Can contributions to a Local Advertising Cooperative for my Extreme Art Studio franchise be capped?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
- 9.4.2 If we establish a Local Advertising Cooperative in your geographic area pursuant to this Section 9.4, you agree to participate and contribute your share, as determined by the members of the Local Advertising Cooperative, to such Local Advertising Cooperative for each Extreme Art Studio Business that you own that exists within the Local Advertising Cooperative's area. Your contributions to a Local Advertising Cooperative will be credited to your Local Advertising Requirement described in Section 9.2, and payable within five days after the end of the calendar month (or as we designate). Your contributions to a Local Advertising Cooperative may also be capped based on the provisions of the bylaws adopted by the Local Advertising Cooperative, subject to our approval. You will pay these monies to us electronically, and we will remit them periodically to the Local Advertising Cooperative. Extreme Art Studio Businesses owned by us or our affiliates will contribute to their respective Local Advertising Cooperative on the same basis as our franchise owners. Members of the cooperative will be responsible for administering the cooperative, including determining the amount of contributions from each member.
- 9.4.3 Each Extreme Art Studio Business contributing to a Local Advertising Cooperative will have one vote on matters involving the activities of the particular Local
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, contributions to a Local Advertising Cooperative may be capped. The FDD states that these contributions can be capped based on the provisions of the bylaws adopted by the Local Advertising Cooperative, but this is subject to Extreme Art Studio's approval.
Extreme Art Studio requires franchisees to participate in a Local Advertising Cooperative if one is established in their geographic area. The amount each franchisee contributes is determined by the members of the Local Advertising Cooperative. These contributions are credited toward the franchisee's Local Advertising Requirement, which is $500 per month.
Franchisees pay these monies to Extreme Art Studio electronically, and Extreme Art Studio remits them periodically to the Local Advertising Cooperative. Extreme Art Studio businesses owned by Extreme Art Studio or its affiliates contribute to their respective Local Advertising Cooperative on the same basis as franchisees. Each Extreme Art Studio Business contributing to a Local Advertising Cooperative has one vote on matters involving the activities of the particular Local Advertising Cooperative.