If Checkersrallys terminates the National Promotion Fund (NPF), how will the unspent monies be distributed?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
If we terminate the NPF, we will distribute all unspent monies to our "Checkers" and "Rally's" franchisees, and to us and our Affiliates, in proportion to their, and our, respective NPF contributions during the preceding twelve (12) month period, or as otherwise provided by the organizational documents of the NPF.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if the company terminates the National Promotion Fund (NPF), the unspent monies will be distributed to Checkersrallys franchisees, as well as to Checkersrallys itself and its affiliates. The distribution will be proportional to each party's contributions to the NPF during the 12-month period preceding the termination. Alternatively, the distribution may occur as specified in the organizational documents of the NPF.
This means that if the NPF is terminated, franchisees can expect to receive a portion of the remaining funds, but the amount will depend on how much they contributed relative to other franchisees and Checkersrallys itself. The distribution method offers some flexibility, as it can also follow the guidelines set in the NPF's organizational documents, which may outline a different distribution scheme.
It's important for prospective franchisees to understand that Checkersrallys has the authority to terminate the NPF, which could impact ongoing marketing and advertising efforts. While the unspent funds are to be distributed, the termination of the NPF could lead to changes in the overall marketing strategy and resources available to franchisees. Franchisees should review the organizational documents of the NPF, if available, to fully understand how assets would be distributed upon termination and what factors might influence those decisions.