How far in advance must an Ella Cafe developer provide notice of a proposed transfer?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
Developer has provided Franchisor the following at least 120 days prior to the proposed closing date of the proposed transfer: (a) written request for Franchisor's consent to the transfer; (b) payment of the non-refundable transfer fee in the amount set forth in the Key Terms, plus reimbursement of Franchisor's reasonable attorneys' fees; and (c) a copy of the proposed asset purchase/transfer agreements, including sale terms.
Source: Item 23 — RECEIPTS (FDD pages 50–181)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, a developer must provide written notice to Ella Cafe at least 120 days before the proposed closing date of the transfer. This advance notice is required for Ella Cafe to properly assess the proposed transfer and the qualifications of the potential transferee.
Specifically, the developer must submit a written request for consent, pay a non-refundable transfer fee (the amount of which is found in the Key Terms section of the FDD), reimburse Ella Cafe for reasonable attorney's fees, and provide a copy of the proposed asset purchase/transfer agreements, including sale terms. This information allows Ella Cafe to evaluate the financial and operational aspects of the transfer.
This 120-day notice period allows Ella Cafe ample time to review the transferee's qualifications, financial capacity, and business standards to ensure they meet the brand's requirements. It also allows Ella Cafe to ensure that all financial obligations to the company and third-party suppliers are current and that the Coffee House premises meet the current image and equipment standards. Failing to provide this notice or meet all conditions could result in the transfer being denied or considered void, representing a material breach of the Development Agreement.