How will Fitstop account for sums paid to the Brand Development Fund?

According to Fitstop's 2024 Franchise Disclosure Document, all sums paid to the Brand Development Fund will be accounted for separately. Franchisees are required to contribute to the Fund an amount equal to two percent (2%) of their Franchised Business's Gross Revenue. These contributions are remitted at the same time and in the same manner as the Royalty Fees, unless Fitstop designates another method with at least 30 days' prior written notice.

These Fund Contributions are non-refundable upon payment. Fitstop has sole discretion to administer the marketing fees described in the agreement, including approving creative concepts, materials, and media used in advertising programs. Franchisees must use only advertising and advertising materials provided by Fitstop, subject to exceptions identified in the agreement and manuals. If a franchisee's advertising campaign does not conform to the manuals, they must submit all advertising plans and materials to Fitstop for approval at least 30 calendar days prior to publication.

Fitstop is not required to expend any particular portion of the Fund or a franchisee's contributions specifically to their Designated Territory. Fitstop may use the Fund for activities it deems appropriate to promote, market, advertise, and develop the System, Proprietary Marks, System Business locations, Approved Services/Products, and the Fitstop brand generally. The approval of a franchisee's advertising plans or materials does not obligate Fitstop to pay for them; Fitstop can adopt such materials for its own benefit or disseminate them for use by other franchisees.

This arrangement gives Fitstop significant control over the Brand Development Fund and how it is used, while franchisees have limited say in how their contributions are spent. Prospective franchisees should consider that their contributions may not directly benefit their specific location and that all marketing efforts are subject to Fitstop's approval.