When is the lease review fee payable to Azal Coffee?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
et the Franchise Location or any portion of the Franchise Location without our prior written consent.
As part of our lease approval process, we may have an attorney review the proposed lease to ensure that the proposed lease meets our requirements. We have the right to charge you a non-refundable fee of One Thousand Five Hundred Dollars ($1,500) to cover the cost of that review.
Source: Item 5 — INITIAL FEES (FDD page 12)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, if Azal Coffee chooses to have an attorney review a prospective franchisee's lease, they may charge a fee of up to $1,500 to cover the cost of the review. The franchisee is responsible for paying this fee within 7 days of demand from Azal Coffee. This fee is non-refundable.
This means that a potential Azal Coffee franchisee needs to be prepared to pay this fee promptly if requested. It is important to factor this cost into the initial investment and cash flow projections. The franchisee should also ensure they understand the terms of the lease and its commercial reasonableness, as Azal Coffee's review is only to determine if the lease meets their requirements for approval, not to assess its overall suitability for the franchisee's business.
It is fairly common in franchising for franchisors to have some level of lease approval, as the location is critical to the success of the business. Requiring the franchisee to cover the cost of the lease review is also not unusual. Franchisees should clarify with Azal Coffee what triggers the lease review, how often it is required, and what factors typically lead to a lease being rejected. Understanding these criteria can help franchisees find suitable locations and avoid unnecessary fees.