What was the total stockholder's equity (deficit) for Checkersrallys as of June 16, 2023?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
at end of period $ 12,557 $ 17,613 $ 18,049 $ 30,813 See accompanying notes, including the supplemental disclosure of cash flow information in Note 2.
CHECKERS DRIVE—IN RESTAURANTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)
(Tabular Dollars in Thousands, Except Share and per Share Data)
| Predecessor | ||||||||
|---|---|---|---|---|---|---|---|---|
| Common Stock | Additional Paid-in Capital | Accumulated Earnings (Deficit) | Total Stockholder's Equity (Deficit) | |||||
| Balances at December 28, 2020 | $ | $ | 262,976 | $ | (326,643) | $ | (63,667) | |
| Stock-based compensation | 2 | 758 | 15 (1 | 758 | ||||
| Contributions from Parent | * | 52,917 | 52,917 | |||||
| Co-op retained earnings adjustment | 15 | 44 | 44 | |||||
| Net loss | 7 4 2 | (10,066) | (10,066) | |||||
| Balances at January 3, 2022 | • | 316,651 | (336,665) | (20,014) | ||||
| Stock-based compensation | 2 | 1,208 | (6) | 1,208 | ||||
| ASC 842 transition | * | 50 + 3 | (38,618) | (38,618) | ||||
| Co-op retained earnings adjustment | 7: | (44) | (44) | |||||
| Net loss | (23,624) | (23,624) | ||||||
| Balances at January 2, 2023 | £ | 317,859 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the total stockholder's equity (deficit) as of June 16, 2023, was a deficit of $166,478. This figure is derived from the consolidated statements of stockholder's equity (deficit) which tracks changes in equity over time. It reflects the cumulative effect of items such as stock-based compensation, contributions from the parent company, adjustments for co-op retained earnings, and net losses.
The stockholder's equity (deficit) is a key indicator of Checkersrallys's financial health. A negative value, as in this case, indicates that the company's liabilities exceed its assets at that point in time. This can be a concern for prospective franchisees, as it suggests potential financial instability or a heavy reliance on debt. However, it is important to consider this figure in the context of the company's overall financial performance and future prospects.
It is also important to note that the financial statements include both a "Predecessor" and a "Successor" designation, relating to periods before and after June 17, 2023. The stockholder's equity (deficit) on June 16, 2023, pertains to the "Predecessor" period. The "Successor" period reflects financial activities after a business combination or other significant event that resulted in a new reporting entity. Prospective franchisees should carefully review the notes to the consolidated financial statements for a full understanding of these designations and their implications.