What is the timeframe for transferring interest in an Ella Cafe franchise after notice of permanent disability?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
Upon the permanent disability of Developer (if Developer is a natural person) or any Principal who is a natural person, Franchisor may, in its sole discretion, require such interest to be transferred to a third party in accordance with the conditions described in this Section 8. within six months after notice to Developer. "Permanent disability" means any physical, emotional, or mental injury, illness, or incapacity which would prevent a person from performing the obligations set forth in this Agreement or in any guaranty made part of this Agreement for at least 90 consecutive days and from which condition recovery within 90 days from the date of determination of disability is unlikely.
Permanent disability will be determined by a licensed practicing physician selected by Franchisor, upon examination of the person; or if the person refuses to submit to an examination, then such person automatically will be deemed permanently disabled as of the date of such refusal for the purpose of this Section 8.8.2.
The costs of any examination required by this Section 8.8.2. will be paid by Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 50–181)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, if a Developer or Principal of the franchise experiences permanent disability, Ella Cafe has the option to require the interest to be transferred to a third party. Should Ella Cafe exercise this option, the transfer must occur within six months after notice of the disability is given to the Developer.
The FDD defines "permanent disability" as a physical, emotional, or mental condition preventing the person from fulfilling their obligations under the Franchise Agreement or any related guaranty for at least 90 consecutive days, with recovery within 90 days from the disability determination being unlikely. The determination of permanent disability is made by a licensed physician selected by Ella Cafe, following an examination of the individual. Refusal to submit to such an examination automatically deems the person permanently disabled for the purposes of the transfer requirements.
The costs associated with the examination to determine permanent disability are to be paid by Ella Cafe. This transfer process is subject to specific conditions outlined in the FDD, in addition to the standard conditions applicable to any transfer made during the franchisee's lifetime.