For Carvel franchises in Indiana, what aspect of the covenant not to compete in the Personal Covenants Agreement is revised by the Indiana Addendum?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
INDIANA ADDENDUM TO PERSONAL COVENANTS AGREEMENT
Notwithstanding anything to the contrary stated in the Personal Covenants Agreement, the following provisions will supersede and apply:
- The Personal Covenants Agreement is revised to limit the geographical extent of the 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 Carvel's 2025 Franchise Disclosure Document, the Indiana Addendum to the Personal Covenants Agreement revises the geographical extent of the covenant not to compete. Specifically, for all Carvel franchises sold in Indiana, the addendum limits the covenant's geographical scope to an area of reasonable size.
This revision means that the standard non-compete clause in the Personal Covenants Agreement, which might otherwise impose a broader geographical restriction, is narrowed for Indiana franchisees. The determination of what constitutes a "reasonable size" area is not defined in the FDD and could be subject to interpretation or negotiation.
For a prospective Carvel franchisee in Indiana, this addendum offers a potentially more favorable non-compete agreement. It is important to understand what Carvel considers a "reasonable size" and how this might affect the franchisee's ability to engage in similar business activities should they leave the Carvel system. A prospective franchisee should seek clarification from Carvel regarding the specific geographical limitations enforced in Indiana.