What is considered a 'Competing Business' for a Carbones Pizzeria franchise?

According to Carbones Pizzeria's 2025 Franchise Disclosure Document, a 'Competing Business' is defined as any eat-in, take-out, or combination eat-in/take-out restaurant or other facility that serves pizza. This definition is crucial for franchisees to understand, as it directly impacts their obligations under the covenant not to compete, both during the term of the franchise agreement and for a period of two years after termination or assignment of the agreement.

During the term of the agreement, a Carbones Pizzeria franchisee is prohibited from operating, owning, managing, or being employed by or consulting with any Competing Business, other than one operated under a valid franchise agreement with Carbones Pizzeria. This restriction also extends to any business or venture that is granting franchises or licenses for the operation of a Competing Business. Furthermore, franchisees are prohibited from diverting or attempting to divert any customer or potential customer to any competitor of the Carbone System.

Post-termination or assignment, the restrictions continue for two years within a defined Restricted Area. This area includes the Franchisee Territory, a radius of 25 miles from the Franchisee Territory, and a radius of 5 miles from any other restaurant or facility operated under the Carbones Pizzeria brand. Violation of these non-compete terms can result in legal action, including injunctive relief, as Carbones Pizzeria asserts that damages from such breaches are not easily compensated by monetary means. The definition of 'Competing Business' is therefore a cornerstone of the franchise agreement, designed to protect Carbones Pizzeria's market position and trade secrets.