Under what conditions can Extreme Art Studio or its affiliates establish a Local Advertising Cooperative?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
und. If we terminate the Brand Fund, we will distribute all unspent monies to our franchise owners, and to us and our affiliates, in proportion to their, and our, respective Brand Fund Contributions during the preceding 12-month period.
9.4 LOCAL ADVERTISING COOPERATIVE.
- 9.4.1 Subject to the terms and conditions of this Section 9.4, you agree that we or our affiliates or designees may establish or direct the establishment of a local advertising cooperative ("Local Advertising Cooperative") in geographical areas (as determined by us) in which two or more Extreme Art Studio Businesses are operating. We will require that each Local Advertising Cooperative that exceeds five franchisee members be organized and governed by written documents. Such written documents will be available for participating Local Advertising Cooperative franchise owners to review. We may change, dissolve and merge Local Advertising Cooperatives. Each Local Advertising Cooperative's purpose is, with our approval, to administer advertising programs and develop advertising, marketing and promotional materials for the area that the Local Advertising Cooperative covers. If, as of the time you sign this Franchise Agreement, we have established a Local Advertising Cooperative for the geographic area in which the Franchised Business is located, or if we establish a Local Advertising Cooperative in that area during this Franchise Agreement's term, you agree to sign the documents we require to become a member of the Local Advertising Cooperative and to participate in the Local Advertising Cooperative as those documents require.
- 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
Advertising Cooperative. The Local Advertising Cooperative may not use any advertising, marketing, or promotional plans or materials without our prior written consent.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to Extreme Art Studio's 2024 Franchise Disclosure Document, Extreme Art Studio or its affiliates or designees can establish a Local Advertising Cooperative in geographical areas where two or more Extreme Art Studio Businesses are operating, as determined by them. If a Local Advertising Cooperative exceeds five franchisee members, Extreme Art Studio will require that it be organized and governed by written documents, which will be available for review by participating franchise owners. Extreme Art Studio also retains the right to change, dissolve, and merge Local Advertising Cooperatives.
If Extreme Art Studio establishes a Local Advertising Cooperative in a franchisee's geographic area, the franchisee is required to sign the necessary documents to become a member and participate in the cooperative. The purpose of each Local Advertising Cooperative is to administer advertising programs and develop advertising, marketing, and promotional materials for its designated area, subject to Extreme Art Studio's approval.
Franchisees must contribute their share to the Local Advertising Cooperative, as determined by its members, for each Extreme Art Studio Business they own within the cooperative's area. These contributions are credited towards the franchisee's Local Advertising Requirement, which is $500 per month, and are payable within five days after the end of the calendar month. Contributions may be capped based on the bylaws adopted by the Local Advertising Cooperative, subject to Extreme Art Studio's approval. Extreme Art Studio Businesses owned by Extreme Art Studio or its affiliates will contribute on the same basis as franchisees. Each contributing Extreme Art Studio Business has one vote on matters involving the cooperative's activities, but all advertising, marketing, and promotional plans or materials require Extreme Art Studio's prior written consent.