What constitutes taking assets for personal use in a Cool Binz franchise, and what are the consequences?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provisions | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| or any other lien is placed against you and not released or bonded within 30 days; (xx) you become insolvent; (xxi) you order or purchase supplies, signs, furnishings, fixtures, equipment or inventory from an unapproved supplier; (xxii) you misuse or make unauthorized use of any COOL BINZ /Required Software; (xxiii) you fail to comply with the anti-terrorism provision; (xxiv) you take for your own personal use any assets or property of the COOL BINZ Business; or (xxv) if there are insufficient funds in your bank account to cover a check or EFT payment 3 or more times within any 12-month period or you fail to achieve minimum sales for 3 consecutive months. These provisions are subject to state law. | |||
| i. | Franchisee's obligations on termination/no n-renewal | Section 13 | Upon termination or early expiration of the Franchise Agreement, your obligations include: (i) pay all amounts owed to us; (ii) de identify and otherwise stop using the Marks in any manner, including in business names and telephone listings; (iii) return all Confidential Information and customer lists to us; (iv) comply with post-term non-competition covenants; and (v) deliver proof of compliance. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 53–58)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, taking assets or property of the Cool Binz business for personal use is a violation of the franchise agreement and can lead to termination. The FDD specifies that if a franchisee takes assets for their own personal use, it constitutes grounds for termination of the Franchise Agreement.
Upon termination of the Franchise Agreement, the franchisee has several obligations. These include paying all amounts owed to Cool Binz, ceasing all use of Cool Binz's Marks, returning all Confidential Information and customer lists, complying with post-term non-competition covenants, and delivering proof of compliance. These obligations are detailed in Section 13 of the Franchise Agreement.
Prospective franchisees should be aware that Cool Binz takes the misuse of company assets seriously. The agreement outlines clear consequences for such actions, emphasizing the importance of maintaining strict separation between personal and business finances and resources. Franchisees should seek clarification from Cool Binz regarding what specifically constitutes 'assets or property of the COOL BINZ Business' to avoid unintentional violations.