What is the contractual maturity date for The Standardx's convertible debt security investment?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
0 million convertible debt security associated with a franchised property, which is classified as AFS and recorded in other assets on our consolidated balance sheets. The investment has a contractual maturity date in 2029. The convertible debt investment is remeasured at fair value on a recurring basis and is classified as Level Three in the fair value hierarchy. We estimated the fair value of this investment to be $42 million and $39 million at December 31, 2024 and December 31, 2023, respectively. The fair value is estimated using a discounted future cash flow model, and the primary sensitivity in the model is the selection of an appropriate discount rate. Fluctuations in our assumptions could result in different estimates of fair value. Net unrealized gains recognized on our consolidated financial statements were as follows:
| Allowance at January 1 $ 50 | $ 63 |
|---|---|
| Provisions (reversals), net 19 (5) |
Source: Item 23 — Receipts (FDD pages 85–132)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the company invested in a $30 million convertible debt security associated with a franchised property during the year ended December 31, 2023. This investment is classified as AFS (available-for-sale) and is recorded in other assets on The Standardx's consolidated balance sheets.
The contractual maturity date for this convertible debt security investment is in 2029. The investment is remeasured at fair value on a recurring basis and is classified as Level Three in the fair value hierarchy. As of December 31, 2024, the fair value of this investment was estimated to be $42 million, while on December 31, 2023, it was $39 million.
The fair value is estimated using a discounted future cash flow model, where the selection of an appropriate discount rate is the primary sensitivity. Fluctuations in assumptions regarding the discount rate could result in different estimates of fair value. This means that the actual value of the investment could change depending on market conditions and other factors.