What must the Ella Cafe franchisee do if they begin construction?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee must construct and build out the Coffee House according to Franchisor's Standards and specifications for design, decor, and layout and must equip the Coffee House according to Franchisor's requirements for fixtures, furnishings, equipment, interior and exterior signage, decor, trade dress, and awnings, which Franchisor will provide to Franchisee. Franchisor will provide such advice regarding construction and build-out as it deems appropriate, but Franchisee is solely responsible for sourcing, hiring, and paying for the professional services needed to complete Franchisee's Coffee House design and build-out obligations. Franchisee is solely responsible for obtaining all government approvals, zoning classifications, permits, licenses, and clearances relating to the Coffee House and for complying with applicable requirements of the Americans with Disabilities Act.
- (ii) During construction, Franchisee must maintain general liability and property damage insurance of the type and with the limits Franchisor requires, protecting Franchisee and Franchisor and its Affiliates and their respective partners, shareholders, directors, agents, and employees.
Such policy or policies must be written by a responsible insurer or insurers acceptable to Franchisor and must contain a waiver of subrogation in favor of Franchisor and its Affiliates, and their respective partners, shareholders, directors, agents, and employees.
Franchisee must notify Franchisor in writing when construction begins and thereafter must provide progress reports when, and in the form, required by Franchisor.
- (iii) During construction, Franchisee must provide Franchisor with such periodic progress reports as Franchisor may reasonably request, including, but not limited to, digital photographs and/or video of the Coffee House premises and the surrounding area.
In addition, Franchisor may make such on-site inspections as it may deem reasonably necessary to evaluate such progress, which visits may be through remote/virtual means.
Franchisee will notify Franchisor of the scheduled date for completion of construction no later than 21 days prior to such date.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, a franchisee must take specific actions once construction begins on their coffee house. The franchisee is required to notify Ella Cafe in writing when construction starts. Following this initial notification, the franchisee must provide progress reports to Ella Cafe according to the schedule and format that Ella Cafe requires. These reports may include digital photographs and/or video of the coffee house premises and the surrounding area. Ella Cafe also retains the right to conduct on-site inspections to assess construction progress, potentially through remote or virtual means.
In addition to providing updates, the franchisee must maintain general liability and property damage insurance throughout the construction period. This insurance must protect both the franchisee and Ella Cafe, including its affiliates, partners, shareholders, directors, agents, and employees. The insurance policy must be written by an insurer acceptable to Ella Cafe and include a waiver of subrogation in favor of Ella Cafe and its related parties.
Furthermore, the franchisee is obligated to inform Ella Cafe of the anticipated construction completion date at least 21 days in advance. These measures ensure that Ella Cafe is kept informed about the progress and adheres to the brand's standards and specifications during the build-out phase. Failing to meet these requirements could potentially lead to breaches of the franchise agreement and associated penalties.