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B65/100FDD 2025

The Seals — 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
65 / 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
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status is FALSE — franchisor may have financial viability issues
  2. 02MEDFinancial performance metrics (revenue and net income) completely undisclosed — impossible to validate unit economics
  3. 03MINOROnly 6 units system-wide — extremely small franchise network limits support infrastructure and brand recognition
  4. 04MINORAggressive 66.7% YoY unit growth from tiny base (likely 3-4 units last year) — may indicate unsustainable expansion or unreliable data
  5. 05MINORHigh franchise fee ($49,000) relative to total investment ($101,200-$147,300) means 33-48% of capital goes to franchisor upfront
  6. 06MINORNo Item 19 financial disclosures — franchisees cannot benchmark expected returns against other units

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.