What state's law governs the Mrcool Multi-Unit Development Agreement?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
| q. | Non-competition covenants during the term of the franchise | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Center developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. |
|---|---|---|---|
| r. | Non-competition covenants after the franchise is terminated or expires | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Center developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. |
| s. | Modification of the agreement | 5.4, 7.11 | Only by written agreement between you and us or if |
| governing law requires a modification. We can change | |||
| the form of the Franchise Agreement for future Centers | |||
| which will not alter your obligations under the Multi | |||
| Unit Development Agreement. | |||
| t. | Integration/merger clauses | 7.12 | The Multi-Unit Development Agreement is the entire |
| agreement between you and us relating to the | |||
| development of the Exclusive Territory. | |||
| Notwithstanding the foregoing, nothing in any | |||
| agreement is intended to disclaim the express | |||
| representations made in the | |||
| Franchise Disclosure | |||
| Document, its exhibits and amendments. | |||
| u. | Dispute resolution by arbitration or mediation | 7.5, 7.6 | Except for certain claims for injunctive relief, all disputes must first be submitted to non-binding mediation in Graves County, Kentucky and, if mediation is unsuccessful, then to binding arbitration in Graves County, Kentucky. This provision is subject to applicable state law. |
| v. | Choice of forum | 7.5, 7.6 | All mediation, arbitration and, if applicable, litigation |
| proceedings must be conducted in, or closest to, State | |||
| court of general jurisdiction that is within or closest to | |||
| Graves County, Kentucky. This provision is subject to | |||
| applicable state law. | |||
| w. | Choice of law | 7.5, 7.6 | Kentucky |
| law will govern. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–50)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, the Multi-Unit Development Agreement is generally governed by Kentucky law. However, this is subject to applicable state law and as disclosed in Exhibit I of the FDD.
This means that while Kentucky law is the first point of reference, state laws could supersede Kentucky law depending on the specific situation or the state where the franchisee is operating. Franchisees should be aware that the choice of law might not be absolute and could be influenced by their own state's regulations.
Prospective franchisees should carefully review Exhibit I and consult with a legal professional to understand how the choice of law provision may affect their rights and obligations, particularly in the state where they plan to develop Mrcool centers. Understanding the interplay between Kentucky law and any relevant state laws is crucial for ensuring compliance and resolving potential disputes.