How are the debt issuance costs amortized for Jersey Mikes' long-term debt?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
rations to service the senior notes, remit management fees, and pay certain other ongoing costs related to the Securitization Transactions.
4. SERVICES DUE FROM MANAGER—RELATED PARTY
Services due from Manager represents assets contributed upon closing of the Securitization Transaction (see Note 3—Securitization Transactions) that are related to the deferred franchise fees contributed. The Manager is obligated to provide services to the Company for the term of the Securitization Transactions.
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the information provided does not specify how Jersey Mike's amortizes debt issuance costs related to its long-term debt. However, the FDD does mention the amortization of services due from the manager, a related party, in connection with the Securitization Transactions.
Specifically, the amortization of services due from the manager amounted to $737,810 for the year ended December 31, 2024, $799,161 for the year ended December 31, 2023, and $1,015,557 for the year ended December 31, 2022. The FDD also provides estimated future amortization amounts for the next five years and beyond as of December 31, 2024.
While the document details the amortization of services due from the manager, it does not provide specific details on how Jersey Mike's amortizes debt issuance costs for its long-term debt. A prospective franchisee should seek clarification from Jersey Mike's regarding the amortization method used for debt issuance costs, as this can impact the financial statements and overall financial planning.