What was the total amount of advance to related parties for Chili, Inc. related to Gold Star?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Gold Star Chili, Inc. | Properties, LLC | TCWW, LLC | Eliminations | _ | Total | ||
|---|---|---|---|---|---|---|---|
| Current Assets | |||||||
| Cash | $ | 437,267 | $ 909,375 | $ 244,320 | $ - | $ | 1,590,962 |
| Accounts Receivable, Less Allowance for | ,, | ||||||
| Expected Credit Losses of $896,732 | 905,238 | 2,002,485 | 4,130 | (1,981,263) | 930,590 | ||
| Advance - Related Party | 3,441,832 | - | - | (3,441,832) | - | ||
| Other Receivables | 21,704 | - | 1,502 | - | 23,206 | ||
| Inventory | 980,151 | - | 27,923 | - | 1,008,074 | ||
| Prepaid Expenses | 166,348 | 109,041 | 15,154 | (12,824) | _ | 277,719 | |
| Total Current Assets | 5,952,540 | 3,020,901 | 293,029 | (5,435,919) | _ | 3,830,551 | |
| Property and Equipment | |||||||
| Land | - | 7,004,518 | - | (164,029) | 6,840,489 | ||
| Buildings | 4,127,417 | 10,257,116 | - | 817,551 | 15,202,084 | ||
| Leasehold Improvements | 5,500,864 | - | 429,641 | - | 5,930,505 | ||
| Furniture and Equipment | 5,913,212 | 184,794 | 535,932 | - | 6,633,938 | ||
| Vehicles | 100,623 | - | - | - | 100,623 | ||
| Construction in Progress | _ | 489,000 | - | - | . - | _ | 489,000 |
| 1 | 6,131,116 | 17,446,428 | 965,573 | 653,522 | 35,196,639 | ||
| Less Accumulated Depreciation | 9,164,879 | 6,837,663 | 291,152 | 727,229 | _ | 17,020,923 | |
| Total Property and Equipment | 6,966,237 | 10,608,765 | 674,421 | (73,707) | _ | 18,175,716 | |
| Fair Value of Interest Rate Swap | 194,930 | 113,503 | - | . - | _ | 308,433 | |
| Other Assets | |||||||
| Right of Use Asset - Operating Leases | 9,246,018 | _ | 1,846,237 | _ | 11,092,255 | ||
| Goodwill, Net | 381,667 | _ | 67,719 | - | 449,386 | ||
| Trademark | - | _ | 475,000 | _ | 475,000 | ||
| Intangibles Subject to Amortization | 48.595 | _ | - | _ | 48,595 | ||
| Deposits | 154,174 | 5,763 | 11,706 | _ | 171,643 | ||
| Investment in Subsidiary | (2,164,835) | -, | , | 2,164,835 | - | ||
| Notes Receivable | 1,817,565 | - | - | (1,817,565) | _ | ||
| Total Other Asse |
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the amount of advances to related parties for Gold Star Chili, Inc. is detailed in the consolidating balance sheet. Specifically, under current liabilities, advances to related parties totaled $1,940,597 for Gold Star Chili, Inc. There were no advances listed for GSC Properties, LLC or TCWW, LLC. After eliminations of ($1,940,597), the total advances to related parties is $0.
This indicates that Gold Star Chili, Inc. has significant financial transactions with related parties, which are then eliminated in the consolidated financial statements. For a prospective franchisee, this highlights the importance of understanding the relationships between Gold Star and its related entities. It's crucial to assess how these transactions might affect the financial stability and operations of the franchise system.
Understanding these related-party transactions is essential for assessing the overall financial health and stability of Gold Star. A potential franchisee should seek clarification from Gold Star regarding the nature of these advances, the terms of repayment, and the potential impact on the franchisee's business.