What was the amount of restricted cash held by Chicken Guy as of December 31, 2023?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
ents and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates under different assumptions or conditions.
Cash, Cash Equivalents and Restricted Cash
The Company considers all highly liquid debt investments with an initia
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, the company held $37,500 in restricted cash as of December 31, 2023. This amount is also consistent for December 29, 2024, and December 25, 2022. Restricted cash is funds collateralizing certain surety bonds maintained by Chicken Guy.
Restricted cash typically cannot be used for day-to-day operations. It is important for prospective franchisees to understand the nature of these restrictions, as it means that Chicken Guy cannot freely access or utilize these funds for its operational needs. This could impact the company's financial flexibility and ability to respond to unforeseen circumstances.
Franchisors often maintain restricted cash accounts for various reasons, such as securing obligations or meeting regulatory requirements. The consistent amount of restricted cash over the three years suggests a stable requirement related to surety bonds. Franchisees should inquire about the specific surety bonds collateralized by this cash and the implications for the franchise system.
Understanding the details of Chicken Guy's restricted cash provides insight into its financial obligations and risk management practices. While the amount is consistent, franchisees should remain informed about any changes in these requirements and their potential impact on the franchisor's financial health.