Are there any specific deadlines within the Mrcool Development Schedule that, if missed, would jeopardize the waiver of the Development Center Initial Franchise Fee?
Mrcool Franchise · 2025 FDDAnswer from 2025 FDD Document
| Development Center Initial Franchise Fee for Other Development Centers | |
|---|---|
| OTHER AUTHORIZED DEVELOPMENT CENTERS: Provided that Franchisee is not in default of the | |
| terms of this MRCOOL Multi-Unit Development Agreement (including but not limited to the Development | |
| Schedule set forth below) and that neither Franchisee nor Franchisee’s affiliates are in default of any Franchise | |
| Agreement or other agreement with Franchisor, the Development Center Initial Franchise Fee for each additional | |
| Development Center (over and above the First Development Center), is: $0 (Waived), payable at the time of | |
| signing the Franchise Agreement for each Development Center. |
Source: Item 23 — RECEIPTS (FDD pages 55–263)
What This Means (2025 FDD)
According to Mrcool's 2025 Franchise Disclosure Document, adherence to the Development Schedule is critical for multi-unit developers. If a franchisee fails to meet the obligations outlined in the Development Schedule, they risk losing the waiver of the Development Center Initial Franchise Fee for additional locations beyond the first one. The initial franchise fee for the first development center is $50,000.
The FDD states that to have the Development Center Initial Franchise Fee waived for each additional Development Center, the franchisee must not be in default of the Mrcool Multi-Unit Development Agreement, including the Development Schedule. This means the franchisee must open and maintain the minimum cumulative number of Mrcool Centers as per the agreed-upon schedule. Missing these deadlines constitutes a breach of the agreement.
Furthermore, the agreement emphasizes that "time is of the essence" regarding the franchisee's development obligations. Failure to comply with the Development Schedule can lead to immediate termination of the agreement and the loss of future development rights. This underscores the importance of meeting each deadline within the Development Schedule to maintain the benefits of the multi-unit development agreement, including the waiver of the initial franchise fee for subsequent Mrcool locations.
In practical terms, a prospective Mrcool franchisee with a multi-unit agreement needs to carefully review and understand the Development Schedule. They should ensure they have the resources and capabilities to meet each deadline for opening and operating new centers. Failing to do so not only puts their development rights at risk but also means they will have to pay the Development Center Initial Franchise Fee for each additional center, which they otherwise would not have to pay.