What section of the Boulder Designs Franchise Agreement discusses the franchisee's obligation regarding insurance?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Before opening the Franchised Business and commencing business, Franchisee must:
i. fulfill all of its obligations pursuant to the other provisions of this Section 5.6;
- ii. furnish Franchisor with copies of all insurance policies required by this Agreement and by the lease (if the Approved Location is leased), or such other evidence of insurance coverage and payment of premiums as Franchisor may request;
- iii. complete initial training to the satisfaction of Franchisor;
- iv. hire and train the personnel necessary or required for the operation of the Franchised Business;
- v. obtain all necessary permits and licenses;
- vi. purchase all Opening Project inventory not purchased pursuant to Section 5.4, as stated in Section 8.2;
- vii. if Franchisee is a business entity, Franchisee has caused each of its stock certificates or other ownership interest certificates to be conspicuously endorsed upon the face thereof a statement in a form satisfactory to Franchisor that such ownership interest is held subject to, and that further assignment or transfer thereof is subject to, all restrictions imposed upon transfers and assignments by this Agreement; and
- viii. pay in full all amounts due to Franchisor, or execute the Promissory Note and Security Agreement (attached hereto as Exhibit 9, if applicable) for any amounts due Franchisor.
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 22–23)
What This Means (2025 FDD)
According to the 2025 Boulder Designs Franchise Disclosure Document, Section 5.5 of the Franchise Agreement outlines the franchisee's obligations before opening their franchised business, including insurance requirements. Specifically, it states that the franchisee must furnish Boulder Designs with copies of all insurance policies required by the agreement and the lease (if applicable), or provide other evidence of insurance coverage and premium payments as requested by Boulder Designs.
This requirement ensures that franchisees have adequate insurance coverage to protect both their business and Boulder Designs from potential liabilities. Franchisees must provide proof of this insurance coverage to Boulder Designs before commencing operations. This is a standard practice in franchising, as franchisors typically require franchisees to maintain certain insurance levels to mitigate risks and protect the brand's reputation.
For a prospective Boulder Designs franchisee, this means understanding the specific insurance requirements detailed elsewhere in the Franchise Agreement or in related documents. They should budget for these insurance costs and ensure they can obtain the necessary coverage before opening their business. Failure to provide the required insurance documentation could delay the opening of the franchise and potentially lead to a breach of the Franchise Agreement.