How much is a Bang Cookies franchisee required to contribute to the Advertising Cooperative?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
ion of this Agreement and any and all future dates demanded by Franchisor, Franchisee shall execute and deliver to Franchisor the Assignment of Telephone Numbers and Digital Media Accounts Agreement attached to this Agreement as Exhibit 6. Franchisee agree that the foregoing shall not be interpreted or construed as permitting Franchisee to establish, designate, utilize and/or otherwise establish accounts as to Digital Media respecting and/or concerning the Franchised Business and/or the System.
9.F. ADVERTISING COOPERATIVE
At all times Franchisor, in Franchisor's Reasonable Business Judgment, possesses the right to authorize, establish, designate and de-authorize a local or regional advertising cooperative within those markets that
Franchisor designates (the "Advertising Cooperative"). Franchisee agrees that Franchisor possesses the sole and exclusive right to designate any geographic area in which two or more Shop franchises are located as a region for the purpose of establishing an Advertising Cooperative. If Franchisee's Shop or Designated Territory is located within the geographic area of an Advertising Cooperative, franchisee must participate in and contribute to the Advertising Cooperative. Franchisee agrees to the following:
- (1) If Franchisor previously instituted or, in the future, institutes an Advertising Cooperative that includes, in whole or in part, Franchisee's Designated Territory or Franchisee's Shop Location, Franchisee shall participate in and make such on-going financial contributions to the Advertising Cooperative, as determined by the Advertising Cooperative;
- (2) Franchisor may establish foundational and organizational requirements of the Advertising Cooperative including voting provisions that allows the Advertising Cooperative to make decisions based on the simple majority vote (1 vote per franchisee Shop located within the designated area of the Advertising Cooperative) with a quorum constituting 25% of those franchisees within the Advertising Cooperative;
- (3) Unless otherwise authorized and approved by Franchisor in writing, each Advertising Cooperative shall be organized for the exclusive purpose of administering marketing programs and the development of media (all subject to the review and approval of Franchisor) for use by members of the Advertising Cooperative in local or regional marketing;
- (4) If at the time of execution of this Agreement an Advertising Cooperative has been established for a geographic area that includes, in whole or in part, Franchisee's Shop location or Designated Territory, or if such Advertising Cooperative is established during the Term of this Agreement, Franchisee shall fully participate in the Advertising Cooperative and Franchisee shall execute, at the request of Franchisor, all documents required by Franchisor and Franchisee shall become a member of the Advertising Cooperative subject to the terms of those documents;
- (5) Franchisee shall contribute to the Advertising Cooperative in the amounts as determined and required by the Advertising Cooperative or, otherwise in accordance with those documents governing the operation of the Advertising Cooperative; provided, however, Franchisee's contributions to the Advertising Cooperative shall not exceed Franchisee's local minimum marketing obligations set forth in Article 9.B. of this Agreement and Franchisee's contributions to the Advertising Cooperative shall count toward satisfaction of Franchisee's minimum local marketing obligations set forth in Article 9.B.;
- (6) Franchisee shall submit to the Advertising Cooperative and to Franchisor such statements and reports as may be required by the Advertising Cooperative and approved by Franchisor. All contributions to the Advertising Cooperative shall be maintained and administered in accordance with the documents governing the Advertising Cooperative. The Advertising Cooperative shall be operated solely for the purpose of collection and expenditure of the Advertising Cooperative's fees for the purpose set forth in this Article 9.F.;
- (7) No marketing materials, plans, or media may be used by the Advertising Cooperative or its members without the prior written approval of Franchisor;
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies' 2024 Franchise Disclosure Document, if a franchisee's shop or designated territory is within the geographic area of an Advertising Cooperative, they must participate in and contribute to it. The amount of the contribution is determined and required by the Advertising Cooperative itself or according to the documents governing its operation. However, the franchisee's contribution to the Advertising Cooperative will not exceed the franchisee's local minimum marketing obligations as outlined in Article 9.B of the Franchise Agreement, and these contributions count toward fulfilling those minimum local marketing obligations.
Bang Cookies retains the right to authorize, establish, designate, and de-authorize local or regional advertising cooperatives in markets it designates. The franchisor has the sole right to designate any geographic area with two or more shop franchises as a region for establishing an Advertising Cooperative. Franchisees must participate and contribute financially to the Advertising Cooperative if their shop or territory falls within its area.
The Advertising Cooperative is designed to administer marketing programs and develop media for its members' local or regional marketing efforts, subject to Bang Cookies' review and approval. The franchisor may establish foundational and organizational requirements for the Advertising Cooperative, including voting provisions allowing decisions to be made by a simple majority vote (one vote per franchisee shop) with a quorum of 25% of franchisees within the cooperative.
Franchisees are required to execute all documents requested by Bang Cookies and become members of the Advertising Cooperative, subject to the terms of those documents. All marketing materials, plans, or media used by the Advertising Cooperative or its members require the franchisor's prior written approval. Bang Cookies shops owned by the franchisor or its affiliates within the Advertising Cooperative's geographic area are not required to contribute to the cooperative.