How does Cilantro Taco Grill use Armando Perez's name to promote the franchise?

According to the 2024 Cilantro Taco Grill FDD, the company has an agreement with Armando Perez (also known as "Pitbull") to use his name to promote the franchise. In exchange for this right, Cilantro Taco Grill pays a portion (currently half) of the Worldwide Creative Marketing Fee to Armando Perez and his management company. Additionally, Perez receives dividends and a minority percentage of the sale price if Cilantro Taco Grill is sold.

It's important to note that while Armando Perez's name is used for promotional purposes, he has not made any financial investment in Cilantro Taco Grill. Furthermore, he is not involved in the company's management and does not have any control over its operations. This arrangement allows Cilantro Taco Grill to leverage Perez's public image and brand recognition to attract potential franchisees and customers.

For a prospective franchisee, this arrangement means that a portion of the Worldwide Creative Marketing Fee contributes to compensating Armando Perez for the use of his name in promoting the Cilantro Taco Grill brand. While Perez's involvement is limited to the use of his name, his association could potentially enhance the brand's visibility and appeal. However, franchisees should be aware that this arrangement also entails ongoing financial obligations in the form of marketing fees and potential dividends, as well as a share of the sale price if the company is sold.