Does the definition of 'Covered Person' for Boulder Designs include the franchisee's siblings?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Covered Person" means (i) the individual executing this Agreement as Franchisee; (ii) each Owner, officer, director, manager, trustee, or general partner and Internal Manager of Franchisee and each Franchisee Affiliate if Franchisee is a Business entity; and (iii) the spouse, adult children, parents, collaterals, or siblings of the individuals included in (i) and (ii).
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, the definition of "Covered Person" does include the franchisee's siblings. This definition is important because it identifies individuals who are subject to certain obligations and restrictions under the franchise agreement, particularly those related to confidentiality and non-competition.
Specifically, the FDD states that a "Covered Person" includes not only the individual franchisee or the owners/officers of a business entity franchisee, but also the spouse, adult children, parents, collaterals, or siblings of those individuals. This broad definition means that these family members are also bound by certain terms of the franchise agreement.
This has significant implications for a prospective Boulder Designs franchisee. It means that the franchisee must ensure that these "Covered Persons" understand and comply with the confidentiality and non-competition clauses in the agreement. For example, these individuals cannot have an interest in or perform services for a competing business during the term of the franchise agreement. The franchisee could be held responsible if a sibling breaches these provisions, potentially leading to legal or financial repercussions.
It is important for prospective franchisees to carefully review the definition of "Covered Person" and understand the obligations and restrictions that apply to these individuals. Franchisees should discuss these provisions with their family members to ensure everyone is aware of their responsibilities under the Boulder Designs franchise agreement.