What is the second distribution provision for Beggars Pizza Franchise, LLC Class B and C members?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
based on the provisions of the Agreement. A general description of the Agreements distribution provisions are as follows:
First, 100 percent to Class A members' pro rata until the cumulative distributions received by the members equals $4,176,000.
Second, 100 percent to the Class B and C membe
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 39)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, the second distribution provision allocates 100% of distributions to Class B and C members in proportion to their vested percentage. This continues until the cumulative distributions received by these members equals $2,435,999.
This provision means that after the initial distribution to Class A members, Class B and C members are next in line to receive distributions. The distribution is based on their vested percentage, meaning the portion of their units that have met the required milestones for vesting. Class C units are immediately vested, while Class B units vest upon achieving certain hurdles.
For a prospective franchisee, understanding these distribution provisions is crucial as it clarifies how profits are allocated among different classes of members within Beggars Pizza Franchise, LLC. It is important to note that as of December 31, 2024, Class B units were not vested, which could impact the distribution dynamics. Franchisees should seek clarification from Beggars Pizza regarding the specific vesting criteria for Class B units and the current vesting status to fully understand their potential share of distributions.