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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
49 / 100
FranchiseVerdict composite
Rating
STRONG
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
Georgia
State whose law governs disputes — relevant if you're not based there
What drove the 49/100 rating
Risk Score Breakdown
- 01MEDNo average revenue or net income disclosed (Item 19 missing) — cannot validate ROI claims or payback period
- 02MINORHigh royalty rate of 12% on gross profit (not revenue) creates ambiguity and reduces net margins significantly
- 03MEDSmall unit count (25 locations) with only 40% YoY growth suggests limited brand awareness and market penetration
- 04MINORInitial investment range of $37.5K–$74.3K is broad (nearly 2x spread) — unclear cost drivers and standardization
- 05MINOR8-year term is longer than industry standard (5-6 years typical), limiting franchisee exit flexibility
- 06HIGHNo litigation disclosure is positive but small system size limits statistical reliability of this metric
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.