How are voting rights allocated to each member class of Beggars Pizza Franchise, LLC?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
s ended December 31, 2024 and 2023, there was no compensation expense related to the issuance of the Class B and C units.
Voting rights are allocated to each member class 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 members in proportion to their vested percentage until the cumulative distributions received by such members equals $2,435,999.
Thereafter, pro rata to memb
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 39)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, voting rights are allocated to each member class based on the provisions outlined in the company's operating agreement. The distribution of these rights is structured in stages. Initially, 100% of the voting rights are allocated pro rata to Class A members until they cumulatively receive distributions totaling $4,176,000. Following this, 100% of the voting rights shift to Class B and Class C members, distributed in proportion to their vested percentage, until they cumulatively receive $2,435,999.
After the initial distributions to Class A, B, and C members, the voting rights are then allocated pro rata based on the vested percentage of each class. Under this structure, Class A members hold 63.2% of the voting rights, Class B members hold 30%, and Class C members hold 6.8%.
For a prospective Beggars Pizza franchisee, it's important to understand that they typically do not receive membership units or direct voting rights within Beggars Pizza Franchise, LLC. The allocation of voting rights primarily concerns the internal governance and financial structure among the different classes of members within the LLC, which are BPF Holding Corporation (Class A), and other individuals holding Class B and C units. Franchisees should focus on how the decisions made by these members may indirectly affect their franchise operations, such as changes in brand standards, marketing strategies, or supply chain management.