What is the duration of the post-termination covenant not to compete for a Boulder Designs franchise?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as otherwise approved in writing by Franchisor, neither Franchisee, nor any Covered Person shall, for a period of three years after the expiration or termination of this Agreement, regardless of the cause of termination, either directly or indirectly, for themselves or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other business entity:
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs's 2025 Franchise Disclosure Document, a franchisee is subject to a post-termination covenant not to compete for a period of three years. This restriction applies after the expiration or termination of the Franchise Agreement, regardless of the reason for termination.
During this three-year period, unless otherwise approved in writing by Boulder Designs, the franchisee (or any 'Covered Person') is prohibited from directly or indirectly engaging in competitive activities. This includes working for, owning, or being involved with any business that competes with Boulder Designs. The non-compete aims to protect Boulder Designs's trade secrets, confidential information, and investments in franchisee training.
These restrictions are acknowledged by Boulder Designs as fair and reasonable, considering the franchisee's skills and opportunities to derive income from other endeavors. The FDD states that these covenants are necessary to protect the franchisor's interests and investments in the franchise system. Prospective franchisees should carefully consider the implications of this non-compete agreement and how it might affect their future business opportunities after leaving the Boulder Designs system.