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What changed in Good Times Restaurants Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Good Times Restaurants Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+254 added−237 removedSource: 10-K (2025-12-29) vs 10-K (2024-12-12)

Top changes in Good Times Restaurants Inc.'s 2025 10-K

254 paragraphs added · 237 removed · 206 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

86 edited+7 added−13 removed89 unchanged
Biggest changeFiscal 2024 Financial & Brand Highlights ● Our net revenues for fiscal 2024 increased by $4,155,000 (3.0%) to $142,315,000 from $138,160,000 in fiscal 2023, primarily due to a late fiscal 2023 Bad Daddy’s restaurant opening, the late fiscal 2023 acquisitions of two Good Times restaurants from franchisees and the fiscal 2024 purchase of one Good Times restaurant from a franchisee. ● Same store sales decreased by 1.2% at our Bad Daddy’s brand during fiscal 2024. ● Same store sales increased by 2.9% at our Good Times brand during fiscal 2024. ● We acquired one previously franchised Good Times restaurant in the third quarter of fiscal 2024. ● We ended fiscal 2024 with $3.9 million in cash and $0.8 million in long-term debt.
Biggest changeFiscal 2025 Financial & Brand Highlights ● Our net revenues for fiscal 2025 decreased by $750,000 (0.5%) to $141,630,000 from $142,380,000 in fiscal 2024. ● Same store sales decreased by 2.1% at our Bad Daddy’s brand during fiscal 2025. ● Same store sales decreased by 5.0% at our Good Times brand during fiscal 2025. ● We ended fiscal 2025 with $2.6 million in cash and $2.3 million in long-term debt.
We: (1) do things the right way, (2) take pride in our work, (3) take pride in our facilities, and (4) take pride in our brand. The pride that is shared by all of us and drives us towards excellence in all of our activities. o Financial Discipline and Strength .
We: (1) do things the right way, (2) take pride in our work, (3) take pride in our facilities, and (4) take pride in our brand. The pride that is shared by all of us and that drives us towards excellence in all of our activities. o Financial Discipline and Strength .
We strive to provide a competitive salary and benefits, strong development opportunities, and a meaningful job or career for all of our employees and believe that this has translated into good employee relations. None of our employees are covered by a collective bargaining agreement. Competition The restaurant industry, including both limited service and full-service segments, is highly competitive.
We strive to provide competitive salary and benefits, strong development opportunities, and a meaningful job or career for all of our employees and believe that this has translated into good employee relations. None of our employees are covered by a collective bargaining agreement. Competition The restaurant industry, including both limited service and full-service segments, is highly competitive.
Managers are cross-trained in back of the house skills (kitchen execution, kitchen management, expediting, and line management), front of the house service positions (host, server and bar) and all other management functions, however each manager is assigned one or more specific areas of responsibility over which they have “ownership” and direct accountability for results.
Managers are cross-trained in back of the house skills (kitchen execution, kitchen management, expediting, and line management), front of the house service positions (host, server and bar) and all other management functions, however each manager is assigned one or more specific areas of responsibility over which they have direct accountability for results.
Further, within the restaurant industry, sales and traffic have exhibited greater weakness in the general casual dining sector than at any time since the post-pandemic recovery, and competitors in the QSR burger segment have been aggressively discounting to address pricing concerns that had been affecting traffic.
Within the restaurant industry, sales and traffic have exhibited greater weakness in the general casual dining sector than at any time since the post-pandemic recovery, and competitors in the QSR burger segment have been aggressively discounting to address pricing concerns that had been affecting traffic.
Certain forward-looking statements are included in this Form 10-K, principally in the sections captioned "Business," and "Management's Discussion and Analysis of Financial Condition and Results of Operations." Forward-looking statements are related to, among other things: ● our expectations as to the impact of a global or regional pandemic or epidemic on our business; ● the sufficiency of the supply of commodities and labor pool to carry on our business; ● anticipated price increases and the impact of inflation ● business objectives and strategic plans; ● operating strategies; ● our ability to open and operate additional restaurants profitably and the timing of such openings; ● expectations that most, if not all, of the Company’s unit growth will be through the development of additional Bad Daddy’s Burger Bar locations; ● restaurant and franchise acquisitions; ● expected future revenues and earnings, comparable and non-comparable restaurant sales, results of operations, and future restaurant growth (both company-owned and franchised); ● estimated costs of opening and operating new restaurants, including general and administrative, marketing, franchise development and restaurant operating costs; ● anticipated selling, general and administrative expenses and restaurant operating costs, including commodity prices, labor and energy costs; ● future capital expenditures; ● our expectation that we will have adequate cash from operations and credit facility borrowings to meet all future debt service, capital expenditure and working capital requirements in fiscal 2025; ● success of advertising and marketing activities; ● the absence of any material adverse impact arising out of any current litigation in which we are involved; ● impact of the adoption of new accounting standards and our financial and accounting systems and analysis programs; ● expectations regarding competition and our competitive advantages; ● impact of our trademarks, service marks, and other proprietary rights; and ● effectiveness of our internal control over financial reporting.
Certain forward-looking statements are included in this Form 10-K, principally in the sections captioned "Business," and "Management's Discussion and Analysis of Financial Condition and Results of Operations." Forward-looking statements are related to, among other things: ● the sufficiency of the supply of commodities and labor pool to carry on our business; 12 Table of Contents ● anticipated price increases and the impact of inflation; ● business objectives and strategic plans; ● operating strategies; ● our ability to open and operate additional restaurants profitably and the timing of such openings; ● expectations that most, if not all, of the Company’s unit growth will be through the development of additional Bad Daddy’s Burger Bar locations; ● restaurant and franchise acquisitions; ● expected future revenues and earnings, comparable and non-comparable restaurant sales, results of operations, and future restaurant growth (both company-owned and franchised); ● estimated costs of opening and operating new restaurants, including general and administrative, marketing, franchise development and restaurant operating costs; ● anticipated selling, general and administrative expenses and restaurant operating costs, including commodity prices, labor and energy costs; ● our expectations as to the impact of a global or regional pandemic or epidemic on our business; ● future capital expenditures; ● our expectation that we will have adequate cash from operations and credit facility borrowings to meet all future debt service, capital expenditure and working capital requirements in fiscal 2026; ● success of advertising and marketing activities; ● the absence of any material adverse impact arising out of any current litigation in which we are involved; ● impact of the adoption of new accounting standards and our financial and accounting systems and analysis programs; ● expectations regarding competition and our competitive advantages; ● impact of our trademarks, service marks, and other proprietary rights; and ● effectiveness of our internal control over financial reporting.
Although this is the case, we have combined recruiting into a single shared services capability and believe that long term, our training capabilities for the brands will similarly be combined into single shared services capability. 11 Table of Contents Each Good Times restaurant employs a general manager, generally one or two hourly assistant managers, up to four hourly shift managers and approximately 10 to 20 non-management team members.
Although this is the case, we have combined recruiting into a single shared services capability and believe that long term, our training capabilities for the brands will similarly be combined into single shared services capability. 9 Table of Contents Each Good Times restaurant employs a general manager, generally one or two hourly assistant managers, up to four hourly shift managers and approximately 10 to 20 non-management team members.
Off-premises sales, including take-out, delivery and curbside pickup, accounted for approximately 27% of all system-wide sales in fiscal 2023. A typical Bad Daddy’s restaurant is approximately 3,500-4,000 square feet with an enclosed patio, smaller than most other chain casual dining restaurants.
Off-premises sales, including take-out, delivery and curbside pickup, accounted for approximately 27% of all system-wide sales in fiscal 2025. A typical Bad Daddy’s restaurant is approximately 3,500-4,000 square feet with an enclosed patio, smaller than most other chain casual dining restaurants.
The terms “we,” “us,” “our,” the “Company,” “Good Times” and similar terms refer to Good Times Restaurants Inc., a Nevada corporation, and its wholly owned consolidated subsidiaries. Unless otherwise indicated or the context otherwise requires, financial and operating data in this 10-K report reflect the consolidated business and operations of Good Times Restaurants Inc. and its subsidiaries.
The terms “we,” “us,” “our,” the “Company,” “Good Times” and similar terms refer to Good Times Restaurants Inc., a Nevada corporation, and its consolidated subsidiaries. Unless otherwise indicated or the context otherwise requires, financial and operating data in this 10-K report reflect the consolidated business and operations of Good Times Restaurants Inc. and its subsidiaries.
Debt Cadence Credit Facility. The Company and its wholly owned subsidiaries (the “Subsidiaries”) maintain an amended and restated credit agreement with Cadence Bank (“Cadence”). Pursuant to the credit agreement, as amended to date, Cadence agreed to loan the Company up to $8,000,000, with a maturity date of April 20, 2028 (the “Cadence Credit Facility”).
The Company and its wholly owned subsidiaries (the “Subsidiaries”) maintain an amended and restated credit agreement with Cadence Bank (“Cadence”). Pursuant to the credit agreement, Cadence agreed to loan the Company up to $8,000,000, with a maturity date of April 20, 2028 (as amended to date, the “Cadence Credit Facility”).
Our site selection process includes evaluating several criteria, including a mix of substantial daily traffic, density of at least 30,000 people within a three-mile radius, strong daytime population and employment base, retail and entertainment traffic generators, good visibility and easy access. Restaurant locations We currently own and operate or license a total of forty Bad Daddy’s Burger Bar locations.
Our site selection process includes evaluating several criteria, including a mix of substantial daily traffic, density of at least 30,000 people within a three-mile radius, strong daytime population and employment base, retail and entertainment traffic generators, good visibility and easy access. Restaurant locations We currently own and operate or license a total of thirty-eight Bad Daddy’s Burger Bar locations.
We placed an elevated level of focus in managing overhead costs and gaining further efficiencies in supervision and support services costs and believe that those costs will be relatively stable, though we expect to invest in modern human resource and financial planning systems that will provide improved abilities for our restaurant leaders and support capability leaders to best create value for the business. 8 Table of Contents 3.
We placed an elevated level of focus in managing overhead costs and gaining further efficiencies in supervision and support services costs and believe that those costs will be relatively stable, though we expect to invest in modern human resource and financial planning systems that will provide improved abilities for our restaurant leaders and support capability leaders to best create value for the business. 3.
As a result, traffic and sales trends have recently been more difficult to predict because of increased volatility in customer perception of the relative strength or weakness of the general economy. 4 Table of Contents Although we conduct all of our restaurant operations within the U.S., worldwide product supply chains have been impacted by international conflicts.
As a result, traffic and sales trends have recently been more difficult to predict because of increased volatility in customer perception of the relative strength or weakness of the general economy. Although we conduct all of our restaurant operations within the U.S., worldwide product supply chains have been impacted by international conflicts.
Bad Daddy’s operates in the full-service dining segment as a specialty burger bar concept and Good Times operates in the quick-service restaurant segment as a drive-thru concept focused on all-natural burgers, fries, and frozen custard. Through our wholly owned subsidiaries (the “Subsidiaries”), we currently own and operate or license forty Bad Daddy’s restaurants in seven states.
Bad Daddy’s operates in the full-service dining segment as a specialty burger bar concept and Good Times operates in the quick-service restaurant segment as a drive-thru concept focused on all-natural burgers, fries, and frozen custard. Through our wholly owned subsidiaries (the “Subsidiaries”), we currently own and operate or license thirty-eight Bad Daddy’s restaurants in seven states.
We offer our guests an extensive ability to customize their burgers and salads, including Create Your Own Burgers and Salads, restricted only by the ingredients available in the kitchen, which include a variety of different protein options including bison, turkey, chicken, salmon, and plant-based protein. 2. A Bad Ass Bar.
We offer our guests an extensive ability to customize their burgers and salads, including Create Your Own Burgers and Salads, restricted only by the ingredients available in the kitchen, which include a variety of different protein options including bison, turkey, chicken, salmon, and plant-based protein. 4 Table of Contents 2. A Bad Ass Bar.
We own and operate fourteen Bad Daddy’s restaurants in North Carolina, ten in Colorado, five in Georgia, four in South Carolina, three in Alabama, two in Tennessee and one in Oklahoma. We license the Bad Daddy’s brand to a third-party licensee who owns and operates the Bad Daddy’s restaurant located in the Charlotte Douglas International Airport.
We own and operate fourteen Bad Daddy’s restaurants in North Carolina, nine in Colorado, four in Georgia, four in South Carolina, three in Alabama, two in Tennessee and one in Oklahoma. We license the Bad Daddy’s brand to a third-party licensee who owns and operates the Bad Daddy’s restaurant located in the Charlotte Douglas International Airport.
This brand positioning results in transactions that generate average sales per transaction of approximately $37 across all transaction types. The lunch daypart (open until 2 p.m.) represents approximately 33% and the happy hour and dinner dayparts (2 p.m. until close) represent approximately 67% of restaurant sales.
This brand positioning results in transactions that generate average sales per transaction of approximately $38 across all transaction types. The lunch daypart (between open and 2 p.m.) represents approximately 33% and the happy hour and dinner dayparts (2 p.m. until close) represent approximately 67% of restaurant sales.
We feature a variety of craft beers from local breweries and a full bar serving our Bad Ass Margarita and other innovative cocktails, and both red and white wine. Our signature recipes include the Bad Ass Burger; Sam I Am Burger and Emilio’s Chicken Sandwich. Signature Chopped Salads include the Texican Chicken Salad and the Stella’s Greek Salad.
We feature a variety of craft beers from local breweries and a full bar serving our Bad Ass Margarita and other innovative cocktails, and both red and white wine. Our signature recipes include the Bacon Cheeseburger on Steroids; Sam I Am Burger and Emilio’s Chicken Sandwich. Signature Chopped Salads include the Texican Chicken Salad and the Stella’s Greek Salad.
Additionally, in the context of a global or regional pandemic or epidemic, future facts and circumstances could change, and impact assumptions relied upon in our forward-looking statements. 15 Table of Contents All forward-looking statements speak only as of the date made.
Additionally, in the context of a global or regional pandemic or epidemic, future facts and circumstances could change, and impact assumptions relied upon in our forward-looking statements. All forward-looking statements speak only as of the date made.
Company-Owned/Co-Developed/Joint-Venture Bad Daddy’s Burger Bar Good Times Burgers & Frozen Custard Total 2024 2023 2024 2023 2024 2023 Alabama 3 3 - - 3 3 Colorado 10 11 27 25 37 36 Georgia 5 5 - - 5 5 North Carolina 14 14 - - 14 14 Oklahoma 1 1 - - 1 1 South Carolina 4 4 - - 4 4 Tennessee 2 2 - - 2 2 Total 39 40 27 25 66 65 Franchise/License Bad Daddy’s Burger Bar Good Times Burgers & Frozen Custard Total 2024 2023 2024 2023 2024 2023 Colorado - - 1 4 1 4 North Carolina 1 1 - - 1 1 Wyoming - - 2 2 2 2 Total 1 1 3 6 4 7 Menu Bad Daddy’s Burger Bar The Bad Daddy’s Burger Bar menu offers our guests a culinary-driven menu consisting of our own unique blend of high quality and handcrafted 1855 Black Angus ® beef burgers with creative, scratch-made toppings including buttermilk-fried bacon, creamy ale queso made in-house, and our specialty signature Bad Daddy’s sauce which is also completely made in-house.
Company-Owned/Co-Developed/Joint-Venture Bad Daddy’s Burger Bar Good Times Burgers & Frozen Custard Total 2025 2024 2025 2024 2025 2024 Alabama 3 3 - - 3 3 Colorado 9 10 27 25 36 35 Georgia 4 5 - - 4 5 North Carolina 14 14 - - 14 14 Oklahoma 1 1 - - 1 1 South Carolina 4 4 - - 4 4 Tennessee 2 2 - - 2 2 Total 37 39 27 25 64 64 Franchise/License Bad Daddy’s Burger Bar Good Times Burgers & Frozen Custard Total 2025 2024 2025 2024 2025 2024 Colorado - - 1 3 1 3 North Carolina 1 1 - - 1 1 Wyoming - - 2 2 2 2 Total 1 1 3 5 4 6 Menu Bad Daddy’s Burger Bar The Bad Daddy’s Burger Bar menu offers our guests a culinary-driven menu consisting of our own unique blend of high quality and handcrafted 1855 Black Angus ® beef burgers with creative, scratch-made toppings including buttermilk-fried bacon, creamy ale queso made in-house, and our specialty signature Bad Daddy’s sauce which is also completely made in-house.
Good Times Burgers & Frozen Custard The menu of each Good Times restaurant is focused primarily on burgers made with fresh, all-natural ground beef from Meyer Natural Foods, chicken sandwiches and chicken tenders using only all-natural chicken from Springer Mountain Farms, and our signature vanilla and monthly featured-flavor custard.
Good Times Burgers & Frozen Custard The menu of each Good Times restaurant is focused primarily on burgers made with a fresh custom grind ground beef, chicken sandwiches and chicken tenders using only all-natural chicken from Springer Mountain Farms, and our signature vanilla and monthly featured-flavor custard.
Recent Developments Macroeconomic Factors and Operating Environment During fiscal 2024, inflation has moderated, however increases in inflation could affect the global and U.S. economies, which could have an adverse impact on our business and results of operations if we, and our franchisees, are not able to adjust prices sufficiently to offset the effect of cost increases without negatively impacting consumer demand.
Recent Developments Macroeconomic Factors and Operating Environment During fiscal 2025, inflation moderated, however economic indicators remain volatile and increases in inflation could affect the global and U.S. economies, which could have an adverse impact on our business and results of operations if we, and our franchisees, are not able to adjust prices sufficiently to offset the effect of cost increases without negatively impacting consumer demand.
The Parker Promissory Note fully amortizes over its original ten-year life maturing on June 1, 2034, carries an interest rate of 5.00% and is, in all respects, subordinate to the Cadence Credit Facility. As of September 24, 2024, the outstanding principal balance on the Parker Promissory Note was $373,000.
The Parker Promissory Note fully amortizes over its original ten-year life maturing on June 1, 2034, carries an interest rate of 5.00% and is, in all respects, subordinate to the Cadence Credit Facility. As of September 30, 2025, the outstanding principal balance on the Parker Promissory Note was $342,000.
We support employees by offering competitive wages and benefits, including a matching 401(k) plan, medical insurance, and incentive plans at every level of management that are tied to performance against key goals and objectives. We motivate and prepare our employees by providing them with opportunities for increased responsibilities and advancement.
We support employees by offering competitive wages and benefits, including a matching 401(k) plan, medical insurance, and incentive plans for certain management positions that are tied to performance against key goals and objectives. We motivate and prepare our employees by providing them with opportunities for increased responsibilities and advancement.
The breakfast menu is centered around Hatch Valley Green Chile Burritos made with our own proprietary green chile recipe using regional roasted green chiles, eggs, potatoes, and cheese offered with the choice of bacon, sausage or chorizo. During breakfast we offer coffee and pure 100% orange juice, along with Wild Spuds as a fried potato side offering.
The breakfast menu is centered around Green Chile Burritos made with our own proprietary green chile recipe using regional roasted green chiles, eggs, potatoes, and cheese offered with the choice of bacon, sausage or chorizo. During breakfast we offer soda, coffee and juice, along with Wild Spuds as a signature fried potato side offering.
The location in the Charlotte Douglas International Airport is independently operated pursuant to a License Agreement with an established airport concessionaire. We closed one Company-owned Bad Daddy’s restaurant during fiscal 2024. 9 Table of Contents Additionally, we currently own and operate or franchise a total of thirty Good Times restaurants.
The location in the Charlotte Douglas International Airport is independently operated pursuant to a License Agreement with an established airport concessionaire. We closed one company-owned Bad Daddy’s restaurant during fiscal 2025 and closed one in early fiscal 2026. Additionally, we currently own and operate or franchise a total of thirty Good Times restaurants.
Annual principal maturities over the next five years are approximately $35,000 each year. Total interest expense on notes payable was $108,000 and $31,000 for fiscal 2024 and 2023, respectively. 5 Table of Contents Concepts Bad Daddy’s Burger Bar Bad Daddy’s Burger Bar is a full-service, casual dining small box “better burger” concept.
Annual principal maturities over the next five years are approximately $35,000 each year. Total interest expense on notes payable was $191,000 and $108,000 for fiscal 2025 and 2024, respectively. Concepts Bad Daddy’s Burger Bar Bad Daddy’s Burger Bar is a full-service, casual dining small box “better burger” concept.
The success of our strategy is evident in our long-term same store sales growth (sales growth over the prior year period at restaurants open more than 18 months, also referred to as comparable sales). Same store sales increased 2.9% in fiscal 2024, and 3.7% in fiscal 2023.
The success of our strategy is evident in our long-term same store sales growth (sales growth over the prior year period at restaurants open more than 18 months, also referred to as comparable sales). Same store sales decreased 5.0% in fiscal 2025 and increased 2.9% in fiscal 2024.
As a result of entering into the Cadence Credit Facility and the various amendments, the Company paid loan origination costs including professional fees of approximately $299,000 and is amortizing these costs over the term of the credit agreement. As of September 24, 2024, the unamortized balance of these fees was $95,000.
As a result of entering into the Cadence Credit Facility and the various amendments, the Company paid loan origination costs including professional fees of approximately $324,000 and is amortizing these costs over the term of the credit agreement. As of September 30, 2025, the unamortized balance of these fees was $93,000.
This menu is supplemented by side selections including our famous Wild Fries, green chile potato poppers, cheese curds, and onion rings. Beverages include typical soft drinks and fresh lemonades, with a selection of shakes and floats made with our frozen custard.
This menu is supplemented by side selections including our famous Wild Fries, crinkle cut fries, jalapeno cheddar cheese poppers, and onion rings. Beverages include typical soft drinks and fresh lemonades, with a selection of shakes and floats made with our frozen custard.
Currently, we are not actively soliciting new franchisees but are assessing potential future growth strategies that include the development of franchised Good Times restaurants. We currently have one license agreement for a Bad Daddy’s location in the Charlotte Douglas International Airport.
We review sites selected for franchises and monitor performance of franchise units. Currently, we are not actively soliciting new franchisees but are assessing potential future growth strategies that include the development of franchised Good Times restaurants. We currently have one license agreement for a Bad Daddy’s location in the Charlotte Douglas International Airport.
We believe we have people with the right expertise as well as capable processes and systems in place to support both concepts and targeted future growth of both of our concepts. We Have Maintained Operating Momentum Same store sales at Good Times have increased thirteen of the past fourteen years.
We believe we have people with the right expertise as well as capable processes and systems in place to support both concepts and targeted future growth of both of our concepts. 6 Table of Contents We Have Maintained Operating Momentum Although same store sales at Good Times decreased in fiscal 2025, they have increased thirteen of the past fifteen years.
However, the true differentiator for the brand is our customers’ ability to build their meal exactly the way they would like. The Bad Daddy’s Create Your Own menu allows full customization of burgers and salads offering over sixty topping options.
However, the true differentiator for the brand is our customers’ ability to build their meal exactly the way they would like. The Bad Daddy’s Create Your Own menu allows full customization of burgers and salads offering over sixty topping options. We have partnered with a craft brewer to make our Bad Daddy’s Amber Ale.
Our executive leadership team has significant experience spanning both full service and quick service restaurant concepts. Each brand is operated with distinct operations teams, while utilizing shared support capabilities in administration, finance, accounting, human resources, real estate, marketing and information technology. Each capability is led by its own qualified leader with many years of functional and leadership experience.
Each brand is operated with distinct operations teams, while utilizing shared support capabilities in administration, finance, accounting, human resources, real estate, marketing and information technology. Each capability is led by its own qualified leader with many years of functional and leadership experience.
As of the date of filing of this report, the Company was in compliance with each of these covenants under the Cadence Credit Facility. As of September 24, 2024, the interest rate applicable to borrowings under the Cadence Credit Facility was 8.41%.
As of the date of filing of this report, the Company was in compliance with each of these covenants under the Cadence Credit Facility. As of September 30, 2025, the interest rate applicable to borrowings under the Cadence Credit Facility was 7.27%.
Media is an important component of building our brand awareness and distinctiveness. We spent most of our media advertising dollars on audio advertising during fiscal 2024 and fiscal 2023, including terrestrial radio, podcasts, and advertising-based streaming platforms.
Media is an important component of building our brand awareness and distinctiveness. Though most of our media advertising dollars were spent on audio advertising during fiscal 2024, including terrestrial radio, podcasts, and advertising-based streaming platforms, in 2025 we expanded to outdoor advertising and significantly reduced audio advertising.
The configuration of restaurant point-of-sales systems is performed by our technology shared service capability. We are implementing a new cloud-based point of sale system and have completed the implementation at all company-owned Good Times restaurants and expect to complete the implementation at all traditional Bad Daddy’s restaurants in the next eighteen months.
We are implementing a new cloud-based point of sale system and have completed the implementation at all company-owned Good Times restaurants and expect to complete the implementation at all traditional Bad Daddy’s restaurants in the next eighteen months.
Our Business Strengths Our Brands Are Complementary While operating in different segments of the restaurant industry, our two brands complement each other in both their similarities and differences: Each has a value proposition enhanced by superior quality ingredients and a focus on the specific elements of service relevant to the concept that deliver an exceptional experience to each guest.
Same store sales have grown at a compound annual growth rate of 3.5% between fiscal 2015 and 2025. 5 Table of Contents Our Business Strengths Our Brands Are Complementary While operating in different segments of the restaurant industry, our two brands complement each other in both their similarities and differences: Each has a value proposition enhanced by superior quality ingredients and a focus on the specific elements of service relevant to the concept that deliver an exceptional experience to each guest.
We want to achieve both growth in unit volumes and growth in number of units, but at the same time maintain a low debt load. 7 Table of Contents Our Brands Have Growth Potential We believe both of our brands are well positioned to take advantage of consumers’ changing demands for restaurants, whether regarding the quality of the ingredients, the ability to customize their order exactly to their liking, or the ability to eat their food in a restaurant dining room, on a patio, in their car, or to either pick it up or have it delivered.
Our Brands Have Growth Potential We believe both of our brands are well positioned to take advantage of consumers’ changing demands for restaurants, whether regarding the quality of the ingredients, the ability to customize their order exactly to their liking, or the ability to eat their food in a restaurant dining room, on a patio, in their car, or to either pick it up or have it delivered.
Employees At September 24, 2024, we had approximately 2,110 active employees of which 1,879 are hourly team members and 231 are salaried managers or professional staff working full time.
Employees At September 30, 2025, we had approximately 2,078 active employees of which 1,839 are hourly team members and 239 are salaried managers or professional staff working full time.
We own and operate twenty-seven Good Times restaurants, and franchise an additional three: one located in Aurora, Colorado and two in Wyoming. We compete primarily on the quality of our products, consistently prompt service, and order accuracy.
We own and operate twenty-seven Good Times restaurants, and franchise an additional three: one located in Aurora, Colorado and two in Wyoming. We compete primarily on the quality of our products, consistently prompt service, and order accuracy. We support our quality position by using only beef and chicken raised humanely with no antibiotics and no added hormones.
Our website information is not part of or incorporated by reference into this Annual Report on Form 10-K. 14 Table of Contents Special Note About Forward-Looking Statements This Form 10-K may include “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and such statements are subject to the safe harbors created thereby.
Special Note About Forward-Looking Statements This Form 10-K may include “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and such statements are subject to the safe harbors created thereby.
The lack of supplies of such products may impact the availability and supplier pricing for products purchased by us for use in our business, which could result in higher food and packaging costs or reduced revenues.
The lack of supplies of such products may impact the availability and supplier pricing for products purchased by us for use in our business, which could result in higher food and packaging costs or reduced revenues.Additionally, recent policy changes related to tariffs have resulted in higher input costs, including the costs of food, paper, and operating supplies.
Additionally, we own trademarks or service marks that have been registered with the United States Patent and Trademark Office including, but not limited to, “Bad Daddy’s Burger Bar EST. 2007”, “Big Daddy Bacon Cheeseburger,” and “Spoonbender” The registration for our “Bad Daddy’s Burger Bar” mark will be renewed prior to September 2031.
We received approval of our federal registration of “Bad Daddy’s Burger Bar” in 2011 and “Good Times” in 2003. Additionally, we own trademarks or service marks that have been registered with the United States Patent and Trademark Office including, but not limited to, “Bad Daddy’s Burger Bar EST. 2007”, “Big Daddy Bacon Cheeseburger,” and “Spoonbender”.
We believe that Bad Daddy’s Burger Bar has an advantage in the premium quality of our ingredients, unparalleled ability for guests to customize their order, distinctiveness of its atmosphere and the indulgence created by our bold, unique flavors.
We believe that Bad Daddy’s Burger Bar has an advantage in the premium quality of our ingredients, unparalleled ability for guests to customize their order, distinctiveness of its atmosphere and the indulgence created by our bold, unique flavors. Nevertheless, Bad Daddy’s Burger Bar may be at a competitive disadvantage to other restaurant chains with greater name recognition and operating scale.
We believe this performance is largely the result of the evolution in our brand positioning, the re-imaging of several of our older restaurants, effective management of media mix, and consistent execution of the customer experience.
Our compound annual same store sales growth rate was approximately 3.5% over the past eleven years. We believe this performance is largely the result of the evolution in our brand positioning, the re-imaging of several of our older restaurants, effective management of media mix, and consistent execution of the customer experience.
We currently have one Good Times restaurant operating under a franchise agreement in the greater Denver metropolitan area and two dual-branded franchised restaurants operating in Wyoming.
We currently have one Good Times restaurant operating under a franchise agreement in the greater Denver metropolitan area and two dual-branded franchised restaurants operating in Wyoming. In addition, we are, through one of our wholly owned subsidiaries, the controlling partner in a joint venture related to six Good Times restaurants operating in the greater Denver metropolitan area.
Management Information Systems The systems in our restaurants are designed in a manner to minimize the amount of time our managers spend on administrative tasks. We utilize up-to-date versions of a leading point-of-sale system in each of our company-owned restaurants that captures transaction-level data required to support information about sales, product mix, and average check.
We utilize up-to-date versions of a leading point-of-sale system in each of our company-owned restaurants that captures transaction-level data required to support information about sales, product mix, and average check. The configuration of restaurant point-of-sales systems is performed by our technology shared service capability.
Increasingly, these concepts are choosing to add drive-thru ordering and pickup as part of their operating model, and though they generate an average per person check that is meaningfully higher than the average check at a Good Times restaurant, now represent competition that is more relevant than it was previously.
Increasingly, traditionally fast-casual concepts are including drive-thru ordering and pickup as part of their operating model, and though they generate an average per person check that is meaningfully higher than the average check at a Good Times restaurant, now represent competition that is more relevant than it was previously. 11 Table of Contents We believe that Good Times may have a competitive advantage in terms of quality of product compared to traditional quick-service burger chains.
We also provide various other incentives, including paid time off, communication allowances, incentive performance bonuses and referral bonuses. We have implemented an online screening and hiring tool that has proven to reduce hourly employee turnover. Franchising For Good Times, we have previously prepared forms of area rights and franchise agreements and advertising material to be utilized in soliciting prospective franchisees.
We also provide various other incentives, including paid time off, communication allowances, incentive performance bonuses and referral bonuses. We have implemented an online screening and hiring tool that has proven to reduce hourly employee turnover.
Many of these restaurants are owned and operated by regional and national restaurant chains, many of which have greater financial resources and experience than we do.
Good Times competes with many other hamburger-oriented quick-service restaurants in the areas in which it operates. Many of these restaurants are owned and operated by regional and national restaurant chains, many of which have greater financial resources and experience than we do.
We also believe that the use of premium, all-natural beef and chicken products differentiates our concept in a crowded quick-service segment of the restaurant industry.
We also believe that the use of premium, all-natural beef and chicken products differentiates our concept in a crowded quick-service segment of the restaurant industry. Our fresh frozen custard is a premium ice cream that is smoother, creamier and thicker than typical soft serve or hard-packed ice cream products.
In addition, we are subject to the Americans with Disabilities Act, which requires restaurants and other facilities open to the public to provide for access and use of facilities for people with disabilities. Management believes that we are in compliance with the Americans with Disabilities Act.
We are subject to the Fair Labor Standards Act, which governs such matters as minimum wages, overtime, and other working conditions. In addition, we are subject to the Americans with Disabilities Act, which requires restaurants and other facilities open to the public to provide for access and use of facilities for people with disabilities.
As of September 24, 2024, there were $500,000 of borrowings against the facility, all of which is due during the fiscal year ending September 2028 and is classified as a long-term liability in the accompanying balance sheet.
As of September 30, 2025, there were $2,000,000 borrowings against the facility, all of which is due during the fiscal year ending September 2028 and is classified as a long-term liability in the accompanying balance sheet. Availability of the Cadence Credit Facility for borrowings is reduced by the outstanding face value of any letters of credit issued under the facility.
We Have Assembled a Dedicated Senior Leadership Team with Significant Experience Each of the members of our senior leadership team have many years of relevant experience in their field of expertise, and most have more than fifteen years of industry experience, with some members having worked together for more than twenty years developing the Good Times concept.
We Have Assembled a Dedicated Senior Leadership Team with Significant Experience Each of the members of our senior leadership team have many years of relevant experience in their field of expertise, and most have more than fifteen years of industry experience. Our executive leadership team has significant experience spanning both full-service and quick-service restaurant concepts.
In-N-Out, a California-based, burger-focused quick-service restaurant concept, has expanded into the Colorado market and Whataburger, a Texas-based burger-focused quick-service restaurant concept has expanded into Colorado with future development expected in markets where we currently operate.
In-N-Out, a California-based, burger-focused quick-service restaurant concept, and Whataburger, a Texas-based burger-focused quick-service restaurant concept have expanded into Colorado with future development expected in markets where we currently operate. Double drive-thru restaurant chains such as Checkers & Rally’s Restaurants, which currently operate double drive-thru restaurants in various markets in the United States, are not currently operating in Colorado.
Although the construction process is generally straightforward and comparatively quick compared to the process required to acquire land and develop a free-standing building, the full process of acquiring acceptable sites is involved and can take in excess of 18 months including lease negotiation, permitting, construction, and team training.
Although the construction process is generally straightforward and comparatively quick compared to the process required to acquire land and develop a free-standing building, the full process of acquiring acceptable sites is involved and can take in excess of 18 months including lease negotiation, permitting, construction, and team training. 7 Table of Contents Good Times Burgers & Frozen Custard We do not have explicit plans to develop additional Good Times restaurants, as we continue to refine the economic model of our primarily drive-thru business.
The resulting product is smoother, creamier and thicker than typical soft serve or hard-packed ice cream products. We serve the frozen custard as vanilla and a flavor of the month in cups and cones and our Spoonbenders a mix of custard and toppings. Additionally, we serve shakes and floats made with our frozen custard.
We serve the frozen custard as vanilla and a flavor of the month in cups and cones; as Spoonbenders, a mix of custard and toppings; and as shakes and floats made with our frozen custard.
We are aware of only two significant quick-service competitors offering frozen custard as a primary menu item operating in the Colorado market and both have a significant presence in Midwestern markets that may be targeted for expansion.
We are aware of three significant quick-service competitors offering frozen custard as a primary menu item operating in the Colorado market, two of which have a significant presence in Midwestern markets that may be targeted for expansion. New concepts centered around sliders compete with our Bambino product; one such concept has begun development in the greater Denver area.
Bad Daddy’s Burger Bar strives to provide proprietary flavors and recipes available nowhere else with fresh, handcrafted quality throughout the menu paired with genuine and warm hospitality. We also rotate through seasonal food and beverage specials to provide variety for our guests while still maintaining the spirited flavor profiles that distinguish us from others.
We also rotate through seasonal food and beverage specials to provide variety for our guests while still maintaining the spirited flavor profiles that distinguish us from others.
Availability of the Cadence Credit Facility for borrowings is reduced by the outstanding face value of any letters of credit issued under the facility. As of September 24, 2024, there were approximately $10,000 in outstanding letters of credit issued under the facility, and approximately $7,490,000 of committed funds available. Parker Promissory Note.
As of September 30, 2025, there were approximately $10,000 in outstanding letters of credit issued under the facility, and approximately $5,990,000 of committed funds available. Parker Promissory Note.
On December 12, 2024 the Company announced a $2.0 million expansion to its share repurchase program bringing the total authorization for repurchases of its common stock to $7.0 million.
On December 12, 2024 the Company announced a $2.0 million expansion to its share repurchase program bringing the total authorization for repurchases of its common stock to $7.0 million. As of September 30, 2025, a total of 1,822,246 shares have been repurchased under the plan at an aggregate cost of approximately $5,019,000.
We advise the franchisee on menu, management training and marketing. On an ongoing basis we conduct standards reviews of all franchise restaurants in key areas including product quality, service standards, restaurant cleanliness and sanitation and food safety.
On an ongoing basis we conduct standards reviews of all franchise restaurants in key areas including product quality, service standards, restaurant cleanliness and sanitation and food safety. 10 Table of Contents Management Information Systems The systems in our restaurants are designed in a manner to minimize the amount of time our managers spend on administrative tasks.
Additional “fast casual” hamburger restaurants, including some who also feature all-natural beef, have been developed in the Colorado market, including markets where we operate.
Fast casual hamburger restaurants have been developed in the Colorado market, including markets where we operate.
We have a breakfast menu consisting of breakfast burritos, orange juice and coffee and a kid’s meal menu featuring a choice of main item, side, drink, and a token redeemable for a free kid’s custard cup or cone. 10 Table of Contents Both of our beef and chicken suppliers are committed to animal welfare and all-natural standards, raising animals without the use of any antibiotics, added hormones, or animal byproducts that are normally used in the open market.
Both of our beef and chicken suppliers are committed to animal welfare and all-natural standards, raising animals without the use of any antibiotics, added hormones, or animal byproducts that are normally used in the open market.
Sales for the Bad Daddy’s restaurants which were open for at least 18 months averaged $2.6 million for fiscal 2024. We believe that both organic growth and unit growth is important to our brand and expect expansion to be disciplined and financed primarily from operating cash flow from the Bad Daddy’s business.
We believe that both organic growth and unit growth is important to our brand and expect expansion to be disciplined and financed primarily from operating cash flow from both brands.
Our discussion for fiscal years 2024 and 2023, which ended on September 24, 2024 (“fiscal 2024”) and September 26, 2023 (‘fiscal 2023”), respectively, each cover periods of 52 full calendar weeks. Fiscal 2025 will consist of 53 weeks and end on September 30, 2025.
Fiscal year 2025 ended on September 30, 2025 (“fiscal 2025”) and covered a period of 53 full calendar weeks. Fiscal year 2024 ended on September 24, 2024 (“fiscal 2024”) and covered a period of 52 calendar weeks. Fiscal 2026 will consist of 52 weeks and end on September 29, 2026.
We have historically sought to attract franchisees that are experienced restaurant operators, are well capitalized and have demonstrated the ability to develop one to five restaurants. We review sites selected for franchises and monitor performance of franchise units.
Franchising and Licensing For Good Times, we have previously prepared forms of area rights and franchise agreements and advertising material to be utilized in soliciting prospective franchisees. We have historically sought to attract franchisees that are experienced restaurant operators, are well capitalized and have demonstrated the ability to develop one to five restaurants.
The registration for our “Good Times” marks will be renewed prior to February 2028 and December 2033 respectively. We intend to maintain our marks and renew registrations on a timely basis. Government Regulation Each of our restaurants is subject to the regulations of various health, sanitation, safety and fire agencies in the jurisdiction in which the restaurant is located.
The registration for our “Bad Daddy’s Burger Bar” mark will be renewed prior to September 2031. The registration for our “Good Times” marks will be renewed prior to February 2028 and December 2033 respectively. We intend to maintain our marks and renew registrations on a timely basis.
Our focus on speed of service keeps our customers happy as most of our sales come from the drive-thru. With menu innovation, we strive to create flavor profiles unique to Good Times, such as our Guacamole Bacon Burger and our Mushroom Swiss Burger. We have rotating limited time menu items and custard flavors.
With menu innovation, we strive to create flavor profiles unique to Good Times, such as our Guacamole Bacon Burger and our Mushroom Melt Burger. We have rotating limited time menu items and custard flavors. Our customers appreciate that we support local causes and do not take ourselves too seriously.
In addition to purchases made under this 2022 Share Repurchase Program, on May 30, 2024, the company purchased an aggregate of 171,276 shares of its common stock at a price of $2.60 per share in a transaction negotiated with a private seller and on February 15, 2024 purchased 19,414 shares from a non-executive employee at a price of $2.47 per share.
In addition to purchases made under this Share Repurchase Program, on May 5, 2025, the company purchased an aggregate of 11,331 shares of its common stock at a price of $2.00 per share in a transaction in a private transaction negotiated with its Senior Vice President of Operations who retired on May 30, 2025. Debt Cadence Credit Facility.
Beginning in 2015, we became subject to the Affordable Care Act which requires us to have the required health insurance benefits for eligible employees. We are also subject to federal and state laws regulating franchise operations, which vary from registration and disclosure requirements in the offer and sale of franchises to the application of statutory standards regulating franchise relationships.
We are also subject to federal and state laws regulating franchise operations, which vary from registration and disclosure requirements in the offer and sale of franchises to the application of statutory standards regulating franchise relationships. Many state franchise laws impose restrictions on franchise agreements, including limitations on non-competition provisions and the termination or non-renewal of a franchise.
Furthermore, most of our competitors in the fast-food business operate more restaurants, have been established for longer, and have greater financial resources and name recognition than we do. There is also active competition for management personnel, as well as for attractive commercial real estate sites suitable for restaurants.
Nevertheless, we may be at a competitive disadvantage to other restaurant chains with greater name recognition and marketing capability. Furthermore, most of our competitors in the fast-food business operate more restaurants, have been established for longer, and have greater financial resources and name recognition than we do.
We augment our broadcast advertising with a social media presence that affords us a higher level of engagement with current customers and an increased level of product giveaways to support high sales opportunity products.
We shifted focus significantly to social and digital media that provides us with a higher level of engagement and targets current customers with an increased level of product giveaways to support high sales opportunity products. Operations We maintain separate operating teams for each of our concepts and have extensive operating, training and quality control systems in place.
We have shifted our focus to a blend of quality and speed while slightly reducing the number of items on the menu. Good Times is primarily a drive-thru concept, as all our restaurants have at least one drive-thru lane and generally have a walk-up window where customers may additionally place orders.
Good Times makes use of various media including social and digital media,audio platforms including limited terrestrial radio, digital audio streaming, as well as streaming video services and outdoor media. Good Times is primarily a drive-thru concept, as all our restaurants have at least one drive-thru lane and generally have a walk-up window where customers may additionally place orders.
Refer to Note 10, Segment Reporting , in the notes to our consolidated financial statements for more information.
Segment Reporting We operate as two reportable business segments: Good Times Burgers and Frozen Custard restaurants and Bad Daddy’s Burger Bar restaurants. Refer to Note 10, Segment Reporting , in the notes to our consolidated financial statements for more information.
More stringent and varied requirements of local governmental bodies with respect to zoning, land use and environmental factors could delay or prevent development of new restaurants in particular locations. We are subject to the Fair Labor Standards Act, which governs such matters as minimum wages, overtime, and other working conditions.
Federal and state environmental regulations have not had a material effect on our operations. More stringent and varied requirements of local governmental bodies with respect to zoning, land use and environmental factors could delay or prevent development of new restaurants in particular locations.
We have partnered with craft brewers to make our Bad Daddy’s draft brews including Bad Daddy’s Amber, IPA, and Light brews. Our creative cocktail menu uses fresh-squeezed housemade sours and fresh garnishes in our signature Bad Ass Margaritas and features creative and timeless options including the Daddy’s Dragonberry and spiked milkshakes.
Our creative cocktail menu uses fresh-squeezed housemade sours and fresh garnishes in our signature Bad Ass Margaritas and features creative and timeless options including the Daddy’s Dragonberry and spiked milkshakes. 8 Table of Contents Bad Daddy’s Burger Bar strives to provide proprietary flavors and recipes available nowhere else with fresh, handcrafted quality throughout the menu paired with genuine and warm hospitality.
Intellectual Property We have registered our marks “Bad Daddy’s Burger Bar” and “Good Times” with the United States Patent and Trademark Office. We received approval of our federal registration of “Bad Daddy’s Burger Bar” in 2011 and “Good Times” in 2003.
There is also active competition for management personnel, as well as for attractive commercial real estate sites suitable for restaurants. Intellectual Property We have registered our marks “Bad Daddy’s Burger Bar” and “Good Times” with the United States Patent and Trademark Office.
Difficulties or failures in obtaining the required licenses or approvals could delay or prevent the opening of a new restaurant. Federal and state environmental regulations have not had a material effect on our operations.
Government Regulation Each of our restaurants is subject to the regulations of various health, sanitation, safety and fire agencies in the jurisdiction in which the restaurant is located. Difficulties or failures in obtaining the required licenses or approvals could delay or prevent the opening of a new restaurant.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny new or modified immigration laws or a change in these policy decisions may have an adverse impact on the number of individuals participating in these markets, and may reduce the total number of employees in the population from which we recruit, affecting our ability to conduct our business, and with respect to our suppliers, may have an adverse impact on their ability to produce products that we purchase for ingredients in our recipes. 21 Table of Contents Risks Related to the Ownership of Our Common Stock Our business could be negatively affected as a result of significant shareholders or potential shareholders attempting to effect changes or acquire control over our company, which could cause us to incur significant expense, hinder execution of our business strategy and impact the trading value of our securities.
Biggest changeAny new or modified immigration laws or a further change in these policy decisions may have an adverse impact on the number of individuals participating in these markets, and may reduce the total number of employees in the population from which we recruit, affecting our ability to conduct our business, and with respect to our suppliers, may have an adverse impact on their ability to produce products that we purchase for ingredients in our recipes.
Although we have a comprehensive program to protect and mitigate risks associated with physical infrastructure and digital assets, including various vulnerability thefts, firewalls, data encryption and other security controls and intend to maintain and upgrade our security technology and operational procedures to prevent damage, breaches or other disruptions, these measures may not eliminate all risks Further, although we purchase cybersecurity insurance, such insurance is a responsive, not a preventive measure, and there can be no assurances that the limits of the policy will be sufficient to cover the costs associated with a cybersecurity event. 18 Table of Contents We are subject to extensive government regulation that may adversely hinder or impact our ability to govern various aspects of our business including our ability to expand and develop our restaurants.
Although we have a comprehensive program to protect and mitigate risks associated with physical infrastructure and digital assets, including various vulnerability thefts, firewalls, data encryption and other security controls and intend to maintain and upgrade our security technology and operational procedures to prevent damage, breaches or other disruptions, these measures may not eliminate all risks Further, although we purchase cybersecurity insurance, such insurance is a responsive, not a preventive measure, and there can be no assurances that the limits of the policy will be sufficient to cover the costs associated with a cybersecurity event. 16 Table of Contents We are subject to extensive government regulation that may adversely hinder or impact our ability to govern various aspects of our business including our ability to expand and develop our restaurants.
The market price of our common stock is likely to continue to be volatile and may fluctuate significantly in response to many factors, including: ● the impact of public health concerns on our business; ● operating results that vary from the expectations of management, securities analysts and investors; ● developments in our business; ● the operating and securities price performance of companies that investors consider to be comparable to us; ● announcements of implementation of strategic transactions or developments and other material events by us or our competitors; ● negative economic conditions that adversely affect the economy, commodity prices, the job market and other factors that may affect the markets in which we operate; ● publication of research reports about us or the sectors in which we operate generally; ● changes in market valuations of similar companies; ● news, publication of research reports, or speculation related to companies similar to us ● additions or departures of key management personnel; ● actions by institutional shareholders; ● speculation in the press, investment community, or on social media about our company, our stock or similar companies or of their stock; 22 Table of Contents ● increased trading volume in our stock caused by individual or algorithmic trading activity; and ● the realization of any of the other risk factors included in this Annual Report on Form 10-K.
The market price of our common stock is likely to continue to be volatile and may fluctuate significantly in response to many factors, including: ● the impact of public health concerns on our business; ● operating results that vary from the expectations of management, securities analysts and investors; ● developments in our business; ● the operating and securities price performance of companies that investors consider to be comparable to us; ● announcements of implementation of strategic transactions or developments and other material events by us or our competitors; ● negative economic conditions that adversely affect the economy, commodity prices, the job market and other factors that may affect the markets in which we operate; ● publication of research reports about us or the sectors in which we operate generally; ● changes in market valuations of similar companies; ● news, publication of research reports, or speculation related to companies similar to us ● additions or departures of key management personnel; ● actions by institutional shareholders; ● speculation in the press, investment community, or on social media about our company, our stock or similar companies or of their stock; ● increased trading volume in our stock caused by individual or algorithmic trading activity; and ● the realization of any of the other risk factors included in this Annual Report on Form 10-K.
The negative publicity associated with such an event could damage our reputation and materially adversely affect our financial performance. 19 Table of Contents The inability of the company to successfully negotiate extended terms on leases reaching end-of-term may reduce future profitability. The company leases the real estate underlying substantially all of its restaurants.
The negative publicity associated with such an event could damage our reputation and materially adversely affect our financial performance. 17 Table of Contents The inability of the company to successfully negotiate extended terms on leases reaching end-of-term may reduce future profitability. The company leases the real estate underlying substantially all of its restaurants.
If we are unable to continue to increase same store sales at existing restaurants, our ability to attain profitability may be adversely affected. We have increased same store sales for thirteen of the past fourteen years at Good Times. We have operated Bad Daddy’s for a shorter period of time and have recently experienced declines in same store sales.
If we are unable to continue to increase same store sales at existing restaurants, our ability to attain profitability may be adversely affected. We have increased same store sales for thirteen of the past fifteen years at Good Times. We have operated Bad Daddy’s for a shorter period of time and have recently experienced declines in same store sales.
If our infrastructure is insufficient to support our growth, our ability to open new restaurants, including the development of the Bad Daddy’s Burger Bar concept, would be adversely affected. 20 Table of Contents Bad Daddy’s Burger Bar is subject to all of the risks of a relatively new business, including competition, and there is no guarantee of a return on our capital investment.
If our infrastructure is insufficient to support our growth, our ability to open new restaurants, including the development of the Bad Daddy’s Burger Bar concept, would be adversely affected. Bad Daddy’s Burger Bar is subject to all of the risks of a relatively new business, including competition, and there is no guarantee of a return on our capital investment.
We are unable to predict the effect that sales may have on the prevailing market price of our common stock. There may be future sales or other dilution of our equity, which may adversely affect the market price of the shares of our common stock and/or dilute the value of shares of our common stock.
We are unable to predict the effect that sales may have on the prevailing market price of our common stock. 20 Table of Contents There may be future sales or other dilution of our equity, which may adversely affect the market price of the shares of our common stock and/or dilute the value of shares of our common stock.
Sales at restaurants opened in new markets may take longer to reach average annual company-owned restaurant sales, if at all, thereby affecting the profitability of these restaurants. 17 Table of Contents The hamburger restaurant market is highly competitive. The hamburger restaurant market is highly competitive.
Sales at restaurants opened in new markets may take longer to reach average annual company-owned restaurant sales, if at all, thereby affecting the profitability of these restaurants. The hamburger restaurant market is highly competitive. The hamburger restaurant market is highly competitive.
Though we recognized net income in fiscal 2024, in light of the uncertainty of macroeconomic conditions, increasing inflation and other factors affecting our supply chain and employee markets, we cannot provide assurance that we will produce income again for the fiscal year ending September 30, 2025.
Though we recognized net income in fiscal 2025, in light of the uncertainty of macroeconomic conditions, increasing inflation and other factors affecting our supply chain and employee markets, we cannot provide assurance that we will produce income again for the fiscal year ending September 29, 2026.
The Bad Daddy’s Burger Bar concept has been in existence for approximately seventeen years and the average age for all Bad Daddy’s restaurants, as of the date of this filing, is approximately eight years. Existing restaurants are currently located in Alabama, Colorado, Georgia, North Carolina, Oklahoma, South Carolina, and Tennessee.
The Bad Daddy’s Burger Bar concept has been in existence for approximately eighteen years and the average age for all Bad Daddy’s restaurants, as of the date of this filing, is approximately nine years. Existing restaurants are currently located in Alabama, Colorado, Georgia, North Carolina, Oklahoma, South Carolina, and Tennessee.
Any or all of these factors could materially adversely affect our financial performance. The outbreak of, and local, state and federal governmental responses to, pandemics or other future health concerns have previously significantly disrupted and could disrupt our business again in the future, which has and could materially affect our financial condition and operating results .
The outbreak of, and local, state and federal governmental responses to, pandemics or other future health concerns have previously significantly disrupted and could disrupt our business again in the future, which has and could materially affect our financial condition and operating results .
Currently we qualify as a “smaller reporting company” under SEC rules. A smaller reporting company prepares and files SEC reports and registration statements using the same forms as other SEC reporting companies, though the information required to be disclosed may differ and be less comprehensive.
A smaller reporting company prepares and files SEC reports and registration statements using the same forms as other SEC reporting companies, though the information required to be disclosed may differ and be less comprehensive.
New pronouncements and varying interpretations of pronouncements have occurred and may occur in the future. Changes to existing rules or differing interpretations with respect to our current practices may adversely affect our reported financial results. Because we currently qualify as a “smaller reporting company,” our disclosures of non-financial and financial information are less than is required by non-smaller reporting companies.
Changes to existing rules or differing interpretations with respect to our current practices may adversely affect our reported financial results. Because we currently qualify as a “smaller reporting company,” our disclosures of non-financial and financial information are less than is required by non-smaller reporting companies. Currently we qualify as a “smaller reporting company” under SEC rules.
Future changes in financial accounting standards may cause adverse unexpected operating results and affect our reported results of operations. Changes in accounting standards can have a significant effect on our reported results and may affect our reporting of transactions completed before the change is effective. See Note 1 to our Consolidated Financial Statements for further discussion.
Changes in accounting standards can have a significant effect on our reported results and may affect our reporting of transactions completed before the change is effective. See Note 1 to our Consolidated Financial Statements for further discussion. New pronouncements and varying interpretations of pronouncements have occurred and may occur in the future.
Changes in enforcement practices related to existing immigration laws and/or modified or newly adopted immigration legislation may affect labor markets related to our suppliers or the QSR business segment The upcoming Presidential administration change may increase the likelihood for Congress to amend existing immigration laws or adopt new immigration laws.
Changes in enforcement practices related to existing immigration laws and/or modified or newly adopted immigration legislation may affect labor markets related to our suppliers or the QSR business segment The increasingly dynamic nature of the federal government may affect the likelihood for Congress to amend existing immigration laws or adopt new immigration laws.
If we were to experience an ownership change, it is possible that a significant portion of our tax loss and credit carryforwards could expire before we would be able to use them to offset future taxable income and could result in the recognition of loss associated with the reduced value of the Company’s deferred tax assets.
If we were to experience an ownership change, it is possible that a significant portion of our tax loss and credit carryforwards could expire before we would be able to use them to offset future taxable income and could result in the recognition of loss associated with the reduced value of the Company’s deferred tax assets. 19 Table of Contents Future changes in financial accounting standards may cause adverse unexpected operating results and affect our reported results of operations.
Our profitability depends in part on our ability to anticipate and react to changes in food costs. Various factors beyond our control, including adverse weather conditions, governmental regulation, production, availability, recalls of food products, seasonality and supply chain impacts due to pandemics or other public health situations may affect our food costs or cause a disruption in our supply chain.
Various factors beyond our control, including adverse weather conditions, governmental regulation, production, availability, recalls of food products, seasonality and supply chain impacts due to pandemics or other public health situations may affect our food costs or cause a disruption in our supply chain. We enter annual contracts with our chicken and other miscellaneous suppliers.
We have accumulated losses and cannot guarantee future profits. We have incurred losses in 29 of our 36 years since inception. As of September 24, 2024, we had an accumulated deficit of $17,622,000.
We have accumulated losses and cannot guarantee future profits. We have incurred losses in 29 of our 37 years since inception. As of September 30, 2025, we had an accumulated deficit of $16,598,000.
Further, excessive claims may result in the inability for us to renew our Stop-Loss policies at reasonable rates, if at all, and we may be required to self-insure significantly higher levels of claims or to completely self-insure all claims under the plans which could have a material and adverse effect on our business and financial performance.
Further, excessive claims may result in the inability for us to renew our Stop-Loss policies at reasonable rates, if at all, and we may be required to self-insure significantly higher levels of claims or to completely self-insure all claims under the plans which could have a material and adverse effect on our business and financial performance. 18 Table of Contents Our business is subject to evolving corporate governance and public disclosure regulations, including environmental, social and governance (“ESG”) matters, that could expose us to numerous risks.
Although we have entered into an employment agreement with Mr. Zink, he may voluntarily terminate his employment with us at any time. In addition, we do not currently maintain key-person insurance on the lives of Messrs. Zink or Stack or Ms. August. We have not entered into any employment agreements with Ms. August or Mr.
In addition, we do not currently maintain key-person insurance on the lives of Messrs. Zink or Ms. August. We have not entered into any employment agreement with Ms. August; she is an employee at will. The loss of services by Mr. Zink or Ms.
We may in the future become subject to lawsuits or other proceedings for purportedly fraudulent transactions arising out of the actual or alleged theft of our customers’ credit or debit card information. In addition, most states have enacted legislation requiring notification of security breaches involving personal information, including credit and debit card information.
Other restaurants and retailers have experienced security breaches in which credit and debit card information of their customers has been stolen. We may in the future become subject to lawsuits or other proceedings for purportedly fraudulent transactions arising out of the actual or alleged theft of our customers’ credit or debit card information.
If this trend continues, it will negatively impact our ability to effectively operate and grow our business and revenues and materially adversely affect our financial performance. 16 Table of Contents If we fail to appropriately plan and sustain our workforce and proactively respond to employee dissatisfaction, it could adversely impact guest satisfaction and operational efficiency, lead to increased litigation and unionization efforts and negatively impact restaurant profitability.
If we fail to appropriately plan and sustain our workforce and proactively respond to employee dissatisfaction, it could adversely impact guest satisfaction and operational efficiency, lead to increased litigation and unionization efforts and negatively impact restaurant profitability.
In addition, we may not be able to pass along higher costs through price increases to our customers. Macroeconomic conditions and inflation could affect our operating results. General economic conditions, including economic downturns related to pandemics or other public health emergencies, have adversely affected our results of operations and may continue to do so.
Macroeconomic conditions and inflation could affect our operating results. General economic conditions, including economic downturns related to pandemics or other public health emergencies, have adversely affected our results of operations and may continue to do so. Similarly, significant inflation has negatively affected our labor and product input costs and could continue to do so.
Changes in the price or availability of our all-natural chicken or beef supply or other commodities could materially adversely affect our profitability. We cannot predict whether we will be able to anticipate and react to changing food costs by adjusting our purchasing practices and menu prices, and a failure to do so could adversely affect our operating results.
We cannot predict whether we will be able to anticipate and react to changing food costs by adjusting our purchasing practices and menu prices, and a failure to do so could adversely affect our operating results. In addition, we may not be able to pass along higher costs through price increases to our customers.
Security breaches of confidential customer information in connection with our electronic processing of credit and debit card transactions may adversely affect our business. The majority of our restaurant sales are by credit or debit cards. Other restaurants and retailers have experienced security breaches in which credit and debit card information of their customers has been stolen.
August, or those of other key management personnel, could have a material adverse effect on our financial condition and results of operations. Security breaches of confidential customer information in connection with our electronic processing of credit and debit card transactions may adversely affect our business. The majority of our restaurant sales are by credit or debit cards.
While Bad Daddy’s Burger Bar operates in the “better burger” restaurant segment, it offers a relatively broad menu and competes with other full-service restaurants in the bar and grill segment. Additionally, customers of both our Good Times restaurants and Bad Daddy’s Burger Bar restaurants are also customers of fast casual hamburger restaurants.
Discounting by our quick-service restaurant competitors may adversely affect the revenues and profitability of our restaurants. 15 Table of Contents While Bad Daddy’s Burger Bar operates in the “better burger” restaurant segment, it offers a relatively broad menu and competes with other full-service restaurants in the bar and grill segment.
We enter annual contracts with our chicken and other miscellaneous suppliers. Our Good Times contracts for chicken are fixed price contracts. Our Bad Daddy’s contracts for chicken and all contracts for beef are generally based on current market prices plus a processing fee.
Our Good Times contracts for chicken are fixed price contracts. Our Bad Daddy’s contracts for chicken and all contracts for beef are generally based on current market prices plus a processing fee. Changes in the price or availability of our all-natural chicken or beef supply or other commodities could materially adversely affect our profitability.
We depend on key management employees. We believe our current operations and future success depend largely on the continued services of our management employees, particularly Ryan Zink, our President and Chief Executive Officer, Keri August our Senior Vice President of Finance and Accounting and Don Stack, our Senior Vice President of Operations for Good Times.
We believe our current operations and future success depend largely on the continued services of our management employees, particularly Ryan Zink, our President and Chief Executive Officer and Keri August our Senior Vice President of Finance and Accounting. Although we have entered into an employment agreement with Mr. Zink, he may voluntarily terminate his employment with us at any time.
ITEM 1A. RISK FACTORS You should carefully consider the following risk factors before making an investment decision with respect to our securities. You are cautioned that the risk factors discussed below are not exhaustive. Risks Related to Our Business Our operations are susceptible to the cost of and changes in food availability which could adversely affect our operating results.
You are cautioned that the risk factors discussed below are not exhaustive. 13 Table of Contents Risks Related to Our Business Our operations are susceptible to the cost of, and changes in, food availability which could adversely affect our operating results. Our profitability depends in part on our ability to anticipate and react to changes in food costs.
Further, policy decisions related to the enforcement of, and rulemaking related to, immigration laws have been volatile and subject to changes resulting from election cycles. Those policies include the degree of tolerance of undocumented workers employed in various segments of the workforce.
Further, recent policy decisions from the current federal government administration related to more strict enforcement of, and rulemaking related to, immigration laws has significantly altered the current environment. Those policies include a lesser degree of tolerance of undocumented workers employed in various segments of the workforce.
Further, changes in customer taste preferences, dietary trends, and preference for delivery and/or carry-out options often affect the restaurant business. If we are unable to continue to compete effectively with other restaurant concepts, our traffic, sales, and restaurant-level profitability could be negatively affected. Sites for new restaurants may be difficult to acquire.
If we are unable to continue to compete effectively with other restaurant concepts, our traffic, sales, and restaurant-level profitability could be negatively affected. Sites for new restaurants may be difficult to acquire. Locating our restaurants in high-traffic and readily accessible areas is an important factor for our success.
Moreover, franchisees may not successfully operate restaurants in a manner consistent with our standards and requirements or may not hire and train qualified managers and other restaurant personnel. Our image and reputation, and the image and reputation of other franchisees, may suffer materially, and system-wide sales could significantly decline if our franchisees do not operate successfully.
Consequently, the quality of franchised restaurant operations may be diminished by any number of factors beyond our control. Moreover, franchisees may not successfully operate restaurants in a manner consistent with our standards and requirements or may not hire and train qualified managers and other restaurant personnel.
Since suitable locations are in great demand, in the future we may not be able to obtain optimal sites for either of our restaurant concepts at a reasonable cost or at all. In addition, we cannot assure you that the sites we do obtain will be successful. Our franchisees could take actions that could harm our business.
We intend to continue to locate Bad Daddy’s Burger Bar restaurants in leased in-line and end-cap retail locations. Since suitable locations are in great demand, in the future we may not be able to obtain optimal sites for either of our restaurant concepts at a reasonable cost or at all.
Any such claim, proceeding, or mandatory notification could cause us to incur significant unplanned expenses, which could have an adverse impact on our financial condition and results of operations. Further, adverse publicity resulting from these allegations may have a material adverse effect on us and our restaurants.
In addition, most states have enacted legislation requiring notification of security breaches involving personal information, including credit and debit card information. Any such claim, proceeding, or mandatory notification could cause us to incur significant unplanned expenses, which could have an adverse impact on our financial condition and results of operations.
These rules and regulations are evolving in scope and complexity and many new requirements have been created in response to recently enacted laws, making compliance more difficult and uncertain. In addition, increasingly regulators, customers, investors, employees and other stakeholders are focusing on environmental, social and governance (“ESG”) matters and related disclosures.
We are subject to changing rules and regulations arising from governmental, quasi-governmental, and other self-regulatory organizations, including state and local governments. These rules and regulations are evolving in scope and complexity and many new requirements have been created in response to recently enacted laws, making compliance more difficult and uncertain.
These changing rules, regulations and stakeholder expectations have resulted in, and are likely to continue to result in, increased general and administrative expenses and increased management time and attention spent complying with or meeting such regulations and expectations.
These changing rules, regulations and stakeholder expectations could result in, increased general and administrative expenses and increased management time and attention spent complying with or meeting such regulations and expectations. For example, developing and acting on policies, procedures, and practices within the scope of ESG, and collecting, measuring and reporting ESG related information may be costly and time intensive.
Franchisees are independent contractors and are not our employees. We provide training and support to franchisees; however, franchisees operate their restaurants as independent businesses. Consequently, the quality of franchised restaurant operations may be diminished by any number of factors beyond our control.
In addition, we cannot assure you that the sites we do obtain will be successful. Our franchisees could take actions that could harm our business. Franchisees are independent contractors and are not our employees. We provide training and support to franchisees; however, franchisees operate their restaurants as independent businesses.
A proliferation of heavy discounting or highly competitive pricing by our major competitors may also negatively affect our sales and operating results. Price increases may impact customer visits. We may make price increases on selected menu items in order to offset increased operating expenses we believe will be recurring.
A proliferation of heavy discounting or highly competitive pricing by our major competitors may also negatively affect our sales and operating results. Tariffs that are implemented or merely threatened may increase the cost of commodities we purchase for use in our restaurants.
Most of our competitors have greater financial resources, marketing programs and name recognition than we do. Discounting by our quick-service restaurant competitors may adversely affect the revenues and profitability of our restaurants.
Finally, new competitors in the business of selling sliders which compete with our Bambino product, have begun to penetrate the Colorado market. Most of our competitors have greater financial resources, marketing programs and name recognition than we do.
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Similarly, significant inflation has negatively affected our labor and product input costs and could continue to do so.
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ITEM 1A. RISK FACTORS You should carefully consider the following risk factors before making an investment decision with respect to our securities.
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Locating our restaurants in high-traffic and readily accessible areas is an important factor for our success. We intend to continue to locate Bad Daddy’s Burger Bar restaurants in leased in-line and end-cap retail locations.
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The federal government may threaten or implement tariffs on other countries that supply commodities we purchase for use in our restaurants. The tariffs themselves could have the impact of increasing the aggregate purchase cost of the same products or reducing the supply of available products.
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Stack, and both are employees at will. The loss of services by Messrs. Zink or Stack or Ms. August, or those of other key management personnel, could have a material adverse effect on our financial condition and results of operations.
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Additionally, these tariffs may result in retaliation by the affected countries, leading to trade wars with an unpredictable result.
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Further, adverse publicity resulting from such an event may harm our business, financial condition and results of operations.
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We may not be able to offset increased cost through menu price increases, and even if we were to increase menu prices to cover some or all of the increased cost, such action could lead to decreased traffic to our restaurants which would negatively affect our financial results.
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Our business is subject to evolving corporate governance and public disclosure regulations, including environmental, social and governance (“ESG”) matters, that could expose us to numerous risks. We are subject to changing rules and regulations arising from governmental, quasi-governmental, and other self-regulatory organizations, including state and local governments, the SEC, the Nasdaq Stock Market and the Financial Accounting Standards Board.
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During fiscal 2025 the ground beef market price indices reached record highs, due to multiple factors, one of which was tariffs imposed on foreign beef-exporting nations. Price increases may impact customer visits. We may make price increases on selected menu items in order to offset increased operating expenses we believe will be recurring.
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For example, developing and acting on policies, procedures, and practices within the scope of ESG, and collecting, measuring and reporting ESG related information may be costly and time intensive. Further, these issues are subject to evolving reporting standards, including the SEC’s recently proposed climate-related reporting requirements.
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If this trend continues, it will negatively impact our ability to effectively operate and grow our business and revenues and materially adversely affect our financial performance.
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Any or all of these factors could materially adversely affect our financial performance. 14 Table of Contents Labor organizing could adversely affect our operations and harm our competitive position in the restaurant industry, which could harm our financial performance.
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Our employees or others may attempt to unionize the workforce in one or more of our restaurants, which could increase our labor costs, limit our ability to manage our workforce effectively, negatively impact our ability to adequately serve our guests, and disrupt our operations.
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A loss of our ability to effectively manage our workforce and the compensation and benefits we offer to our employees could negatively affect our financial performance.
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Additionally, customers of both our Good Times restaurants and Bad Daddy’s Burger Bar restaurants are also customers of fast casual hamburger restaurants. Further, changes in customer taste preferences, dietary trends, and preference for delivery and/or carry-out options often affect the restaurant business.
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Our image and reputation, and the image and reputation of other franchisees, may suffer materially, and system-wide sales could significantly decline if our franchisees do not operate successfully. We depend on key management employees.
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Further, adverse publicity resulting from these allegations may have a material adverse effect on us and our restaurants. In addition to systems where we directly control the security procedures, policies, and standards, confidential customer information is also handled by third-party service providers.
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Though our agreements with these service providers typically include indemnification provisions and requirements as to the providers’ security practices, no assurance can be given that these third party providers would be able to provide such indemnification in the case of a significant breach, and many of the same risks, including reputational risk, apply to information they handle.
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In the case of delivery service providers, the end user is a direct customer of the delivery provider, however reputational risk to our Company still exists with respect to those customers who receive food and beverage through us that has been delivered by such service provider.
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These risks extend beyond services with which we directly contract. Recent outages with cloud infrastructure providers such as Amazon’s AWS, can cascade throughout multiple systems and could inhibit the majority or entirety of our system from accepting orders or otherwise operating. Further, adverse publicity resulting from such an event may harm our business, financial condition and results of operations.
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In addition, regulators, customers, investors, employees and other stakeholders may focus on environmental, social and governance (“ESG”) matters and related disclosures.
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Risks Related to the Ownership of Our Common Stock Our business could be negatively affected as a result of significant shareholders or potential shareholders attempting to effect changes or acquire control over our company, which could cause us to incur significant expense, hinder execution of our business strategy and impact the trading value of our securities.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changePersonnel and Third-Party Engageme nt Our Information Technology department is led by the Director of Technology who has more than twenty years of experience in technology management and cybersecurity, conducts regular risk assessments and continuously monitors our networks and systems. The Company engages third party risk security vendors to identify, mitigate, and remediate cybersecurity risks.
Biggest changePersonnel and Third-Party Engagement Our Information Technology department is led by the Director of Technology and Innovation who has more than twenty-five years of experience in technology management and cybersecurity, conducts regular risk assessments and continuously monitors our networks and systems. 21 Table of Contents The Company engages third-party risk security vendors to identify, mitigate, and remediate cybersecurity risks.
This process involves continuous monitoring, risk assessment, implementation of advanced security measures, and regular updates to our protocols to address emerging threats. 23 Table of Contents As of the date of this report, we are not aware of any cybersecurity incidents that have had a material effect on our operations, business, results of operations, or financial condition.
This process involves continuous monitoring, risk assessment, implementation of advanced security measures, and regular updates to our protocols to address emerging threats. As of the date of this report, we are not aware of any cybersecurity incidents that have had a material effect on our operations, business, results of operations, or financial condition.
We require the annual submission of SOC 1 security certificates from third party vendors that provide systems underlying our financial reporting infrastructure or with access to our financial and sales data. Governance The Director’s presentation at the Company’s monthly senior leadership meeting, led by the CEO, includes the results of the most recent scans and routine testing.
We require the annual submission of SOC 1 security certificates from third-party vendors that provide systems underlying our financial reporting infrastructure or with access to our financial and sales data. Governance The Director of Technology and Innovation’s presentation at the Company’s monthly senior leadership meeting, led by the CEO, includes the results of the most recent scans and routine testing.
Should a cybersecurity incident occur, the Director would immediately report it to the CEO, who would report any material cybersecurity breach promptly to the Company’s Board of Directors. The Board of Directors is acutely aware of the critical nature of managing risks associated with cybersecurity threats.
Should a cybersecurity incident occur, the Director of Technology and Innovation is required to immediately report it to the CEO, who is required to report any material cybersecurity breach promptly to the Company’s Board of Directors. The Board of Directors is acutely aware of the critical nature of managing risks associated with cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAll of our properties are covered up to replacement cost under our property and casualty insurance policies and in the opinion of management are adequately covered by insurance. Our restaurants serve as collateral for the Cadence Credit Facility as discussed in the Notes to Consolidated Financial Statements included in this report. 24 Table of Contents
Biggest changeAll of our properties are covered up to replacement cost under our property and casualty insurance policies and in the opinion of management are adequately covered by insurance. Our restaurants serve as collateral for the Cadence Credit Facility as discussed in the Notes to Consolidated Financial Statements included in this report.
ITEM 2. PROPERTIES We currently lease approximately 7,650 square feet of space for our executive offices in Golden, Colorado for approximately $126,225 per year, under a lease agreement which expires in October 2027.
ITEM 2. PROPERTIES We currently lease approximately 7,650 square feet of space for our executive offices in Golden, Colorado for approximately $130,000 per year, under a lease agreement which expires in October 2027.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe plaintiffs filed a notice of appeal of the Court’s January 25, 2023, decisions. Good Times, in turn, filed a notice of appeal of the Court’s previous dismissal of its counterclaim against the plaintiffs.
Biggest changeOn January 25, 2023, the Court rendered judgment dismissing the plaintiffs’ claims in their entirety and denying all of the requested relief. 22 Table of Contents The plaintiffs filed a notice of appeal of the Court’s January 25, 2023, decisions. Good Times, in turn, filed a notice of appeal of the Court’s previous dismissal of its counterclaim against the plaintiffs.
On June 20, 2024, the court of appeals affirmed its previous reversal of the trial court’s dismissal of Good Times’ counterclaim. The trial court will now consider the issue of White Winston’s liability to Good Times. The amount of Good Times’ claimed damages (which consists substantially of its prior legal fees) exceeds $3 million.
On June 20, 2024, the court of appeals affirmed its previous reversal of the trial court’s dismissal of Good Times’ counterclaim. The trial court considered the issue of White Winston’s liability to Good Times and Good Times’ claimed damages which exceeded $3 million and consisted largely of Good Times’ legal fees.
On July 30, 2021, the plaintiffs moved the Court for leave to amend their complaint and add new causes of action and a claim for $18 million in damages. On January 25, 2023, the Court rendered judgment dismissing the plaintiffs’ claims in their entirety and denying all of the requested relief.
On July 30, 2021, the plaintiffs moved the Court for leave to amend their complaint and add new causes of action and a claim for $18 million in damages.
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The trial court ordered the parties to submit briefing on the issue of Good Times’ damages claim. The briefing closed on December 10, 2024, and Good Times expects the trial court to render a decision sometime after.
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The trial court ordered the parties to submit briefing on the issue of damages. On April 11, 2025, the Court-appointed special master issued a recommendation that Good Times recover damages in the amount of $3.826 million plus pre- and post-judgment interest. White Winston filed a written objection to the Special Master’s recommendation, and Good Times filed a written response.
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While Good Times plans to vigorously pursue this remaining claim to conclusion, there is no assurance that it will be successful and, even if it is successful, its recovery may be less than such claimed damages amount.
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On July 30, 2025, the Court entered a final judgment in Good Times’ favor in the amount of $3,826,715.07 in damages, $813,845.34 in pre-judgment interest, and post-judgment interest at a rate of 9.5% per annum.
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Following the end of Good Times’ 2025 fiscal year, the parties reached a preliminary agreement, subject to final documentation, to resolve Good Times’ claims against White Winston for an amount significantly less than this judgment. Final documentation of this settlement will conclude the litigation.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities. As of September 24, 2024, the Company has purchased approximately 1,670,718 shares of its common stock pursuant to the share repurchase plan leaving approximately $350,000 available for repurchases under the plan.
Biggest changeAs of September 30, 2025, the Company has purchased approximately 1,822,246 shares of its common stock pursuant to the share repurchase plan leaving approximately $1,981,000 available for repurchases under the plan.
On December 12, 2024, the Company the Company announced a $2 million expansion of its existing share repurchase program, which now provides authorization for a total of $7 million dollars of aggregate share repurchases.
Issuer Purchases of Equity Securities The Company‘s Board of Directors authorized a $5 million share repurchase program which became effective February 7, 2022. On December 12, 2024, the Company announced a $2 million expansion of its existing share repurchase program, which now provides authorization for a total of $7 million dollars of aggregate share repurchases.
Period Total number of shares (or units) purchased Average price paid per share (or unit) Total number of shares (or units) purchased as part of publicly announced plans or programs Maximum dollar value of shares that may yet be purchased under the plans or programs 6/26/2024 – 7/23/2024 17,000 $ 2.57 17,000 7/24/2024 – 8/20/2024 23,312 $ 2.70 23,312 8/21/2024 – 9/24/2024 17,124 $ 2.92 17,124 Total 57,436 57,436 $ 350,000
Period Total number of shares (or units) purchased Average price paid per share (or unit) Total number of shares (or units) purchased as part of publicly announced plans or programs Maximum dollar value of shares that may yet be purchased under the plans or programs 7/02/2025 – 7/29/2025 15,600 $ 1.73 15,600 7/30/2025 – 8/26/2025 - - - 8/27/2025 – 9/30/2025 - - - Total 15,600 15,600 $ 1,981,000
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Issuer Purchases of Equity Securities The Company‘s Board of Directors authorized a $5.0 Million share repurchase program which became effective February 7, 2022. The authorization to repurchase will continue until the maximum value of shares is achieved or the Company terminates the program.
Added
The authorization to repurchase will continue until the maximum value of shares is achieved or the Company terminates the program. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, restrictions in purchases associated with the Cadence Credit Facility, and alternative investment opportunities.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFiscal 2025 will consist of 53 weeks and end on September 30, 2025. 26 Table of Contents The following tables present information about our reportable segments for the respective periods, all dollar values are represented in thousands: Fiscal Year 2024 (52 Weeks) 2023 (52 Weeks) Bad Daddy’s: Restaurant sales $ 103,539 99.7 % $ 102,241 99.7 % Franchise revenues 305 0.3 % 276 0.3 % Restaurant operating costs: (1) Food and packaging costs 32,155 31.1 % 31,972 31.3 % Payroll and employee benefit costs 35,831 34.6 % 35,892 35.1 % Restaurant occupancy and other costs 21,972 21.2 % 21,476 21.0 % Depreciation & amortization 2,962 2.9 % 3,060 3.0 % Preopening costs - 0.0 % 484 0.5 % Total restaurant operating costs $ 92,920 89.7 % $ 92,884 90.9 % General & administrative costs (2) 8,270 8.0 % 7,594 7.4 % Advertising costs 2,173 2.1 % 1,866 1.8 % Asset impairment costs 689 0.7 % 1,519 1.5 % Gain on disposal of assets 23 0.0 % (4 ) 0.0 % Loss from operations (231 ) (0.2 %) (1,342 ) (1.3 %) Good Times: Restaurant sales $ 38,016 98.8 % $ 34,988 98.2 % Franchise revenues 455 1.2 % 655 1.8 % Restaurant operating costs: (1) Food and packaging costs 11,549 30.4 % 10,938 31.3 % Payroll and employee benefit costs 12,858 33.8 % 11,657 33.3 % Restaurant occupancy and other costs 8,403 22.1 % 7,144 20.4 % Depreciation & amortization 793 2.1 % 603 1.7 % Total restaurant operating costs $ 33,603 88.4 % $ 30,342 86.7 % General & administrative costs (2) 2,246 5.8 % 1,571 4.4 % Litigation Contingencies (332 ) (0.9 %) 0 0.0 % Advertising costs 1,355 3.5 % 1,392 3.9 % Asset impairment costs 9 0.0 % 70 0.2 % Gain on restaurant asset sale (21 ) (0.0 %) (37 ) (0.1 %) Income from operations $ 1,611 4.2 % $ 2,305 6.5 % (1) Restaurant operating costs are expressed as a percentage of restaurant sales.
Biggest changeFiscal 2026 will consist of 52 weeks and end on September 29, 2026. 24 Table of Contents The following tables present information about our reportable segments for the respective periods, all dollar values are represented in thousands: Fiscal Year 2025 (53 Weeks) 2024 (52 Weeks) Bad Daddy’s: Restaurant sales $ 101,385 99.2 % $ 103,539 99.6 % Franchise and other revenues 825 0.8 % 367 0.4 % Restaurant operating costs: (1) Food and packaging costs 31,520 31.1 % 32,155 31.1 % Payroll and employee benefit costs 35,325 34.8 % 35,831 34.6 % Restaurant occupancy and other costs 22,031 21.7 % 22,160 21.4 % Depreciation & amortization 2,950 2.9 % 2,921 2.8 % Total restaurant operating costs $ 91,826 90.6 % $ 93,067 89.9 % General & administrative costs (2) 2,596 2.5 % 3,037 2.9 % Advertising costs 1,894 1.9 % 1,876 1.8 % Asset impairment costs 466 0.5 % 689 0.7 % (Gain) loss on lease terminations and asset disposals (459 ) (0.4 %) 23 0.0 % Income from operations 5,887 5.8 % 5,214 5.0 % Good Times: Restaurant sales $ 39,229 99.5 % $ 38,016 98.8 % Franchise and other revenues 191 0.5 % 455 1.2 % Restaurant operating costs: (1) Food and packaging costs 12,367 31.5 % 11,549 30.4 % Payroll and employee benefit costs 13,952 35.6 % 12,858 33.8 % Restaurant occupancy and other costs 9,385 23.9 % 8,403 22.1 % Depreciation & amortization 964 2.5 % 793 2.1 % Preopening costs 8 0.0 % - 0.0 % Total restaurant operating costs $ 36,676 93.5 % $ 33,603 88.4 % General & administrative costs (2) 1,681 4.3 % 1,898 4.9 % Litigation contingencies - 0.0 % (332 ) (0.9 %) Advertising costs 1,418 3.6 % 1,355 3.5 % Asset impairment costs 161 0.4 % 9 0.0 % Gain on restaurant asset sale and asset disposals (27 ) (0.1 %) (21 ) (0.1 %) (Loss) income from operations $ (489 ) (1.2 %) $ 1,959 5.1 % Other: Franchise and other revenues $ - 0.0 % $ 3 0.0 % Restaurant operating costs: (1) Restaurant occupancy and other costs (449 ) (0.3 %) (188 ) (0.1 %) Depreciation & amortization 40 0.0 % 41 0.0 % Total restaurant operating costs $ (409 ) (0.3 %) $ (147 ) (0.1 %) General & administrative costs 5,457 3.9 % 5,646 4.0 % Advertising costs 3 0.0 % 297 0.2 % Loss on asset disposals 17 0.0 % - 0.0 % Loss from operations $ (5,068 ) (3.6 %) $ (5,793 ) (4.1 %) Prior to fiscal 2025, certain general and administrative expenses now included in Other were combined and reported with our Bad Daddy's segment.
Financing Cash Flows. Net cash used in financing activities for the fiscal year ended September 24, 2024, was $1,797,000, which includes proceeds from long-term debt of $1,380,000, including the making of the Parker Promissory Note, payments of long-term debt of $1,258,000, net contributions from non-controlling interests of $28,000, and $1,947,000 in payments for the purchase of treasury stock.
Net cash used in financing activities for the fiscal year ended September 24, 2024, was $1,797,000, which includes proceeds from long-term debt of $1,380,000, including the making of the Parker Promissory Note, payments of long-term debt of $1,258,000, net contributions from non-controlling interests of $28,000, and $1,947,000 in payments for the purchase of treasury stock.
Financing Cadence Credit Facility: The Company and its wholly owned subsidiaries (the “Subsidiaries”) maintain an amended and restated credit agreement with Cadence Bank (“Cadence”) pursuant to which, Cadence agreed to loan the Company up to $8,000,000, which has a maturity date of April 20, 2028 (the “Cadence Credit Facility”).
Financing Cadence Credit Facility The Company and its wholly owned subsidiaries (the “Subsidiaries”) maintain an amended and restated credit agreement with Cadence Bank (“Cadence”) pursuant to which, Cadence agreed to loan the Company up to $8,000,000, which has a maturity date of April 20, 2028 (as amended to date, the “Cadence Credit Facility”).
The following is a description of what we consider to be our most significant accounting policies and estimates. 33 Table of Contents Leases: The Company determines if a contract contains a lease at inception. The Company's material long-term operating lease agreements are for the land and buildings for our restaurants as well as our corporate office.
The following is a description of what we consider to be our most significant accounting policies and estimates. 31 Table of Contents Leases: The Company determines if a contract contains a lease at inception. The Company's material long-term operating lease agreements are for the land and buildings for our restaurants as well as our corporate office.
Adjusted EBITDA is defined as EBITDA, adjusted for non-cash stock-based compensation expense, preopening expense, non-recurring acquisition costs, non-cash disposal of assets and non-cash asset impairment charges. Adjusted EBITDA is intended as a supplemental measure of our performance that is not required by or presented in accordance with GAAP.
Adjusted EBITDA is defined as EBITDA, adjusted for non-cash stock-based compensation expense, preopening expense, non-recurring acquisition costs, non-cash disposal of assets, litigation contingencies, and non-cash asset impairment charges. Adjusted EBITDA is intended as a supplemental measure of our performance that is not required by or presented in accordance with GAAP.
Our current working capital deficit is additionally affected by the recognition of short-term lease liabilities, as we lease substantially all of our real estate and have both current- and long-term obligations to our landlords. We believe that we will have sufficient capital to meet our working capital, and recurring capital expenditure needs in fiscal 2025.
Our current working capital deficit is additionally affected by the recognition of short-term lease liabilities, as we lease substantially all of our real estate and have both current- and long-term obligations to our landlords. We believe that we will have sufficient capital to meet our working capital, and recurring capital expenditure needs in fiscal 2026.
Bad Daddy’s same store restaurant sales, also referred to as comparable sales, decreased 1.2% during fiscal 2024 compared to fiscal 2023. Bad Daddy’s restaurants are included in same store sales after they have been open a full eighteen months.
Bad Daddy’s same store restaurant sales, also referred to as comparable sales, decreased 2.1% during fiscal 2025 compared to fiscal 2024. Bad Daddy’s restaurants are included in same store sales after they have been open a full eighteen months.
As a result of entering into the Cadence Credit Facility and the various amendments, the Company paid loan origination costs including professional fees of approximately $299,000 and is amortizing these costs over the term of the credit agreement.
As a result of entering into the Cadence Credit Facility and the various amendments, the Company paid loan origination costs including professional fees of approximately $324,000 and is amortizing these costs over the term of the credit agreement.
Our working capital position benefits from the fact that we generally collect cash from sales to customers the same day, or in the case of credit or debit card transactions, within a few days of the related sale and have payment terms with vendors that are typically between 14 and 21 days.
Our working capital position benefits from the fact that we generally collect cash from business-to-customer sales the same day, or in the case of credit or debit card transactions, within a few days of the related sale and have payment terms with vendors that are typically between 14 and 21 days.
The Company’s tax years corresponding to the Company’s fiscal years 2021 through 2023 remain open for examination by the authorities under the normal three-year statute of limitations. Should the Company utilize any of its U.S. or state NOLs, the tax year to which the original loss relates will remain open to examination.
The Company’s tax years corresponding to the Company’s fiscal years 2022 through 2024 remain open for examination by the authorities under the normal three-year statute of limitations. Should the Company utilize any of its U.S. or state NOLs, the tax year to which the original loss relates will remain open to examination.
In a 52-week fiscal year, each of the Company’s quarterly periods comprises 13 weeks. The additional week in a 53-week fiscal year is added to the first quarter, making such quarter consist of 14 weeks. Our discussion for the fiscal years ending September 24, 2024 and September 26, 2023 each cover periods of 52 full calendar weeks.
In a 52-week fiscal year, each of the Company’s quarterly periods comprises 13 weeks. The additional week in a 53-week fiscal year is added to the first quarter, making such quarter consist of 14 weeks. Our discussion for the fiscal years ending September 30, 2025 and September 24, 2024 each cover periods of 53 and 52 full calendar weeks, respectively.
The Parker Promissory Note fully amortizes over its original ten-year life maturing on June 1, 2034, carries an interest rate of 5.00% and is, in all respects, subordinate to the Cadence Credit Facility. As of September 24, 2024, the outstanding principal balance on the Parker Promissory Note was $373,000.
The Parker Promissory Note fully amortizes over its original ten-year life maturing on June 1, 2034, carries an interest rate of 5.00% and is, in all respects, subordinate to the Cadence Credit Facility. As of September 30, 2025, the outstanding principal balance on the Parker Promissory Note was $342,000.
Annual principal maturities over the next five years are approximately $35,000 each year. Total interest expense on notes payable was $108,000 and $31,000 for fiscal 2024 and 2023, respectively.
Annual principal maturities over the next five years are approximately $35,000 each year. Total interest expense on notes payable was $191,000 and $108,000 for fiscal 2025 and 2024, respectively.
The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. No accrual for interest and penalties was considered necessary as of September 24, 2024.
The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. No accrual for interest and penalties was considered necessary as of September 30, 2025.
Currently we have not been notified nor are we aware of any leases in default by the franchisees, however there can be no assurance that there will not be in the future which could have a material effect on our future operating results.
Currently we have not been notified nor are we aware of any leases or subleases in default by the franchisee or unrelated parties, however there can be no assurance that there will not be in the future which could have a material effect on our future operating results.
Additional sales data related to Bad Daddy’s company-owned restaurants: Fiscal Year 2024 2023 Total operating store weeks 2,074.5 2,042.5 Average sales per week $ 49,900 $ 50,100 Annualized net sales per square foot (1) $ 677 $ 694 (1) Based on comparable stores for the full fiscal year.
Additional sales data related to Bad Daddy’s company-owned restaurants: Fiscal Year 2025 2024 Total operating store weeks 2,065.0 2,074.5 Average sales per week $ 49,100 $ 49,900 Annualized net sales per square foot (1) $ 677 $ 677 (1) Based on comparable stores for the full fiscal year.
As of September 24, 2024, there were $500,000 of borrowings against the facility, all of which is due during the fiscal year ending September 2028 and is classified as a long-term liability in the accompanying balance sheet.
As of September 30, 2025, there were $2,000,000 of borrowings against the facility, all of which is due during the fiscal year ending September 2028 and is classified as a long-term liability in the accompanying balance sheet.
During the fiscal year ended September 24, 2024, the Company incurred $54,000 of contingent rent. Some of the leases provide for base rent, plus additional rent based on gross sales, as defined in each lease agreement.
During the fiscal year ended September 30, 2025, the Company incurred $29,000 of contingent rent. Some of the leases provide for base rent, plus additional rent based on gross sales, as defined in each lease agreement.
As of September 24, 2024, the unamortized balance of these fees was $95,000. 32 Table of Contents In connection with the Cadence Credit Facility, the Company and the Subsidiaries entered into an Amended and Restated Security and Pledge Agreement (the “Security Agreement”) with Cadence.
As of September 30, 2025, the unamortized balance of these fees was $93,000. 30 Table of Contents In connection with the Cadence Credit Facility, the Company and the Subsidiaries entered into an Amended and Restated Security and Pledge Agreement (the “Security Agreement”) with Cadence.
Availability of the Cadence Credit Facility for borrowings is reduced by the outstanding face value of any letters of credit issued under the facility. As of September 24, 2024, there were approximately $10,000 in outstanding letters of credit issued under the facility, and approximately $7,490,000 of committed funds available.
Availability of the Cadence Credit Facility for borrowings is reduced by the outstanding face value of any letters of credit issued under the facility. As of September 30, 2025, there were approximately $10,000 in outstanding letters of credit issued under the facility, and approximately $5,990,000 of committed funds available.
Income from Operations: Income from operations was $1,380,000 in fiscal 2024 compared to income from operations of $963,000 in fiscal 2023. The change from fiscal 2023 to fiscal 2024 was primarily attributable to matters discussed in the relevant sections above . Interest Expense: Interest expense was $125,000 during fiscal 2024, compared with $78,000 during fiscal 2023.
Income from Operations: Income from operations was $330,000 in fiscal 2025 compared to $1,380,000 in fiscal 2024. The change from fiscal 2024 to fiscal 2025 was primarily attributable to matters discussed in the relevant sections above . Interest Expense: Interest expense was $196,000 during fiscal 2025, compared with $125,000 during fiscal 2024.
As of the date of filing of this report, the Company was in compliance with each of these covenants under the Cadence Credit Facility. As of September 24, 2024, the interest rate applicable to borrowings under the Cadence Credit Facility was 8.41%.
As of the date of filing of this report, the Company was in compliance with each of these covenants under the Cadence Credit Facility. As of September 30, 2025, the interest rate applicable to borrowings under the Cadence Credit Facility was 7.27%.
Good Times food and packaging costs were $11,549,000 (30.4% of restaurant sales) in fiscal 2024, up from $10,938,000 (31.3% of restaurant sales) in fiscal 2023.
Good Times food and packaging costs were $12,367,000 (31.5% of restaurant sales) in fiscal 2025, up from $11,549,000 (30.4% of restaurant sales) in fiscal 2024.
(2) Includes direct and allocated corporate general and administrative costs. Bad Daddy’s Restaurants We currently operate thirty-nine company-owned Bad Daddy’s restaurants. We also license one restaurant in North Carolina. Good Times Burgers & Frozen Custard Restaurants We currently operate twenty-seven company-owned and joint-venture Good Times restaurants all in the state of Colorado.
Bad Daddy’s Restaurants We currently operate thirty-seven company-owned Bad Daddy’s restaurants. We also license one restaurant in North Carolina. 25 Table of Contents Good Times Burgers & Frozen Custard Restaurants We currently operate twenty-seven company-owned and joint-venture Good Times restaurants all in the state of Colorado.
You should review the reconciliation of net income to EBITDA and Adjusted EBITDA below and not rely on any single financial measure to evaluate our business. 31 Table of Contents The following table reconciles net income to EBITDA and Adjusted EBITDA (in thousands) : Fiscal Year 2024 2023 Net income, as reported $ 1,613 $ 11,086 Depreciation and amortization 3,757 3,617 Provision for income taxes (624 ) (10,787 ) Interest expense, net 125 78 EBITDA 4,871 3,994 Preopening expense (1) - 484 Non-cash stock-based compensation (2) 134 131 Gain on disposal of assets (3) (8 ) (41 ) Litigation Contingencies (332 ) - Asset impairment charges (4) 698 1,589 Adjusted EBITDA $ 5,363 $ 6,157 (1) Represents expenses directly associated with the opening of new restaurants, including preopening rent.
You should review the reconciliation of net income to EBITDA and Adjusted EBITDA below and not rely on any single financial measure to evaluate our business. 29 Table of Contents The following table reconciles net income to EBITDA and Adjusted EBITDA (in thousands) : Fiscal Year 2025 2024 Net income attributable to common shareholders, as reported $ 1,024 $ 1,613 Depreciation and amortization 4,049 3,849 Depreciation and amortization attributable to non-controlling interest (101 ) (92 ) Provision for income taxes (824 ) (624 ) Interest expense, net 196 125 EBITDA 4,344 4,871 Preopening expense (1) 8 - Non-cash stock-based compensation (2) 112 134 Non-cash gain on lease terminations and disposal of assets (3) (763 ) 2 Non-cash gain on disposal of assets attributable to non-controlling interest (3 ) (10 ) Litigation contingencies - (332 ) Asset impairment charges (4) 627 698 Adjusted EBITDA $ 4,325 $ 5,363 (1) Represents expenses directly associated with the opening of new restaurants, including preopening rent.
(2) Represents non-cash stock-based compensation as described in Note 8 to the Consolidated Financial Statements. (3) Primarily related to deferred gains on previous sale-leaseback transactions on two Good Times restaurants. (4) Represents costs recognized in connection with the asset impairment charges as described in Note 1 to the Consolidated Financial Statements.
(2) Represents non-cash stock-based compensation as described in Note 8 to the Consolidated Financial Statements. (3) Primarily related to gains on lease terminations as well as fixed asset disposals and deferred gains on previous sale-leaseback transactions on two Good Times restaurants.
Food and Packaging Costs: For fiscal 2024, food and packaging costs increased $794,000 to $43,704,000 (30.9% of restaurant sales) compared to $42,910,000 (31.3% of restaurant sales) in fiscal 2023. Bad Daddy’s food and packaging costs were $32,155,000 (31.1% of restaurant sales) in fiscal 2024, up from $31,972,000 (31.3% of restaurant sales) in fiscal 2023.
Food and Packaging Costs: For fiscal 2025, food and packaging costs increased $183,000 to $43,887,000 (31.2% of restaurant sales) compared to $43,704,000 (30.9% of restaurant sales) in fiscal 2024. Bad Daddy’s food and packaging costs were $31,520,000 (31.1% of restaurant sales) in fiscal 2025, down from $32,155,000 (31.1% of restaurant sales) in fiscal 2024.
Long-lived Asset Impairment Charges: For fiscal 2024, the asset impairment charge was $698,000 compared to $1,589,000 in fiscal 2023. We review long-lived assets and intangibles subject to amortization for impairment when there are factors that indicate the carrying value of such assets may not be recoverable.
We review long-lived assets and intangibles subject to amortization for impairment when there are factors that indicate the carrying value of such assets may not be recoverable.
This $101,000 decrease is primarily due to the temporary closure for remodel of one joint-venture restaurant during the third fiscal quarter of 2024, as well decreased profitability during the fiscal year of the six restaurants involved in the partnership. Adjusted EBITDA EBITDA is defined as net income (loss) before interest, income taxes and depreciation and amortization.
This $192,000 decrease is primarily due to decreased profitability during the fiscal year of the six restaurants involved in the partnership. Adjusted EBITDA EBITDA is defined as net income before interest, income taxes and depreciation and amortization.
Average Good Times restaurant sales for company-owned and joint venture restaurants open the entire 2024 and 2023 fiscal years were as follows: Fiscal Year 2024 2023 Average annual unit volume $ 1,538,000 $ 1,506,000 During fiscal 2024, company-operated Good Times restaurants’ sales for restaurants that had been open a full eighteen months ranged from a low of $1,037,762 to a high of $2,545,795.
Fiscal 2025 and fiscal 2024 for Good Times include franchise advertising contributions of $68,000 and $179,000, respectively. 26 Table of Contents Average Good Times restaurant sales for company-owned and joint venture restaurants open the entire 2025 and 2024 fiscal years were as follows: Fiscal Year 2025 2024 Average annual unit volume $ 1,468,000 $ 1,538,000 During fiscal 2025, company-operated Good Times restaurants’ sales for restaurants that had been open a full eighteen months ranged from a low of $980,755 to a high of $2,532,226.
We have historically used menu price increases to manage profitability in times of inflation, however the current unusually high rate of wage inflation, exceeds what we believe we can reasonably pass through to our customers without negatively affecting frequency and trial by our customers, and we are not able to predict the impact of beef price inflation or our ability to offset the potential increase in cost of beef with menu price increases. 27 Table of Contents Same Store Sales Same store sales for each brand represent the comparison of restaurant sales in the current year, to the same comparable weeks in the immediately preceding fiscal year for those stores open for at least 18 months.
We have historically used menu price increases to manage profitability in times of inflation, however the current unusually high rate of wage inflation, exceeds what we believe we can reasonably pass through to our customers without negatively affecting frequency and trial by our customers, and we are not able to predict the impact of beef price inflation or our ability to offset the potential increase in cost of beef with menu price increases.
The net loss in fiscal 2024 is primarily due to restaurant fixed asset retirements, mostly offset by a deferred gain on previous sale lease-back transactions related to two Good Times restaurants. The gain in fiscal 2023 is primarily comprised of a deferred gain on previous sale lease-back transactions related to two Good Times restaurants.
The net loss in fiscal 2024 was primarily due to restaurant fixed asset retirements, mostly offset by a deferred gain on previous sale lease-back transactions related to two Good Times restaurants. Long-lived Asset Impairment Charges: For fiscal 2025, the asset impairment charge was $627,000 compared to $698,000 in fiscal 2024.
For fiscal 2024, general and administrative costs increased $1,351,000 from $9,165,000 (6.6% of total revenue) in fiscal 2023 to $10,516,000 (7.4% of total revenue) in fiscal 2024.
For fiscal 2025, general and administrative costs decreased $847,000 from $10,581,000 (7.4% of total revenue) in fiscal 2024 to $9,734,000 (6.9% of total revenue) in fiscal 2025.
Cash Flows Fiscal Year Ended September 24, 2024 September 26, 2023 Net cash provided by operating activities $ 5,130 $ 7,965 Net cash used in investing activities (3,662 ) (10,443 ) Net cash used in financing activities (1,797 ) (2,246 ) Net change in cash and cash equivalents $ (329 ) $ (4,724 ) Operating Cash Flows.
Cash Flows Fiscal Year Ended September 30, 2025 September 24, 2024 Net cash provided by operating activities $ 1,613 $ 5,130 Net cash used in investing activities (3,844 ) (3,662 ) Net cash provided by (used in) financing activities 983 (1,797 ) Net change in cash and cash equivalents $ (1,248 ) $ (329 ) Operating Cash Flows.
Net cash from operating activities decreased by $2,835,000, primarily due to decreased net income, income tax provision and long-lived asset impairments as well as increased cash usage for accounts payable and lease liabilities, offset by decreased cash usage for accrued liabilities, other assets and deferred income, as presented on the Consolidated Statements of Cash Flows. Investing Cash Flows.
Net cash from operating activities decreased by $3,517,000, primarily due to decreased net income, income tax provision and an increase in non-cash gains, as well as increased cash usage for accounts payable, accrued liabilities and lease liabilities, partially offset by increased cash flow related to receivables, prepaid expenses, inventories and other assets, as presented on the Consolidated Statements of Cash Flows.
Good Times advertising costs consist primarily of contributions made to the advertising materials fund and a regional advertising cooperative based on a percentage of restaurant sales which are used to provide radio advertising, social media, on-site and point-of-purchase materials. Advertising costs are presented gross, with franchisee contributions to the fund being recognized as a component of franchise revenues.
Good Times advertising costs consist primarily of radio advertising, agency fees and social media. Advertising costs are presented gross, with franchisee contributions to the fund being recognized as a component of franchise revenues.
Bad Daddy’s payroll and other employee benefit costs were $35,831,000 (34.6% of restaurant sales) for fiscal 2024, down from $35,892,000 (35.1% of restaurant sales) in fiscal 2023.
Payroll and Other Employee Benefit Costs: For fiscal 2025, payroll and other employee benefit costs increased $588,000 to $49,277,000 (35% of restaurant sales) compared to $48,689,000 (34.4% of restaurant sales) in fiscal 2024. Bad Daddy’s payroll and other employee benefit costs were $35,325,000 (34.8% of restaurant sales) for fiscal 2025, down from $35,831,000 (34.6% of restaurant sales) in fiscal 2024.
Other Operating Costs: For fiscal 2024, other operating costs increased $1,275,000 to $20,288,000 (14.3% of restaurant sales) up from $19,013,000 (13.9% of restaurant sales) in fiscal 2023. Bad Daddy’s other operating costs were $15,296,000 (14.8% of restaurant sales) for fiscal 2024, up from $14,834,000 (14.5% of restaurant sales) in fiscal 2023.
Other Operating Costs: For fiscal 2025, other operating costs increased $449,000 to $20,737,000 (14.7% of restaurant sales) up from $20,288,000 (14.3% of restaurant sales) in fiscal 2024. Bad Daddy’s other operating costs were $15,373,000 (15.2% of restaurant sales) for fiscal 2025, up from $15,364,000 (14.8% of restaurant sales) in fiscal 2024.
Bad Daddy’s depreciation costs decreased $98,000 from $3,060,000 in fiscal 2023 to $2,962,000 in fiscal 2024. Good Times depreciation costs increased $190,000 from $603,000 in fiscal 2023 to $793,000 in fiscal 2024. General and Administrative Costs: General and administrative costs include all corporate and administrative functions.
Good Times depreciation costs increased $171,000 from $793,000 in fiscal 2024 to $964,000 in fiscal 2025. General and Administrative Costs: General and administrative costs include all corporate and administrative functions.
Contingencies and Off-Balance Sheet Arrangements We remain contingently liable on various leases underlying restaurants that were previously sold to franchisees. We have never experienced any losses related to these contingent lease liabilities, however if a franchisee defaults on the payments under the leases, we would be liable for the lease payments as the assignor or sub-lessor of the lease.
We have never experienced any losses related to these contingent lease or sublease liabilities, however if the franchisee or unrelated parties default on the payments under the leases or subleases, we would be liable for the lease payments as the assignor or sub-lessor of the lease.
Good Times restaurant sales increased $3,028,000 to $38,016,000 in fiscal 2024 from $34,988,000 in fiscal 2023.
Good Times restaurant sales increased $1,213,000 to $39,229,000 in fiscal 2025 from $38,016,000 in fiscal 2024.
Our impairment assessment process requires the use of estimates and assumptions regarding future cash flows and operating outcomes, which are based upon a significant degree of management’s judgment, including judgment surrounding the Company’s ability to improve the operating performance of its restaurants. 34 Table of Contents Recent Accounting Pronouncements The information contained in Note 1 to our Consolidated Financial Statements included in this report concerning a description of recent accounting pronouncements, including our expected dates of adoption and the estimated effects on our results of operations and financial condition, is incorporated by reference herein.
Recent Accounting Pronouncements The information contained in Note 1 to our Consolidated Financial Statements included in this report concerning a description of recent accounting pronouncements, including our expected dates of adoption and the estimated effects on our results of operations and financial condition, is incorporated by reference herein. 32 Table of Contents
Results of Operations for Fiscal 2024 Compared to Fiscal 2023 Net Revenues: Net revenues for fiscal 2024 increased $4,155,000 (3.0%) to $142,315,000 from $138,160,000 for fiscal 2023. Bad Daddy’s concept revenues increased $1,327,000 while our Good Times concept revenues increased $2,828,000. Bad Daddy’s restaurant sales increased $1,298,000 to $103,539,000 in fiscal 2024 from $102,241,000 in fiscal 2023.
Results of Operations for Fiscal 2025 Compared to Fiscal 2024 Net Revenues: Net revenues for fiscal 2025 decreased $750,000 (0.5%) to $141,630,000 from $142,380,000 for fiscal 2024. Bad Daddy’s concept revenues decreased $1,696,000 while our Good Times concept revenues increased $949,000. Bad Daddy’s restaurant sales decreased $2,154,000 to $101,385,000 in fiscal 2025 from $103,539,000 in fiscal 2024.
Good Times advertising costs decreased $37,000 from to $1,392,000 (3.9% of total revenues) in fiscal 2023 to $1,355,000 (3.5% of total revenues) in fiscal 2024. The decrease is primarily due to a reduction in TV media and an increase in product rebates, partially offset by increased market research.
Good Times advertising costs increased $63,000 from $1,355,000 (3.5% of total revenues) in fiscal 2024 to $1,418,000 (3.6% of total revenues) in fiscal 2025. The increase is primarily due to increased outdoor and social media expenses, sponsorships and agency fees, partially offset by decreased radio media expense.
Net cash used in financing activities for the fiscal year ended September 26, 2023 was $2,246,000, which includes proceeds from long-term debt of $750,000, stock option exercises of $5,000 and net distributions to non-controlling interests of $635,000, $92,000 in restricted stock unit vesting paid in cash, and $2,274,000 in payments for the repurchase of common stock.
Net cash provided by financing activities for the fiscal year ended September 30, 2025, was $983,000, which includes proceeds from long-term debt of $2,250,000, payments of long-term debt of $780,000, net distributions to non-controlling interests of $38,000, $391,000 in payments for the purchase of treasury stock, and $58,000 for restricted stock vesting settled in cash.
In addition, we have three Good Times franchise restaurants, one operating in Colorado and two in Wyoming. Impact of Inflation at Both Concepts Commodity prices have been more stable during fiscal 2024, though beef and bacon are at or are near record highs and have exhibited extreme volatility.
In addition, we have three Good Times franchise restaurants, one operating in Colorado and two in Wyoming. Impact of Inflation at Both Concepts Commodity prices have been more stable during fiscal 2025 relative to the prior 3 years, with dairy byproducts, chicken, and eggs moderating.
Provision for Income Taxes: There was a $624,000 benefit from income taxes for fiscal 2024 , primarily driven by changes in the projections of full-year net income and available tax credits. There was a $10,787,000 benefit for fiscal 2023.
Provision for Income Taxes: There was an $824,000 benefit from income taxes for fiscal 2025, compared to a $624,000 benefit for fiscal 2024 . The primary driver of the tax benefit for both fiscal 2025 and 2024 were changes in available tax credits.
As of September 24, 2024, the Company had approximately $268,000 in outstanding commitments related to the remodel of one Good Times restaurant. We anticipate any commitments in fiscal 2025 will be funded out of existing cash or future borrowings against the Cadence Credit Facility.
We anticipate any commitments in fiscal 2026 will be funded out of existing cash or future borrowings against the Cadence Credit Facility.
Bad Daddy’s advertising costs consist primarily of menu development, printing costs, local store marketing and social media. All restaurants contribute to an advertising materials fund based on a percentage of restaurant sales. We anticipate that Bad Daddy’s advertising costs as a percentage of net revenues will decrease to between 1.5% and 2.0% in fiscal 2025.
The increase is primarily due to increases in TV and outdoor media partially offset by a decrease in social media advertising. Bad Daddy’s advertising costs consist primarily of third-party gift card commissions, menu development, printing costs, local store marketing and social media. All restaurants contribute to an advertising materials fund based on a percentage of restaurant sales.
Net cash used in investing activities for the fiscal year ended September 24, 2024 and September 26, 2023 were $3,662,000 and $10,443,000, respectively, which primarily reflect the purchases of property and equipment in each period as well as the acquisition of a restaurant from a franchisee in the current year period, and the net purchase of all non-controlling interests in our Bad Daddy’s locations in the prior year period.
Investing Cash Flows. Net cash used in investing activities for the fiscal year ended September 30, 2025 and September 24, 2024 were $3,844,000 and $3,662,000, respectively, which primarily reflect the purchases of property and equipment and acquisitions of restaurants from franchises in each year as well as the payment of lease termination fees in the current year. Financing Cash Flows.
Good Times other operating costs were $4,992,000 (13.1% of restaurant sales) in fiscal 2024, up from $4,179,000 (11.9% of restaurant sales) in fiscal 2023. The increase was primarily attributable to costs associated with three additional company-owned restaurants, as well as increased repair and maintenance, credit card and customer delivery fees and higher utility expenses.
This increase was primarily attributable to higher repair and maintenance, utility and technology expenses . 27 Table of Contents Good Times other operating costs were $5,730,000 (14.6% of restaurant sales) in fiscal 2025, up from $4,992,000 (13.1% of restaurant sales) in fiscal 2024.
This increase is primarily attributable to the acquisition, by the Company during fiscal 2023, of two Good Times restaurants previously owned by franchisees and the current fiscal year acquisition of a Good Times restaurant previously owned by a franchisee.
The increase was primarily due to the first quarter 2025 acquisition of two Good Times restaurants, and the third fiscal quarter 2024 acquisition of one Good Times restaurant, previously owned by franchisees, partially offset by the closure of one Good Times restaurant during the fourth quarter of fiscal 2024.
As a percent of sales, payroll and employee benefits costs decreased by 0.5% primarily attributable to incentive compensation plan revisions and a 4.6% increase in menu pricing. Good Times payroll and other employee benefit costs were $12,858,000 (33.8% of restaurant sales) in fiscal 2024, up from $11,657,000 (33.3% of restaurant sales) in fiscal 2023.
Good Times payroll and other employee benefit costs were $13,952,000 (35.6% of restaurant sales) in fiscal 2025, up from $12,858,000 (33.8% of restaurant sales) in fiscal 2024.
New Store Preopening Costs: For fiscal 2024, we had no preopening costs compared to $484,000 in fiscal 2023. Depreciation and Amortization Costs: Depreciation and amortization includes depreciation on capital expenditures for restaurants and corporate assets as well as amortization of acquired franchise rights and leasehold interests.
The current fiscal year costs primarily relate to training costs incurred as part of our two Good Times restaurant acquisitions. Depreciation and Amortization Costs: Depreciation and amortization includes depreciation on capital expenditures for restaurants and corporate assets as well as amortization of acquired franchise rights and leasehold interests.
As a percent of sales, payroll and employee benefits costs increased by 0.5% in fiscal 2024 compared to fiscal 2023. This increase was primarily attributable to increased wage rates, partially offset by menu price increases and increased labor productivity. Occupancy Costs: Occupancy costs include rent, real and personal property taxes, common area maintenance expenses, licenses and insurance expense.
As a percent of sales, payroll and employee benefits costs increased by 1.8% in fiscal 2025 compared to fiscal 2024. This increase was primarily attributable to higher average wage rates and decreased labor productivity resulting from the deleveraging impact of lower sales, partially offset by decreased incentive compensation.
There were thirty-eight restaurants included in the same store sales base at the end of the fiscal year. Additionally, net revenues for fiscal 2024 were increased by $29,000 in license fees compared to the prior fiscal year.
Additionally, net revenues for fiscal 2025 were increased by gift card breakage of $439,000 and license fees of $19,000 compared to the prior fiscal year.
The most significant driver of the prior year benefit was the release of the valuation allowance previously assessed on the deferred tax assets. See Note 7 to the Consolidated Financial Statements included in this report for further information. Net Income: Net income for fiscal 2024 was $1,879,000 compared to net income of $11,672,000 in fiscal 2023.
See Note 7 to the Consolidated Financial Statements included in this report for further information. 28 Table of Contents Net Income: Net income for fiscal 2025 was $1,098,000 compared to net income of $1,879,000 in fiscal 2024. The change from fiscal 2024 to fiscal 2025 was primarily attributable to the matters discussed in the relevant sections above .
This increase is primarily attributable to the fourth quarter 2023 Madison, Alabama restaurant opening, and the prior year closure of the Cherry Creek restaurant partially offset by lower average unit volumes. The decrease, as a percent of sales, is attributable to the impact of a 4.6% average annual increase in menu pricing.
The increase, as a percent of sales, is primarily attributable to higher purchase prices on ground beef and eggs, partially offset by the impact of the 1.0% increase in menu pricing compared to the prior year.
This increase is primarily due to menu price increases and increased customer traffic. The average menu price increase in fiscal 2024 over fiscal 2023 was approximately 4.0%. Additionally, revenues for fiscal 2024 decreased by $200,000 in lower franchise revenues compared to fiscal 2023. Fiscal 2024 and fiscal 2023 for Good Times include franchise advertising contributions of $179,000 and $261,000, respectively.
Same store restaurant sales decreased 5.0% during fiscal 2025 compared to fiscal 2024. This decrease is primarily due to decreased customer traffic, partially offset by a menu price increase. The average menu price increase in fiscal 2025 over fiscal 2024 was approximately 1.0%.
For fiscal 2024, depreciation and amortization costs increased $92,000 to $3,755,000 compared to $3,663,000 in fiscal 2023. The increases are due to additional company-owned restaurants, newly deployed assets including signs, menu boards, and restaurant remodels, partially offset by the prior year impairment of assets for two restaurants.
For fiscal 2025, depreciation and amortization costs increased $199,000 to $3,954,000 compared to $3,755,000 in fiscal 2024. The increase is primarily due to additional company-owned restaurants and restaurant remodels. Bad Daddy’s depreciation costs increased $29,000 from $2,921,000 in fiscal 2024 to $2,950,000 in fiscal 2025.
We anticipate that in fiscal 2025 Good Times advertising costs as a percentage of net revenues will decrease to between 2.5% and 3.0%. Loss (Gain) on Restaurant Asset Disposals: For fiscal 2024, the loss on restaurant asset disposals was $2,000 compared to a gain of $41,000 in fiscal 2023.
(Gain) loss on lease terminations and asset disposals: For fiscal 2025, the net gain on lease terminations and asset disposals was $469,000 compared to a net loss of $2,000 in fiscal 2024. The net gain in fiscal 2025 is primarily due to gains on lease terminations related to three Bad Daddy’s locations.
For fiscal 2024, the income attributable to non-controlling interests was $266,000 compared to $586,000 for fiscal 2023. Of the fiscal 2024 income attributable to non-controlling interests, none is attributable to Bad Daddy’s joint-venture restaurants, compared to $219,000 in the same prior year period.
Income Attributable to Non-Controlling Interests: The non-controlling interest represents the limited partner’s share of income in the Good Times restaurants owned by a partnership in which the Company is the controlling partner. For fiscal 2025, the income attributable to non-controlling interests was $74,000 compared to $266,000 for fiscal 2024.
The current year impairment costs are primarily attributable to the impairment of the lease right-of-use assets of two Bad Daddy’s locations. During fiscal 2023 we recorded non-cash charges of $1,519,000 and $70,000 related to four Bad Daddy’s locations and two Good Times locations, respectively.
During fiscal 2024 we recorded non-cash impairment charges of $689,000 and $9,000 related to Bad Daddy’s and Good Times, respectively. Litigation Contingencies: There were no litigation contingency costs during fiscal 2025. There was $332,000 of income related to the adjustment of the Company’s litigation contingency reserve during fiscal 2024.
Good Times occupancy costs were $3,411,000 (9.0% of restaurant sales) in fiscal 2024, up from $2,965,000 (8.5% of restaurant sales) in fiscal 2023. The increase was primarily attributable to the costs incurred for three additional company-owned restaurants as well as real property tax increases resulting from increased property valuations .
Good Times occupancy costs were $3,655,000 (9.3% of restaurant sales) in fiscal 2025, up from $3,411,000 (9.0% of restaurant sales) in fiscal 2024.
The $1,351,000 increase in general and administrative expenses in fiscal 2024 is primarily attributable to: ● Increase in home office payroll and benefits costs of $545,000 associated with additional HR and training roles, and additional staffing related to insourcing of accounting, and the vacancy in the prior year of the finance department leader position 29 Table of Contents ● Increase in costs associated with multi-unit supervisory roles of $506,000 ● Increase in routine course legal costs of $272,000 ● Decrease in recruiting and training related costs of $126,000 ● Net increases in all other expenses of $154,000 Advertising Costs: For fiscal 2024, advertising costs increased $270,000 from $3,258,000 (2.4% of total revenues) in fiscal 2023 to $3,528,000 (2.5% of total revenues) in fiscal 2024.
The $847,000 decrease in general and administrative expenses in fiscal 2025 is primarily attributable to: ● Decrease in third party accounting fees of $505,000 related to insourcing of accounting ● Decrease in legal fees and settlement costs of $382,000 ● Decrease in costs associated with multi-unit supervisory roles of $197,000 ● Increase in home office payroll and benefits of $170,000 ● Increase in technology related expenses of $141,000 ● Net decreases in all other expenses of $74,000.
The $61,000 decrease is primarily attributable to incentive compensation plan revisions, the prior fiscal year closure of one Denver, Colorado restaurant mostly offset by increases due to the fourth quarter 2023 Madison, Alabama restaurant opening, and the prior year remodel temporary closure of the Greenville, South Carolina restaurant.
The $506,000 decrease is primarily attributable to the fourth fiscal quarter 2024 closure of one Bad Daddy’s restaurant, as well as reduced restaurant-level incentive compensation, partially offset by an additional week in the first fiscal quarter versus the prior year first fiscal quarter and decreased labor productivity.
This increase is a result of the fourth quarter 2023 Madison, Alabama restaurant opening, the prior year remodel temporary closure of the Greenville, South Carolina restaurant, and menu price increases partially offset by the prior year closure of the Cherry Creek restaurant and reduced customer traffic, concentrated in certain restaurants.
This decrease is a result of the closure of one restaurant near the end of fiscal 2024, reduced customer traffic and by negative mix shift attributable to the success of the Company’s smashed patty burgers, partially offset by an additional week in the first fiscal quarter versus the prior year first fiscal quarter and menu price increases.
This increase is primarily due to the acquisition, by the Company during fourth quarter 2023, of two Good Times restaurants previously owned by franchisees, the current fiscal year acquisition of a Good Times restaurant previously owned by a franchisee, increased customer traffic, and menu price increases. Same store restaurant sales increased 2.9% during fiscal 2024 compared to fiscal 2023.
This increase is driven by the first quarter 2025 acquisition of two Good Times restaurants, the third quarter 2024 acquisition of one Good Times restaurant, previously owned by franchisees, the third quarter 2024 temporary closure of one Good Times restaurant for remodel, and an additional week in the first fiscal quarter versus the prior year first fiscal quarter, partially offset by the fourth quarter 2024 closure of one Good Times restaurant as well as the first quarter 2025 temporary closure of one Good Times restaurant for remodel, and reduced customer traffic.
For fiscal 2024, occupancy costs increased $480,000 from $9,607,000 (7.0% of restaurant sales) in fiscal 2023 to $10,087,000 (7.1% of restaurant sales). Bad Daddy’s occupancy costs were $6,676,000 (6.4% of restaurant sales) for fiscal 2024, up from $6,642,000 (6.5% of restaurant sales) in fiscal 2023.
Occupancy Costs: Occupancy costs include rent, real and personal property taxes, common area maintenance expenses, licenses and insurance expenses. For fiscal 2025, occupancy costs increased $143,000 from $10,087,000 (7.1% of restaurant sales) in fiscal 2024 to $10,230,000 (7.3% of restaurant sales).
Removed
This decrease is primarily driven by general weakness in the casual dining restaurant segment as indicated by sequentially lower same store sales as measured by Black Box Intelligence, weaker traffic specific to Bad Daddy’s in certain restaurants, partially offset by menu price increases. The average menu price increase was approximately 4.6% in 2024 over 2023.
Added
In order to better align with our internal reporting and provide a better representation of restaurant-level operations, beginning with fiscal 2025, these expenses have been removed from the Bad Daddy's segment and are now stated separately in Other. Fiscal 2024 figures were recast for comparability.
Removed
The decrease, as a percent of sales, is primarily attributable to the impact of a 4.0% average annual increase in menu pricing. 28 Table of Contents Payroll and Other Employee Benefit Costs: For fiscal 2024, payroll and other employee benefit costs increased $1,140,000 to $48,689,000 (34.4% of restaurant sales) compared to $47,549,000 (34.6% of restaurant sales) in fiscal 2023.
Added
Unallocated costs such as human resources, finance, purchasing, restaurant development and administration are recorded at the Corporate level and are included in Other. The amounts reported for each reportable business segment contain allocations from Corporate for items such as technology support, repair and maintenance, marketing and restaurant accounting.
Removed
The $1,201,000 increase is attributable to labor associated with three additional company-owned restaurants, an increase in operating hours caused by later closing times in nearly every restaurant, and higher average wage rates resulting from market forces and the CPI-indexed minimum wage in Denver and the state of Colorado, partially offset by increased labor productivity.
Added
In addition, Corporate collects rent from the Good Times segment related to one restaurant for which Corporate owns the real estate. There are no material transactions between our reportable business segments. (1) Restaurant operating costs are expressed as a percentage of restaurant sales. (2) Includes direct and allocated corporate general and administrative costs.
Removed
The $462,000 increase is attributable to the fourth quarter 2023 Madison, Alabama restaurant opening, and the prior year remodel temporary closure of the Greenville, South Carolina restaurant, increased repair and maintenance and other employee-related expenses, partially offset by reduced restaurant supply costs.
Added
Though beef and bacon were at or are near record highs during the last quarter of fiscal 2025, they have recently began to decrease.
Removed
Bad Daddy’s advertising costs increased $307,000 from $1,866,000 (1.8% of total revenues) in fiscal 2023 to $2,173,000 (2.1% of total revenues) in fiscal 2024. The increase is primarily due to increases in third party gift card commissions and printing costs, partially offset by decreases in local store marketing and media services.
Added
There is continued uncertainty regarding the degree of inflation and its associated impact on our business related to tariffs that have been implemented or threatened to be imposed on other countries, some of which are sources of food and packaging supplies for our business.
Removed
Litigation Contingencies: There was $332,000 of income related to the adjustment of the Company’s litigation contingency reserve during fiscal 2024. This adjustment is due to the reversal of our previous contingency reserve of $332,000. The Company did not record any changes in litigation contingencies in fiscal 2023.

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