What is the annual interest rate on the May 16, 2020 note for Exit franchisees?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Interest accrues on the note at 3.75% per annum.
The previous deferment may result in a balloon payment.
U.S.
Small Business Administration Note dated May 16, 2020 to alleviate economic injury 98,264 117,674 149,900 caused by disaster, payable in monthly installments of $731 from November 18, 2022 through November 2052.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the interest rate on the May 16, 2020 Small Business Administration note is 3.75% per annum. This note was intended to alleviate economic injury caused by a disaster.
The note is payable in monthly installments of $731, starting from November 18, 2022, and continuing through November 2052. The FDD also mentions that a previous deferment on the note may result in a balloon payment, which could be a significant financial obligation for the franchisee at the end of the loan term.
Prospective Exit franchisees should carefully consider the terms of this SBA note, including the interest rate, monthly payment amount, and the potential for a balloon payment. Understanding these details is crucial for assessing the financial feasibility and risks associated with this financing option.