Does the Carvel Franchise Agreement contain a covenant not to compete that extends beyond the termination of the franchise?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
- Section 15.4.B. (Restrictive Covenants: Post Term) of the Franchise Agreement is revised to limit the geographical extent of the post-term covenant not to compete to an area of reasonable size, for all franchises sold in the State of Indiana.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to the 2025 Carvel FDD, Section 15.4.B of the Franchise Agreement addresses post-term restrictive covenants, and is revised for franchises sold in Indiana to limit the geographical extent of the post-term covenant to an area of reasonable size.
Specifically, for franchisees in Indiana, the standard post-term covenant not to compete is modified to ensure its geographical scope is reasonable. This suggests that without this Indiana-specific revision, the standard agreement includes a post-term non-compete clause.
It is important for prospective franchisees to carefully review Section 15.4.B of the Franchise Agreement and any state-specific addenda to fully understand the terms of the post-term non-compete, including its duration and geographic scope. Franchisees should also consult with a legal professional to assess the enforceability of these provisions in their specific jurisdiction.