What was the approximate total of cumulative aggregate financing arrangements provided to Clear Pest Pros franchisees by the financial institution as of December 31, 2024?
Clear_Pest_Pros Franchise · 2025 FDDAnswer from 2025 FDD Document
00 authorized shares of $1 par value stock. As of December 31, 2024, 2023, and 2022, there were 5,000 shares issued and outstanding.
13. Contingencies
The Company is party to an agreement with an unrelated financial institution where the Company guarantees a portion of the losses resulting from equipment-related financing arrangements made between the financial institution and certain of the Company's franchisees. In the event of a default by a franchisee, the Company guarantees the financial institution's losses, including proceeds received from the sale of collateralized equipment as follows: 30% on equipment and between 30% and 100% on non-equipment. As of December 31, 2024, 2023, and 2022 the financial institution provided cumulative aggregate financing arrangements for certain of the Company's franchisees totaling approximately $8,170, $8,170, and $8,140 with open financed amounts totaling approximately $147, $849, and $1,774, respectively. Payments made under this guarantee during the years ended December 31, 2024, 2023, and 2022 were approximately $3, $0, and $178, respectively, and the Company has recorded the estimated present value of this contingent liability as of December 31, 202
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 67)
What This Means (2025 FDD)
According to Clear Pest Pros' 2025 Franchise Disclosure Document, as of December 31, 2024, the financial institution provided cumulative aggregate financing arrangements for certain Clear Pest Pros franchisees totaling approximately $8,170 (in thousands). This indicates the total amount of financing the financial institution has extended to Clear Pest Pros franchisees over time.
Clear Pest Pros guarantees a portion of losses resulting from equipment-related financing arrangements between the financial institution and its franchisees. In the event a franchisee defaults, Clear Pest Pros guarantees the financial institution's losses, covering 30% on equipment and between 30% and 100% on non-equipment.
The open financed amounts, representing the outstanding balances of these financing arrangements, totaled approximately $147 (in thousands) as of the same date. This figure reflects the amount of financing that Clear Pest Pros franchisees had not yet repaid. Payments made by Clear Pest Pros under this guarantee during the year ended December 31, 2024, were approximately $3 (in thousands), and the company recorded the estimated present value of this contingent liability as approximately $10 (in thousands) as of December 31, 2024.