Does Aw assume any indirect obligation to franchisees with respect to the maintenance, direction, or administration of the Aw Marketing Fund?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
no requirement that the Marketing Fund be audited.
You understand and acknowledge that the Marketing Fund is intended to maximize recognition of the Marks and patronage of Papa Ray's Pizza Restaurants. Although we intend to use the Marketing Fund to develop advertising, marketing and promotional materials, and to place advertising in a manner that will benefit all Papa Ray's Pizza Restaurants, we have no obligation to ensure that expenditures by the Marketing Fund in or affecting any geographic area are proportionate or equivalent to contributions to the Marketing Fund by Papa Ray's Pizza Restaurants operating in that geographic area or that any Papa Ray's Pizza Restaurant will benefit directly or in proportion to its contribution to the Marketing Fund from the development of advertising, marketing and promotional materials or the placement of advertising. Contributions to the Marketing Fund will not be used principally to solicit new franchise sales. We assume no direct or indirect liability or obligation to you with respect to the maintenance, direction or administration of the Marketing Fund.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw assumes no direct or indirect liability or obligation to franchisees regarding the maintenance, direction, or administration of the Marketing Fund, except as expressly provided in the franchise agreement.
Aw administers a system-wide Marketing Fund, directing all advertising, marketing, and promotional programs financed by the fund. This includes discretion over creative concepts, materials, endorsements, and the geographic, market, and media placement of programs. The Marketing Fund can be used to cover various costs, such as preparing advertising materials, administering advertising programs, maintaining the company website, supporting public relations, and providing promotional materials to Papa Ray's Pizza Restaurants.
The Marketing Fund is maintained as a separate account and is accounted for separately from Aw's other funds. It is not used for Aw's general operating expenses, except for reasonable salaries, administrative costs, and overhead related to the fund's administration. Aw may spend more or less than the total contributions to the fund in any fiscal year and may borrow from lenders or invest surpluses for future use. Interest earned on the fund is used to pay for advertising and promotional costs. Aw prepares an annual statement of monies collected and costs incurred by the Marketing Fund, which is furnished to franchisees upon written request.
Aw aims to maximize recognition of the Marks and patronage of Papa Ray's Pizza Restaurants through the Marketing Fund. While Aw endeavors to use the fund to develop advertising and promotional materials that benefit all restaurants, it does not guarantee that expenditures in any geographic area will be proportionate to contributions from restaurants in that area, or that any restaurant will benefit directly or in proportion to its contribution.