How does the lack of financing assistance from Chesters (Item 10) impact the franchisee's pre-opening purchase obligations (Item 9)?

According to Chesters's 2025 Franchise Disclosure Document, Item 9 outlines the franchisee's obligations, including 'Pre-opening purchases/leases' as detailed in Sections 5, 6, 8, 9, 10, and 16 of the Franchise Agreement and Items 5, 7, and 8 of the FDD. While Item 10 generally covers financing, the provided excerpts focus on pre-opening obligations and restrictions on suppliers rather than financing specifics. Therefore, the lack of explicit financing details in these excerpts makes it difficult to directly assess the impact on pre-opening purchases.

However, Item 5 mentions a third-party equipment lender, Ascentium Capital, that Chesters has a program with to finance the purchase price for certain core equipment, signage, fixtures, and supplies. This suggests that while Chesters itself may not provide direct financing, there are avenues for franchisees to finance these essential pre-opening purchases through a third party. The franchisee will not pay Chesters any monies or fees directly, but Ascentium will pay Chesters the financed amount for the purchased core equipment, signage, fixtures, and supplies.

Item 8 also indicates that franchisees are required to purchase products from designated or approved suppliers, which can impact the total cost to establish the restaurant, estimated to be 70% to 95% of the total cost to establish, and approximately 20% to 40% of the total annual cost to operate, your Restaurant. Without direct financing from Chesters, franchisees may need to secure financing independently to meet these purchase obligations from approved suppliers. Prospective franchisees should inquire with Chesters about the typical costs associated with pre-opening purchases and the specific requirements for sourcing equipment and supplies to fully understand the financial implications.