Is the transfer fee for an Ella Cafe franchise refundable?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
Developer has provided Franchisor the following at least 120 days prior to the proposed closing date of the proposed transfer: (a) written request for Franchisor's consent to the transfer; (b) payment of the non-refundable transfer fee in the amount set forth in the Key Terms, plus reimbursement of Franchisor's reasonable attorneys' fees; and (c) a copy of the proposed asset purchase/transfer agreements, including sale terms.
Source: Item 23 — RECEIPTS (FDD pages 50–181)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the transfer fee is non-refundable. Specifically, before a transfer can occur, the developer must provide Ella Cafe with a written request for consent to the transfer and payment of the non-refundable transfer fee, along with reimbursement of Ella Cafe's reasonable attorney's fees.
This means that if a franchisee wishes to sell their Ella Cafe franchise to a new owner, they will be required to pay a transfer fee to Ella Cafe. This fee is not returned to the franchisee, regardless of whether the transfer is completed or not.
Prospective franchisees should consider this non-refundable fee as a cost associated with potentially selling their franchise in the future. It is important to factor this into their financial planning and understand that this fee will not be reimbursed even if the transfer does not proceed.