Does Care Plus Medical Ucc require participation in a Market Cooperative?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
are an unaudited annual financial statement of the Marketing Fund within 120 days of the close of Care Plus Medical UCC's fiscal year and will provide the financial statement to Franchisee upon request.
- 9.4 Market Cooperatives. Care Plus Medical UCC may establish market advertising and promotional cooperative funds ("Market Cooperative") in any geographical areas. If a Market Cooperative for the geographic area encompassing the Location has been established at the time Franchisee commences operations hereunder, Franchisee shall immediately become a member of such Market Cooperative. If a Market Cooperative for the geographic area encompassing the Location is established during the term of this Agreement, Franchisee shall become a member of such Market Cooperative within 30 days. Care Plus Medical UCC shall not require Franchisee to be a member of more than one Market Cooperative. If Care Plus Medical UCC establishes a Market Cooperative:
- (a) Governance. Each Market Cooperative will be organized and governed in a form and manner, and shall commence operations on a date, determined by Care Plus Medical UCC. Care Plus Medical UCC may require the Market Cooperative to adopt bylaws or regulations prepared by Care Plus Medical UCC. Unless otherwise specified by Care Plus Medical UCC, the activities carried on by each Market Cooperative shall be decided by a majority vote of its members. Care Plus Medical UCC will be entitled to attend and participate in any meeting of a Market Cooperative. Any Care Plus Medical business owned by Care Plus Medical UCC in the Market Cooperative shall have the same voting rights as those owned by its franchisees. Each Business owner will be entitled to cast one vote for each Business owned, provided, however, that a franchisee shall not be entitled to vote if it is in default under its franchise agreement. If the members of a Market Cooperative are unable or fail to determine the manner in which Market Cooperative monies will be spent, Care Plus Medical UCC may assume this decision-making authority after 10 days' notice to the members of the Market Cooperative.
- (b) Purpose. Each Market Cooperative shall be devoted exclusively to administering regional advertising and marketing programs and developing (subject to Care Plus Medical UCC's approval) standardized promotional materials for use by the members in local advertising and promotion.
- (c) Approval. No advertising or promotional plans or materials may be used by a Market Cooperative or furnished to its members without the prior approval of Care Plus Medical UCC pursuant to Section 9.1. Care Plus Medical UCC may designate the national or regional advertising agencies used by the Market Cooperative.
- (d) Funding. The majority vote of the Market Cooperative will determine the dues to be paid by members of the Market Cooperative, including Franchisee, but not less than 1% and not more than 5% of Gross Sales.
- (e) Enforcement. Only Care Plus Medical UCC will have the right to enforce the obligations of franchisees who are members of a Market Cooperative to contribute to the Market Cooperative.
- (f) Termination. Care Plus Medical UCC may terminate any Market Cooperative. Any funds left in a Market Cooperative upon termination will be transferred to the Marketing Fund.
- 9.5 Required Spending. Franchisee shall spend at least 2% of Gross Sales each month on marketing the Business. Upon request of Care Plus Medical UCC, Franchisee shall furnish proof
of its compliance with this Section. Care Plus Medical UCC has the sole discretion to determine what activities constitute "marketing" under this Section.
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to Care Plus Medical Ucc's 2024 Franchise Disclosure Document, participation in a Market Cooperative is sometimes required. If a Market Cooperative exists for the geographic area of the franchise location when the franchisee begins operations, the franchisee must immediately become a member. If a Market Cooperative is established during the term of the Franchise Agreement for the franchisee's area, the franchisee has 30 days to join. Care Plus Medical Ucc will not require a franchisee to be a member of more than one Market Cooperative.
Each Market Cooperative is devoted to administering regional advertising and marketing programs and developing standardized promotional materials, subject to Care Plus Medical Ucc's approval. The cooperative's activities are decided by a majority vote of its members, though Care Plus Medical Ucc is entitled to attend and participate in any meeting and has the same voting rights as franchisees for any Care Plus Medical business it owns in the Market Cooperative. Each business owner gets one vote per business owned, unless they are in default under their franchise agreement.
The majority vote of the Market Cooperative determines the dues to be paid by members, including franchisees, but the dues must be between 1% and 5% of Gross Sales. Care Plus Medical Ucc has the sole right to enforce the obligations of franchisees to contribute to the Market Cooperative. Care Plus Medical Ucc also has the power to terminate any Market Cooperative, and any funds remaining upon termination are transferred to the Marketing Fund.
Care Plus Medical Ucc maintains significant control over the Market Cooperative, including the ability to require the cooperative to adopt bylaws or regulations prepared by Care Plus Medical Ucc. Additionally, no advertising or promotional plans or materials can be used by the Market Cooperative without Care Plus Medical Ucc's prior approval, and Care Plus Medical Ucc may designate the national or regional advertising agencies used by the Market Cooperative. If the members of a Market Cooperative cannot agree on how to spend the cooperative's money, Care Plus Medical Ucc may assume decision-making authority after 10 days' notice.