What happens if Deer Solution does not institute the Brand Development Fund?
Deer_Solution Franchise · 2025 FDDAnswer from 2025 FDD Document
mmediately to procure insurance and charge all costs, fees, and expenses associated with same to Franchisee, which such charges, together with a reasonable administrative fee for Franchisor's expenses in so acting, shall be immediately payable by Franchisee to Franchisor upon demand. The foregoing remedies are in addition to any other remedies Franchisor may have under this Agreement, at law, or in equity.
ARTICLE 9 BRAND DEVELOPMENT AND MARKETING
9.A. BRAND DEVELOPMENT FUND
At all times and from time to time, as determined by Franchisor, in Franchisor's Reasonable Business Judgment, Franchisor may institute, implement, maintain, delegate, and administer a brand development fund (the "Brand Development Fund"). The following shall apply to the Brand Development Fund at all times throughout the Term:
(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) and, in accordance with the payment terms of Article 5.E. of this Agreement (the "Brand Development Fund Fee"), provided, however, Franchisee will not be required to contribute more than 3% of the Gross Sales of the Franchised Business for each weekly Accounting Period;
(2) Franchisor will provide Franchisee with written notice of the Brand Development Fund Contribution Percentage. Upon such written notice to Franchisee, the Brand Development Fund Fee be paid by Franchisee to the Brand Development Fund and/or, at Franchisor's election, prededucted from Franchisee's Gross Sales by Franchisor and shall be applicable at all times thereafter throughout the Term, except as may be 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;
(3) Franchisor, in Franchisor's Reasonable Business Judgment, shall direct all advertising, media placement, marketing and public relations programs and activities financed by the Brand Development Fund, with sole discretion over the strategic direction, creative concepts, materials, and endorsements used by the Brand Development Fund, and the geographic, market, and media placement and allocation thereof. Without limiting the foregoing, the Brand Development Fund may also be utilized for evaluation and monitoring of the Business Management Systems, maintenance and upgrades to the System Website, and development of Digital Media;
(4) Franchisee agrees that the purpose of the advertising, media, marketing, and activities financed by the Brand Development Fund is and shall be for the general enhancement of the System brand as associated with the Licensed Marks and general public brand recognition and awareness of the Licensed Marks. The Brand Development Fund will not be utilized to directly or indirectly market or promote the Franchised Business or, unless otherwise directed by Franchisor, in Franchisor's Reasonable Business Judgment, pay for media placements that may benefit or include any media market that includes Franchisee's Administrative Office or Operating Territory;
Source: Item 23 — RECEIPTS (FDD pages 55–246)
What This Means (2025 FDD)
According to Deer Solution's 2025 Franchise Disclosure Document, Deer Solution, in its Reasonable Business Judgment, may institute, implement, maintain, delegate, and administer a brand development fund. If Deer Solution does not institute the Brand Development Fund, franchisees will not be required to pay the Brand Development Fund Fee, which is a percentage of Gross Sales.
If Deer Solution does institute the Brand Development Fund, franchisees will pay a mandatory and continuing fee to the Brand Development Fund in an amount equal to a percentage of Gross Sales, but franchisees will not be required to contribute more than 3% of the Gross Sales of the Franchised Business for each weekly Accounting Period. Deer Solution will provide franchisees with written notice of the Brand Development Fund Contribution Percentage.
Deer Solution is not obligated to ensure that expenditures by the Brand Development Fund in or affecting any geographic area are proportionate or equivalent to the contributions to the Brand Development Fund by Deer Solution Businesses operating in that geographic area or that any Deer Solution Businesses will benefit directly or in proportion to its contribution to the Brand Development Fund from the development of advertising and marketing materials. Deer Solution may use the Brand Development Fund to promote or benefit any type of Deer Solution Businesses in the System or Deer Solution Businesses located within a particular region of the United States.
Franchisee agrees that Franchisee's failure to derive any such benefit will not serve as a basis for a reduction or elimination of its obligation to contribute to the Brand Development Fund. Franchisee agrees that the failure (whether with or without Deer Solution's permission) of any other franchisee to make the appropriate amount of contributions to the Brand Development Fund shall not in any way release Franchisee from or reduce Franchisee's obligations. Deer Solution assumes no direct or indirect liability, responsibility, or obligation to Franchisee with respect to the maintenance, direction, and/or administration of the Brand Development Fund.