For Cool Binz equipment sales, when does the customer take ownership and assume risk of loss?

d encumbrances, and that the Equipment conforms to the requirements set by CBI under the Franchise Agreement. CBI offers no other warranty and assigns to Franchisee any and all rights to any express or implied warranty of each Equipment manufacturer. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES ON THE EQUIPMENT OFFERED, GIVEN OR PROVIDED BY CBI INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

• 4. EQUIPMENT USAGE. Franchisee agrees not to use the Equipment in any business or manner other than in the conduct of the Business pursuant to the Franchise Agreement. Franchisee acknowledges that the Equipment is proprietary to the COOL BINZ franchise system. The Equipment can only be used in connection with COOL BINZ authorized services. Any usage

contrary to this provision shall be considered to be a breach of the Franchise Agreement, the Promissory Note, and this Agreement.

• 5. TRANSFER OF OWNERSHIP. Franchisee acknowledges that the Franchise Agreement imposes restrictions and limitations on the resale of the Equipment. Franchisee acknowledges that the Equipment may not be sold, leased, or rented to or used by any other party, except under the conditions stated below, as provided in the Franchise Agreement, or as permitted in writing by CBI. The Equipment is proprietary and authorized for use only within the COOL BINZ franchise network. Franchisee covenants that Franchisee will not transfer title to the Equipment except in one of these two ways:
  • a. Sell the Equipment to another COOL BINZ Franchisee in good standing under its franchise agreement at a mutually acceptable price. CBI has first right of refusal to purchase the Equipment and must approve any transaction. If CBI financed any portion of the purchase price of the Equipment, the transferee will pay the proceeds to CBI if there is any outstanding balance under the Promissory Note for the Equipment prior to transfer of the Equipment. At the time of transfer Franchisee's account with CBI must be current and the purchasing Franchisee may not have any pending default under any agreement with CBI.
  • b. If Franchisee is terminating or not renewing the Franchise Agreement and Franchisee owns another COOL BINZ franchise, the Equipment (and the liability for any amount owing on the purchase price of the Equipment) will be transferred to that franchise upon written request.
  • c. CBI will repurchase the storage containers bins (the "Bins") in accordance with the table below. The percentages shown assume reasonable wear and tear and regular maintenance. If any components of the original Bins are missing, or there is damage or excessive wear and tear, CBI reserves the right to make a corresponding adjustment to the repurchase price. The original Bins pricing under its Schedule will be reduced to the applicable percentage in effect based on the time elapsed after original purchase.

• 6. RETURN OF EQUIPMENT. Upon expiration or termination of the Franchise Agreement, Franchisee will cooperate with CBI to repurchase all or some of the Equipment pursuant to the terms in the Franchise Agreement, unless Franchisee has arranged for the sale of the Equipment to another COOL BINZ franchisee with the consent of CBI.
• 7. COVENANTS OF FRANCHISEE. Franchisee covenants with CBI to (i) use and maintain the Equipment in a lawful manner and so as not to violate any law or regulation of the state, city or other political subdivisions in which Franchisee uses the Equipment; (ii) return, pay and file when due all taxes, fees and similar charges, including without limitation sales or use tax, and ad valorem and personal property taxes, imposed on the ownership, possession or use of the Equipment; (iii) keep the Equipment free and clear of all liens, security interests, claims and encumbrances except for those incurred through the initial financing of the Equipment with CBI or from a vendor approved by CBI; (iv) obtain and maintain property insurance on the Equipment covering loss, damage, theft, vandalism and casualty; (v) maintain the Equipment per the manufacturer's maintenance, repair and replacement instructions; (vi) maintain in place any notices, labels or other indicia provided by CBI to indicate that the Equipment is subject to this Agreement; (vii) operate the Business as required under the Franchise Agreement; and (viii) notify CBI when any party claims any interest in the Equipment.
• **8.

Source: Item 23 — RECEIPTS (FDD pages 63–238)