What is the definition of an 'Out of Territory Candidate' for a Cordova franchise?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
You may place a candidate that resides and/or is located outside of your Operating Territory and within the United States (an "Out of Territory Candidate") with a client that is located within your Operating Territory provided that you comply with rules and System requirements including, but not limited to, our fee splitting rules as set forth in the Manuals.
You may solicit candidates who reside within or outside of Franchisee's Operating Territory provided that you comply with our solicitation rules and requirements as designated by us in our Manuals. You are not allowed to directly solicit clients outside of your Operating Territory, and you do not have the right to use other channels of distribution, such as the internet, catalog sales, or other direct marketing to make sales outside your Operating Territory.
Source: Item 12 — TERRITORY (FDD pages 28–30)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, an 'Out of Territory Candidate' is defined as a candidate who resides and/or is located outside of a franchisee's Operating Territory but within the United States. This definition is relevant to the rules governing how a Cordova franchisee can operate and market their business.
Specifically, a franchisee can place an Out of Territory Candidate with a client located within their Operating Territory, provided they comply with Cordova's rules and System requirements, including fee-splitting rules as detailed in the manuals. This allows franchisees to source candidates from a wider geographic area than just their own territory, potentially increasing their access to qualified personnel. However, it's crucial to adhere to the franchisor's guidelines when doing so.
While franchisees can solicit candidates both within and outside their Operating Territory, they are restricted from directly soliciting clients outside of their assigned territory. This distinction is important for franchisees to understand to avoid violating the terms of their Franchise Agreement and to focus their marketing efforts within their designated area. The FDD also states that franchisees do not have the right to use other channels of distribution, such as the internet, catalog sales, or other direct marketing to make sales outside their Operating Territory.