As of what date were the equipment financing agreements between Benihana and Sterling National Bank fully paid?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
nce costs related to the amended Credit Agreement, which were capitalized and are recorded as a direct deduction to the long-term debt and $0.6 million in debt issuance costs recorded in Other Assets on the consolidated balance sheets. As of December 31, 2021, the Company was in compliance with the financial covenants required by the Credit Agreement.
Equipment Financing Agreements
On June 5, 2015 and August 16, 2016, the Company enter
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the equipment financing agreements with Sterling National Bank were fully paid as of December 31, 2021. These agreements, entered into on June 5, 2015, and August 16, 2016, were for $1.0 million and $0.7 million, respectively, and were used to purchase equipment for STK locations in Orlando, Chicago, San Diego, and Denver.
Each financing agreement had a five-year term with an annual interest rate of 5%, payable in equal monthly installments. The fact that these agreements are paid off could indicate a positive financial position for Benihana at that time.
Prospective franchisees should note that while these specific equipment financing agreements are no longer outstanding, it's important to inquire about Benihana's current debt obligations and financial health to assess the overall stability of the franchise system. Understanding the financial obligations of the franchisor can help a franchisee make an informed decision.