Does the note payable to an officer of Boulder Designs have a stated interest rate?

According to Boulder Designs' 2025 Franchise Disclosure Document, a portion of the notes payable is to a company officer. As of December 31, 2024 and 2023, $90,000 was due to an officer of Boulder Designs. The document specifies that this particular note does not have a stated interest rate. This means Boulder Designs is not obligated to pay interest on this specific $90,000 note.

For a prospective franchisee, this detail is important for understanding the financial obligations and related-party transactions of Boulder Designs. While the absence of interest on this note might seem beneficial for the company, it's crucial to consider the broader context of related-party transactions. Such transactions can influence the company's profitability, as the terms and prices of services charged to Boulder Designs can be determined by the member involved.

It is important to note that while this specific note payable to an officer does not have a stated interest rate, other notes payable may have different terms. For instance, the FDD mentions that notes payable include three notes payable on demand with an aggregate balance of $248,000 and $255,000 for 2024 and 2023, respectively. One of these notes bears interest at 4%, while the other two do not have a stated interest rate. Therefore, franchisees should carefully review all financial statements and related notes to fully understand the company's debt structure and obligations.