After termination or non-renewal of the Cordova franchise agreement, what must a franchisee do with the Cordova manuals?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
| h. "Cause" defined-non-curable defaults | 16.A.(1), 16.A.(2) | The following are defaults that cannot be cured: three or more instances where you commit a curable default, whether or not you timely cured such default in each instance; you intentionally and knowingly refuse to comply with the terms of the Franchise Agreement, and/or the standards specifications, and/or requirements set forth in the operations manual and/or as communicated to you by us from time to time; you intentionally, knowingly, or negligently operate the Franchised Business in violation of applicable laws, rules, and regulations and, in doing so, create a foreseeable, imminent, and/or immediate threat to the health and safety of others; you abandon the Franchised Business; you or your Owners intentionally made a material statement or omission in questionnaires submitted to us; the data, information, and/or records that you record and/or submit to us are intentionally misleading or false; you transfer or attempt to transfer the Franchised Business or the ownership interests in your franchise company without our approval; you disclose or permit the disclosure of information contained in the operations manual and/or of confidential information; you or your Owners engage in intentionally dishonest or unethical conduct that impacts our System; you and/or your Owners breach and, if such breach is capable of a cure, fail to timely cure another agreement with us, including the Owner and Spouse Agreement and Guaranty; you and your Owners and managers fail to complete, to our satisfaction, our initial and on-going training programs; you fail to notify us of the misuse of confidential information and you fail to protect same; you misappropriate or misuse the Licensed Marks; you are deemed insolvent, make an assignment for the benefit of creditors, admit in writing your inability to pay debts; are adjudicated bankrupt, file a voluntary bankruptcy petition or have one filed against you, and/or you acquiesce to the appointment of a trustee or receiver, or a court orders one; execution is levied against the Franchised Business; a final judgment is entered against the Franchised Business and is not satisfied within 30 days; you are dissolved; a lawsuit or action is commenced against the Franchised Business to foreclose on a lien on equipment of the Franchised Business and such action is not dismissed after 60 days; real or personal property used by the Franchised Business is sold or levied by a sheriff or other law |
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enforcement officer; and/or you abandon or fail to continuously
own and operate the Franchised Business.
| i. | Franchisee's obligations on termination/non-renewal | 6, 17 | You must: pay all sums that you owe to us under the Franchise Agreement and all other agreements with us; cease owning and operating the Franchised Business; cease representing yourself as a franchisee of ours; permanently cease using and/or accessing the System, the Licensed Marks, our confidential information, the Manuals, the Business Management System, the Business Management System Data, and the System Supplies; return the Manuals and all confidential information to us in the original form provided to you and document the destruction of all electronic files related to same; completely de-identify the location and/or facility associated with the Franchised Business; as requested by us, transfer to us all data, telephone listings, digital media, accounts, web listings and websites associated with the Franchised Business; and abide by the post-termination non competition covenants and restrictions. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 33–37)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, upon termination or non-renewal of the franchise agreement, a franchisee has specific obligations regarding the Cordova manuals. The franchisee must cease using and/or accessing the manuals. Furthermore, the franchisee is required to return the manuals and all confidential information to Cordova in their original form. In addition to returning the physical manuals, the franchisee must document the destruction of all electronic files related to the manuals and confidential information.
This requirement ensures that the proprietary knowledge and operational methods contained within the Cordova system remain protected after a franchise relationship ends. By mandating the return of physical manuals and the destruction of electronic copies, Cordova aims to prevent former franchisees from using the system's information to operate competing businesses or otherwise undermine the brand's competitive advantage.
For a prospective franchisee, this obligation highlights the importance of understanding the terms of termination and non-renewal. It also underscores the need to maintain careful control over confidential information and to have systems in place to ensure the complete destruction of electronic files upon the end of the franchise agreement. Failure to comply with these requirements could result in legal action from Cordova.