What secures all obligations under the Member's credit facility related to Bft?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
maining CycleBar trademark intangible asset of $9,649 is considered to be at a heightened risk of future impairment in the event of significant unfavorable changes in assumptions, including forecasted future cash flows, as well as discount rates and other macroeconomic factors.
Note 7 – Related Party Transactions
Significant related party transactions consist of net advances to the Member, allocations of expenses from the Member, including commissions paid to employees of the Member related to the sale of franchise and area development agreements, borrowings from, and excess cash transfers to the Member and other related parties under common control of the Member. The Member also holds restricted cash on the Compan
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, all obligations under the Member's credit facility are secured by substantially all of the tangible and intangible assets of the Company. The Member owns all of the Interests issued and outstanding and is the sole member of the Company. As of March 15, 2023, the Member contributed $8,000 in cash, $8,910 in property and equipment and $90,812 in intangible assets. These assets are used in its operations and to satisfy minimum net worth requirements to qualify for large franchisor exemptions available under certain state franchise registration laws.
This means that if the Member, which is the sole owner of the company, has a credit facility, that credit is secured by the company's assets. This includes both physical assets like equipment and intangible assets. For a prospective Bft franchisee, this information is relevant to understanding the financial structure and obligations of the parent company.
It's important to note that this arrangement could have implications for the financial stability of Bft, which in turn could affect franchisees. If the Member defaults on its credit facility, the creditors could potentially claim the company's assets, which could disrupt Bft's operations and its ability to support its franchisees. Prospective franchisees should consider this information as part of their due diligence and assess the financial health of the franchisor.