Does the personal liability of the Franchisee to Deck Medic extend to the advertising obligations outlined in Article 9 of the Franchise Agreement?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
Although Franchisor will endeavor to utilize the National Advertising Fund to develop advertising and marketing materials and programs, Franchisor undertakes no obligation to ensure that expenditures by the National Advertising Fund in or affecting any geographic area are proportionate or equivalent to the contributions to the National Advertising Fund by Deck Medic Businesses operating in that geographic area or that any Deck Medic Businesses will benefit directly or in proportion to its contribution to the National Advertising Fund from the development of advertising and marketing materials. Franchisor may use the National Advertising Fund to promote or benefit any type of Deck Medic Businesses in the System. Franchisor may use the National Advertising Fund to promote or benefit Deck Medic Businesses located within a particular region of the United States. Franchisee agrees that Franchisee's failure to derive any such benefit will not serve as a basis for a reduction or elimination of its obligation to contribute to the National Advertising Fund. Franchisee agrees that the failure (whether with or without Franchisor's permission) of any other franchisee to make the appropriate amount of contributions to the National Advertising Fund shall not in any way release Franchisee from or reduce Franchisee's obligations under this Article 9, such obligations being separate and independent obligations of Franchisee under this Agreement. Except as expressly provided in this Article 9, Franchisor assumes no direct or indirect liability, responsibility, or obligation to Franchisee with respect to the maintenance, direction, and/or administration of the National Advertising Fund; and
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the franchisee's obligations to contribute to advertising are independent. Specifically, the franchisee's obligation to contribute to the National Advertising Fund is not reduced or eliminated if the franchisee does not directly benefit from the fund's expenditures in their area. Furthermore, the failure of other franchisees to contribute to the National Advertising Fund does not release the franchisee from their obligations under Article 9. This means that each franchisee is individually responsible for their advertising contributions, regardless of the performance or contributions of others. Deck Medic undertakes no obligation to ensure that National Advertising Fund expenditures in any geographic area are proportionate or equivalent to the contributions to the fund by Deck Medic businesses operating in that geographic area or that any Deck Medic Businesses will benefit directly or in proportion to its contribution to the National Advertising Fund from the development of advertising and marketing materials.
Franchisee agrees that Franchisee's failure to derive any such benefit will not serve as a basis for a reduction or elimination of its obligation to contribute to the National Advertising Fund. Franchisee agrees that the failure (whether with or without Franchisor's permission) of any other franchisee to make the appropriate amount of contributions to the National Advertising Fund shall not in any way release Franchisee from or reduce Franchisee's obligations under this Article 9, such obligations being separate and independent obligations of Franchisee under this Agreement.
In summary, a Deck Medic franchisee cannot avoid or reduce their advertising obligations based on the performance of the advertising fund or the contributions of other franchisees. Each franchisee's advertising obligations are treated as separate and independent.