What constitutes a 'Company Owned Outlet' for a Cordova franchise?

According to Cordova's 2025 Franchise Disclosure Document, a Company Owned Outlet is defined as an outlet owned either directly or indirectly by Cordova, its affiliate, or any person identified in Item 2 of the FDD. This definition extends to any outlet operated as a joint venture partly owned by Cordova, its affiliate, or individuals identified in Item 2, or managed by these entities.

This definition is important for prospective franchisees because the financial performance of Company Owned Outlets may be presented in Item 19 of the FDD. Understanding the distinction between a Company Owned Outlet and a franchised outlet is crucial for interpreting the financial performance representations accurately. For example, Cordova has one Company Owned Outlet in Omaha, Nebraska, which commenced operations in 2016. The FDD indicates that the Omaha Outlet operates in an Operating Territory equivalent to two territories.

It is also important to note that the financial and operational characteristics of Company Owned Outlets may differ from those of franchised outlets. Cordova identifies managerial skill and efficiency due to an experienced management team, brand recognition in the local market, and the absence of ongoing fees (such as Royalty Fees and Brand Development Fund Fees) as potential differences. These factors could impact the financial performance of franchised outlets compared to the Company Owned Outlet. Therefore, prospective franchisees should carefully consider these differences when evaluating the financial performance data provided in the FDD.