During the term of the Cicis franchise agreement, can an owner's immediate family member own a competing business?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
th the actions specified in this Section 9.B, you hereby irrevocably designate and appoint us and our duly authorized officers and agents as your agent and attorney in fact, which appointment is coupled with an interest and is irrevocable, to act for and on your behalf to execute, verify, and file any such documents and to do all other lawfully permitted acts to further the purposes of this Section 9.B with the same legal force and effect as if executed by you.
C. Noncompetition Covenants. You acknowledge that you, your Owners, your employees, and your other representatives will receive valuable training and access to Confidential Information during the Term which are beyond your and their present skills and experience, including information regarding our operational, sales, and promotional and marketing methods and techniques and those of the System. You acknowledge that (i) such specialized training and Confidential Information provide a competitive advantage and will be valuable to each of you in the development and operation of your Restaurant, and (ii) gaining access to such specialized training and Confidential Information is, therefore, a primary reason for entering into this Agreement. In consideration for such specialized training, Confidential Information and rights, you agree that:
- (1) during the Term, except as we otherwise approve in writing, neither you nor any of your Owners and Operator (and members of their immediate family) will, either directly or indirectly, anywhere in the world, for yourself or themselves or through, on behalf of, or in conjunction with any other Person:
- (a) divert, or attempt to divert, any business or customer of your Restaurant to any competitor, by direct or indirect inducement or otherwise;
- (b) except with respect to other Cicis Restaurants operated under valid franchise agreements with us, own, maintain, operate, engage in, be employed by, or have any financial or beneficial interest in, advise, assist, aid, make loans to, act as landlord to, or otherwise support, anywhere in the world, any Competing Business (defined below); or
- (1) during the Term, except as we otherwise approve in writing, neither you nor any of your Owners and Operator (and members of their immediate family) will, either directly or indirectly, anywhere in the world, for yourself or themselves or through, on behalf of, or in conjunction with any other Person:
(c) interfere with our relationships with any supplier to Cicis Restaurants or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System; and
(2) for a continuous uninterrupted period commencing upon the expiration or termination of, or a Transfer (defined below) described in, this Agreement and continuing for two (2) years thereafter, except as we otherwise approve in writing, neither you nor any of your Owners and Operator (and members of their immediate family) will, directly or indirectly, for yourselves, or through, on behalf of, or in conjunction with any other Person, by direct inducement or otherwise, engage in any activities described in Section 9.C(1) above in respect of any Competing Business:
- (a) at the Location; or
- (b) within the Protected Area; or
- (c) if this Agreement is executed pursuant to a development agreement, within the development area described therein; or
- (d) within a 10-mile radius of (i) the Location, (ii) the Protected Area, (iii) the development area, if applicable, or (iv) any Cicis Restaurant or other Cicis-branded food service facility in existence or under construction as of the date of this Agreement or at the commencement of the obligation described in this Section 9.C(2).
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to the 2025 Cicis Franchise Disclosure Document, during the term of the franchise agreement, neither the franchisee, nor any of the franchisee's owners and operators (including members of their immediate family) can own, maintain, operate, engage in, be employed by, or have any financial or beneficial interest in, advise, assist, aid, make loans to, act as landlord to, or otherwise support, anywhere in the world, any Competing Business, except with Cicis's written approval or with respect to other Cicis Restaurants operated under valid franchise agreements with Cicis. A Competing Business is defined as a business that derives more than 50% of its revenue from selling pizza using the distribution methods Cicis authorizes, functions as a commissary to sell or lease to or supply any such business, or grants franchises or licenses for or provides services to any of the foregoing.
This non-compete restriction is in place to protect Cicis's competitive advantage, which stems from the specialized training and confidential information franchisees receive. Cicis considers this training and information crucial for the development and operation of the restaurant. The agreement specifies that these restrictions apply to the franchisee, their owners, operators, employees, and immediate family members to prevent any direct or indirect support of competing businesses.
After the franchise agreement expires, the franchisee and their immediate family are still restricted from engaging in a Competing Business for two years. This restriction applies to the specific location of the Cicis restaurant, the protected area around it, or within a 10-mile radius of the Cicis location. This extended restriction is designed to further protect Cicis's market position and prevent former franchisees from leveraging their knowledge of the Cicis system to benefit a competitor in close proximity to a Cicis restaurant.
These non-compete clauses are standard practice in franchising to protect the brand and system. Prospective Cicis franchisees should carefully consider these restrictions and how they might impact their family's business activities, both during the term of the franchise agreement and for the two-year period following its expiration or termination.