In the Ella Cafe Franchise Agreement, what does the term 'Agreement' refer to?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
d Franchisee's application and desires to grant Franchisee such franchise, all pursuant to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration for the premises and other good and valuable consideration contained in this Agreement, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE 1. DEFINITIONS
- "Action" means any action, suit, proceeding, claim, demand, governmental investigation, governmental inquiry, judgment or appeal thereof, whether formal or informal.
- "Approved Vendor" means a supplier, vendor, or distributor of Inputs which has been approved by the Franchisor.
"Coffee House" or "Franchised Business" or "Business" means the Ella Coffee House business owned by Franchisee and operated under this Agreement.
"Competitor" means any business which offers products or services similar to those offered by the Franchised Business.
"Confidential Information" means all trade secrets, the Standards, and other elements of the System; all customer information; customer list, all information contained in the Manual; Franchisor's proprietary beverage and food recipes, spice blends, and standards and specifications for product preparation, packaging and service; financial information; marketing data; vendor and supplier information; all other knowledge, trade secrets, or know-how concerning the methods of operation of the Coffee House which may be communicated to Franchisee, or of which Franchisee may be apprised, by virtue of its operation under the terms of the Franchise Agreement, and all other information that Franchisor designates.
"Franchise Agreement" means the form of agreement prescribed by Franchisor and used to grant to its franchisees the right to own and operate a single Coffee House, including all attachments, exhibits, riders, guarantees, or other related instruments, all as amended from time to time.
"Gross Sales" Gross Sales is the total Selling Price of all services and products and all income of every other kind and nature related to the Coffee House, including income related to catering operations and special events and the full value of beverages or meals provided to Franchisee's bona fide employees as a benefit of their employment (except Franchisee may deduct from Gross Sales the value of any employee discounts that are given during the week in which the food and beverages are provided), whether for cash or credit and regardless of collection in the case of credit. Gross Sales does not include (a) receipts from any public telephone, vending machine, or video games installed in the Coffee House, except for Franchisee's share of the revenues; (b) sales (or similar) taxes that Franchisee collects from Coffee House customers if such taxes are transmitted to the appropriate taxing authority(ies); (c) proceeds from isolated sales of trade fixtures that are not part of the products and services offered at the Coffee House and that do not have any material effect on the operation of the Coffee House; (d) tips or gratuities paid directly by Coffee House customers to Franchisee's employees or paid to Franchisee and then turned over to employees by in lieu of direct tips or gratuities; or (e) returns to shippers or manufacturers; and (f) amounts paid to, collected by, or shared with third-party food ordering and delivery systems with which we allow the Coffee House to do business, including but not limited to UBER EATS, DOORDASH, and FAVOR. Gross Sales also does not include proceeds from the sale of gift certificates or stored value cards, but it does include the redemption value of gift certificates and stored value cards at the time purchases are made. Franchisee is responsible for the accurate reporting of gift certificate and stored value card sales and the corresponding impact on Gross Sales. Franchisee has until 30 days after the end of Franchisor's fiscal year to notify Franchisor of any errors Franchisee made in calculating Gross Sales as those errors relate to the reporting of gift certificate and stored value card sales. "Selling Price" is defined as the non-discounted, regular menu price.
"Input" means any goods, services, supplies, fixtures, equipment, inventory, computer hardware and software, real estate, or comparable items related to establishing or operating the Business.
"Location" means the physical location stated on Attachment 2 as determined in accordance with Section 6.1.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the term "Agreement" is used throughout the document and has different meanings depending on the context. The document defines several terms, including "Franchise Agreement," which refers to the specific agreement form prescribed by Ella Cafe for granting franchisees the right to own and operate a single Coffee House. This definition includes all attachments, exhibits, riders, guarantees, and other related instruments, as amended from time to time.
In Article 1, the term "Agreement" is referenced in the context of consideration for the premises and other good and valuable consideration, indicating that the parties involved are agreeing to the terms outlined within the document. Furthermore, the term "Agreement" is used when defining other key terms such as "Coffee House" or "Franchised Business," which means the Ella Coffee House business owned by the franchisee and operated under the Franchise Agreement.
In Article 2, the "Agreement" is referenced in the context of granting the franchisee the right to develop and continuously operate a Coffee House at a specific location. The franchisee undertakes the obligation to continually operate the Coffee House during the term of the agreement and strictly according to its terms and conditions. The document also specifies what rights the agreement does not grant, such as the right to sublicense the use of the System or Marks, co-brand with another concept, or ship ELLA products. The term of the Agreement, also referred to as "Term", will begin on the Effective Date and will continue for a period of 10 years, unless sooner terminated as provided in the Agreement.