What specific obligation does the Boulder Designs franchisee have regarding the initial fee?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon execution of this Agreement, Franchisee shall pay Franchisor an Initial Training Fee in the amount specified in Exhibit 1, Key Terms Page. The initial training program consists of approximately five business day(s) of classroom training and on-the-job initial training program for the Franchisee and its initial manager. Instruction pertains to all material aspects of the operation of a BOULDER DESIGNS Business, including such topics as: BOULDER DESIGNS mission and principles; establishment of your business structure; legal filings; business licenses; banking and checking accounts; insurance; accounting and legal support; computer system and software installation; set up accounting systems; market research; marketing plan; optional establishment of office lease; employment suggestions; incoming call scripts; office administration; administrative management training; trademark usage guidelines; maintenance of quality standards; customer service techniques; record keeping and reporting procedures; other operational issues; resale, transfer, renewals and assignment training; vendor interaction and ordering, and on-the-job training. Franchisor shall conduct the initial training program either in person at its headquarters or at another designated location or locations, as Franchisor requires. Initial Training amount is fully earned and nonrefundable upon completion of the Franchisee's training. If Franchisee does not successfully complete the initial training, Franchisor reserves the right to deduct any amount from Franchisee's Initial Training Fee to cover Franchisor's expense and the cost of providing the initial training course in addition to Franchisee paying Franchisor the On-Site Training Cancellation Fee and the other rights of Franchisor pursuant to this agreement.
Initial Training Fee is allocated to Franchisor's cost and expense in providing such training to the Franchisee and its initial manager; however, all expenses incurred by Franchisee and its employees in attending such program including, but not limited to, travel costs, room and board expenses and employees' salaries, shall be the sole responsibility of Franchisee. Additional trainees will be at the then-current published rates. Any additional individuals or new internal managers are subject to fees under Section 8.4 of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, a franchisee is obligated to pay an Initial Training Fee upon the execution of the Franchise Agreement. The specific amount of this fee is detailed in Exhibit 1, Key Terms Page, of the agreement. This fee covers the initial training program, which consists of approximately five business days of classroom and on-the-job training for both the franchisee and their initial manager. The training encompasses various aspects of operating a Boulder Designs business, including the company's mission, business structure, legal filings, licensing, banking, insurance, accounting, computer systems, marketing, and customer service.
The Initial Training Fee is allocated to cover Boulder Designs' costs and expenses in providing the training. However, franchisees are responsible for their own travel, lodging, and salary expenses incurred while attending the training program. Additional trainees beyond the franchisee and initial manager will incur further fees at the then-current published rates, as outlined in Section 8.4 of the agreement.
It's important to note that the Initial Training Fee is considered fully earned and nonrefundable once the franchisee completes the training. However, if a franchisee does not successfully complete the initial training, Boulder Designs reserves the right to deduct expenses from the Initial Training Fee to cover their costs of providing the training course. Additionally, the franchisee may be required to pay an On-Site Training Cancellation Fee, as well as be subject to other rights of Boulder Designs as specified in the agreement. This highlights the importance of franchisees fully committing to and completing the initial training program to avoid potential financial penalties.