What is the limitation on transfer fees that Cordova can collect?

According to Cordova's 2025 Franchise Disclosure Document, a franchisee must pay a fixed transfer fee of $20,000 to Cordova when transferring their franchise. This fee is outlined in Article 14.C.(11) of the franchise agreement. The document specifies that this fee is a fixed sum, meaning Cordova does not appear to have discretion to charge more than $20,000 for a transfer.

However, there is an exception to this transfer fee. In the event of the death or permanent disability of an individual franchisee, the franchise agreement may be transferred to a designated person, heir, or beneficiary without requiring the payment of the $20,000 transfer fee. This exception provides some relief to the franchisee's family or designated beneficiary in such unfortunate circumstances.

It is important to note that even if the transfer fee is waived due to death or disability, the transfer is still subject to other applicable terms and conditions outlined in Article 14 of the franchise agreement. The transferee must also agree to be unconditionally bound by the terms of the agreement and personally guarantee the franchisee's obligations, executing the Franchise Owner and Spouse Agreement and Guaranty. This ensures that the new franchisee is fully committed to upholding the standards and responsibilities of the Cordova franchise system.