What was the total amount of Cinnaholic's related party payable as of December 31, 2024?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
$32,921, respectively. Future minimum lease payments under the lease total $37,210, of which $31,858 is due during the year ending December 31, 2022, and $5,352 is due during the year ending December 31, 2023. Starting from March 2023, the minimum rent is $2,757 monthly.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 61)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the total amount due to a related party as of December 31, 2024, was $520,959. The FDD also indicates that these advances from related parties or companies with common ownership bear no interest and are payable upon demand.
This means that Cinnaholic had a significant financial obligation to related parties at the end of 2024. These related parties could be individuals or other businesses with some form of common ownership or control with Cinnaholic.
For a prospective franchisee, this related party payable could be a relevant factor when assessing the financial health and stability of Cinnaholic. While the advances are interest-free, the fact that they are payable upon demand means that Cinnaholic could be required to repay this large sum at any time, which could impact its available cash flow and operations. It's worth noting that the balance due to related parties was $377,838 as of December 31, 2023, indicating an increase in the amount owed to related parties during 2024.