What was the average amortization period for Checkers' leasehold interests as of January 1, 2024?

According to Checkers's 2025 Franchise Disclosure Document, the average amortization period for leasehold interests as of January 1, 2024, was 11.1 years. Leasehold interests are amortized on a straight-line basis over the remaining lease term, including any optional renewal periods that are likely to be exercised. This amortization period applies to the Successor period following the Out-of-Court Restructuring.

For a prospective Checkers franchisee, understanding the amortization period of leasehold interests is crucial for financial planning. Amortization is the process of spreading the cost of an asset over its useful life. In this case, the leasehold interests, which represent the cost of acquiring the rights to use a property for the duration of the lease, are being expensed over 11.1 years. This means that a portion of the cost is recognized as an expense each year, which affects the franchisee's profitability and tax obligations.

The FDD also mentions that the company recognized amortization expense, net of revenue, of $0.2 million for the period ended January 1, 2024 (Successor). This figure provides context for the scale of amortization expenses Checkers deals with. It is important to note that this figure is net of revenue, meaning it accounts for any income generated from these leasehold interests.

Prospective franchisees should consult with financial advisors to fully understand the implications of leasehold interest amortization on their investment. They should also inquire about the specific terms of their lease agreements and any potential renewal periods, as these factors directly impact the amortization period and associated expenses. Understanding these financial details is essential for making informed decisions and ensuring the long-term financial health of their Checkers franchise.