What is the Cool Binz franchisee prohibited from doing with the equipment without written permission from CBI?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to the 2025 Cool Binz Franchise Disclosure Document, a franchisee faces restrictions on how they can use and transfer ownership of the equipment essential for operating their Cool Binz franchise. Specifically, the franchisee is prohibited from using the equipment in any business or manner other than in the conduct of the Business pursuant to the Franchise Agreement. This means the equipment must be exclusively used for Cool Binz authorized services. Any usage contrary to this provision is considered a breach of the Franchise Agreement.
Furthermore, the Cool Binz franchisee acknowledges that the Franchise Agreement imposes restrictions and limitations on reselling the Equipment. The franchisee cannot sell, lease, or rent the equipment to any other party, unless explicitly permitted in writing by CBI or under the conditions stated in the Franchise Agreement. The equipment is proprietary and authorized for use only within the Cool Binz franchise network.
These restrictions ensure that the Cool Binz equipment is used solely for the purposes of operating the franchise and maintaining the integrity of the Cool Binz brand. A franchisee must obtain written permission from CBI before engaging in any activity that deviates from the standard usage or involves transferring ownership of the equipment. Failure to comply with these restrictions could result in a breach of contract and potential legal consequences.