Under what conditions might a Nothing Bundt Cakes franchisee be exempt from Cooperative membership?
Nothing_Bundt_Cakes Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to designate any geographical area for purposes of establishing a regional advertising and promotional cooperative ("Cooperative"), and to determine whether a Cooperative is applicable to your Bakery. If a Cooperative is established applicable to your Bakery, you must participate in and contribute to the Cooperative. Each Cooperative will be organized for the exclusive purpose of administering regional advertising programs and developing, subject to our approval, standardized advertising materials for use by the members in local advertising. No promotional or advertising plans or materials may be used by a Cooperative or furnished to its members without our prior written approval. All such plans and materials will be submitted to us for approval. Cooperative contributions will be credited towards either your Production Fund contributions and/or your Media Fund contributions, as we shall decide. We may grant to any franchisee, in our sole discretion, an exemption for any length of time from the requirement of membership in a Cooperative, upon written request of such franchisee stating reasons supporting such exemption. Our decision concerning such request for an exemption will be final. Upon the request of a franchisee in the Cooperative, the Cooperative will provide that franchisee a copy of the bill for advertising that the Cooperative received. Neither we nor the Cooperative will prepare an annual accounting of these funds. (Section 11.5 of the Franchise Agreement).
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 42–52)
What This Means (2025 FDD)
According to Nothing Bundt Cakes's 2025 Franchise Disclosure Document, a franchisee may be exempt from the requirement of membership in a Cooperative under certain conditions. Nothing Bundt Cakes, in its sole discretion, may grant an exemption for any length of time.
To be considered for an exemption, a franchisee must submit a written request stating the reasons supporting the exemption. The decision regarding the exemption request rests solely with Nothing Bundt Cakes, and their decision is considered final.
If a Cooperative is established and applicable to a franchisee's bakery, the franchisee is generally required to participate in and contribute to the Cooperative. These Cooperative contributions will be credited towards either the Production Fund contributions or the Media Fund contributions, as determined by Nothing Bundt Cakes. This exemption provides a potential benefit to franchisees who can demonstrate a valid reason for not participating in the Cooperative, allowing them to focus their advertising and promotional efforts in a way that best suits their specific market or circumstances.