What was the net value of Checkersrallys' definite-lived intangible assets as of December 30, 2024?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
| (Successor) | ||||
|---|---|---|---|---|
| December 30, | January 1, | Estimated | ||
| 2024 | 2024 | Useful Lives | ||
| Land | $ 5,922 | $ 6,735 | ||
| Leasehold and land improvements | 2,270 | 804 | 1-10 years | |
| Buildings | 6,779 | 3,617 | 5-30 years | |
| Equipment, furniture and fixtures | 22,181 | 19,689 | 3-10 years | |
| Construction in progress | 3,141 40,293 | 1,320 32,165 | ||
| Less: accumulated depreciation | (8,614) | (2,856) | ||
| Property and equipment, net | $ 31,679 | $ 29,309 | ||
| Depreciation | expense | associated with | property and | equipment, |
| $7.9 million for the fiscal year ended December 30, 2024 (Successor) and for the periods from June 17, | ||||
| 2023 | through January 1, (Successor) | 2024 | (Successor) and | from January 3, |
| Amortization | December 30, | January 1, | ||
| Period | 2024 | 2024 | ||
| Balance, gross 10 years | $31,767 | $ 31,767 | ||
| Less: accumulated amortization | (4,895) | (1,730) | ||
| Balance, net | $26,872 | $ 30,037 | ||
| Fiscal Year Ending | Amount | |||
| 2025 | $3,166 | |||
| 2026 | 3,166 | |||
| Thereafter | Total 2024 | 11,042 $26,872 2024 | ||
| Tradenames, indefinite-lived | $197,500 | $197,500 | ||
| Definite-lived intangible assets, net | 1,223 | 1,349 | ||
| Intangible assets. net | $198,723 | $198,849 | ||
| Fiscal Year Ending | Amount | |||
| 2025 | $91 | |||
| Thereafter | Total | 769 $1,223 |
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys' 2025 Franchise Disclosure Document, the net value of definite-lived intangible assets was $1,223 as of December 30, 2024. This figure represents the remaining value of intangible assets with a finite lifespan, such as franchise agreements, after accounting for accumulated amortization. Amortization is the systematic reduction of the value of an intangible asset over its useful life, similar to depreciation for tangible assets.
For a prospective Checkersrallys franchisee, understanding the value and amortization schedule of definite-lived intangible assets is important for financial planning and assessing the long-term value of the franchise. These assets contribute to the overall value of the business but diminish over time, impacting the franchisee's financial statements and potentially affecting the resale value of the franchise.
The FDD also provides a breakdown of the amortization schedule for these assets. For the fiscal year ending 2025, the amortization amount is projected to be $91. The remaining total after 2025 is $769, which sums up to the total net value of $1,223. This information allows franchisees to anticipate future expenses related to amortization and factor it into their financial projections.
It's worth noting that Checkersrallys also has tradenames, which are classified as indefinite-lived intangible assets with a value of $197,500 as of December 30, 2024. Unlike definite-lived assets, indefinite-lived assets are not amortized but are subject to impairment testing, which could result in a write-down of their value if their fair value declines below their carrying amount.