What is a Mrcool franchisee required to do with the Business Management System data upon expiration or termination of the franchise agreement?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
s Manual;
- (2) All rights in and to the Business Management System are non-transferable and non-assignable to Franchisee and shall be utilized by Franchisee subject to the terms and conditions of this
Agreement, Business Management System licenses that Franchisor may approve of and otherwise as determined by Franchisor in Franchisor's Reasonable Business Judgment;
- (3) As between Franchisee and Franchisor, Franchisor is and shall be the exclusive owner of the Business Management System Data, except that Franchisee shall store and maintain such data in accordance with all applicable local, state and federal privacy, data collection and solicitation laws. Among other things, upon expiration or termination of this Agreement for any reason, Franchisee shall preserve and maintain the Business Management System data for the purpose of transferring such data to Franchisor;
- (4) At all times, Franchisee shall provide and permit Franchisor to maintain direct and independent access to the Business Management System and Franchisee shall electronically transfer and transmit to Franchisor all Business Management System Data;
- (5) When instructed by Franchisor, Franchisee shall upgrade, replace and modify the Business Management System;
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, upon the expiration or termination of the franchise agreement, a franchisee must preserve and maintain the Business Management System data for the purpose of transferring it to Mrcool. This means that the franchisee cannot simply abandon or delete the data; they have a responsibility to keep it secure and accessible so that it can be handed over to Mrcool.
In addition to preserving the data for transfer, the franchisee must also return to Mrcool the Confidential Information, including without limitation the Business Management System Data and all customer lists and information. This obligation reinforces Mrcool's ownership and control over this critical business information. The franchisee is allowed to retain copies of the franchise agreement and general correspondence, provided that these do not contain confidential information.
Furthermore, Mrcool retains exclusive ownership of the Business Management System Data. Throughout the term of the franchise agreement, Mrcool is entitled to direct and independent access to the Business Management System, and the franchisee must electronically transfer and transmit all Business Management System Data to Mrcool. This ongoing access ensures that Mrcool can monitor the business and maintain its data assets, even before the agreement's expiration or termination. These stipulations ensure Mrcool maintains control and access to critical business data, even after a franchise relationship ends.