Must the Hydrodog cooperative's rules and procedures be approved by the franchisor?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
The Cooperative must be governed in the manner we prescribe.
You shall make contributions to the Cooperative in such amounts at the times and in the manner as determined by majority vote of the Cooperative members, subject to our approval.
The following provisions apply to each Cooperative:
(a) The Cooperative must be organized and governed in a form and manner, and commence operation on a date that we approve in advance in writing;
(b) the Cooperative must be organized for the exclusive purpose of administering marketing programs; developing, subject to our approval, standardized promotional materials for the members' use in Local Advertising within the Cooperative's area;
(c) the Cooperative may adopt its own rules and procedures, but such rules or procedures must be approved by us and must not restrict or expand your rights or obligations under this Agreement;
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, if a regional advertising cooperative is established, Hydrodog franchisees must adhere to specific rules and procedures, which are subject to the franchisor's approval. Hydrodog has the discretion to create these cooperatives in areas with two or more Hydrodog businesses. Franchisees are obligated to join the cooperative in their area upon Hydrodog's request and must govern the cooperative as Hydrodog prescribes.
The cooperative can adopt its own rules and procedures, but these are not valid until Hydrodog approves them. These rules and procedures must not conflict with the franchise agreement. Any lawful action taken by the cooperative is binding if approved by more than 50% of the voting power, with each franchised business having one vote, but no franchisee can hold more than 25% of the vote, regardless of how many businesses they own.
Hydrodog also requires that all marketing and promotional plans and materials used by the cooperative receive prior written approval. Franchisees must submit their contributions to the cooperative monthly, along with any required reports, subject to Hydrodog's approval. In the event of an impasse within the cooperative, Hydrodog's resolution is final and binding. This level of oversight ensures that all cooperative activities align with Hydrodog's overall brand standards and strategic objectives.