Is the Aplus Marketing Fee considered a trust or escrow?

According to Aplus's 2024 Franchise Disclosure Document, the Marketing Fee is not considered a trust or escrow. Aplus franchisees are required to contribute up to $1,500 or 2% of Gross Sales each month, whichever is less, for the Marketing Fee. Currently, all franchisees contribute $750 per month. These funds are used at Aplus's discretion for advertising programs, with Aplus having exclusive control over the creative content, advertising placement, and allocation of funds. Aplus may use these funds to cover administrative costs related to the Marketing Fee.

Importantly, Aplus explicitly states that the Marketing Fee is not a trust or escrow, and neither Aplus nor its affiliates have any fiduciary obligation for administering the Marketing Fee. There is no requirement for the Marketing Fee monies to be audited, and Aplus does not provide an accounting of how the funds are spent. While most of the Marketing Fee monies are spent in the year they accrue, any remaining amount is carried over to the following year.

While Aplus spends or makes available Marketing Fee monies for each APLUS Store operated by franchisees, Aplus is not obligated to ensure that expenditures from the Marketing Fee monies will affect any geographic area are or will be proportionate or equivalent to the contributions to the APLUS Stores operating in that geographic area. Aplus also has no obligation to ensure that any APLUS Store will benefit directly or in proportion to its Marketing Fee contribution or from the development of advertising, business development and marketing materials and/or programs, the placement of advertising or otherwise. This lack of fiduciary responsibility and transparency is not uncommon in franchising, but prospective franchisees should be aware that they have limited control or insight into how their marketing contributions are used.