Is a Boulder Designs franchisee's spouse considered a 'Covered Person'?
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, a franchisee's spouse is considered a 'Covered Person.' The FDD defines 'Covered Person' to include not only the individual franchisee and owners/officers of a business entity franchisee, but also the spouse, adult children, parents, collaterals, or siblings of those individuals. This definition has significant implications for franchisees and their families.
As a 'Covered Person,' the spouse is subject to certain restrictions and obligations outlined in the franchise agreement. Most notably, 'Covered Persons' are prohibited from holding an interest in or performing services for any Competitive Business during the term of the agreement. This restriction aims to protect Boulder Designs' trade secrets and confidential information by preventing those with close ties to the franchisee from engaging in competing ventures.
This broad definition of 'Covered Person' means that the franchisee's spouse must also avoid any involvement with businesses that offer similar products or services to Boulder Designs. This could potentially limit the spouse's career options or business ventures during the term of the franchise agreement. Prospective franchisees should carefully consider these restrictions and discuss them with their spouse before entering into a franchise agreement with Boulder Designs.