What was the total stock consideration in the Checkersrallys Out-of-Court Restructuring?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
air value as of the acquisition date. As an indirect subsidiary of the accounting acquirer, the Company has elected to apply pushdown accounting, whereby it will also recognize the assets acquired and liabilities assumed at fair value as of the acquisition date.
The total stock consideration w
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the Out-of-Court Restructuring agreement, executed on June 16, 2023, resulted in Topco acquiring all voting interests of Burger BossCo. The total stock consideration for this acquisition was $97.8 million, which comprised 90 shares of Burger BossCo acquired by Topco.
The fair value of the stock consideration was determined through a third-party valuation using market and income approaches, with the results weighted appropriately. This valuation is a critical component of the business combination accounting, ensuring that the assets and liabilities are recorded at fair value as of the acquisition date.
For a prospective Checkersrallys franchisee, understanding the financial restructuring is important because it reflects the financial health and stability of the parent company. The valuation methods used and the involvement of third-party specialists suggest a rigorous approach to financial reporting, which can provide reassurance about the franchisor's financial management practices.