What sections of the Christian Brothers Automotive Franchise Agreement address advertising obligations?

hristian Brothers Automotive Corporation

independent right to enforce it. Franchisee will submit copies of all such executed

Nondisclosure Agreements to Franchisor within ten (10) days of their execution.

1. ADVERTISING AND MARKETING.

8.01 Advertising Standards. Franchisee will only use such advertising, identification and

promotional materials and programs (including, but not limited to, printed and broadcast

advertisements, stationery, business cards, press releases, signs, displays, leaflets,

newspaper inserts, promotional mail outs and promotional literature) which have been

furnished by Franchisor or been approved in advance by Franchisor in accordance with

Section 8.04. All advertising by Franchisee shall be conducted in a dignified manner, shall

conform to such standards, specifications and requirements as Franchisor may specify from

time to time in writing, in its Confidential Operations Manual or otherwise, and shall not

in any way detract from, reflect unfavorably upon, or denigrate the Marks, the System, the

products, or Franchisor.

8.02 Administration of Franchisor's Marketing Program. Franchisor or its designee may

administer Marketing Funds (as defined below) as follows:

(a) As provided in Section 4.02 of this Agreement, if Franchisor establishes any

Programs, Franchisee will pay to Franchisor a "Marketing Fee" of up to the

Maximum Annual Cost per Program fund per year. The Marketing Fee will be

combined with contributions made by all other franchisees of Franchisor that are

members of that Program to create marketing funds (the "Marketing Funds").

(b) Franchisor will have sole discretion over the creative concepts, materials and media

used in such Program, and the placement and allocation of advertising. Franchisee

acknowledges that the Marketing Funds are intended to further general public

Franchise Agreement (Ver 04-14-2025)

Franchisee: ___________

Franchisor: Christian Brothers Automotive Corporation

recognition and acceptance of the Marks for the benefit of the System and that

Franchisor and its designees undertake no obligation to make expenditures which

are equivalent or proportionate to Franchisee's contributions. Franchisor cannot

and does not represent or insure that each franchise member of a Program will

benefit directly or on a pro rata basis from the placement of advertising in

connection with a particular Program.

(c) The Marketing Fund may be used to meet any and all costs of employing

advertising agencies and administering, directing, preparing, placing and paying for

regional and/or national advertising for the Program to which the Marketing Fund

pertains, including public relations and promotional campaigns typically used in

media such as direct mail advertising, newspapers, radio, and cable and local

television. This sum may also be spent for items including conducting marketing

studies, the production and purchase of advertising art, commercials, musical

jingles, print advertisements, point of sale materials, media advertising, outdoor

advertising art, and direct mail pamphlets and literature. This sum may further be

spent for additional items such as marketing support for technician recruitment

initiatives, testing new advertising tactics, national discount/offer funding, call

performance tracking, online reputation management, online directory listings

management, conducting market research, the development of customizable

franchisee marketing resources, travel costs for the marketing team to visit with

franchisees and attend marketing conferences that provide additional marketing

training to keep up-to-date on the latest marketing trends, performing marketing

vendor/solution audits and branded promotional items. Franchisor may, but need

Franchise Agreement (Ver 04-14-2025)

Franchisee: ___________

Franchisor: Christian Brothers Automotive Corporation

not, maintain sums paid by franchisees to the Marketing Funds or income from the

Marketing Funds in a separate account from the other funds of Franchisor.

Franchisor may expend or allocate up to fifteen percent (15%) of the Marketing

Funds on an annual basis for such reasonable administrative costs and overhead, if

any, as Franchisor may incur in connection with the Marketing Funds. Franchisor

shall, within one hundred twenty (120) days following the close of its fiscal year,

prepare and distribute to all System franchisees an unaudited report certified as

correct by an officer of Franchisor, setting forth Marketing Funds revenue and

expenses for the fiscal year just ended.

(d) Franchisor shall use its best efforts to expend the amounts contributed to the

Marketing Funds during the fiscal year within which the contributions are made.

Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 37–39)