What is the 'Note' referring to in the context of the Benjamin Franklin Plumbing Franchise Agreement?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
Debtor and Secured Party entered into a Promissory Note ("Note") on the same date as this Security Agreement ("Agreement") under which Secured Party agreed to permit Debtor to pay the Franchise Fee on a payment plan;
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to the 2025 Benjamin Franklin Plumbing Franchise Disclosure Document, the "Note" refers to a Promissory Note. This Note is an agreement where Benjamin Franklin Franchising SPE LLC permits a franchisee (referred to as "Debtor" or "Maker") to pay the franchise fee over time through a payment plan, instead of paying the full amount upfront.
Specifically, the Promissory Note documents the franchisee's debt to Benjamin Franklin Plumbing for a portion of the franchise fee. The franchisee is jointly and severally indebted to Benjamin Franklin Plumbing for the principal amount specified in the Note. As an incentive for Benjamin Franklin Plumbing to accept the Note, the franchisee agrees to secure their obligations under the Note and the Franchise Agreement by granting Benjamin Franklin Plumbing a security interest in certain collateral.
Furthermore, the FDD includes a Guarantee related to the Promissory Note. Under the Guarantee, other parties ("Guarantors") may personally guarantee that the franchisee will fulfill all obligations outlined in the Note. These Guarantors waive certain rights, such as requiring Benjamin Franklin Plumbing to first pursue action against the franchisee before seeking fulfillment of the guarantee from them. The FDD also mentions an amortization schedule to the promissory note, but the actual schedule is not included in the provided documentation.