What was the interest expense for Lees Famous Recipe in 2023?
Lees_Famous_Recipe Franchise · 2025 FDDAnswer from 2025 FDD Document
d the present value discount as of December 31, 2023:
| 2024 2025 | $ 380,466 388,297 |
|---|---|
| 2026 | 352,602 |
| 2027 | 358,874 |
| 2028 | 365,278 |
| Thereafter | 5,450,970 |
| Total undiscounted cash flows | 7,296,487 |
| Less: present value discount | (3,725,886) |
| Total lease liabilities | $ 3,570,601 |
NOTE 7 - NOTES PAYABLE
Notes payable are summarized as follows:
| 2023 | 2022 | |
|---|---|---|
| Note payable to financing company under a $25,000,000 | $ 21,000,000 | $ 21,000,000 |
| credit agreement, interest only payments at LIBOR with a | ||
| floor of 1%, plus 7% (12.35% at December 31, 2023), maturing | ||
| November 2026, secured by substantially all business assets | ||
| Note payable to Famous Recipe Group, LLC, annual | 3,500,000 | 3,500,000 |
| principal payments of $700,000 starting in June 2024, | ||
| interest at 5%, maturing June 2028, unsecured | ||
| Note payable to financial institution, monthly payments | 1,135,757 | 1,152,000 |
| through November 2027 of $6,361, starting January 2023, | ||
| including interest at 5.25%, secured by the mortgaged property | ||
| Note payable to financial institution, monthly payments | 1,127,869 | 1,143,999 |
| through November 2027 of $6,317, starting January 2023, | ||
| including interest at 5.25%, secured by the mortgaged property | ||
| Note payable to financial institution, monthly payments | 1,222,515 | 1,240,000 |
| through November 2027 of $6,847, starting January 2023, | ||
| including interest at 5.25%, secured by the mortgaged property | ||
| Note payable to financial institution, monthly payments | 1,222,515 | 1,240,000 |
| through November 2027 of $6,847, starting January 2023, | ||
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 69)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the interest expense for Lees Famous Recipe in 2023 is not explicitly stated. However, the document provides details on several notes payable and their associated interest rates. For example, there is a note payable to a financing company with interest-only payments at LIBOR with a floor of 1%, plus 7%, resulting in a 12.35% interest rate as of December 31, 2023. There are also multiple notes payable to financial institutions with monthly payments including interest at 5.25% or 5.30%.
To determine the total interest expense for 2023, a prospective Lees Famous Recipe franchisee would need to calculate the interest paid on each note payable throughout the year. This would involve understanding the principal amounts, interest rates, and payment schedules for each note. The notes payable include those to the financing company, Famous Recipe Group, LLC, and various financial institutions.
It's important to note that the provided financial statements include various related party transactions and other financial details, such as employee benefit plan contributions and advertising service revenues and payables. However, without a consolidated interest expense figure, a potential franchisee should request this specific information from Lees Famous Recipe to gain a clearer understanding of the company's financial obligations and performance.