What interest rate did Pump It Up's PPP Loans accrue?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
The PPP Loans and Second Draw PPP Loan were used to fund payroll, rent, utilities, and interest on existing debt through the Paycheck Protection Program. The PPP loans accrued interest at 1.0% per annum, had a term of two years, and were unsecured and guaranteed by the SBA. The Second Draw PPP loan accrued interest at 1.0% per annum, had a term of five years, and was unsecured and guaranteed by the SBA.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the company received Paycheck Protection Program Loans (PPP Loans) and a Second Draw PPP Loan. Both the PPP Loans and the Second Draw PPP Loan accrued interest at a rate of 1.0% per annum. The original PPP Loans had a term of two years, while the Second Draw PPP Loan had a term of five years. Both were unsecured and guaranteed by the SBA. These loans were intended to cover payroll, rent, utilities, and interest on existing debt.
In August 2021 and January 2022, Pump It Up received notifications from the SBA that the PPP Loans had been forgiven, and the company recorded the forgiveness income. However, the SBA retained the right to review funding eligibility and usage of funds for compliance with program requirements.
While the FDD mentions the interest rate on the PPP loans obtained by the parent company, it does not specify whether franchisees can obtain similar loans or lines of credit, or what interest rates they might expect. A prospective franchisee should inquire about what financing options are available to them.