Under what conditions will the Advance Funding Facility for Benjamin Franklin Plumbing terminate?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
suer completed a financing transaction (the "Securitization Transaction") resulting in the issuance of the $5,000 in maximum principal amount Advance Funding Facility (the "Advance Funding Facility" or "AFF"), $50,000 in maximum principal amount of Series 2021-1 Variable Funding Senior Notes, Class A-1 (the "VFN" or the "Class A-1 2021 Notes") and $425,000 of Series 2021-1 3.734% Fixed Rate Senior Secured Notes, Class A-2 (the "Term Notes" or "Class A-2 Notes") and, together with the Advance Funding Facility and VFN, (the "Series 2021-1 Notes"). Additionally, on November 7, 2022, the Issuer completed an additional financing transaction resulting in the issuance of $200,000 in maximum principal amount of Series 2022-1 Variable Funding Senior Notes (the "Class A-1 2022 Notes").
Advance Funding Facility
The Advance Funding Facility, which was undrawn as of December 31, 2024 and 2023, provides for a maximum outstanding principal amount of $5,000. Under the provisions of the AFF, any outstanding advances under the AFF bear interest at a variable rate, Prime Rate + 3%, and the Issuer is ob
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to the 2025 FDD, the Advance Funding Facility (AFF) for Benjamin Franklin Plumbing will terminate under specific conditions related to the repayment of obligations. The AFF, which had no outstanding balance as of December 31, 2024, provides a maximum principal amount of $5,000.
The agreement specifies that the AFF will terminate upon the earlier of two conditions: first, the full payment of all obligations related to the Class A-2 Notes; or second, the full payment of all interest and principal on all AFF advances. This means that once either the Class A-2 Notes are completely paid off, or all the advances taken under the AFF, including interest and principal, are fully repaid, the facility will terminate.
For a prospective Benjamin Franklin Plumbing franchisee, this information is relevant because it outlines the terms under which the financing facility, which could be used to support the franchise, will cease to be available. It is also important to note that the AFF is not a revolving facility, meaning that any amounts borrowed and repaid cannot be re-borrowed. This could impact the franchisee's financial planning and access to capital over time.