What is the definition of 'Franchisee's Territory' in relation to the non-compete agreement for Beggars Pizza?

According to Beggars Pizza's 2025 Franchise Disclosure Document, the non-compete agreement signed by the franchisee's managers and other personnel with access to confidential information includes a clause that restricts them from engaging in competitive business activities. Specifically, for two years after leaving their position with the franchisee, they cannot be involved with any business that offers or sells similar food items to Beggars Pizza within the franchisee's territory.

The definition of the 'Franchisee's Territory' is critical in determining the scope of this non-compete obligation. The agreement states that the competitive business cannot be located at or within the 'Franchisee's Territory as defined in Franchisee's franchise agreement with Franchisor'. The document also states that the boundaries of the territory have been described to the employee. In addition to the franchisee's territory, the non-compete also applies within a 10-mile radius of the franchisee's Beggars Pizza restaurant or within a 10-mile radius of any business operating under Beggars Pizza's marks.

This means that a former employee is restricted from working for a competitor not only within the specific territory granted to the franchisee but also within a broader 10-mile radius of any Beggars Pizza location. The franchisee should ensure that their employees understand the defined territory and the extended radius to avoid potential legal issues related to the non-compete agreement. The employee also acknowledges that violating the agreement will cause irreparable harm to both the franchisor and franchisee and that the franchisor and/or franchisee may apply for an injunction to prevent any violation of the agreement.

Prospective franchisees should carefully review the definition of 'Franchisee's Territory' in their franchise agreement to fully understand the geographic scope of the non-compete obligations for their employees. This will help in managing the risks associated with employee turnover and potential competition. Franchisees should also ensure that their employees are fully aware of these restrictions and that they understand the implications of violating the non-compete agreement.