When does the revolving loan for Chesters mature?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 21: **FINANCIAL STATEMENTS]
The Agreement includes a revolving loan for maximum borrowings up to $1,000,000 that matures December 31, 2026. Interest is calculated at the greater of 5% or Prime rate plus 1% (8.5% at December 31, 2024 and 2023) and secured by essentially all business assets. There were no amounts outstanding under the revolving loan as of December 31, 2024 and 2023. The revolving loan matures on December 31, 2026.
As part of the Agreement, the Company is required to comply with financial and nonfinancial covenants. Management believes it was in compliance with all covenants as of December 31, 2024. The Company was not in compliance with certain financial covenants for the year ended December 31, 2023. During 2024, the bank granted a waiver for the noncompliance in 2023.
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the agreement includes a revolving loan with maximum borrowings up to $1,000,000. This loan is secured by essentially all of Chesters' business assets. The revolving loan matures on December 31, 2026.
The interest for the revolving loan is calculated at the greater of 5% or the prime rate plus 1%. As of December 31, 2024 and 2023, the interest rate was 8.5%.
Chesters is required to comply with financial and nonfinancial covenants as part of the agreement. Management believed it was in compliance with all covenants as of December 31, 2024. However, Chesters was not in compliance with certain financial covenants for the year ended December 31, 2023, but the bank granted a waiver for the noncompliance during 2024.