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D77/100FDD 2026

Wireless Zone — Litigation & Risk

Retail · FDD Items 3, 4 & 5

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Moderate — Review

2 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
2
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
77 / 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
35
Government-backed loans issued
Default rate
37.9%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
11 loans
Loans charged off or defaulted
Total loan volume
$16.1M
Avg loan size
$461K
Participating lenders
20

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

What drove the 77/100 rating

Risk Score Breakdown

  1. 01MEDNo disclosed average net income despite $1.6M avg revenue — inability or unwillingness to share profitability data is concerning
  2. 02MINORRoyalty structure tied to Gross Profit (not revenue) at up to 22% is unusual and creates ambiguity around actual cost burden
  3. 03MINORUnit growth of only 6.3% YoY is weak for a 792-unit system, suggesting market saturation or franchisee struggles
  4. 04HIGHPrior litigation (2016) involving royalty model and renewal rights disputes indicates franchisor-franchisee tension and potential contract ambiguity
  5. 05MINORHigh investment range ($441K–$1.3M) with no Item 19 financial performance data creates significant uncertainty around ROI

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.