What is the 'Due Date' in relation to the Brand Development Fund Fee for Bang Cookies franchisees?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
(1) If Franchisor institutes the Brand Development Fund, Franchisee shall pay, on the Due Date, a mandatory and continuing fee to the Brand Development Fund in an amount equal to a percentage of Gross Sales (as determined and designated by Franchisor in Franchisor's Reasonable Business Judgment) for each weekly Accounting Period (the "Brand Development Fund Fee"), provided, however, Franchisee will not be required to contribute more than 2% of the Gross Sales of the Franchised Business for each weekly Accounting Period;
(2) Franchisor will provide Franchisee with written notice of the percentage of Gross Sales that Franchisee is required to contribute to the Brand Development Fund.
Upon such written notice to Franchisee, the percentage of Gross Sales to be paid by Franchisee to the Brand Development Fund will be applicable for each and every weekly Accounting Period thereafter during the Term until otherwise designated by Franchisor in writing.
The Brand Development Fund Fee shall be paid to Franchisor on the Due Date and in accordance with the payment terms and method set forth in Article 5.B. for the payment of Royalty Fees;
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, if Bang Cookies institutes a Brand Development Fund, franchisees must pay a mandatory and continuing fee on the 'Due Date'. This fee is a percentage of Gross Sales, determined by Bang Cookies, for each weekly Accounting Period. However, the franchisee will not be required to contribute more than 2% of their Gross Sales for each weekly Accounting Period.
Bang Cookies will provide written notice to the franchisee specifying the percentage of Gross Sales required for the Brand Development Fund Fee. This percentage will remain applicable for each weekly Accounting Period until Bang Cookies provides a new written designation. The Brand Development Fund Fee is paid to Bang Cookies on the Due Date, following the payment terms and method outlined in Article 5.B for Royalty Fees.
In simpler terms, the 'Due Date' is the date on which Bang Cookies franchisees must pay their Brand Development Fund Fee, which is calculated as a percentage of their weekly gross sales, with a maximum contribution of 2%. The specific payment terms and methods will mirror those used for royalty fees, as detailed in another section of the Franchise Agreement. This contribution is mandatory if Bang Cookies establishes a Brand Development Fund.