What is the length of the Initial Term for the Carvel Support Services Agreement?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
12. Term and Termination.
- a. The initial term of this Agreement shall commence on the Effective Date and end on the last day of the same calendar year as the Effective Date (the "Initial Term"). Thereafter, this Agreement shall renew automatically for successive one-year terms, commencing on January 1 of each calendar year (each, a "Renewal Term"), unless earlier terminated as provided in this Agreement.
- b. This Agreement shall terminate immediately with respect to the Franchised Business upon the effective date of the termination or expiration of the Franchise Agreement for the Franchised Business.
- c. Company may terminate this Agreement for any reason or for no reason by giving written notice of such termination to Franchisee at least sixty (60) day prior to the effective date of such termination.
- d. In the event this Agreement is terminated for any reason or expires, Franchisee shall pay Company for all of the Support Services performed prior to the effective date of the termination or expiration to the extent not already paid.
- e. In the event Company ceases to offer or provide Support Services to franchisees in the System, on or before the Service Start Date, this Agreement shall automatically terminate.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, the initial term of the Support Services Agreement begins on the effective date and concludes on the last day of the same calendar year as the effective date. This means that regardless of when the agreement is signed during a calendar year, the initial term will always end on December 31st of that year.
Thereafter, the Support Services Agreement automatically renews for successive one-year terms, commencing on January 1st of each calendar year. This automatic renewal continues unless the agreement is terminated earlier as specified within the agreement itself. This structure provides Carvel franchisees with ongoing support while requiring them to actively manage the agreement if they wish to terminate it.
The Support Services Agreement can be terminated under several conditions, including the termination or expiration of the Franchise Agreement for the Carvel business. Carvel may also terminate the Support Services Agreement for any reason by providing the franchisee with at least sixty days' written notice prior to the termination date. Additionally, the agreement will automatically terminate if Carvel ceases to offer or provide support services to franchisees before the service start date.