When does the Azal Coffee agreement become effective?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
| THIS ADDENDUM is made the day of, 20, and modifies a |
|---|
| Franchise Agreement of the same date (the "Franchise Agreement") entered into by Durar Investment, LLC, a Michigan limited liability company, ("Franchisor") and |
| , a(" Franchisee "). In this |
| , a |
| A. Introduction . You entered into an agreement ("Purchase Agreement") for the |
| purchase of the Azal Coffee located at ("Store") from the current owner of the Store (the "Seller"). We and you |
| desire to amend the Franchise Agreement to reflect the fact that you are acquiring an open and |
| operating Store by transfer from one of our existing franchisees. All capitalized terms not otherwise |
| defined in this Addendum will have the same meaning as in the Franchise Agreement. |
| B. Contingency ; Date of Effectiveness of Franchise Agreement . The rights and |
| obligations of the parties under the Franchise Agreement are contingent on: (1) your completion of |
| our initial training program; and (2) the closing of the transaction under the Purchase Agreement and the transfer of possession and ownership of the Store to you. If these contingencies are not |
| met by, 20, we may, at our option, terminate the Franchise Agreement. If |
| we terminate the Franchise Agreement as provided in this Section, we will have the right to retain |
| the transfer fee paid by you (or the Seller) and otherwise the parties will have no further rights or |
| obligations to each other under the Franchise Agreement; provided that, the confidentiality and |
| non-competition provisions of the Franchise Agreement will survive the termination. If these |
| contingencies are met by the date specified above in this Section, then the Franchise Agreement |
| will become effective on the date that you receive possession and ownership of the Store (the "Effective Date"). |
| Ellective Date ). |
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, the effectiveness of the Franchise Agreement is contingent upon specific conditions. For a franchisee acquiring an existing Azal Coffee store, the agreement becomes effective on the date they receive possession and ownership of the store, referred to as the "Effective Date."
However, this is conditional on two key factors: the franchisee must complete Azal Coffee's initial training program, and the transaction for purchasing the store must close, transferring possession and ownership to the franchisee. A specific date is set, and if these contingencies are not met by that date, Azal Coffee has the option to terminate the Franchise Agreement.
If Azal Coffee terminates the agreement due to unmet contingencies, they retain the transfer fee. However, the confidentiality and non-competition provisions of the Franchise Agreement remain in effect even after termination. Meeting the specified contingencies by the set date ensures the Franchise Agreement becomes effective upon the transfer of the store.