What are the consequences if a Cool Binz franchisee is convicted of a felony?

According to the 2025 Cool Binz Franchise Disclosure Document, if a franchisee is convicted of a felony, Cool Binz has the right to terminate the Franchise Agreement. Specifically, Cool Binz can terminate the agreement immediately upon written notice if the franchisee, or their Managing Owner or Designated General Manager, is convicted of a felony or pleads no contest to a felony. This also applies to any conviction that is equivalent to a felony. Furthermore, failure to disclose a prior felony conviction or its equivalent can also lead to immediate termination.

This provision gives Cool Binz a significant degree of control over who operates its franchises and protects the brand's reputation. Franchisees must ensure that they, their managing owner, and designated general manager maintain a clean criminal record to avoid the risk of losing their franchise. The inclusion of 'no contest' pleas and equivalent convictions broadens the scope of this clause, meaning franchisees cannot circumvent the rule through legal technicalities.

Many franchise agreements contain similar clauses allowing for termination in the event of a felony conviction, as it is a standard practice to protect the franchisor's brand and business interests. This type of clause is intended to ensure that individuals of good character are operating the franchise and to mitigate any potential negative publicity or legal issues that could arise from a franchisee's criminal activity. Prospective franchisees should be aware of this clause and understand the importance of maintaining a clean criminal record throughout the term of their franchise agreement.