $401k average revenue equals ~$30k annual royalty with unclear franchisor sustainability at this unit count

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.