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D72/100FDD 2025

Tapster — Litigation & Risk

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

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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
72 / 100
FranchiseVerdict composite
Rating
CAUTION
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
Illinois
State whose law governs disputes — relevant if you're not based there

What drove the 72/100 rating

Risk Score Breakdown

  1. 01MINOROnly 4 operating units indicates extremely small, unproven system with minimal scale and validation
  2. 02MINORNo Item 19 (Average Unit Volume) disclosure — inability or unwillingness to share revenue/profitability data is a major warning sign
  3. 03HIGHGoing Concern status is FALSE, suggesting potential financial instability or liquidity issues at corporate level
  4. 04MINORWide investment range ($229K-$1.33M) with no clear breakdown raises questions about cost transparency and scalability
  5. 05MINORDual royalty structure (5% or $7K/month flat) suggests uncertainty about unit economics; flat fee indicates concerns about sales volume
  6. 06MEDOnly 10-year term (shorter than industry standard 15-20 years) may indicate limited corporate confidence in long-term viability
  7. 07HIGHMinimal disclosed litigation history is suspiciously absent for a franchise system — likely incomplete disclosure

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.