What is the definition of 'Designated Bank Account' for Carvel franchisees?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
As used herein, the term "Designated Bank Account" means the bank account on file with Franchisor for EFT payments required under the Franchise Agreement or Manuals.
Franchisee is responsible for maintaining sufficient funds in the Designated Bank Account for all Comprehensive Support Fees due under this Agreement, in addition to any amounts drafted by EFT under the Franchise Agreement and the Manuals.
In the event there are insufficient funds in the Designated Bank Account to cover the draft of a payment due hereunder, Company reserves the right to charge Franchisee the return costs charged by Franchisor's bank and an administrative fee to cover Franchisor's and/or Company's cost of addressing the nonpayment.
Such administrative fee is in addition to any interest on the amount due.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, a Designated Bank Account is defined as the bank account the franchisee has on file with Carvel for Electronic Funds Transfer (EFT) payments required under the Franchise Agreement or the Manuals. This account is crucial for ensuring timely payments of fees.
Carvel franchisees are responsible for maintaining sufficient funds in this Designated Bank Account to cover all Comprehensive Support Fees and any other amounts drafted via EFT as outlined in the Franchise Agreement and Manuals. This requirement ensures that Carvel can reliably collect the necessary fees to support the franchise system.
If a Carvel franchisee fails to maintain sufficient funds in the Designated Bank Account, Carvel reserves the right to charge the franchisee for any return costs imposed by the bank, as well as an administrative fee to cover Carvel's costs associated with addressing the nonpayment. This administrative fee is in addition to any interest that may accrue on the unpaid amount. This policy underscores the importance of franchisees managing their accounts diligently to avoid additional charges and maintain a good financial standing with Carvel.