What was the total debt for Checkersrallys as of January 1, 2024?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
028 | | 146 | | Thereafter | - | 252 | | Total | $ | 1,679 |
(Tabular Dollars in Thousands, Except Share and per Share Data)
13. Debt, Financing Obligations and Credit Facilities
Debt, financing obligations and credit facilities consisted of the following as of January 1, 2024 (Successor), and January 2, 2023 (Predecessor):
| January 1, 2024 (Successor) | January 2, 2023 (Predecessor) | |
|---|---|---|
| Related party note maturing April 25, 2024 bearing interest at LIBOR plus an applicable margin or an alternative base rate plus an applicable margin, Interest is paid quarterly. | $ = | $ 181,913 |
| Related party Restatement Date Term Loan maturing April 25, 2023 bearing interest at LIBOR plus an applicable margin or an alternative base rate plus an applicable margin. Interest is paid quarterly. | e | 19,244 |
| Related party note maturing April 25, 2025 bearing interest at LIBOR plus an applicable margin or an alternative base rate plus an applicable margin, Interest is capitalized on all payment dates. | *: | 65,126 |
| Related party amended note maturing April 25, 2025 bearing interest at LIBOR plus an applicable margin or an alternative base rate plus an applicable margin. Interest is capitalized on all payment dates. | 5 | 31,066 |
| Related party revolver maturing April 25, 2025 bearing interest at LIBOR plus an applicable margin or an alternative base rate plus an applicable margin. | 2: | 1,000 |
| Obligations under premium financing arrangements, with short-term maturities | 1,028 | 1,127 |
| Financing obligations relating to restaurant sales maturing at various dates through October 1, 2039, bearing interest rates ranging from $3.20%$ to $7.06%$ | 7,923 | 8,640 |
| Last-Out Term Loans, maturing June 16, 2028, bearing interest at an alternative base rate plus 8% or the Adjusted Term SOFR plus 9% plus a credit adjustment spread. Company has option to pay interest in kind at a rate equal to 6% rather than in cash. | 76,952 | ie. |
| New Money Loans, maturing June 16, 2027, bearing interest at an alternative base rate plus 6% or the Adjusted Term SOFR plus 7% plus a credit adjustment spread. Company has option to pay interest in kind a |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the total debt, financing obligations, and credit facility as of January 1, 2024, was $95,537. After deducting current maturities of $1,879, the total debt, financing obligations, and credit facility, less current maturities, amounted to $93,658.
This figure represents the aggregate of several debt components, including related party notes and loans, obligations under premium financing arrangements, financing obligations relating to restaurant sales, and last-out and new money loans. These debts carry varying interest rates and maturity dates, reflecting different financing arrangements Checkersrallys has in place.
For a prospective franchisee, understanding the debt structure of Checkersrallys is crucial. While this information provides a snapshot of the company's financial obligations, it does not detail the specific terms and conditions of each debt instrument. Franchisees should consider this debt level in the context of Checkersrallys's overall financial health and stability, as it could impact the company's ability to support its franchisees or invest in future growth. It is also important to note that a significant portion of the debt is related to related-party transactions, which may have different implications than traditional debt.
It is advisable for potential franchisees to seek clarification from Checkersrallys regarding the nature and terms of these debts, as well as their potential impact on the franchise system. Consulting with a financial advisor to assess the financial stability of Checkersrallys is also recommended.