How is the Best Brains Brand Development Fund accounted for?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
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- The Brand Development Fund will be accounted for separately from the other funds of the Company and shall not be used to defray the Company's general operating expenses, except for such reasonable salaries, administrative costs and overhead we may incur in activities reasonably related to the administration of the Brand Development Fund and its advertising and marketing.
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- We shall be authorized to spend in any fiscal year an amount greater or less than the aggregate contribution of all BEST BRAINS businesses to the Brand Development Fund in that year; and the Brand Development Fund may borrow from the Company or other lenders to cover deficits of the Brand Development Fund or cause the Brand Development Fund to invest any surplus for future use by the Brand Development Fund. An unaudited report of the receipts and disbursements of the Brand Development Fund will be prepared annually and will be made available to you upon written request.
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- Upon 30 days' prior written notice to you, we shall have the right to suspend contributions to and operation of the Brand Development Fund for one or more periods that we determine to be appropriate or to terminate the Brand Development Fund.
- i. We shall distribute all unspent monies of the Brand Development Fund which was terminated to the Company, its affiliates and franchisees in proportion to their respective contributions to the Brand Development Fund during the preceding twelve-month period.
- ii. We shall have the right to reinstate the Brand Development Fund upon the same terms and conditions as set forth in this Agreement, upon thirty days' prior written notice to you.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, the Brand Development Fund is accounted for separately from the company's other funds. This means that the money contributed to the fund is tracked independently. Best Brains can use the fund to cover reasonable salaries, administrative costs, and overhead related to the fund's administration, advertising, and marketing activities.
Best Brains is authorized to spend more or less than the total contributions to the Brand Development Fund in any given fiscal year. To manage potential deficits, the fund can borrow money from the company or other lenders. Conversely, any surplus funds can be invested for future use. Franchisees are entitled to receive an unaudited report of the Brand Development Fund's receipts and disbursements annually, upon written request.
Best Brains retains the right to suspend or terminate the Brand Development Fund with 30 days' prior written notice to franchisees. If the fund is terminated, any unspent monies will be distributed to the company, its affiliates, and franchisees in proportion to their contributions to the fund during the preceding twelve-month period. Best Brains can reinstate the fund under the same terms and conditions with 30 days' prior written notice.