Does the Mrcool FDD specify any conditions under which the franchisee can refuse to sign a Franchise Agreement for an additional Development Center?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
| Development Center Initial Franchise Fee for Other Development Centers | |
|---|---|
| OTHER AUTHORIZED DEVELOPMENT CENTERS: Provided that Franchisee is not in default of the | |
| terms of this MRCOOL Multi-Unit Development Agreement (including but not limited to the Development | |
| Schedule set forth below) and that neither Franchisee nor Franchisee’s affiliates are in default of any Franchise | |
| Agreement or other agreement with Franchisor, the Development Center Initial Franchise Fee for each additional | |
| Development Center (over and above the First Development Center), is: $0 (Waived), payable at the time of | |
| signing the Franchise Agreement for each Development Center. |
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, a franchisee's obligation to sign a Franchise Agreement for additional Development Centers is contingent upon certain conditions. Specifically, the franchisee must not be in default of the Mrcool Multi-Unit Development Agreement, including adherence to the Development Schedule. Additionally, neither the franchisee nor their affiliates should be in default of any existing Franchise Agreement or other agreements with Mrcool.
If these conditions are met, the Development Center Initial Franchise Fee for each additional Development Center (beyond the first) is waived, amounting to $0, which is payable at the time of signing the Franchise Agreement for each Development Center. This waiver serves as an incentive for franchisees to expand their operations, provided they remain in good standing with Mrcool.
However, if the franchisee fails to meet the obligations outlined in the Development Agreement or defaults on any other agreements with Mrcool, they may be required to pay the standard initial franchise fee for each additional development center, or Mrcool may choose not to offer an additional franchise agreement. Therefore, maintaining compliance with all agreements is crucial for franchisees looking to expand their Mrcool business without incurring additional franchise fees.