Does Cordova have a right of first refusal to purchase the assets of a Cordova franchise?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee or an Owner desire to engage, in whole or in part, in a Transfer of Franchisee, this Agreement, Franchisee's Cordova Business, and/or Franchisee's Administrative Office, then Franchisee or such Owner (as applicable) must obtain a bona fide, signed written offer from the fully disclosed purchaser (the "Offer") and submit an exact copy of the Offer to Franchisor. Franchisor shall have 30 days after receipt of the Offer to decide whether Franchisor will purchase the interest in Franchisee, Franchisee's Cordova Business, and/or Franchisee's Administrative Office for the same price and upon the same terms contained in the Offer (however, Franchisor may substitute cash for any form of payment proposed in the Offer). If Franchisor notifies Franchisee that Franchisor intends to purchase the interest within said 30 day period, Franchisee or Owner (as applicable) must sell the interest to Franchisor. Franchisor will have at least an additional 60 days to prepare for closing. Franchisor shall be entitled to receive from Franchisee or Owner (as applicable) all customary representations and warranties given by Franchisee or Owner (as applicable)
as the seller of the assets and/or the ownership interest or, at Franchisor's election, the representations and warranties contained in the offer. If Franchisor does not exercise its right of first refusal, Franchisee or Owner (as applicable) may complete the Transfer to the purchaser pursuant to and in accordance with the terms of the Offer, provided that separate and apart from this Article 14.F. right of first refusal, Franchisee complies with the terms of this Article 14. However, if the sale to the purchaser is not completed within 120 days after delivery of the Offer to Franchisor, or there is a material change in the terms of the sale, Franchisor will again have the right of first refusal specified in this Article 14.F. Franchisor's right of first refusal in this Article 14.F. shall not apply to any Transfer pursuant to Article 14.E. of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 44–195)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, Cordova does have a right of first refusal if a franchisee desires to transfer their franchise. Specifically, if a franchisee or owner wants to transfer the franchise, the agreement, the Cordova business, or the administrative office, they must first get a signed, written offer from a potential buyer. This offer must then be submitted to Cordova.
Cordova then has 30 days to decide if it wants to purchase the franchisee's interest, the Cordova business, or the administrative office at the same price and terms as the offer. Cordova can, however, substitute cash for any other form of payment proposed in the offer. If Cordova decides to purchase the interest, the franchisee or owner must sell it to Cordova, and Cordova will have at least 60 additional days to prepare for closing.
Cordova is entitled to receive customary representations and warranties from the franchisee or owner as the seller of the assets or ownership interest. If Cordova does not exercise its right of first refusal, the franchisee or owner can complete the transfer to the purchaser, provided they comply with all other terms of the transfer agreement. However, if the sale is not completed within 120 days after Cordova receives the offer, or if there is a material change in the terms of the sale, Cordova has the right of first refusal again. This right of first refusal does not apply to transfers to a wholly-owned corporate entity as described in another section of the agreement.