What amount of goodwill did Checkers recognize as part of the business combination?

According to Checkers' 2025 Franchise Disclosure Document, as part of the business combination, Checkers recognized $31.8 million of goodwill. Goodwill represents the excess of the consideration transferred over the net of the acquisition date fair values of the assets acquired and liabilities assumed in a business combination.

Goodwill is primarily attributable to the deferred tax liability created by the business combination. Checkers has elected to amortize the goodwill over a 10-year period using the straight-line method. This means that the $31.8 million will be expensed gradually over 10 years, impacting the company's reported profits during that time.

Impairment testing is performed at the enterprise level upon the occurrence of a triggering event indication that the fair value of the Company might be less than its carrying amount. When a triggering event occurs, Checkers has the option to perform a qualitative assessment to determine whether a quantitative test is needed. If that assessment demonstrates that it is more likely than not that an impairment does not exist, no further testing is required. If impairment of goodwill is more likely than not, a quantitative test is required that compares the fair value of the Company with its carrying amount. If the carrying amount exceeds fair value, that amount represents the impairment loss to be recognized, up to the carrying amount of goodwill.