When transferring a Monicals Pizza franchise, what must the franchisee do regarding obligations owed to the Franchisor?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: RECEIPTS]
17. RIGHTS AND DUTIES UPON EXPIRATION OR TERMINATION
17.1 Actions to be Taken
Except as otherwise provided herein, upon termination or expiration, this Agreement and all rights granted hereunder to Franchisee shall terminate and Franchisee shall:
- 17.1.1 immediately cease to operate the Franchised Restaurant and shall not thereafter, directly or indirectly, represent to the public or hold itself out as a present or former franchisee of Franchisor;
- 17.1.2 cease to use the Trade Secrets and other Confidential Information, the System and the Marks including, without limitation, all signs, slogans, symbols, logos, advertising materials, stationery, forms and any other items which display or are associated with the Marks;
- 17.1.3 upon demand by Franchisor immediately assign (or, if an assignment is prohibited and Franchisor approved the form of lease containing such prohibition, sublease for the full remaining term, and on the same terms and conditions as Franchisee's lease) its interest in any lease then in effect for the Approved Location to Franchisor, and Franchisee shall furnish Franchisor with evidence satisfactory to Franchisor of compliance with this obligation within thirty (30) days after termination or expiration of this Agreement, and Franchisor has the right to pay rent and other expenses directly to the party to whom such payment is ultimately due;
- 17.1.4 take such action as may be necessary to cancel or assign to Franchisor, at Franchisor's option, any assumed name or equivalent registration filed with state, city or county authorities
which contains the name "MONICAL'S PIZZA®" or any other Mark, and Franchisee shall furnish Franchisor with evidence satisfactory to Franchisor of compliance with this obligation within thirty (30) days after termination or expiration of this Agreement;
- 17.1.5 promptly return to any third party any leased, loaned or other third-party equipment used in the operation of the Franchised Restaurant, except to the extent Franchisor shall otherwise direct in writing by which Franchisor shall agree to assume the responsibility of Franchisee with respect thereto under any applicable lease or agreement, but without release of the original liability of Franchisee thereunder;
- 17.1.6 pay all sums owing to Franchisor and any Affiliate. In the event of termination for any default of Franchisee, such sums shall include, but not be limited to, all damages, costs and expenses, including reasonable attorneys' fees, with respect to litigation, arbitration, appellate or bankruptcy proceedings, unpaid Royalty Fees, loss of future royalty Fee payments incurred by Franchisor as a result of any early termination of this Agreement, and any other amounts due to Franchisor or any Affiliate;
- 17.1.7 pay to Franchisor all costs and expenses, including reasonable attorneys' fees, incurred by Franchisor subsequent to the termination or expiration of the Franchise in obtaining injunctive or other relief for the enforcement of any provisions of this Agreement;
- 17.1.8 immediately surrender access to and return any paper copies of the Confidential Operations Manual, Trade Secrets and all other Confidential Information including records, files, instructions, brochures, agreements, disclosure statements and any and all other materials provided by Franchisor to Franchisee relating to the operation of the Franchised Restaurant, all of which are acknowledged by Franchisee to be Franchisor's property;
- 17.1.9 assign all telephone listings and numbers and e-mail addresses for the Franchised Restaurant to Franchisor, notify the telephone company, Internet service provider and all listing agencies of the termination or expiration of Franchisee's right to use any telephone numbers, facsimile numbers, e-mail addresses and on-line identifiers associated with the Marks in any regular, classified or other telephone directory or Internet listing, and authorize transfer of same to or at the direction of Franchisor; and
- 17.1.10 comply with all other applicable provisions of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to the 2025 Monicals Pizza Franchise Disclosure Document, upon termination or expiration of the franchise agreement, the franchisee has several obligations to fulfill. The franchisee must immediately cease operating the Monicals Pizza restaurant and abstain from representing themselves as a current or former franchisee. They are also required to stop using any trade secrets, confidential information, the Monicals Pizza system, and any associated marks, including signs, slogans, logos, and advertising materials.
Additionally, the franchisee must assign their interest in any lease for the approved location to Monicals Pizza, or sublease if assignment is prohibited, and provide evidence of compliance within 30 days. Monicals Pizza has the right to pay rent and other expenses directly to the party to whom payment is due. The franchisee must also take necessary actions to cancel or assign any assumed name registrations to Monicals Pizza.
Furthermore, the franchisee is obligated to return leased equipment, pay all sums owed to Monicals Pizza and its affiliates, including damages, costs, attorney's fees, unpaid royalty fees, and losses from early termination. They must also surrender access to and return all confidential information, including the operations manual and trade secrets. Finally, the franchisee must assign all telephone listings, numbers, and email addresses to Monicals Pizza and comply with all other applicable provisions of the franchise agreement.