What areas are excluded from the Site Selection Area for an Ella Cafe franchise?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
ndependent contractors with whom Franchisor contracts to perform these obligations.
ARTICLE 6. SITE SELECTION, LOCATION, DEVELOPMENT, AND OPENING
- 6.1 Determining Location and Designated Area. If the Location and Designated Area are not determined by the Effective Date, then:
- (i) Franchisee must identify a site for the Coffee House within the Site Selection Area and submit to Franchisor a site approval request packet, as set forth in Section 6.2(iii) below. If Franchisee has signed a separate multi-unit development agreement, then Franchisee must identify a site located in the Development Area set forth in the development agreement. Otherwise, Franchisee must identify a site within the non-exclusive Site Selection Area set forth in Attachment 2. The site must meet Franchisor's then-current site selection criteria and must otherwise be mutually acceptable to Franchisor and Franchisee. Franchisee acknowledges and agrees that it acquires no rights in and to the Site Selection Area, other than the right to select a site for the Coffee House from within its boundaries, and, without limitation of the foregoing, Franchisee has no exclusivity rights in the Site Selection Area. Franchisee further acknowledges and agrees that the Site Selection Area excludes any Reserved Area, any existing Site Selection Area of another Coffee House franchisee, and any designated area of any other Coffee House franchisee, which may be designated after the execution of this Agreement and which may be within the Site Selection Area.
- (ii) Within 180 days after the Effective Date, Franchisee shall obtain approval from Franchisor for the proposed Location within the Site Selection Area described in Attachment 2.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the Site Selection Area for a new franchise has some explicit exclusions. Specifically, the franchisee has no exclusive rights to the Site Selection Area, only the right to propose a location within it.
The areas excluded from the Site Selection Area include any "Reserved Area." The FDD defines Reserved Areas as enclosed retail sales establishments such as shopping malls, grocery stores, retailers that are part of regional or national chains, food courts, airports, hospitals, cafeterias, commissaries, schools, colleges, universities, hotels, office buildings, stadiums, arenas, ballparks, convention centers, festivals, fairs, military bases, and other mass gathering locations or events.
In addition to Reserved Areas, the Site Selection Area also excludes any existing Site Selection Area or designated area of another Ella Cafe franchisee. This means that a new franchisee cannot select a location that is already within the territory of another existing franchise, even if it falls within the general Site Selection Area outlined in Attachment 2 of the franchise agreement. Furthermore, the franchisor retains the right to designate new areas for other franchisees within the Site Selection Area, which could further limit a franchisee's options even after the agreement is signed.