What must an Antioch Pizza Shop franchisee do upon termination of the franchise agreement?
Antioch_Pizza_Shop Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition, for two (2) years after the termination or expiration of this Agreement, Franchisee shall not carry on, be engaged in or advise in the establishment or operation of any business involving or related to the operation of a restaurant selling pizza, burgers, Italian sandwiches, dessert, or similar businesses described in section (a) above except (i) pursuant to Agreements with Franchisor, or (ii) if Franchisee is not then a party to any other Agreement with Franchisor, only at a site that is at least five and one-half (5 1/2) miles from any Antioch Pizza Shop™ (or successor name) restaurant (including Franchisee's former Restaurant) that is operating or being developed.
Franchisee agrees and acknowledges that this restriction represents only a limited one on Franchisee's ability to conduct a business and that the purpose of this covenant is not to deprive Franchisee of a means of livelihood, and will not do so, but is rather to protect the goodwill and interest of Franchisor, other franchisees and the System.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to the 2025 FDD, an Antioch Pizza Shop franchisee faces certain restrictions after the termination or expiration of their Franchise Agreement. Specifically, for two years following the end of the agreement, the franchisee is restricted from engaging in or advising in the establishment or operation of any business involving or related to a restaurant selling pizza, burgers, Italian sandwiches, desserts, or similar businesses. This restriction applies unless the franchisee enters into agreements with Antioch Pizza Shop or, if not a party to any other agreement with Antioch Pizza Shop, operates at a site at least 5.5 miles away from any Antioch Pizza Shop restaurant (including the franchisee's former location) that is operating or being developed.
This post-termination covenant is designed to protect the goodwill and interests of Antioch Pizza Shop, its other franchisees, and the overall system. The FDD acknowledges that this restriction is a limited one on the franchisee's ability to conduct business and is not intended to deprive the franchisee of a means of livelihood. The agreement emphasizes that its purpose is to safeguard the brand and prevent unfair competition by former franchisees who have gained knowledge and experience operating within the Antioch Pizza Shop system.
These types of non-compete clauses are common in franchising to protect the brand and prevent franchisees from using the franchisor's confidential information and business model to compete against the system after leaving. Prospective Antioch Pizza Shop franchisees should carefully consider the implications of this restriction, particularly if they plan to remain in the restaurant industry after their franchise agreement ends. Understanding the geographic limitations and the types of businesses restricted is crucial for future planning.