What were the approximate total assets and liabilities of the entities under common ownership whose loans Chesters has guaranteed as of December 31, 2024?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
s and amounts that would have been incurred had comparable transactions been entered into with independent parties.
The Company has guaranteed the loans of four entities under common ownership. The entities under common ownership have total assets and liabilities of ap
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, Chesters has guaranteed the loans of four entities under common ownership. As of December 31, 2024, these entities had approximate total assets of $8,218,000 and total liabilities of $7,926,000.
It is important for a prospective franchisee to understand the implications of these guaranteed loans. If these other entities were to default on their loans, Chesters could be held responsible for repaying them. This could potentially impact Chesters's financial stability and its ability to support its franchisees.
For comparison, the FDD also provides the total assets and liabilities for these entities as of December 31, 2023, which were approximately $5,118,000 and $5,278,000, respectively. This shows a significant increase in both assets and liabilities from 2023 to 2024. A prospective franchisee should inquire about the nature of these assets and liabilities and the reasons for the increase. Understanding the financial health and obligations of these related entities can provide valuable insight into the overall risk associated with investing in a Chesters franchise.