What is the definition of a 'Market Cooperative' for Chocolate Bash?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
CB Franchising 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.
CB Franchising shall not require Franchisee to be a member of more than one Market Cooperative.
If CB Franchising 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 CB Franchising.
CB Franchising may require the Market Cooperative to adopt bylaws or regulations prepared by CB Franchising.
Unless otherwise specified by CB Franchising, the activities carried on by each Market Cooperative shall be decided by a majority vote of its members.
CB Franchising will be entitled to attend and participate in any meeting of a Market Cooperative.
Any Chocolate Bash business owned by CB Franchising 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, CB Franchising 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 CB Franchising's approval) standardized promotional materials for use by the members in local advertising and promotion.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, a Market Cooperative is defined as a market advertising and promotional cooperative fund that Chocolate Bash may establish in any geographical area. If a Market Cooperative exists for the area encompassing a franchisee's location when they start operating, the franchisee must immediately become a member. If a Market Cooperative is created during the term of the Franchise Agreement, the franchisee has 30 days to join. Franchisees are not required to be members of more than one Market Cooperative.
Chocolate Bash determines the organization, governance, and start date of each Market Cooperative and may require the adoption of bylaws or regulations. Unless Chocolate Bash specifies otherwise, a majority vote of the members decides the activities of the cooperative. Chocolate Bash is entitled to attend and participate in any meeting, and any Chocolate Bash business owned by them has the same voting rights as those owned by franchisees. Each business owner gets one vote per business owned, but a franchisee in default under their franchise agreement cannot vote.
The purpose of each Market Cooperative is to administer regional advertising and marketing programs and develop standardized promotional materials for local advertising and promotion, subject to Chocolate Bash's approval. If the members cannot agree on how to spend the Market Cooperative's funds, Chocolate Bash can assume decision-making authority after giving the members 10 days' notice. This structure ensures that marketing efforts are coordinated and aligned with the overall brand strategy, while also allowing for some local adaptation.