What is the deadline for an Ella Cafe franchisee to procure the required insurance after the Effective Date?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
At its sole expense, Franchisee shall procure within sixty days of the Effective Date, and maintain in full force and effect during the term of this Agreement, insurance as required by state law and as we specify below. All policies (except any workers' compensation insurance) shall expressly name Franchisor as an additional insured, grantor of franchise and loss payee and all shall contain a waiver of all subrogation rights against Franchisor and its successors and assigns. In addition to any other insurance that may be required by applicable law, or by lender or lessor, Franchisee shall procure:
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, a franchisee must procure the required insurance within sixty days of the Effective Date of the Franchise Agreement. This insurance must remain in full force and effect throughout the term of the agreement.
The insurance policies must name Ella Cafe as an additional insured, grantor of franchise, and loss payee. Additionally, the policies must include a waiver of all subrogation rights against Ella Cafe and its successors and assigns. This requirement ensures that Ella Cafe is protected from potential liabilities and losses related to the franchisee's business operations.
Failure to obtain or maintain the required insurance coverage within the specified timeframe constitutes a default under the Franchise Agreement. Ella Cafe has the right to terminate the agreement if the franchisee fails to cure this default within 10 days after receiving written notice. This underscores the importance of securing the necessary insurance promptly to avoid potential termination of the franchise agreement.