What is the reported total of Gold Star Chili, Inc.'s long-term liabilities?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| GSC | |||||
|---|---|---|---|---|---|
| Gold Star | Properties, | ||||
| Chili, Inc. | LLC | TCWW, LLC | Eliminations | Total | |
| Long-Term Liabilities | |||||
| (Less Current Portion) | |||||
| Line of Credit | 1,399,992 | - | - | - | 1,399,992 |
| Installment Note Payable | 7,151,608 | 5,931,166 | - | (1,817,565) | 11,265,209 |
| Operating Lease Liabilities | 8,674,979 | - | 1,855,590 | - | 10,530,569 |
| Advances - Related Party | - | - | 3,441,832 | (3,441,832) | - |
| Deferred Franchise Fees | 60,041 | 5,867 | 65,908 | ||
| Total Long-Term Liabilities | 17,286,620 | 5,931,166 | 5,303,289 | (5,259,397) | 23,261,678 |
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the total long-term liabilities for Gold Star Chili, Inc. is $23,261,678 as of December 31, 2024. This figure is a consolidated total that includes the long-term liabilities of Gold Star Chili, Inc. itself ($17,286,620), GSC Properties, LLC ($5,931,166), and TCWW, LLC ($5,303,289), after accounting for eliminations of ($5,259,397).
Long-term liabilities represent financial obligations that Gold Star has due beyond the next year. These liabilities can include items such as long-term loans, deferred revenue, and lease obligations. For a prospective franchisee, this figure provides insight into the overall financial leverage and long-term financial health of Gold Star. A high level of long-term liabilities could indicate a higher degree of financial risk for the franchisor.
It is important for a potential Gold Star franchisee to consider the franchisor's debt level in relation to its assets and equity. While a substantial amount of debt isn't automatically negative, it's crucial to assess how Gold Star manages its liabilities and whether its cash flow is sufficient to cover these obligations. Reviewing the complete financial statements and consulting with a financial advisor can provide a more comprehensive understanding of the franchisor's financial stability and its potential impact on the franchisee's investment.