What happens if a Carbones Pizzeria franchisee abandons the restaurant?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary |
|---|---|---|
| Franchise Agreement | ||
| a. Length of the Franchise term | Section 2 | 10 years from date of signing the Franchise Agreement |
| b. Renewal or extension of the term | Section 2 (See Note 2) | One 10 year term |
| c. Requirements for franchisee to renew or extend | Section 2 | Sign new agreement (which may contain materially different terms and conditions than your original Franchise Agreement), pay renewal fee, update your Restaurant to meet our then-current requirements for new restaurants |
| d. Termination by franchisee | None | Not applicable |
| e. Termination by franchisor without | None | Not applicable |
| cause | ||
| f. Termination by franchisor with cause | Section 15 | We may terminate only if you do one of the things described in Section 15 |
| g. "Cause" defined – curable defaults | Sections 15(e) through 15(f) | You have 30 days to cure nonpayment of fees, sanitation problems, non submission of reports and any other default not listed in Section 15 |
| h. "Cause" defined – non-curable defaults | Sections 15(a) through 15(d) | Non curable defaults include abandonment, trademark misuse and conviction of an offense directly related to the Restaurant business |
| i. Franchisee's obligations on termination/nonrenewal | Section 16 | Obligations include complete de identification and payment of amounts due. (See also "Noncompetition covenants after the franchise is terminated or expires" below.) |
| j. Assignment of contract by franchisor | No restriction on our right to assign | |
| k. "Transfer" by franchisee – defined | Sections 13 and 14 | Includes transfer of Franchise Agreement or assets or ownership change |
| l. Franchisor's approval of transfer by franchisee | Section 13 | We have the right to approve all transfers but will not unreasonably withhold approval so long as all conditions to transfer have been satisfied |
| m. Conditions for franchisor approval of transfer | Section 13(b) | New franchisee qualifies, transfer fee paid, training completed, release signed by you and current agreement signed by new franchisee. |
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, abandonment of the restaurant constitutes a non-curable default under the franchise agreement. This means that Carbones Pizzeria can terminate the franchise agreement immediately if a franchisee abandons the restaurant.
Upon termination, the franchisee has specific obligations. These include de-identifying the restaurant completely, which means removing all Carbones Pizzeria branding and trademarks from the location. The franchisee must also pay all outstanding amounts due to Carbones Pizzeria. Additionally, the franchisee is subject to non-competition covenants, which restrict their involvement in any competing pizza business for a period of two years after termination. These restrictions apply within the franchisee's territory, within a 25-mile radius of the territory, or within a 5-mile radius of any other Carbones Pizzeria restaurant.
Furthermore, Carbones Pizzeria has the option to purchase the franchisee's inventory and merchandise bearing the Carbones Pizzeria marks upon termination. This is a standard clause in many franchise agreements to ensure brand consistency and control over remaining assets after a franchise ceases operation. Abandonment is a serious breach of the franchise agreement, leading to immediate termination and significant post-termination obligations for the franchisee.