What is the geographical limitation of the post-term non-competition covenant for a Monicals Pizza franchise in Indiana?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
| This Addendum to the Area Development Agreement is agreed to this day of, 20, by and between Monical Pizza Corporation and | ||||
|---|---|---|---|---|
| 1. | In recognition of the requirements of the Indiana Deceptive Franchise Practices Law, IC 23-2.2.7 and the Indiana Franchise Disclosure Law, IC 23-2-2-2.5, the Area Development Agreement for Monical Pizza Corporation is amended as follows: | |||
| | Section 8 of the Area Development Agreement is amended to prohibit unlawful unilateral termination of a franchise unless there is a material violation of the Area Development Agreement and termination is not in bad faith. | |||
| | Section 9.4 of the Area Development Agreement is amended subject to Indiana Code 23-2- 2.7-1(9) to provide that post-term non-competitor covenants shall have geographic limitation of the territory granted to Developer. | |||
| | Section 11.3 of the Area Development Agreement is amended to provide that Developer will not be required to indemnify Franchisor for any liability imposed upon Franchisor as a result of Developer's reliance upon or use of procedures or products, which were required by Franchisor, if such procedures or products were utilized by Developer in the manner required by Franchisor. | |||
| | Section 13.1 of the Area Development Agreement is amended to provide that in the event of a conflict between the laws of Indiana and Illinois, the Indiana Franchise Disclosure Law and/or the Indiana Deceptive Franchise Practices Law will prevail. | |||
| | Section 13.2 of the Area Development Agreement is amended to provide that Developer may commence litigation in Indiana for any cause of action under Indiana law. | |||
| | Section 13.7 of the Area Development Agreement is amended to provide that arbitration between Franchisor and Developer, shall be conducted in Indiana or a site mutually agreed upon. | |||
| 2. | Each provision of this Addendum shall be effective only to the extent that the jurisdictional requirements of the Indiana Law applicable to the provisions are met independently of this Addendum. To the extent this Addendum shall be deemed to be inconsistent with any terms or conditions of said Area Development Agreement or exhibits or attachments thereto, the terms of this Addendum shall govern. IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read this Addendum, and understands and consents to be bound by all of its terms. MONICAL PIZZA CORPORATION: | Developer: | ||
| By: | By: | |||
| Title: | Title: |
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to the 2025 Monicals Pizza FDD, an addendum to the Area Development Agreement addresses non-compete clauses specifically for Indiana franchisees. Section 9.4 of the Area Development Agreement is amended, in accordance with Indiana Code 23-2-2.7-1(9), to ensure that post-term non-compete covenants are geographically limited to the territory granted to the developer. This means that after the franchise agreement ends, the franchisee will only be restricted from operating a competing business within the specific territory they were initially granted by Monicals Pizza.
This addendum acknowledges and complies with the Indiana Deceptive Franchise Practices Law and the Indiana Franchise Disclosure Law. It ensures that the standard non-compete restrictions are modified to align with Indiana state law, which requires a more limited geographic scope. This modification is significant for prospective franchisees in Indiana, as it provides a clearer and more limited restriction on their ability to engage in a competing business after the termination of their franchise agreement.
The Indiana-specific addendum also includes other protections for the franchisee. For example, it addresses unlawful unilateral termination, reliance on franchisor-required procedures, choice of law, venue for litigation, and arbitration location. These modifications collectively aim to provide additional clarity and protection to Monicals Pizza franchisees operating in Indiana, ensuring compliance with state-specific franchise laws.
Prospective Monicals Pizza franchisees in Indiana should carefully review this addendum and understand the specific geographic limitations of the post-term non-compete covenant. They should also consult with a legal professional to fully understand their rights and obligations under Indiana law.