What was the reported value of the Series 2020-1 Class A-2 Notes for Hardees in 2023?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
| _ | 20 | 24 | 2023 | ||||
|---|---|---|---|---|---|---|---|
| Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||
| Financial liabilities: | |||||||
| Series 2018-1 Class A-2-II Notes $ | 329,928 | $ 315,044 | $ 332,363 | $ 319,515 | |||
| Series 2018-1 Class A-2-III Notes | 234,366 | 222,070 | 236,353 | 227,945 | |||
| Series 2020-1 Class A-2 Notes | 382,905 | 344,350 | $ 385,688 | $ 346,802 | |||
| Series 2021-1 Class A-2 Notes | 172,625 | 146,543 | 173,801 | 146,485 |
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the carrying amount for the Series 2020-1 Class A-2 Notes in 2023 was $385,688, while the estimated fair value was $346,802. These figures reflect the financial liabilities of Hardees, specifically related to notes issued as part of their financing arrangements.
These notes were initially issued on December 21, 2020, to refinance previous notes (Series 2018-1 Class A-2-I Notes) with an aggregate principal amount of $400,000. The Series 2020-1 Class A-2 Notes have an anticipated repayment date in December 2027 and a final maturity date in December 2050, requiring quarterly principal payments of $1,000 starting March 22, 2021.
For a prospective Hardees franchisee, understanding these financial liabilities is crucial. While the franchisee is not directly responsible for these debts, they reflect the overall financial health and obligations of the Hardees brand. A significant debt load could impact the franchisor's ability to invest in brand development, marketing, or support for franchisees. Therefore, it is advisable for potential franchisees to consider these figures as part of their due diligence, assessing the franchisor's financial stability and long-term prospects.