What right does a Boulder Designs franchisee waive regarding the restrictive covenants in the franchise agreement?
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 the 2025 Boulder Designs Franchise Disclosure Document, a franchisee acknowledges the fairness and reasonableness of the restrictive covenants within the franchise agreement. Specifically, the franchisee agrees that the time and geographical restrictions are fair and not the result of any overreaching, duress, or coercion. This means a franchisee gives up the right to later claim these restrictions are unfair or were imposed under pressure.
Furthermore, the franchisee certifies they understand and accept the obligations imposed by the agreement without reservation, and that no promises or representations have been made to induce them to sign the agreement. This statement aims to prevent franchisees from later claiming they were misled or coerced into signing the agreement based on promises not written in the contract.
In practical terms, this clause is designed to protect Boulder Designs from legal challenges to the non-compete and other restrictive clauses in the agreement. A prospective franchisee should carefully consider the implications of these waivers and ensure they fully understand and accept the restrictions before signing the agreement. It is advisable to seek legal counsel to review the franchise agreement and understand the full extent of these waivers.