If a transfer would cause a transferee to breach another agreement, will Carvel consent to the transfer?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
We have sole and absolute discretion to withhold our consent, except as otherwise provided in Sections 16.4 through 16.7.
Without limiting the foregoing, we will not consent to a Transfer, and we are under no obligation to do so, if (i) your Franchised Business is not open and operating; or (ii) the Transfer would cause a transferee or its owners to breach another agreement (whether or not with us).
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, Carvel will not consent to a transfer if it would cause the transferee or its owners to breach another agreement. This applies regardless of whether the other agreement is with Carvel or a third party.
This provision protects Carvel from potential liabilities or conflicts that could arise if a new franchisee is already bound by obligations that conflict with the Carvel franchise agreement. It ensures that the transferee can fully commit to and comply with the terms of the Carvel franchise without facing legal or contractual conflicts.
For a prospective Carvel franchisee, this means it is crucial to disclose any existing agreements or obligations that the transferee or its owners have with other parties. Failure to do so could result in the denial of the transfer. It also highlights the importance of carefully reviewing all existing agreements to ensure there are no potential conflicts before pursuing a Carvel franchise.