What is the Cool Binz franchisee's responsibility regarding the resale of the equipment?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, a franchisee faces restrictions on reselling equipment. The franchisee cannot sell, lease, or rent the equipment to another party unless specific conditions are met or Cool Binz provides written permission. The equipment remains proprietary and authorized for use only within the Cool Binz franchise network.
There are two ways a Cool Binz franchisee can transfer title to the equipment. First, they can sell to another Cool Binz franchisee in good standing, provided they agree on a price, Cool Binz has the first right of refusal to purchase the equipment, and Cool Binz approves the transaction. If Cool Binz financed the equipment, the proceeds must first cover any outstanding balance under the promissory note. The selling franchisee's account with Cool Binz must be current, and the purchasing franchisee cannot have any pending defaults. Second, if a franchisee is terminating or not renewing their agreement but owns another Cool Binz franchise, the equipment and associated liabilities can be transferred to that franchise upon written request.
Cool Binz also retains the option to repurchase the storage containers (bins), with the repurchase price based on a percentage of the original price, adjusted for wear and tear and maintenance. If components are missing or there is excessive damage, Cool Binz reserves the right to adjust the repurchase price accordingly. Upon expiration or termination of the Franchise Agreement, the franchisee will cooperate with Cool Binz 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.