Under what circumstances may a Boulder Designs Franchisee be entitled to additional time to commence operation of the Franchised Business?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
red and as to which Franchisor may consent, provided such request for extension is provided to Franchisor in writing at least 30 days after the Effective Date.
Section 5.4 Failure to Begin Operations
Should Franchisee fail to begin operating the Franchised Business within 180 days after the Effective Date, Franchisor has the right to terminate this Agreement with no refund to Franchisee of any amounts if Franchisee fails to cure such default within a thirty (30) day period.
Section 5.5 Opening
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 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, a franchisee is generally required to begin operating their franchised business within 180 days of the effective date of the franchise agreement. Failure to do so can result in the termination of the agreement, with no refund of any amounts paid to Boulder Designs, if the franchisee does not correct the failure within a 30-day period.
Before opening, the Boulder Designs franchisee must fulfill several obligations, including providing copies of required insurance policies, completing initial training to Boulder Designs' satisfaction, hiring and training necessary personnel, obtaining all necessary permits and licenses, purchasing required inventory, ensuring that ownership interest certificates are properly endorsed if the franchisee is a business entity, and paying all amounts due to Boulder Designs. Compliance with these conditions is essential for the franchisee to be prepared to continuously operate the franchised business within the specified timeframe.
The FDD excerpt does not explicitly state any circumstances under which a Boulder Designs franchisee may be granted additional time to commence operations beyond the initial 180-day period. It only outlines the conditions that must be met and the consequences of failing to begin operations within the given timeframe. A prospective franchisee should directly ask Boulder Designs about the possibility of extensions and under what specific circumstances they might be granted.