When does the term loan of Chesters, with interest payable at prime rate minus 0.25%, mature?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
he Agreement), as amended, with a financial institution and has the following outstanding debt:
| 2024 | 2023 | |
|---|---|---|
| Term loan – interest is payable at 7.25%. | $ 718,235 | $ 1,084,858 |
| The note matures in December 2028, collateralized | ||
| by certain business assets | ||
| Term loan – interest is payable at prime rate minus 0.25%. |
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, there are two loans with interest rates related to the prime rate. One term loan's interest is payable at prime rate minus 0.25% and another tenant improvement loan's interest is payable at prime rate minus 0.25%. Both of these loans mature in October 2028. These loans are also collateralized by certain business assets.
It is important to note that the financial statements provide a snapshot of Chesters's financial position as of a specific date (December 31, 2024, in this case). Loan terms and balances can change over time as Chesters takes on new debt or pays down existing obligations.
A prospective franchisee should consult with a financial advisor to fully understand the implications of Chesters's debt structure and how it might affect the franchisee's investment. It would also be prudent to confirm with Chesters whether these loan terms are still current and to request details on any other outstanding financial obligations.