Does the table specify any conditions related to the franchise agreement provisions for Carvel?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
o meet our then | | | | current Standards | | | | f. | | | | Sign and return your Renewal Franchise | | | | Agreement (which may be materially different from | | | | the terms contained in the Franchise Agreement | | | | attached to this Disclosure Document). | | | | g. Pay the Renewal Fee | | | | h. You and your guarantors and owners must sign a | | | | general release. | | | | i. If you operate a Co-Branded Shoppe, you must | | | | secure the right from the Co-Branded Franchisor to | | | | continue to operate the Co-Branded Franchise. |
| Section in | ||
|---|---|---|
| Franchise | ||
| Provisions | Agreement | Summary If you do not meet these conditions by, and you continue to operate after, the expiration date of the Franchise Agreement, the Franchise Agreement will be extended on a month-to-month basis until such time as (i) the conditions above are satisfied, or (ii) we notify you that the Franchise Agreement is terminated. |
| d. Termination by you | FA: 17.1 | Not applicable, except franchisees may terminate for any grounds permitted by state law. |
| e. Termination by us | Not applicable | Not applicable |
| without cause | ||
| f. | FA: 17 | We may terminate only if you default. |
| Termination by us | ||
| with cause | ||
| g. "Cause" defined - curable defaults | FA: 17.3 | You have 24 hours to cure if: a. You refuse us permission to inspect or audit. b. Any dilution or adulteration of products at the Shoppe, or any misrepresentation, substitution, or palming off of non-Approved Products from the Shoppe operated under the Franchise Agreement. c. You fail to comply fully with all laws. You have 5 days to cure if: a. You sell, barter, or exchange any Proprietary Goods or Approved Products or other proprietary items at wholesale or retail. You have 10 days to cure if: a. You fail to pay any of your debts to us, our affiliates, or others b. You do not obtain personal covenants required under the Franchise Agreement. c. You default under your mortgage or lease. d. You fail to obtain insurance or provide proof of insurance. e. You fail to provide required reports. You have 30 days to cure if: a. You do not maintain the required financial records. b. You fail to meet the Site Approval Deadline or Construction Start Deadline. c. You breach any other provision of your Franchise |
| h. "Cause" defined - noncurable defaults | FA: 17.2 | Agreement. On notice to you: a. You or your Owners violate restrictive covenants |
| CBS: 20.J | or restrictions on use of Confidential Information. | |
| Section in Franchise | ||
| ----------------------------------------------------- | ---------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| Provisions | Agreement | Summary |
| b. You copy or permit anyone else to copy any part | ||
| of the Manuals. | ||
| c. | ||
| You (or any principal of your Entity) are convicted | ||
| of a felony, fraud, etc.; engage in conduct harmful to | ||
| the business, System, or Proprietary Marks; or | ||
| commit a fraud. | ||
| d. You abandon the Shoppe or suspend operation of | ||
| the Shoppe for five or more days without our consent. | ||
| e. Your (or your affiliate's) interest in the lease or | ||
| sublease for the Accepted Location expires or | ||
| terminates or you otherwise lose possession of the | ||
| site. | ||
| f. | ||
| After curing a default, you commit the same or | ||
| similar default again within 12 months. | ||
| g. You become insolvent, become subject to | ||
| bankruptcy, make an assignment for creditors, subject | ||
| to a receiver, have unpaid judgments, subject to | ||
| attachment proceedings or execution of levy, or un | ||
| dismissed foreclosure. | ||
| h. You or your Owners violate, or have any assets | ||
| blocked under, any laws related to terrorism. | ||
| i. You fail to meet the Opening Deadline (or any | ||
| extended deadline). | ||
| j. | ||
| You have an uncured default in any other | ||
| agreement with us or affiliates which would permit | ||
| termination under such agreement. | ||
| k. | ||
| A threat or danger to public health or safety | ||
| results from your continued operation of the Shoppe. | ||
| l. | ||
| You misuse or make any unauthorized use of the | ||
| Proprietary Marks. | ||
| m. If you operate a Co-Branded Shoppe, your Co | ||
| Branded Agreement expires or is terminated, or you | ||
| HES: 20.R. | lose the right to operate the Co-Branded Franchise. | |
| On notice to you (in addition to the defaults in the | ||
| Franchise Agreement): | ||
| a. You fail to comply with the franchise agreement | ||
| for your Host Facility or the franchise agreement for | ||
| your Host Facility terminates or expires. | ||
| b. The Host Facility's brand deteriorates in quality or | ||
| reputation and is damaging the Carvel brand and | ||
| Proprietary Marks. | ||
| i. Your obligations on termination/nonrenewal | FA: 18 ES: 20.I. HES: 20.S., T, U. and V. | a. Stop using the System, including our Proprietary Marks, Confidential Information, Trade Secrets, and Manuals, and de-identify the Shoppe. b. Immediately deliver to us or destroy all materials related to the System and your copies of any of the Manuals. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 84–91)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, the table outlines various conditions related to franchise agreement provisions, covering aspects such as termination, transfer, and obligations.
The table details conditions under which Carvel franchisees may terminate the agreement, noting that franchisees can terminate for any grounds permitted by state law. It also specifies conditions for termination by Carvel with cause, categorizing defaults as curable and non-curable. Curable defaults have varying cure periods: 24 hours for refusing inspection or product adulteration, 5 days for unauthorized sales, 10 days for failure to pay debts or maintain insurance, and 30 days for failing to maintain financial records or meet deadlines. Non-curable defaults include violating restrictive covenants, copying manuals, felony convictions, abandoning the shop, or losing the lease.
Additionally, the table addresses obligations upon termination or non-renewal, requiring franchisees to cease using the Carvel system, including proprietary marks and confidential information, and to return or destroy all related materials. It also covers conditions related to the transfer of the franchise, including the requirement for guarantors and owners to sign a general release and remain liable for pre-transfer obligations. For Hosted Express Shoppes, the transfer must include the Host Facility.
The franchise agreement also includes conditions regarding Carvel's right of first refusal to acquire the business, an option to purchase the business, and terms related to the franchisee's death or disability. Non-competition covenants during and after the franchise term are also specified, restricting involvement in competitive businesses. Finally, the table notes that the franchise agreement cannot be orally modified, although Carvel can change the manuals, and that only the terms of the franchise agreement and related agreements are binding.