B66/100FDD 2025
Stroll Or Greet — Litigation & Risk
Business Services - Other · FDD Items 3, 4 & 5
Moderate — Review
2 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
2
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
66 / 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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 66/100 rating
Risk Score Breakdown
- 01MINORDeclining unit count (-0.7% YoY) indicates contracting system despite low barrier to entry
- 02HIGHMaterial litigation history: consent orders in CA (2020) and WA (2018/2019) for illegal franchise sales and disclosure violations—suggests compliance issues at corporate level
- 03MINORNo average revenue or net income disclosure (Item 19) prevents financial validation of business model viability
- 04MINORUnusual royalty structure (15% of 'advertising value' rather than gross revenue) is opaque and difficult to audit
- 05MINORNo protected territory creates direct competition among franchisees in same market
- 06MINORShort 3-year term limits franchisee planning horizon and increases renewal risk
- 07MINORRegulatory actions specifically for selling franchises improperly raises questions about current FDD accuracy and completeness
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.