Does the individual agree that the restrictions in the Boulder Designs agreement are fair and reasonable?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
ranchisees, Franchisor has the right to require that all sales made by the competitive business are reported to Franchisor. Individual will also pay to Franchisor, without demand, a weekly fee of $1000, retroactive to the first date of the violation and for each week that the violation continues or until judicial order is entered, without being deemed to revive or modify this Agreement. These payments are liquidated damages to compensate Franchisor for its damages from Individual's violation of this covenant not to compete and are not a penalty. Individual agrees that the length of time and geographical restrictions contained in this Agreement are fair and reasonable and not the result of overreaching, duress or coercion of any kind. Individual agrees that its full, uninhibited and faithful observance of each of the covenants in this Section will not cause any undue hardship financial or otherwise and that the enforcement of each of these covenants in this Section will not impair Individual's ability to obtain employment commensurate with Individual's abilities and on terms fully acceptable to Individual or otherwise to obtain income required for the comfortable support of Individual and Individual's family and the satisfaction of Individual's creditors.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, the individual acknowledges and agrees to the fairness and reasonableness of the restrictions outlined in the franchise agreement. Specifically, the individual agrees that the time and geographical restrictions are fair and not a result of any overreaching, duress, or coercion. This indicates that the individual understands and accepts the limitations placed on them by the agreement, including those related to competition with Boulder Designs.
The individual also agrees that adhering to these restrictions will not cause undue financial hardship or impair their ability to obtain suitable employment or income. This suggests that the individual believes they can comply with the non-compete obligations without significant negative impact on their livelihood. Furthermore, the individual recognizes that their specialized knowledge of the Boulder Designs business could cause serious harm to Boulder Designs and its franchisees if used to benefit a competitor.
This acknowledgment is crucial for Boulder Designs as it reinforces the enforceability of the non-compete clauses. It demonstrates that the franchisee entered the agreement with a clear understanding of the restrictions and their potential impact. This can be important in the event of a dispute where Boulder Designs seeks to enforce these clauses, as the franchisee's prior agreement can be used as evidence of their acceptance of the terms.
Moreover, the document states that the individual certifies they have read the agreement carefully, understand it, and accept the obligations without reservation, and that no promises or representations have been made to induce the signing of the agreement. This further solidifies the individual's commitment to the terms and conditions of the Boulder Designs franchise agreement.