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A49/100FDD 2026
Taste Buds Kitchen — Litigation & Risk
Education - Tutoring & Test Prep · FDD Items 3, 4 & 5
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
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
7
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$1.9M
Avg loan size
$274K
Participating lenders
2
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Not required
You retain the right to sue in court
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
Maryland
State whose law governs disputes — relevant if you're not based there
What drove the 49/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 financial performance representations disclosed — cannot independently verify claimed $701,223 average revenue or $172,156 net income figures
- 02MEDHigh initial investment ($425,750–$549,650) against small unit base (14 locations) suggests limited franchisee success data and scalability concerns
- 03MINORMinimum royalty of $125/week ($6,500 annually) creates cash flow burden even for underperforming locations and indicates franchisor prioritizes fees over franchisee profitability
- 04MINOROnly 14 units with 20% YoY growth is modest expansion; insufficient scale to validate business model or support franchisee marketing/operational resources
- 05HIGHGoing Concern status FALSE appears contradictory — requires clarification on franchisor's financial stability and long-term viability
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.