When do the Royalty Fees for a Boulder Designs franchise begin, and on what day of each month are they due?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
of Franchisee's failure to timely commence operations of the Franchised Business and shall not be construed as nor considered to be a penalty
Section 3.2 Royalty Fees
Beginning on the date stated on the Key Terms Page and continuing on the first business day of each calendar month thereafter, for so long as this Agreement shall be in effect, Franchisee shall pay to Franchisor without offset, credit or deduction of any nature, Royalty Fees due to Franchisor. The first payment of the Royalty Fees will take place upon execution of this Agreement; the next monthly Royalty Fee payment will take place on the first business day of the calendar month which follows the month in which this Agreement was executed. Other than increases described in the Key Terms Page, Franchisor reserves the right to increase the Royalty Fee up to 30% over the Term of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs's 2025 Franchise Disclosure Document, Royalty Fees begin on the date stated on the Key Terms Page. These fees continue on the first business day of each calendar month for the duration of the Franchise Agreement. The initial Royalty Fee payment is due upon the execution of the agreement. The subsequent monthly Royalty Fee payment is due on the first business day of the month following the month in which the agreement was executed.
In addition to Royalty Fees, Boulder Designs franchisees must also pay a Technology Fee on the first of every month. The amount of this fee is defined on the Key Terms page or in Exhibit 1 of the Franchise Agreement. This Technology Fee covers the costs associated with providing franchisees with technology and technical resources, such as internet resources, website, email, intranet address, and software.
It's important to note that Boulder Designs reserves the right to increase the Royalty Fee by up to 30% over the term of the agreement, provided they give the franchisee 30 days' advance notice. The Technology Fee can also be increased at Boulder Designs's discretion, again with 30 days' notice. Furthermore, the Technology Fee increases automatically each calendar year by an amount not exceeding 10% of the prior year's fee. Franchisees are also responsible for purchasing and maintaining an approved point of sale (POS) system through an approved supplier.
Prospective Boulder Designs franchisees should carefully review the Key Terms Page and Exhibit 1 of the Franchise Agreement to understand the specific amounts and terms related to both the Royalty Fees and the Technology Fees. Understanding these payment obligations is crucial for managing the financial aspects of the franchise.