What was the interest rate on the $80,000 unsecured note that Afuri Ramen Dumpling had with Afuri Japan?

According to the 2024 Afuri Ramen Dumpling Franchise Disclosure Document, Afuri Franchise, Inc. had an $80,000 unsecured note with Afuri Japan. The note had an annual interest rate of 1.4% and was scheduled to be paid in annual installments of $20,000. The note was scheduled to mature in 2024, but the company repaid the note in 2021. Interest paid totaled $2,004 and $0 for the years ended December 31, 2021 and 2020, respectively.

This related-party transaction indicates a financial relationship between Afuri Ramen Dumpling and its parent company, Afuri Japan. The interest rate of 1.4% on the $80,000 note is relatively low, which could be seen as a benefit to Afuri Franchise, Inc. However, the fact that the note was repaid early in 2021 suggests that the company had sufficient funds to cover the debt.

For a prospective franchisee, this information highlights the importance of understanding the financial relationships and transactions between Afuri Ramen Dumpling and its related entities. While the specific note was repaid, it's essential to inquire about any ongoing or potential future financial obligations or dependencies between the franchisor and its affiliates. Understanding these relationships can provide a clearer picture of the franchisor's financial stability and potential risks.