How will Eos Worldwide determine the spending of contributions to the Brand Development Fund?

(a) We may form a Brand Development Fund to promote EOS, the EOS Franchise System and its Services and Products. The terms of this Section 11.4 are forward thinking to the extent any such Brand Fund may be formed in the future; provided, however, you would be required to comply with applicable terms and conditions for the Brand Fund as we may establish and update from time to time. The Brand Fund will be used for national, international and/or regional advertising, publicity and promotion relating to EOS and the EOS Franchise System. We will have the right to determine the manner in which the contributions to the Brand Fund are spent, and we may use any form of media we determine is appropriate to conduct advertising and may utilize an in-house advertising department or outside agencies. Some portion of the Brand Fund may be used for creative concept production, website development, marketing surveys, test marketing and related purposes. We will have the right to direct all advertising activities with sole discretion over creative concepts, materials and media used, as well as their placement and allocation, and the right to determine, in our sole discretion, the composition of all geographic and market areas for the implementation of any such advertising and promotional activities.

• (b) The Brand Fund will be operated to maximize general public recognition of the Marks and patronage of EOS Worldwide businesses and therefore, we have no obligation to ensure that expenditures of the Brand Fund in or affecting any geographic area are proportionate or equivalent to payments of the Brand Fund contributions by franchisees operating in that geographic area, or that any franchisee's business will benefit directly from any uses or proportionately with any other franchisees.
• (c) Brand Fund contributions paid will be kept separate and distinct and will be accounted for separately from our other funds. These funds will not be used to defray any of our general operating expenses, except as described in the paragraph above, and no amount of the Brand Fund will be spent for advertising that is principally a solicitation for the sale of franchises, although we will retain the right to include "Franchises Available" or "Interested in becoming a Professional EOS Implementer" or similar language along with our contact information on Brand Fund advertising.
• (d) We may reimburse ourselves out of the Brand Fund for the total costs (including indirect costs) of developing, producing and distributing any advertising materials and administering the Brand Fund (including without limitation, legal, auditing and accounting fees, salaries of in-house advertising personnel and outside advertising agencies and other expenses incurred in connection with collecting any Brand Fund contributions).
• (e) Any sums paid to the Brand Fund that are not spent in the year they are collected will carry over to the following year. For any fiscal year in which we operate or maintain a Brand Fund to which you contribute, then within one hundred twenty (120) days of the fiscal year-end, we will prepare, and furnish to you upon written request, an annual, unaudited statement of funds collected and costs incurred.
• (f) Except as expressly provided in this Section, we assume no direct or indirect liability or obligation to you with respect to collecting amounts due to the Brand Fund.
  • (g) For purposes of this Agreement, the Brand Fund will be deemed to be our affiliate.

Source: Item 23 — RECEIPTS (FDD pages 74–246)