What collateral secures Anago's line of credit?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
le assets, net consist of a trademark with a cost of $184,000 and the related accumulated amortization as of December 31, 2024, 2023, and 2022 of $154,356, $142,089, and $129,822, respectively. During the years ended December 31, 2024, 2023, and 2022 amortization expense totaled $12,267, $12,267, and $12,267, respect
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the company has a line of credit agreement with a bank that has borrowing limits up to $200,000. This line of credit bears an interest rate of 6.25% and matures in June 2025. The document states that the line of credit is collateralized by a majority of the assets of the company. As of December 31, 2024, 2023, and 2022, the balance on the line of credit was $-0-.
This means that Anago has pledged a significant portion of its assets to secure the line of credit. If Anago were to default on its line of credit obligations, the bank would have a legal claim to those assets. This arrangement is a common practice for businesses to secure financing.
For a prospective franchisee, this information provides insight into Anago's financial obligations and how they are managed. While the specific assets securing the line of credit are not detailed, the fact that a majority of the company's assets are used as collateral suggests a substantial commitment. Franchisees may want to inquire further about the specific assets involved to assess any potential impact on the franchisor's ability to support its franchisees.