What is the geographic scope of the post-termination covenant not to compete for a Boulder Designs franchise, in relation to the Approved Location?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
- i. own an interest in, manage, operate or provide services to any Competitive Business located or operating (a) within 25 miles of the Approved Location or within the Territory (whichever is greater), and (b) within 25 miles of the location of any other BOULDER DESIGNS Business in existence at the time of termination or expiration; or
- ii. solicit or otherwise attempt to induce or influence any customer, employee or other business associate of Franchisor, its Affiliate(s) or any other franchisee to terminate or modify his, her or its business relationship with Franchisor, its Affiliate(s) or any other franchisee, by direct or indirect inducement or otherwise.
In furtherance of this Section, Franchisor has the right to require officers, managers, and partners along with certain individuals and any Covered Person to execute a standard form non-disclosure or noncompetition agreements in a form the same as the Non-Disclosure and Non-Competition Agreement attached as Exhibit 2.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, the post-termination covenant not to compete restricts a franchisee from engaging in a competitive business within a specific geographic area. Specifically, for three years after the franchise agreement terminates or expires, the franchisee is restricted from owning, managing, operating, or providing services to a competitive business.
This restriction applies to businesses located or operating within 25 miles of the Approved Location or within the Territory, whichever is greater. It also extends to businesses within 25 miles of any other Boulder Designs location that exists at the time of termination or expiration. This means a former franchisee cannot operate a competing business near their old location or near any other existing Boulder Designs franchise.
This non-compete agreement also prevents the franchisee from soliciting or attempting to influence any customer, employee, or business associate of Boulder Designs, its affiliates, or any other franchisee to terminate or modify their relationship with them. This provision aims to protect Boulder Designs' customer base and business relationships. The franchisor can also require officers, managers, partners, and certain individuals to sign non-disclosure and non-competition agreements.