What activities are prohibited under the non-competition covenants after the termination or expiration of a Monicals Pizza franchise agreement?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | or Other Agreement | Summary |
|---|---|---|
| creating a health or safety hazard to customers, employees or the public; engage in any activity reserved to us; fail to comply with laws or regulations after notice of non-compliance; on 2 or more separate occasions, breach the Franchise Agreement or fail to comply with requirements, specifications, standards or procedures on 2 or more occasions within any 12 months; or default under any other agreement between you and us (or an affiliate) such that we (or the affiliate) have the right to terminate the agreement. | ||
| i. Franchisee's obligations on termination/non renewal | Section 17.1 | If the Franchise Agreement is terminated or not renewed, you must: stop operating the franchised restaurant; stop using any trade secret or other confidential information, the System and the Marks; if requested, assign your interest in the franchise location to us; cancel or assign to us any assumed names; promptly return to any third party any leased, loaned or other third-party equipment used in the operation of the franchised restaurant; pay all sums owed to us (or an affiliate) including damages and costs incurred in enforcing the Franchise Agreement; |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 32–41)
What This Means (2025 FDD)
According to the 2025 Monicals Pizza Franchise Disclosure Document, if the Franchise Agreement is terminated or not renewed, the franchisee must comply with the covenants not to compete. The FDD states that the franchisee must stop operating the franchised restaurant and cease using any trade secrets, confidential information, the Monicals Pizza system, and the brand's Marks.
Additionally, the franchisee is obligated to surrender access to and return all paper copies of the Confidential Operations Manual, trade secrets, and all other confidential information to Monicals Pizza. These post-termination obligations are typical in franchising to protect the brand's proprietary information and market position.
It is important for a prospective Monicals Pizza franchisee to carefully review the specific terms of the non-competition covenants within the Franchise Agreement to fully understand the restrictions placed upon them after the termination or expiration of the franchise. This includes understanding the duration and geographic scope of the non-compete, as well as the definition of competitive activities that are prohibited.