What happens to any interest earned on Pearce Bespoke Brand Fund contributions?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
In implementing the Brand Fund, Franchisor has the right to spend in any fiscal year an amount greater or less than the aggregate contributions to the Fund in that year, and the Brand Fund may borrow from Franchisor or other lenders to cover Fund deficits. Franchisor can accumulate funds over time until such time as Franchisor determines in its sole discretion that sufficient funds are available to adequately conduct Fund activities as contemplated herein. Franchisor can cause the Fund to invest any surplus. Franchisor may, in its sole discretion, defer, waive and/or compromise claims for contributions to, and/or claims against or with respect to, the Fund and take legal or other action against any franchisee in default of its obligations and/or deny it access to programs, materials and/or other benefits funded by the Brand Fund. Franchisee acknowledges and agrees that Franchisor has no obligation to ensure that expenditures by the Brand Fund are or will be proportionate or equivalent to contributions to the Fund by franchisees operating in any geographic area, or that any franchisee will benefit directly, indirectly or in proportion to its contribution to the Fund. Any interest earned on Fund contributions will be remitted to the Brand Fund. Franchisor and its affiliates will not be liable for any act or omission in connection with the Brand Fund that is consistent with this Agreement. You acknowledge that the Brand Fund is not a "trust," and does not create and is not in the nature of a "fiduciary" or similar special arrangement.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, any interest earned on contributions to the Brand Fund will be remitted back into the Brand Fund. This means that any interest accrued from the Brand Fund's balance will be reinvested to support the fund's activities.
Pearce Bespoke has the right to spend more or less than the aggregate contributions in any given fiscal year and can borrow funds to cover deficits. Pearce Bespoke can also accumulate funds and invest any surplus. The franchisor may defer or waive claims for contributions and take action against franchisees who default on their obligations.
As a Pearce Bespoke franchisee, it's important to understand that the franchisor has no obligation to ensure that Brand Fund expenditures are proportionate to contributions from franchisees in any specific geographic area, nor is there a guarantee that any franchisee will directly or indirectly benefit in proportion to their contribution. The Brand Fund is not considered a trust or fiduciary arrangement.