D72/100FDD 2025
Styles Studios Fitness — Litigation & Risk
Health & Fitness · FDD Items 3, 4 & 5
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
72 / 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
66
Government-backed loans issued
Default rate
6.2%
vs <3% typical · system-wide
5-yr default rate
9.1%
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$167.0M
Avg loan size
$2.5M
Participating lenders
30
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
Delaware
State whose law governs disputes — relevant if you're not based there
What drove the 72/100 rating
Risk Score Breakdown
- 01HIGHGoing Concern status is False — indicates potential financial distress or viability questions with the franchisor
- 02MEDOnly 1 unit in system with unknown growth trajectory — extremely limited track record and no evidence of scalability
- 03MEDNet Income not disclosed in FDD Item 19 — impossible to assess actual profitability; average revenue of $725k may mask significant losses
- 04MINORWide investment range ($458k–$2.2M) with no clear cost drivers — suggests inconsistent unit economics or hidden variables
- 05MINOR6% royalty on gross sales with no net income transparency — franchisee profitability unclear relative to fee burden
- 06MINORSingle-unit franchise with protected territory — cannot validate multi-unit success, market demand, or franchisor support capability
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.