What is the interest rate on the 2024-1 Variable Funding Notes for Bojangles?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
------------------|--------------| | 2026 | 563 | | 2027 | 553 | | 2028 | 554 | | 2029 | 531 | | Thereafter | 8,007 $ 10,783 |
(dollars in thousands)
10. Commitments and Contingencies
Guarantee of Affiliated Parties Indebtedness
In conjunction with the 2020-1 Securitization Transaction, Issuer issued an aggregate principal amount of $415,000 Series 2020-1 3.832% Class A-2 Senior Secured Notes with an anticipated repayment date of October 2025 and a legal final maturity date
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, the 2024-1 Variable Funding Notes bear interest at a rate of 2.55% plus the Secured Overnight Financing Rate (SOFR). These notes provide for senior secured revolving facility loans, subfacilities for swingline loans, and letters of credit, up to an aggregate amount of $50,000.
In addition to the interest, Bojangles is required to pay a commitment fee of 0.50% per annum for any unused commitments. They also must pay letter of credit fees of 2.55% per annum on any outstanding noncash collateralized letters of credit.
Prospective franchisees should understand that the SOFR is a variable rate, meaning the actual interest paid on these notes can fluctuate over time based on market conditions. This introduces an element of unpredictability into Bojangles's financing costs. Franchisees may want to inquire about how these financing arrangements at the corporate level could indirectly affect their operations or financial obligations.