Does Buff City Soap have a fiduciary duty to franchisees with regard to the operation of the Brand Fund?

According to Buff City Soap's 2025 Franchise Disclosure Document, Buff City Soap does not act as a trustee regarding the Brand Fund and has no fiduciary duty to franchisees concerning the Brand Fund's operation or administration. The Brand Fund is essentially a conduit for collecting and spending contributions as described in the agreement.

Buff City Soap will account for the Brand Fund separately from its other funds and will not use it to cover general operating expenses, except for reasonable salaries, administrative costs, travel, and overhead related to administering the Brand Fund and its programs. The company may spend more or less than the aggregate contributions in any fiscal year and can borrow to cover deficits or invest surpluses. Any interest earned on Brand Fund monies will be used to pay advertising costs before using other assets of the fund.

Upon written request, but no more than once annually, Buff City Soap will provide franchisees with a copy of its unaudited annual statement of monies collected and costs incurred by the Brand Fund. This arrangement is typical in franchising, where franchisors maintain control over marketing funds but often provide some level of accounting to franchisees. Prospective franchisees should understand that while they contribute to the Brand Fund, Buff City Soap has significant discretion in how those funds are spent, without a fiduciary obligation to maximize direct benefits to each individual franchise.