For Pump It Up, what is the purpose of including FB Holdings, LLC's financial statements?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 21: FINANCIAL STATEMENTS]
ITEM 21 FINANCIAL STATEMENTS
Attached hereto as Exhibit G are audited consolidated financial statements for our parent company FB Holdings, LLC for the year ended December 31, 2024, for the year ended December 31, 2023, and for the year ended December 31, 2022.
You have not been provided with financial statements of the Franchisor, Pump It Up Holdings, LLC. Therefore, you do not have knowledge of how this specific company has performed. However, FB Holdings, LLC has agreed absolutely and unconditionally to guarantee to assume the duties and obligations of Franchisor under the franchise agreements entered into by Franchisor should Franchisor become unable to perform its duties and obligations. A copy of FB Holdings, LLC's guaranty is included with Exhibit G.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 59)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the audited consolidated financial statements for the parent company, FB Holdings, LLC, are included for the years ended December 31, 2024, 2023, and 2022. Pump It Up Holdings, LLC, the franchisor, does not provide its own financial statements. Therefore, prospective franchisees do not have direct insight into the franchisor's specific financial performance.
To compensate for the lack of the franchisor's financial statements, FB Holdings, LLC provides an absolute and unconditional guarantee to assume the duties and obligations of Pump It Up Holdings, LLC under the franchise agreements. This guarantee ensures that FB Holdings, LLC will step in and fulfill the franchisor's responsibilities if Pump It Up Holdings, LLC becomes unable to do so. A copy of this guarantee is included as an exhibit.
This arrangement is intended to provide franchisees with a level of financial security. While they don't see the franchisor's direct financials, the parent company's guarantee and financial statements offer assurance that there is a financially stable entity backing the franchise agreement. Prospective franchisees can review FB Holdings, LLC's financial statements to assess the parent company's ability to support the franchise system. This is a common practice when the direct franchisor is a subsidiary or has limited operating history.