What does the Non-Compliance Cure Costs and Fee cover for Ella Cafe franchisees?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Non-Compliance Cure Costs and Fee | Our out-of-pocket costs and internal cost allocation, plus 10% | When billed | We may cure your non-compliance on your behalf (for example, if you do not have required insurance, we may purchase insurance for you), and you will owe our costs plus a 10% administrative fee. |
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the Non-Compliance Cure Costs and Fee covers situations where Ella Cafe cures a franchisee's non-compliance on their behalf. This means that if a franchisee fails to meet certain requirements, such as maintaining required insurance, Ella Cafe may take action to rectify the situation.
In such cases, Ella Cafe will cover the costs associated with curing the non-compliance, such as purchasing the necessary insurance. The franchisee is then responsible for reimbursing Ella Cafe for these out-of-pocket costs.
In addition to the direct costs, Ella Cafe also charges a 10% administrative fee on top of the out-of-pocket expenses and internal cost allocation. This fee is intended to cover Ella Cafe's internal costs associated with managing and resolving the franchisee's non-compliance. The Non-Compliance Cure Costs and Fee is due when billed.