Is the Face Foundrie marketing fund considered an asset of the franchisor?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
All sums paid to the Fund will be maintained in an account separate from our general funds.
The Fund is not and will not be our asset, and we or our designee will maintain separate bookkeeping accounts for the Fund.
We will have the right to charge the Fund for the reasonable administrative costs and overhead that we incur in activities reasonably related to the direction and implementation of the Fund and advertising programs for you and the System (for example, accounting costs, salaries, costs of our personnel for creating and implementing, advertising, merchandising, promotional and marketing programs and associated overhead).
The Fund and its earnings will not otherwise inure to our benefit.
We have no fiduciary obligation to you for administering the Fund.
We may incorporate the Fund or operate it through a separate entity when we think best.
The successor entity will have all of the rights and duties described in this paragraph.
We may use collection agents and institute legal proceedings to collect the Marketing Contributions at the Fund's expense.
We also may forgive, waive, settle and compromise all claims by or against the Fund.
We assume no other direct or indirect liability or obligation to you for collecting amounts due to, maintaining, directing, or administering the Fund.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 33–43)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, the System Marketing Fund is explicitly stated not to be an asset of the franchisor. The FDD specifies that all sums paid into the Fund will be maintained in a separate account from Face Foundrie's general funds, and separate bookkeeping accounts will be maintained for the Fund. This separation is a common practice in franchising to ensure that marketing funds are used solely for the benefit of the franchise system and not for the franchisor's direct financial gain.
Face Foundrie retains the right to charge the Fund for reasonable administrative costs and overhead incurred in activities related to the direction and implementation of the Fund and advertising programs. These costs include accounting, salaries, and personnel costs associated with creating and implementing advertising, merchandising, promotional, and marketing programs. However, the FDD emphasizes that the Fund and its earnings will not otherwise benefit Face Foundrie, ensuring that the financial benefits of the marketing efforts are directed towards enhancing the Face Foundrie system as a whole.
While Face Foundrie has the authority to manage and direct the Fund, including the ability to use collection agents and institute legal proceedings to collect marketing contributions, it assumes no direct or indirect liability or obligation to franchisees for collecting amounts due to, maintaining, directing, or administering the Fund. This arrangement is structured to provide Face Foundrie with the necessary control over marketing initiatives while protecting the financial integrity of the Fund for the benefit of the franchise system. Face Foundrie also states that they have no fiduciary obligation to franchisees for administering the Fund.