What is the Brain Balance franchisee's obligation if an Advertising Cooperative is recommended and established in their DMA?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
- (f) If FRANCHISOR recommends an Advertising Cooperative ("Advertising Co-op") in FRANCHISEE's designated marketing area ("DMA") and one is established, FRANCHISEE shall join it by executing the applicable by-laws, and shall contribute at least the amount set forth in Section 6.07. FRANCHISEE's payments to the media fund for the Advertising Co-op will apply toward satisfaction of FRANCHISEE's obligations for local advertising described in Section 6.07 of this Agreement. Advertising Co-ops are independently established and operated by franchisees in a DMA and not controlled or governed by FRANCHISOR.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, if the franchisor recommends an Advertising Cooperative within a franchisee's designated marketing area (DMA) and such a cooperative is established, the franchisee is obligated to join it. This involves executing the cooperative's by-laws and contributing at least the amount specified in Section 6.07 of the franchise agreement.
Payments made by the franchisee to the Advertising Co-op's media fund will count towards fulfilling the franchisee's local advertising obligations as outlined in Section 6.07 of the agreement. This means that participation in the co-op can help a franchisee meet their required local advertising expenditure.
It's important to note that these Advertising Co-ops are independently run by franchisees within their DMA and are not under the direct control or governance of Brain Balance itself. This implies that while Brain Balance may recommend the formation of a co-op, the franchisees themselves are responsible for its operation and management.