What is the 'First Due Date' defined as in the Chesters equipment finance agreement?

According to Chesters's 2025 Franchise Disclosure Document, the 'First Due Date' in the context of the equipment finance agreement (EFA) refers to the first monthly due date specified by Chesters for payments. This date is significant because it marks when the franchisee must make a pro-rated payment, calculated from the loan's commencement date to this first monthly due date. This pro-rated payment is equal to 1/30th of a standard payment times the number of days from the commencement date to the first monthly due date.

This initial pro-rated payment, along with the first full payment, is due either in advance, on the First Due Date, or on the second Due Date, as specified by Chesters. The interest rate quoted in the agreement excludes this pro-rated payment and all fees, meaning the franchisee should factor this additional cost into their financial planning. Subsequent payments are then due on the same day of each month following the First Due Date, continuing until the franchisee has fulfilled all obligations under the agreement.

Chesters retains the authority to adjust the payment amount if the financed amount changes, ensuring the interest rate remains consistent. This adjustment protects Chesters from losses due to changes in the actual cost of collateral or financed soft costs. The franchisee should be aware that all payments are due regardless of whether an invoice is received, emphasizing the importance of tracking payment schedules and due dates to avoid late fees or other penalties.

In summary, the 'First Due Date' is a critical date for Chesters franchisees as it dictates the start of their repayment schedule and includes a pro-rated payment in addition to the standard payment. Franchisees must understand how this date is determined and how it affects their overall financial obligations to Chesters.