Upon expiration or termination of the Carvel franchise agreement, will any monetary amount be attributed to goodwill associated with the franchisee's activities?

According to Carvel's 2025 Franchise Disclosure Document, no monetary amount will be attributed to goodwill associated with a franchisee's activities upon the expiration or termination of the franchise agreement. Carvel retains exclusive right and interest in the Marks and the goodwill associated with them. The franchisee acknowledges that they have no interest in the Marks beyond the non-exclusive license granted in the franchise agreement.

This means that when a Carvel franchise agreement ends, the franchisee will not receive any compensation for the goodwill they may have built up in the business. Goodwill refers to the intangible value of a business, such as its brand reputation, customer relationships, and local recognition. Typically, in other business arrangements, the value of goodwill might be considered in determining the sale price of a business.

For a prospective Carvel franchisee, this condition highlights that the value they build in their franchise primarily benefits Carvel. Upon exiting the franchise system, the franchisee cannot monetize the goodwill they helped create. This is a standard practice in many franchise systems, as the brand and its associated goodwill are considered the franchisor's intellectual property.