When is the Transfer Fee due for an Ella Cafe franchise?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
elopment Agreement**
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer For Convenience | No fee to transfer for convenience of ownership or non controlling interest, except reimbursement of our attorneys' fees | When transfer is requested | Transfer for convenience of ownership is when an individual franchisee assigns his or her rights to a corporation, limited liability company, or other entity controlled by the same individual. |
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the standard Transfer Fee is due "when transfer occurs." The Transfer Fee is payable if a franchisee sells their Ella Cafe business. The amount of this fee is $10,000, in addition to any broker fees and other out-of-pocket costs that Ella Cafe incurs during the transfer process.
However, the FDD also notes an exception for "transfer for convenience of ownership or non controlling interest." In these specific cases, there is no transfer fee, except for reimbursement of Ella Cafe's attorneys' fees. A transfer for convenience of ownership occurs when an individual franchisee assigns their rights to a corporation, limited liability company, or other entity controlled by the same individual.
It is important for prospective Ella Cafe franchisees to understand the conditions under which a transfer fee is required, as well as the potential costs associated with selling or transferring ownership of their franchise. Understanding these fees and conditions is crucial for financial planning and decision-making throughout the franchise term.