What is the maturity date for the New Money Loans obtained by Checkersrallys as part of the Out-of-Court Restructuring?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
ssued to Checkers Topco, LLC ("Topco"), the secured creditors of Holdings and Burger BossCo acquired all of the equity of Topco, and the equity of Burger BossCo owned by BossCo Holdings was repurchased by Burger BossCo for a nominal amount.
As part of the Out-of-Court Restructuring, each First Lien Lender was provided with the right to elect to provide up to pro rata share of commitments to make $25 million in "First-Out Delayed Draw Term Loans" ("New Money Loans") under that certain Credit Agreement, dated as of June 16, 2023 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement" and such commitments, the "New Money Commitments"), by and among Holdings, CDI, Burger BossCo, the persons party thereto from time to time as "Lenders" thereunder, and Jefferies Finance LLC, as the administrative agent and the collateral agent for such lenders. The New Money Loans accrue interest at a floating rate, which can be, at the Company's option, (x) an alternative base rate plus 6.00% per annum or (y) the Adjusted Term Secured Overnight Financing Rate plus 7.00% per annum plus a credit adjustment spread. The Company has the option to pay interest on the New Money Loans that has accrued at a rate equal to 4.00% per annum in kind, rather than in cash. The New Money Loans mature on June 16, 2027. Additionally, the Company is required to make recurring quarterly principal payments on the New Money Loans in the amount equivalent to 0.25% of the original principal amount which may increase upon additional borrowings. The remainder of the principal amount is due upon maturity. Upon each principal repayment, the Company is required to pay a contractual premium, equal to (i) prior to the first anniversary, a make-whole provision calculated as a discounted amount of remaining interest paymen
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the New Money Loans mature on June 16, 2027. These loans were part of an Out-of-Court Restructuring, where First Lien Lenders had the option to provide commitments up to $25 million in First-Out Delayed Draw Term Loans. These loans are governed by a Credit Agreement dated June 16, 2023.
The New Money Loans accrue interest at a floating rate, which Checkersrallys can elect to be either an alternative base rate plus 6.00% per annum, or the Adjusted Term Secured Overnight Financing Rate plus 7.00% per annum, along with a credit adjustment spread. Checkersrallys also has the option to pay interest on these loans that has accrued at a rate of 4.00% per annum in kind, rather than in cash.
In addition to the maturity date, Checkersrallys is required to make recurring quarterly principal payments on the New Money Loans, equivalent to 0.25% of the original principal amount, which may increase with additional borrowings. The remaining principal amount is due upon maturity. Furthermore, each principal repayment is subject to a contractual premium, which varies depending on the timing of the repayment: a make-whole provision before the first anniversary, 7% on or after the first anniversary but before the second, 5% on or after the second anniversary but before the third, and 3% on or after the third anniversary. This detailed repayment structure and the associated premiums are important considerations for Checkersrallys's financial obligations.