ad-fund-agreement

name	ad-fund-agreement
title	Advertising Fund Contribution Agreement
description	Drafts franchise advertising fund contribution agreements or addenda governing franchisee obligations to a centralized marketing fund. Trigger when drafting ad fund agreements, marketing fund addenda, or franchise contribution agreements involving fund administration, contribution calculations, or financial reporting.
author	CaseMark
author_url	https://github.com/CaseMark/skills/tree/main/skills/legal/ad-fund-agreement
license	Apache-2.0
version	0.1.0
execution_mode	open
jurisdiction	us
practice	commercial
language	en
tags	["agreement","drafting","transactional"]

Advertising Fund Contribution Agreement

Drafts a franchise advertising fund agreement or addendum establishing contribution obligations, fund administration, and transparency provisions that minimize disputes.

Prerequisites

1. Franchise Agreement — executed copy with date, amendment numbers, notice clauses, defined terms (especially "Gross Sales")
2. Fund structure — standalone vs. addendum; national vs. regional; separate account vs. accounting mechanism
3. Contribution rate — percentage of Gross Sales, payment frequency, remittance method (typically EFT aligned with royalty schedule)
4. State franchise law — jurisdiction-specific disclosure obligations, separate-account mandates, reporting requirements
5. FDD language — current Item 6 and Item 7 advertising fund disclosures for consistency

Document Sections

#	Section	Key Content
1	Header & Parties	Title, legal names, effective date, reference to underlying Franchise Agreement, incorporation language
2	Recitals	Fund business purpose, mutual benefit acknowledgment, obligation commencement date
3	Fund Establishment	Scope (national/regional/system-wide), legal structure, stated purpose
4	Contribution Obligation	Gross Sales percentage, Gross Sales definition, payment frequency/due dates, remittance method, late-payment consequences
5	Fund Administration	Franchisor discretion, non-fiduciary disclaimer, enumerated permissible uses, rate/structure modification with notice, carry-forward and borrowing
6	Franchisee Rights & Limitations	No proportional-benefit or geographic-targeting guarantee, separation from local ad obligations, franchisor approval over local ads, limited audit rights
7	Financial Reporting	Annual minimum reporting (receipts, disbursements by category, ending balance), audit provisions, FDD integration, surplus/deficit treatment
8	Term & Termination	Coterminous with franchise agreement, modification notice periods, post-termination payment obligations, surviving provisions, fund dissolution
9	Legal Compliance	Authority representations, state franchise law compliance, FDD consistency, governing law, dispute resolution, integration clause