For what purpose does Aw intend to establish, maintain, and administer the Marketing Fund?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
Recognizing the value of advertising and marketing to the goodwill and public image of Papa Ray's Pizza Restaurants, we intend to establish, maintain and administer an advertising, marketing and promotional fund (the "Marketing Fund") for such advertising, marketing and promotions as we may deem necessary or appropriate in our sole discretion.
You agree to contribute to the Marketing Fund two percent (2%) of the Gross Revenue (as defined below) of the Papa Ray's Pizza Restaurant.
We have the right to discontinue or reestablish the Marketing Fund upon sixty (60) days advance notice to you.
In the event we discontinue the Marketing Fund, we will distribute all unspent amounts existing in the Marketing Fund on the date of discontinuance to franchisees in proportion to their respective contributions for the most recent six (6) months.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw intends to establish, maintain, and administer an advertising, marketing, and promotional fund (the "Marketing Fund") for advertising, marketing, and promotions that Aw deems necessary or appropriate in its sole discretion. As a franchisee, you are required to contribute 2% of your Papa Ray's Pizza Restaurant's gross revenue to this fund. Aw retains the right to discontinue or reestablish the Marketing Fund, providing 60 days' advance notice.
The Marketing Fund is designed to maximize recognition of Aw's marks and increase patronage of Papa Ray's Pizza Restaurants. Aw has sole discretion over the advertising, marketing, and promotional programs financed by the fund, including creative concepts, materials, endorsements, and the placement and allocation of these programs across different geographic areas, markets, and media. The fund may cover the costs of producing advertising materials, administering advertising programs, maintaining the company website, supporting public relations, conducting market research, and providing promotional materials to Papa Ray's Pizza Restaurants.
While Aw aims to use the Marketing Fund to benefit all Papa Ray's Pizza Restaurants, there is no obligation to ensure that expenditures in any specific area are proportionate to the contributions from restaurants in that area. Additionally, Aw does not guarantee that any particular restaurant will directly benefit from the fund in proportion to its contribution. The Marketing Fund is a separate account, and while it will not be used for Aw's general operating expenses, it may cover reasonable salaries, administrative costs, and overhead related to administering the fund and its programs. Aw may spend more or less than the total contributions in any given year and may borrow from or invest surpluses for the fund.
Franchisees should note that all interest earned on the Marketing Fund will be used to cover advertising, marketing, and promotional costs before other assets of the fund are used. Aw will provide an annual statement of monies collected and costs incurred by the Marketing Fund upon written request. If the Marketing Fund is discontinued, any unspent amounts will be distributed to franchisees in proportion to their contributions over the most recent six months.