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B65/100FDD 2025

Topsail Steamer — 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
North Carolina
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MEDNo average revenue or net income disclosed in FDD Item 19 — impossible to validate ROI claims or unit economics
  2. 02MINORExplosive 500% YoY unit growth (from 2 to 10 units) suggests either rapid expansion or recent launch; unproven business model at scale
  3. 03MEDInitial investment range of $242K–$398K is substantial with no disclosed profitability benchmarks to justify it
  4. 04MEDOnly 10 total units system-wide indicates very early-stage franchise with minimal operating history and limited comparable unit data
  5. 05MINOR7% royalty on weekly gross revenue (not net) compounds pressure on already-opaque unit economics
  6. 06HIGHNo litigation disclosed is positive, but combined with lack of financial transparency raises questions about FDD completeness

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.