What was the total value of notes receivable for Fat Shack at the end of 2023?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
e method starting with January 1, 2019.
4. NOTES RECEIVABLE
During the year ended December 31, 2022, the Company executed one additional note receivable loan agreement with an unrelated third-party franchisee totaling $75,000. These notes require monthly principal payments through maturity, ranging from September 1, 2023 to January 27, 2026. In lieu of interest, these notes require a payment of 1% of the third party's franchise gross sales for every month that the note has an outstanding balance. The total amounts of these loans are not typically advanced to the third party in a lump sum. Instead, the Company begins paying for franchise start-up expenses on behalf of the third party upon execution of the agreement. The loans are collateralized by substantially all assets of the franchise owned by the third party. The outstanding balance of the note receivables at December 31
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the total value of notes receivable at the end of 2023 was $479,960. These notes receivable stem from loan agreements Fat Shack has with its franchisees.
Specifically, in 2022, Fat Shack executed a note receivable loan agreement with a third-party franchisee for $75,000. These notes require monthly principal payments with maturities ranging from September 1, 2023, to January 27, 2026. Instead of interest, Fat Shack receives 1% of the franchisee's gross sales for each month the note has an outstanding balance.
These loans are not disbursed as a lump sum; instead, Fat Shack uses the funds to cover the franchisee's start-up expenses. The loans are secured by the assets of the franchisee's Fat Shack location. At the close of 2024, 2023, and 2022, the outstanding balances for these notes receivable were $701,287, $479,960 and $528,900, respectively.