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B65/100FDD 2025

X-Golf — Litigation & Risk

Entertainment - Indoor Golf · 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
65 / 100
FranchiseVerdict composite
Rating
MODERATE
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
146
Government-backed loans issued
Default rate
3.3%
vs <3% typical · system-wide
5-yr default rate
10.0%
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$89.6M
Avg loan size
$614K
Participating lenders
21

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

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MEDNo Item 19 (Average Unit Volume) disclosed - inability to verify $99,000 average revenue claim or validate profitability
  2. 02HIGHActive litigation involving fraud allegations, breach of fiduciary duty, and revenue siphoning by former management raises governance and trust concerns
  3. 03MEDHigh initial investment ($1.13M-$1.76M) combined with undisclosed net income creates unfavorable risk-reward profile
  4. 04MINOR7% royalty on adjusted gross sales reduces already-thin margins in golf entertainment sector
  5. 05MINORRapid 23.2% YoY unit growth may indicate aggressive recruitment masking underlying unit economics problems
  6. 06HIGHGoing Concern status is False - potential financial viability concerns at corporate level
  7. 07MINORProtected territory alone insufficient to offset operational and financial uncertainties

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.