Are there any exceptions to the cancellation of previous agreements with Antioch Pizza Shop?
Antioch_Pizza_Shop Franchise · 2025 FDDAnswer from 2025 FDD Document
th the intention of complying with its terms and conditions through the term of this Agreement and not for the purpose of resale of the developmental rights hereunder.
9. POST-TERMINATION COVENANTS
- 9.1 Unless otherwise specified, the term "Developer" as used in this Section 9 shall include each and every Owner of Developer.
- 9.2 Developer specifically acknowledges that, pursuant to this Agreement, Developer will have access to the Confidential Information. Accordingly, Developer covenants that Developer and its Owners shall not, for a period of two (2) years after the expiration or termination of this Agreement, regardless of the cause of termination, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with any person, persons, or entity:
- (a) own, maintain, operate, engage in, consult with or have any interest in (as disclosed or beneficial owner) any business which offers products or services which are the same as, or similar to, those offered by Antioch Pizza Shop Restaurants, or any entity which is granting franchises or licenses for any business which offers products or services which are the same as, or similar to, those offered by Antioch Pizza Shop Restaurants within the Development Area, or within a five and one-half (5 ½) mile radius of any existing Antioch Pizza Shop Restaurant, except under a validly existing Franchise Agreement with Franchisor. You acknowledge and agree that, after the date of this Agreement, other Antioch Pizza Shop Restaurants may open, thereby expanding the geographical area in which you will not be able to compete with us; and
- (b) directly or indirectly divert or attempt to divert any former business or customer of an Antioch Pizza Shop Restaurant to any competitive business.
The ownership of five percent (5%) or less of a publicly traded Franchisor will not be deemed to be prohibited by this paragraph.
9.3 Court Modification of Agreement**.** You agree that this form of Agreement is prepared for use in many jurisdictions with differing public policies and that such public policies change. Accordingly, you agree that the prevailing non-competition restrictions set forth above may be modified by a Court to the extent necessary to make the non-competition agreements valid and enforceable against you.
MUDA 2025 - 8 -
- 9.4 Enforcement of Covenants Not to Compete. You acknowledge that violation of the covenants not to compete contained in this Agreement would result in immediate and irreparable injury to us for which no adequate remedy at law will be available. Accordingly, you hereby acknowledge that we may seek to obtain the entry of an injunction prohibiting any conduct by you or your Owners in violation of the terms of the covenants not to compete set forth in this Agreement.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to the 2025 FDD, there are specific instances where previous agreements with Antioch Pizza Shop may not be cancelled, particularly concerning post-termination non-compete clauses. Specifically, the non-compete agreement does not prevent ownership of five percent or less of a publicly traded franchisor.
Additionally, the FDD states that the non-competition restrictions may be modified by a court to the extent necessary to make the non-competition agreements valid and enforceable against the franchisee. This implies that the standard terms might be altered based on jurisdictional public policies or specific legal challenges.
Furthermore, after the termination or expiration of the agreement, a franchisee is restricted from engaging in a similar business for two years, unless it's pursuant to agreements with Antioch Pizza Shop or if the site is at least five and one-half miles from any Antioch Pizza Shop restaurant. These exceptions provide some flexibility for former franchisees under certain conditions.