Does the definition of 'Covered Person' for Boulder Designs include general partners of the franchisee?
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 general partners of the franchisee. Specifically, if the franchisee is a business entity, then each owner, officer, director, manager, trustee, or general partner of the franchisee is considered a "Covered Person".
This definition is important because "Covered Persons" may be subject to certain obligations or restrictions under the franchise agreement. For example, Boulder Designs may require "Covered Persons" to execute a standard form non-disclosure or non-competition agreement. This means that general partners could be personally bound by confidentiality and non-compete obligations, even if they are not directly involved in the day-to-day operations of the franchise.
Prospective Boulder Designs franchisees should carefully consider the implications of the "Covered Person" definition, especially if they plan to operate the franchise through a partnership or other business entity. They should also review the non-disclosure and non-competition agreements to understand the specific restrictions that may apply to general partners and other "Covered Persons."