Does the personal liability of the Franchisee to Mrcool extend to the advertising obligations outlined in Article 9 of the Franchise Agreement?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
pursuant to Article 18.M. of this Agreement, this written Agreement represents the sole Agreement between Franchisor and Franchisee.
18.S. NON-UNIFORM AGREEMENTS
Franchisee agrees that Franchisor makes no representations or warranties that all other agreements with MRCOOL Franchising, LLC franchisees entered into before or after the Effective Date do or will contain terms substantially similar to those contained in this Agreement. Franchisee agrees that Franchisor may waive or modify comparable provisions of other Franchise Agreements to other System franchisees in a non-uniform manner.
18.T NO RIGHT TO OFFSET
Franchisee shall not, on grounds of the alleged nonperformance, material breach, or default by Franchisor of this Agreement, any other agreement between Franchisor and Franchisee, or for any other reason, withhold any payment, fee, or any other amount payable by Franchisee to Franchisor pursuant to this Agreement, including, without limitation, the payment of the Royalty Fee and Advertising Contributions, or any other payment obligation by Franchisee to Franchisor. Franchisee shall not have the right to offset or withhold any liquidated or unliquidated amount allegedly due to Franchisee from Franchisor against any payment, fee, or any other amount payable to Franchisor pursuant to this Agreement or any other payment obligation by Franchisee to Franchisor.
**18.U.
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, the franchisee is obligated to make advertising contributions as outlined in Article 9. Specifically, the franchisee is required to contribute to the Brand Development Fund. The FDD states that the franchisee cannot withhold payments, fees, or any other amounts payable to Mrcool, including advertising contributions, due to alleged nonperformance or breach by Mrcool. The franchisee also does not have the right to offset any amount allegedly due from Mrcool against any payment owed to Mrcool.
This means that even if the franchisee believes Mrcool has not fulfilled its obligations, they must continue to make advertising contributions as required by the agreement. Failure to do so would likely constitute a breach of the franchise agreement. This requirement is independent of other franchisees' compliance, meaning one franchisee's failure to contribute does not relieve another of their obligations.
Furthermore, Mrcool assumes no direct or indirect liability or responsibility regarding the Brand Development Fund's maintenance, direction, or administration, except as expressly provided in Article 9. This indicates that Mrcool's liability related to the Brand Development Fund and advertising obligations is limited, and the franchisee bears the responsibility of making the required contributions regardless of the fund's performance or benefits derived.