What happens if a Cool Binz franchisee is not in full compliance with the Franchise Agreement?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to our right to terminate this Agreement, and not in lieu of such right, or any other rights we may have against you, upon a failure to cure any default within the applicable time period (if any), we have the right, but not the obligation to,
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- Charge the Non-Compliance Fee;
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- Reduce the size of your Territory or permit other franchisees or Company Stores to provide the Services and Products within your Territory;
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- Enter upon the COOL BINZ Business premises and exercise complete authority with respect to the operation of the COOL BINZ Business until such time as we determine, in our sole discretion that the default has been cured, and you are otherwise in compliance with this Agreement. In the event we exercise the rights described in this Section, you must pay us a reasonable management fee and reimburse us for all reasonable costs and overhead, if any, incurred in connection with our operation of your COOL BINZ Business including, without limitation, costs of personnel for supervising and staffing the COOL BINZ Business and their travel and lodging accommodations, plus a 20% service charge. This fee is in addition to the payment of the Royalty and all other fees due under this Agreement during the time we exercise our rights under this Agreement. If we undertake to operate the COOL BINZ Business pursuant to this Section, you agree to indemnify and hold us (and our representative(s) and employees) harmless fr
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, if a franchisee fails to comply with the Franchise Agreement, Cool Binz has the right to take several actions. These actions are in addition to Cool Binz's right to terminate the agreement and any other rights they may have against the franchisee.
First, Cool Binz can charge a Non-Compliance Fee, the amount of which is not specified in the provided documentation. Second, Cool Binz can reduce the size of the franchisee's territory or allow other franchisees or company stores to operate within the franchisee's territory. Third, Cool Binz can enter the franchisee's business premises and take control of operations until the default is resolved, as determined by Cool Binz.
If Cool Binz takes control of the business, the franchisee must pay a reasonable management fee and reimburse Cool Binz for all reasonable costs and overhead incurred during their operation of the business, including personnel costs, travel, and lodging, plus a 20% service charge. This fee is in addition to all other fees due under the Franchise Agreement. The franchisee also agrees to indemnify and hold Cool Binz harmless from any claims arising from their operation of the business.