What is the geographic scope of the non-competition covenant after the Carbones Pizzeria franchise is terminated or expires?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary | |
|---|---|---|---|
| Franchise Agreement | new initial franchise fee). (See also “Noncompetition covenants after the franchise is terminated or expires” below.) | ||
| n. Franchisor’s right of first | Section 13(a) | We can match any offer for your business | |
| refusal to acquire franchisee’s business | |||
| o. Franchisor’s option to purchase franchisee’s business | Section 16 | We have right to purchase your inventory and merchandise bearing the Marks upon termination or expiration without renewal of yourfranchise. | |
| p. Death or disability of franchisee | Section 14 | Your heirs can assume your rights, but if they do, they must meet the transfer requirements. | |
| q. Non-competition covenants during the term of the franchise | Section 4 | No involvement in competing business anywhere during the term of the Franchise Agreement or in any business or venture that is granting franchises or licenses for the operation of a competing business. A competing business an eat-in, or take-out, or combination eat-in/take out restaurant of other facility which serves pizza. | |
| r. Non-competition covenants after the franchise is terminated or expires | Section 4 | No involvement in any competing business for 2 years in the Franchisee Territory, within a radius of 25 miles from the Franchisee Territory or a radius of 5 miles from any other restaurant or other facility operated under the Marks. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 24–26)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, after the franchise is terminated or expires, the franchisee is restricted from involvement in any competing business for a period of 2 years. This restriction applies within the Franchisee Territory, within a 25-mile radius from the Franchisee Territory, or within a 5-mile radius from any other restaurant or facility operating under the Carbones Pizzeria Marks.
This non-compete agreement also extends to any business or venture that grants franchises or licenses for operating a competing business. A competing business is defined as an eat-in, take-out, or combination eat-in/take-out restaurant or other facility that serves pizza.
For a prospective Carbones Pizzeria franchisee, this means that upon termination or expiration of the franchise agreement, they will be significantly limited in their ability to operate or be involved with any pizza-related business within a substantial geographic area. This restriction is in place to protect Carbones Pizzeria's market share and brand recognition. Franchisees should carefully consider these limitations before entering into a franchise agreement, as they could impact future business opportunities.