In Hawaii, when will the payment of initial franchise fees for a Boulder Designs franchise be deferred?

According to Boulder Designs's 2025 Franchise Disclosure Document, for franchisees in Hawaii, the payment of initial franchise fees will be deferred until Boulder Designs has met its initial obligations to the franchisee, and the franchisee has commenced doing business. This requirement was imposed by the Hawaii Securities Compliance Branch due to Boulder Designs's financial condition.

This means that a new Boulder Designs franchisee in Hawaii will not be required to pay the initial franchise fee upfront. Instead, the payment is delayed until Boulder Designs has fulfilled its pre-opening responsibilities, such as providing training, site selection assistance, and other support outlined in the franchise agreement. Furthermore, the franchisee must have started business operations before the initial franchise fee is due.

This deferral of fees provides a significant benefit to the franchisee, as it reduces the initial financial burden and risk. It also ensures that Boulder Designs is incentivized to provide the necessary support to get the franchisee up and running. This financial assurance was specifically required by the Hawaii Securities Compliance Branch due to concerns about Boulder Designs's financial stability, offering an extra layer of protection for franchisees in that state.

Prospective franchisees should carefully review the franchise agreement to understand the specific obligations that Boulder Designs must fulfill before the initial franchise fee becomes due. They should also confirm the details of this deferral with the Hawaii Securities Compliance Branch to ensure full compliance and understanding of the terms.