Regarding a Cordova franchise transfer, what legal requirement must be met?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
In recognition of the requirements of the Minnesota Statutes, Chapter 80C. and Minnesota Franchise Rules, Chapter 2860, the parties to the attached Cordova Franchising, LLC Franchise Agreement (the "Franchise Agreement"), as follows:
- Article 14.C. of the Franchise Agreement, under the heading "Conditions for Approval of Transfer," subarticle 14.C.(6) is supplemented with the addition of the following language:
; provided, however, that all rights enjoyed by Franchisee and any causes of action arising in Franchisee's favor from the provisions of the Minnesota Franchise Act, Minn. Stat. Section 80C.14 et seq. and Minnesota Rules 2860.4400(D), shall remain in force; it being the intent of this provision that the non-waiver provisions of the Minnesota Rules 2860.4400(D) be satisfied; and
Minnesota law provides a franchisee with certain termination and non-renewal rights. Minn. Stat. Sect. 80C.14 Subdivisions 3, 4, and 5 require, except in certain specified cases, that franchisee be given 180 days-notice of nonrenewal of this Agreement by Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 44–195)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, if a franchisee is located in Minnesota, there are specific legal requirements pertaining to franchise transfers, as detailed in the Minnesota Franchise Act. Specifically, the standard Cordova franchise agreement is supplemented to ensure that all rights and causes of action arising in the franchisee's favor under the Minnesota Franchise Act (Minn. Stat. Section 80C.14 et seq.) and Minnesota Rules 2860.4400(D) remain in effect, aligning with the non-waiver provisions of Minnesota Rules 2860.4400(D). This amendment ensures that franchisees in Minnesota retain their statutory rights, even during a transfer.
This means that Cordova franchisees in Minnesota cannot be forced to waive their rights under the Minnesota Franchise Act as a condition of the transfer. These rights include certain protections regarding termination and non-renewal, such as the requirement for the franchisor to provide 180 days' notice of nonrenewal in certain situations, as mandated by Minn. Stat. Sect. 80C.14 Subdivisions 3, 4, and 5. The amendment explicitly states that these rights remain in force, ensuring compliance with Minnesota law.
For a prospective Cordova franchisee in Minnesota, this amendment offers an additional layer of legal protection during a franchise transfer. It prevents Cordova from enforcing any transfer conditions that would require the franchisee to relinquish their rights under Minnesota franchise law. This could be a significant benefit, as it ensures that the franchisee can still pursue legal remedies or assert their statutory rights even after the transfer is completed. Franchisees outside of Minnesota may not have this specific protection, as it is tailored to comply with Minnesota state law.