What are some examples of costs that the Aw Marketing Fund may be used to pay for?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree that the Marketing Fund may be used to pay the costs of preparing and producing video, audio and written advertising materials; administering national, regional or local advertising programs including, without limitation, direct mail and other media advertising, and employing advertising agencies to assist in those activities; establishing and maintaining the Company Website; supporting public relations, market research and marketing activities; and providing advertising, marketing and promotional materials to Papa Ray's Pizza Restaurants. The Marketing Fund will furnish you with approved advertising, marketing and promotional materials at its direct cost of producing those materials.
The Marketing Fund will be a separate and distinct account and will be accounted for separately from the other funds of the Company and will not be used to defray any of our general operating expenses, except for any reasonable salaries, administrative costs and overhead we may incur in activities reasonably related to the administration of the Marketing Fund and its advertising, marketing and promotional programs (including, without limitation, conducting market research, preparing advertising, marketing and promotional materials, and collecting and accounting for contributions to the Marketing Fund). We may spend in any fiscal year an amount greater or less than the total contribution of Papa Ray's Pizza Restaurants to the Marketing Fund in that year. We may cause the Marketing Fund to borrow from us or other lenders to cover deficits of the Marketing Fund or cause the Marketing Fund to invest any surplus for future use by the Marketing Fund. All interest earned on monies contributed to the Marketing Fund will be used to pay advertising, marketing and promotional costs of the Marketing Fund before other assets of the Marketing Fund are expended. We will prepare an annual statement of monies collected and costs incurred by the Marketing Fund and will furnish it to you on written request.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, the Marketing Fund is used for various advertising, marketing, and promotional activities. Aw has sole discretion over these programs. The fund can cover the costs of preparing video, audio, and written advertising materials. It also supports the administration of national, regional, or local advertising programs, including direct mail and other media advertising, and the employment of advertising agencies.
Additionally, the Marketing Fund can be used for establishing and maintaining the company website, supporting public relations, market research, and general marketing activities. It also provides advertising, marketing, and promotional materials to Aw restaurants. The Marketing Fund operates as a separate account, distinct from Aw's general operating funds. However, Aw can use the fund to cover reasonable salaries, administrative costs, and overhead related to managing the Marketing Fund and its associated programs.
Aw retains the right to spend more or less than the total contributions from franchisees in any given fiscal year. The company may also borrow from lenders or invest surplus funds for future use by the Marketing Fund. Any interest earned on the Marketing Fund will be used to cover advertising, marketing, and promotional costs before other assets are expended. Franchisees are entitled to receive an annual statement detailing the monies collected and costs incurred by the Marketing Fund upon written request.