Under what conditions must a Checkersrallys franchisee participate in a special promotion and pay advertising fees?

According to Checkersrallys's 2025 Franchise Disclosure Document, a franchisee must participate in special promotions and pay associated advertising fees if they receive 90 days' notice from Checkersrallys and their local or regional advertising cooperative. This participation begins on the effective date of the notice and continues until the promotion concludes. These regional advertising fees are in addition to the standard 4.5% advertising expenditure required by the Franchise Agreement and are not credited towards it.

This means that Checkersrallys franchisees need to be prepared to adjust their marketing budgets and strategies on relatively short notice to accommodate these special promotions. The additional fees could impact profitability, especially if the promotion does not generate the anticipated revenue increase. Franchisees should carefully evaluate the potential costs and benefits of such promotions when they are announced.

It's important to note that while franchisees can choose not to participate in price advertising, participation in other special promotions is mandatory if the 90-day notice is given. This mandatory participation ensures a unified marketing approach across the Checkersrallys system during specific promotional periods, but it also reduces the individual franchisee's control over their advertising spending. Franchisees should factor this potential for additional advertising expenses into their financial planning and discuss any concerns with existing franchisees to understand the frequency and impact of these special promotions.