What amount did the Shareholder provide to Craters & Freighters in December 2023 to fund future investments?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
l course of business and were conducted on an arm's length basis.
In December 2023, the Shareholder provided the Company $5,000,000 to fund future investments. During the year ended December 31, 2023, the Shareholder took $2,230,312 in distributions which has been offset against the Shareholder advance. At December 31, 2023, $2,769,688 remained as a balance with a maturity date of January 1, 2026. The remaining balance of $2,769,688 was paid in full during the year ended December 31, 20
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, in December 2023, the Shareholder provided the company $5,000,000 to fund future investments. During the same year, the Shareholder took $2,230,312 in distributions, which was offset against the advance. As of December 31, 2023, the remaining balance was $2,769,688, with a maturity date of January 1, 2026.
The loan from the Shareholder to Craters & Freighters had an interest rate of 2.95%. No payments were due on the advance until January 1, 2025, so the balance was considered long term. The remaining balance of $2,769,688 was paid in full during the year ended December 31, 2024. As of December 31, 2024, the amount due to the shareholder was $0.
This type of shareholder investment is not uncommon in franchise systems, especially during periods of growth or strategic initiatives. It's important for prospective franchisees to understand the financial health and capital structure of Craters & Freighters, including any debts or obligations to shareholders, as this can impact the company's ability to support its franchisees and invest in the brand.