Is Mrcool required to segregate the Brand Development Fund from its general operating funds?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
We are not required to segregate the Brand Development Fund from our general operating funds and we are not a fiduciary or trustee of the Brand Development Fund. The Brand Development Fund will not be used to directly promote your Center or the marketing area in which your Center will be located. (Franchise Agreement, Article 9.A.).
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 27–35)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, Mrcool is not required to segregate the Brand Development Fund from its general operating funds. Mrcool also states that it is not considered a fiduciary or trustee of the Brand Development Fund.
This means that Mrcool has the discretion to manage the Brand Development Fund alongside its other operational finances. While Mrcool will maintain unaudited financial records detailing expenditures from the Brand Development Fund, franchisees only have the right to request an accounting of how the funds were spent once per 12-month period.
This arrangement gives Mrcool significant control over the fund, but it also means that the fund is potentially subject to the same financial risks as Mrcool's general operations. Prospective franchisees should consider this when evaluating the financial stability of Mrcool and the potential use of the Brand Development Fund. Franchisees should also be aware that the Brand Development Fund will not be used to directly promote an individual franchisee's center or marketing area.