FranchiseVerdict
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D70/100FDD 2025

The Cocky Rooster — Litigation & Risk

Food & Beverage - Quick 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
70 / 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
1
Government-backed loans issued
Default rate
—
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$605K
Avg loan size
$605K
Participating lenders
1

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

What drove the 70/100 rating

Risk Score Breakdown

  1. 01MINOROnly 2 franchised units reported with unknown growth trajectory suggests minimal system traction and expansion stagnation
  2. 02HIGHGoing Concern = False indicates franchisor may be experiencing financial distress or operational instability
  3. 03MINORHigh initial investment range ($455K-$777K) paired with only 2 units suggests inadequate franchise support infrastructure and unproven scalability
  4. 04MINORNo Item 19 financial performance representation provided — cannot validate the claimed $1.7M average revenue or $355K net income figures
  5. 05MINORExtreme disparity between claimed average net income ($355K) and franchise fee ($49.5K) appears unrealistic without substantiation
  6. 06MINORUnknown unit growth rate indicates franchisor is not transparently tracking or reporting expansion metrics

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.