What is the interest rate for the 2022-1 Class A-2 notes related to Auntie Annes?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
y comprised of satellite SBRs that the Company leases to certain franchisees under month-to-month operating lease agreements.
4 Intangible Assets
Intangible assets, net at December 31, 2023 consists of the following:
| For the fiscal years ended: | 2023 | 2022 | | |---|---|---|---| | Expected life (years) | 5 | 5 | | Intangible assets, net at December 25, 2022 consists of the following:
| For the fiscal years ended: | 2023 | 2022 | | |---|---|---|---| | Current: | | | | | Federal | $ 13,888 | | $ 10,615 | | State | 4,069 | 3,952 | | | Foreign | 2,695 | 2,346 | | | Deferred: | | | | | Federal | (2,138) | 4,060 | | | State | (463) | 162 | | | Income tax expense | $ 18,051 | | $ 2 1,135 | Amortization expense of definite-lived intangible assets totaled $1,728 and $3,365 for the fiscal years ended December 31, 2023 and December 25, 2022, respectively.
Estimated future amortization expense for each of the next five years is as follows:
| -- | -- | -- | ----------------------- |
|---|
| 2024 | $ 1,730 |
|---|---|
| 2025 | 1,592 |
| 2026 | 1,406 |
| 2027 | 1,392 |
| 2028 | 1,392 |
Source: Item 23 — RECEIPTS (FDD pages 106–366)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, the 2022-1 Class A-2 notes have an interest rate of 7.206%. As of December 31, 2023, the outstanding principal amount for these notes was $350,563. These notes are part of the senior secured notes issued by FOCUS Brands Funding LLC and Jamba Juice Funding LLC.
The interest rate is fixed for these notes, providing predictability in debt servicing. However, franchisees should understand that these notes are obligations of Auntie Annes's parent company and its affiliates, not direct obligations of the individual franchisees. The financial health of the parent company can indirectly impact franchisees, as it affects the resources available for brand support, marketing, and innovation.
Prospective franchisees should consider the overall debt structure of Auntie Annes's parent company as part of their due diligence. While the interest rate on these specific notes is known, it's important to assess the total debt burden and how it might affect the franchisor's ability to support the franchise system. Understanding the financial stability of the parent company is crucial for evaluating the long-term viability of an Auntie Annes franchise.