What non-competition covenants must a transferring Petro Stopping Center franchisee and their owners sign?
Petro_Stopping_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
(n) you and your transferring Owners (and your and your Owners' spouses) must sign a non-competition covenant in favor of us agreeing to be bound, commencing on the effective date of the transfer, by the restrictions contained in this Agreement; and
(o) you and your transferring Owners must agree that you and they will not directly or indirectly at any time or in any manner (except with respect to other Petro Centers you own and operate) identify yourself or themselves or any business as a current
or former Petro Center, or as one of our licensees or franchisees, use any Mark, any colorable imitation of a Mark, or other indicia of a Petro Center in any manner or for any purpose or utilize for any purpose any trade name, trade or service mark or other commercial symbol that suggests or indicates a connection or association with us.
Depending on the nature of the transfer, we may choose, in our sole discretion, to waive certain of the foregoing conditions to the extent we deem them inapplicable to the transfer.
Source: Item 14 — Other investments (FDD pages 131–208)
What This Means (2025 FDD)
According to Petro Stopping Center's 2025 Franchise Disclosure Document, both the transferring franchisee and their owners must adhere to specific non-competition covenants. These covenants are designed to protect Petro Stopping Center's interests and maintain the integrity of its brand.
Specifically, the transferring franchisee and their owners (including their spouses) must sign a non-competition covenant in favor of Petro Stopping Center. This agreement binds them to the restrictions outlined in the franchise agreement, starting from the effective date of the transfer. Additionally, they must agree not to identify themselves or any business as a current or former Petro Stopping Center, licensee, or franchisee. This includes refraining from using any Petro Stopping Center marks, imitations of those marks, or any other indicators that suggest an association with Petro Stopping Center. They also cannot use any trade names, service marks, or commercial symbols that imply a connection with the company.
These restrictions ensure that former franchisees do not leverage their past association with Petro Stopping Center to unfairly compete with the brand after transferring their franchise. However, Petro Stopping Center retains the discretion to waive certain conditions of the transfer, depending on the specific circumstances. This provides some flexibility in applying these requirements on a case-by-case basis.