Under the Chesters EFA, what is the condition for Chesters to execute a document reflecting adjustments?
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.
You represent and warrant to us that all information conveyed to us in connection with this EFA and all related documents whether by you, a guarantor, the Supplier or any other person, is true, accurate, complete and not misleading.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters' 2025 Franchise Disclosure Document, if the final actual cost of the collateral and any financed soft costs is different than the estimated cost, Chesters is authorized to adjust the financed amount to the actual cost. If Chesters requests, the franchisee agrees to execute a document reflecting such adjustments. Chesters will provide evidence of cost changes requiring such adjustments if the franchisee requests it.
This means that as a Chesters franchisee, you may be required to sign a document acknowledging adjustments to the financed amount if the actual costs differ from the initial estimates. However, you have the right to request evidence from Chesters supporting the cost changes that necessitate these adjustments. This protects the franchisee by ensuring transparency and justification for any changes to the financial agreement.
This clause ensures that the financial agreement remains accurate and reflects the true costs incurred. It is important for a prospective Chesters franchisee to carefully review all cost estimates and understand the potential for adjustments. By requesting evidence of cost changes, franchisees can verify the accuracy of the adjustments and ensure they are only paying for legitimate expenses.