Under what circumstances does Carvel include the California Addendum to the Franchise Agreement?

According to Carvel's 2025 Franchise Disclosure Document, a California Addendum to the Franchise Agreement is included when franchises are offered and sold in the state of California or to California residents. This addendum is included to address the requirements of the California Franchise Investment Law §§ 31000 through 31516, and the California Franchise Relations Act, California Business and Professions Code §§ 20000 through 20043.

The California Addendum modifies certain provisions of the standard Carvel Franchise Agreement to comply with California law. These modifications cover areas such as releases, termination, governing law, arbitration, covenants not to compete, and litigation. For example, the addendum clarifies that a general release signed upon renewal or transfer does not waive rights under the California Franchise Investment Law or the Franchise Relations Act.

Prospective Carvel franchisees in California should carefully review the California Addendum along with the Franchise Agreement to understand their rights and obligations under California law. They should also consult with legal counsel to determine the applicability of California and federal laws to the franchise agreement's provisions, especially those related to venue, arbitration, and covenants not to compete, as these may not be enforceable under California law.