What was the amount of second lien debt relieved for Checkers on December 31, 2020?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
, 2023 (Predecessor). The amount of board compensation and travel related costs was $0.5 million for each of the years ended January 2, 2023 (Predecessor) and January 3, 2022 (Predecessor) and was recorded in "general and administrative expenses" in the accompanying consolidated statement of operations.
Predecessor
On December 31, 2020, the Company entered into an agreement to amend the Amended and Restated Second Lien Credit Agreement whereby $52.4 million of second lien debt was relieved for $52.9 million of non-cash consideration that was contributed to the Company by its parent, BossCo Holdings. The Second Lien Credit lenders were also co
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, on December 31, 2020, $52.4 million of second lien debt was relieved. This was achieved through a non-cash consideration of $52.9 million contributed to the company by its parent, BossCo Holdings. The Second Lien Credit lenders were also common shareholders of BossCo Holdings. Additionally, as part of the Second Lien Second Amendment, Checkers agreed to a $25 million term loan with Burger BossCo Debt Holdings, LP, an affiliate of BossCo Holdings.
This transaction was part of an agreement to amend the Amended and Restated Second Lien Credit Agreement. The debt relief was facilitated by the parent company's contribution, indicating a strategic financial restructuring. The lenders' dual role as shareholders suggests a vested interest in the company's financial health and future performance.
For a prospective franchisee, this information provides insight into Checkers' past financial maneuvers and its relationship with its parent company and lenders. Understanding these historical debt restructurings can help in assessing the financial stability and risk profile of the franchise. It's important to note that such restructurings can impact the company's ability to invest in growth, support franchisees, or adapt to changing market conditions. Therefore, a franchisee should further investigate the current debt structure and financial health of Checkers to make an informed investment decision.