What is the interest rate on the Craters & Freighters line of credit?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
, Net | $ 197,251 $ | 153,931 |
Note 5: Line of Credit
The Company has a $100,000 line of credit available with a bank. No advances were outstanding as of December 31, 2024 and 2023. The line of credit expires on December 17, 2025 and bears interest at the Daily SOFR rate plus 2.75%. T
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, the company has a $100,000 line of credit with a bank. As of December 31, 2024 and 2023, there were no outstanding advances on this line of credit.
The line of credit is set to expire on December 17, 2025, and it bears interest at a variable rate. The interest rate is calculated as the Daily SOFR (Secured Overnight Financing Rate) plus 2.75%. The line of credit is secured by a general business security agreement.
For a prospective Craters & Freighters franchisee, this information is relevant for understanding the financial standing of the franchisor. The interest rate on the line of credit is variable, meaning it will fluctuate with changes in the Daily SOFR rate. This could impact the cost of borrowing for Craters & Freighters, and potentially, its financial stability. Franchisees should monitor the SOFR rate and consider how changes could affect the franchisor's financial health.