factual

Are there limitations of claims specified in the Mrcool franchise agreement?

Mrcool Franchise · 2025 FDD

Answer from 2025 FDD Document

hat the non-waiver provisions of N.Y. Gen. Bus. Law Sections 687.4 and 687.5 be satisfied.

    1. Under Article 15.B. of the Franchise Agreement, under the heading "Conditions for Renewal," the subarticle 15.B(8) is supplemented with the addition of the following language:
    • ; provided, however, that all rights and causes of action arising in favor of Franchisee from the provisions of New York General Business Law Sections 680-695 and the regulations issued thereunder, shall remain in force; it being the intent of this provision that the non-waiver provisions of N.Y. Gen. Bus. Law Sections 687.4 and 687.5 be satisfied.
    1. Article 18 of the Franchise Agreement and, if Franchisee executes a Development Agreement, Section 7 of the Development Agreement, under the heading "Enforcement and Construction," shall be supplemented by the addition of the following new subarticle 18.Z. to the Franchise Agreement and Section 7.24 of the Development Agreement:

Nothing in this Agreement should be considered a waiver of any right conferred upon franchisee by New York General Business Law, Sections 680-695.

    1. There are circumstances in which an offering made by MRCOOL Franchising, LLC would not fall within the scope of the New York General Business Law, Article 33, such as when the offer and acceptance occurred outside the State of New York. However, an offer or sale is deemed made in New York if you are domiciled in New York or the Outlet will be opening in New York. MRCOOL Franchising, LLC is required to furnish a New York prospectus to every prospective franchisee who is protected under the New York General Business Law, Article 33.
    1. No statement, questionnaire or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
    1. Each provision of this amendment shall be effective only to the extent, with respect to such provision, that the jurisdictional requirements of the New York General Business Law, are met independently without reference to this amendment.

[SIGNATURE PAGE TO FOLLOW]

IN WITNESS WHEREOF, the parties have duly executed and delivered this New York amendment to the MRCOOL Franchising, LLC Franchise Agreement and, if applicable, the Development Agreement on the same date as the Franchise Agreement and Development Agreement were, respectively, executed.

| Franchisor: MRCOOL Franchising, LLC | Franchisee: | |----------------------------------------|---------------------| | Signature | Signature | | Name and Title (please print) | Name (please print) | | Dated | Dated Signature Name (please print) Dated |

NORTH DAKOTA FRANCHISE AGREEMENT AMENDMENT

Amendments to the MRCOOL Franchise Agreement

In recognition of the North Dakota Franchise Investment Law, Section 51-19, the parties to the attached MRCOOL Franchising, LLC Franchise Agreement (the "Franchise Agreement") agree as follows:

The North Dakota Addendum is only applicable if you are a resident of North Dakota or if your MRCOOL Center outlet will be located within the State of North Dakota.

    1. Article 15 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring North Dakota franchisees to sign a general release upon renewal of the Franchise Agreement are not enforceable in North Dakota."
    1. Article 16 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring North Dakota Franchisees to consent to termination or liquidated damages are not enforceable in North Dakota."
    1. Articles 6 and 17 of the Franchise Agreement are hereby amended by the addition of the following language: "Covenants not to compete such as those mentioned above are generally considered unenforceable in the State of North Dakota."
    1. Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Covenants requiring North Dakota franchisees to consent to the jurisdiction of courts outside of North Dakota may not be enforceable in North Dakota."
    1. Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "for North Dakota Franchisees, North Dakota law shall apply."
    1. Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring a franchisee to consent to a waiver of trial by jury are not enforceable under Section 51-19-09 of the North Dakota Franchise Investment Law."

Source: Item 23 — RECEIPTS (FDD pages 55–263)

What This Means (2025 FDD)

According to the 2025 Mrcool FDD, there are limitations to claims specified in the franchise agreement, particularly concerning state franchise laws. For instance, in New York, no statement signed by a franchisee can waive claims under state franchise law, including fraud, or disclaim reliance on statements made by Mrcool or its representatives. This provision overrides any conflicting terms in other documents. Similarly, the New York General Business Law Sections 680-695 is not waived by the agreement.

In Rhode Island, the FDD amendment specifies that any clause restricting jurisdiction or venue to outside the state, or requiring application of other states' laws, is void concerning claims enforceable under the Rhode Island Franchise Investment Act. Additionally, any general release required for renewal, termination, or transfer is void regarding claims under the Rhode Island Franchise Investment Act.

For Minnesota franchisees, the FDD states that acknowledgments do not act as a release, estoppel, or waiver of liability under the Minnesota Franchise Act. Mrcool cannot require litigation outside Minnesota, waiver of a jury trial, or consent to liquidated damages or termination penalties. The Limitations of Claims section must comply with Minn. Stat. §80C.17 Subd.5. Similarly, in Virginia, no statement can waive claims under state franchise law or disclaim reliance on statements made by Mrcool. Furthermore, it is unlawful for Mrcool to cancel a franchise without reasonable cause, as defined under the Virginia Retail Franchising Act. In Washington, a release or waiver of rights executed by a franchisee shall not include rights under the Washington Franchise Investment Protection Act except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, rights or remedies under the Act such as a right to a jury trial may not be enforceable.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.