What is the Chesters franchisee's responsibility regarding the execution of documents reflecting adjustments to the financed amount?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
You irrevocably instruct us to pay the Supplier on your behalf, which payment is the funding of our loan to you.
The Financed Amount is based upon the total estimated cost of the Collateral and financed Soft Costs (adjusted for any non-reimbursed down payments made by you) (the "Estimated Cost"), which Estimated Cost you and/or the Supplier have provided to us.
If the final actual cost of the Collateral and any financed Soft Costs that we pay the Supplier and any taxing authority (the "Actual Cost") is different than the Estimated Cost, you authorize us to adjust the Financed Amount to the Actual Cost.
If we request, you agree to execute a document reflecting such adjustments and we will provide you with evidence of our cost changes requiring such adjustments if you request.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, if the final actual cost of the collateral and any financed soft costs differs from the estimated cost, Chesters is authorized to adjust the financed amount to reflect the actual cost. If Chesters requests, the franchisee must agree to execute a document reflecting these adjustments. Chesters will provide evidence of the cost changes that necessitate such adjustments, if the franchisee requests it.
This means that as a Chesters franchisee, you need to be prepared to sign documents that adjust the amount you've financed if the actual costs of the collateral and soft costs change. This is to ensure that the financed amount accurately reflects the final costs. It is in the franchisee's best interest to request evidence of these cost changes from Chesters to verify the adjustments.
This requirement is fairly standard in financing agreements. Franchisees should carefully review any documents related to financing and ensure they understand the terms and conditions, including those related to cost adjustments and documentation. Keeping clear records and requesting documentation from Chesters will help ensure transparency and accuracy in the financing process.