Is the Baya Bar Brand Fund intended to be of limited or perpetual duration?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 13.3.7 Although the Brand Fund is intended to be of perpetual duration, Franchisor may terminate it at any time and for any reason or no reason.
Franchisor will not terminate the Brand Fund, however, until all monies in the Brand Fund have been spent for advertising or promotional purposes or returned to contributors, without interest, on the basis of their respective contributions.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the Brand Fund is intended to be of perpetual duration. However, Baya Bar retains the right to terminate the Brand Fund at any time, for any reason, or for no reason at all.
If Baya Bar decides to terminate the Brand Fund, the FDD specifies that the funds must be used for advertising or promotional purposes. Alternatively, the remaining monies can be returned to the contributors, without interest, based on their respective contributions.
This clause gives Baya Bar significant flexibility in managing the Brand Fund. While the intention is for the fund to be ongoing, franchisees should be aware of the possibility of termination and the conditions under which that could occur. Prospective franchisees should consider this when evaluating the long-term marketing support they can expect from the franchise.