FranchiseVerdict
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D75/100FDD 2025

Terra Superfoods — Litigation & Risk

Other · 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
75 / 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
California
State whose law governs disputes — relevant if you're not based there

What drove the 75/100 rating

Risk Score Breakdown

  1. 01MINOROnly 2 units in system indicates minimal scale, unproven model, and extreme difficulty achieving ROI projections
  2. 02HIGHGoing Concern status is FALSE — franchisor may lack financial stability or operational viability
  3. 03MEDNo Item 19 (Average Unit Volume/Net Income) disclosed — impossible to validate $152k-$305k investment thesis or profitability claims
  4. 04MINORWide investment range ($152k spread) suggests inconsistent unit economics or unclear cost structure
  5. 05MINORUnclear unit growth trajectory with only 2 locations raises questions about franchisee recruitment and system health
  6. 06MED6% royalty on undisclosed revenue base makes it impossible to assess true cost burden on franchisee profitability

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.