What is the Cool Binz franchisee's responsibility regarding the transfer of title to the equipment?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
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 specific restrictions and obligations when transferring the title of equipment used in their Cool Binz business. The equipment is considered proprietary to the Cool Binz franchise system and can only be used for authorized services.
A Cool Binz franchisee can only transfer title to the equipment in one of two ways: selling to another Cool Binz franchisee in good standing, or transferring the equipment to another Cool Binz franchise owned by the same franchisee if the Franchise Agreement is being terminated or not renewed. In the event of a sale to another franchisee, Cool Binz has the first right of refusal to purchase the equipment and must approve the transaction. If Cool Binz financed any portion of the equipment, the proceeds from the sale must first be used to pay off any outstanding balance under the Promissory Note for the equipment. Additionally, the franchisee's account with Cool Binz must be current, and the purchasing franchisee cannot have any pending defaults under any agreement with Cool Binz.
These stipulations ensure that the equipment remains within the Cool Binz system and that any financial obligations to Cool Binz are satisfied before the transfer of ownership. The franchisor maintains control over who uses the equipment and how it is used, protecting the brand and ensuring consistent service standards. Franchisees need to be aware of these limitations and requirements when considering selling their franchise or transferring equipment between different franchise locations they own.