Are the notes receivable from related parties for Crave interest-bearing?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
ined whether any tax positions have met the recognition threshold and has measured the Company's exposure to those tax positions, noting none at the Company level.
3. Related party transactions
The Company has notes receivable from a related party with common ownership. These notes are noninterest bearing
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the notes receivable from a related party are noninterest bearing. The related party has common ownership with Crave. These notes are payable upon demand.
As of December 31, 2024, 2023, and 2022, the amount receivable was $320,387 for each year. This indicates that the balance has remained constant over these three years.
For a prospective franchisee, this information is relevant because it provides insight into Crave's financial dealings with related parties. While the notes being non-interest bearing might not directly impact a franchisee's operations, it is important to understand the financial relationships of the franchisor. It is fairly common for franchisors to have related-party transactions, and the key is whether these transactions are conducted at arm's length and are fair to both parties.