How is 'Affiliate' defined in the Boulder Designs franchise agreement regarding non-competition?

According to Boulder Designs's 2025 Franchise Disclosure Document, the term 'Affiliate' is defined within the context of the non-competition clause in the franchise agreement. Specifically, 'Affiliate' means any business entity that controls, is controlled by, or is under common control with the individual franchisee. This definition is important because the non-competition agreement restricts the franchisee from engaging in competitive business activities not only on their own behalf but also on behalf of any affiliate.

This definition has significant implications for a prospective Boulder Designs franchisee. It means that the franchisee's non-compete obligations extend beyond their direct business operations to any other business entity they control, are controlled by, or share common control with. For example, if a franchisee owns a separate landscaping business, that business could be considered an affiliate and thus subject to the non-competition restrictions. This could limit the franchisee's ability to operate or invest in other businesses that might be deemed competitive with Boulder Designs.

The non-competition agreement prevents an individual with a relationship with the franchisee from owning an interest in, managing, operating, providing services to, or being engaged in any competitive business. This restriction applies during the term of the franchise agreement and for a period of two years after the relationship ends. The restricted area is the greater of 25 miles from the franchisee's approved location or the territory defined in the franchise agreement. The definition of 'Affiliate' broadens the scope of this restriction, ensuring that the franchisee cannot circumvent the non-compete obligations through related business entities.

In summary, the definition of 'Affiliate' in the Boulder Designs franchise agreement is a critical component of the non-competition clause. It broadens the scope of the franchisee's obligations, preventing them from using related business entities to engage in activities that would violate the non-compete agreement. Prospective franchisees should carefully consider this definition and its implications for their other business interests before entering into a franchise agreement with Boulder Designs.