When is the initial franchise fee for a Cool Binz franchise due?

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ITEM 5: INITIAL FEES

Initial Fees for Franchises

Initial Franchise Fee

Upon signing of the Franchise Agreement, you must pay an initial franchise fee of $59,900 (the "Initial Franchise Fee"). The Initial Franchise Fee is deemed fully earned upon payment and non-refundable under any circumstances. The Initial Franchise Fee purchases a Territory that will encompass approximately 350,000 to 450,000 people to a maximum of 500,000 people ("Territory").

For a Territory with populations greater than 450,000 people, the Initial Franchise Fee will equal the Initial Franchise Fee above, plus $0.20 for each person over 450,000 (the "Additional Fee").

For example, the Initial Franchise Fee for a Territory with a population of 500,000 will be computed as follows:

$$$59,900 + (50,000 \times .20) = $69,900$$

As the Territories are generally defined by ZIP codes, we reserve the right not to charge the Additional Fee if we are unable to meet the 350,000 population count without exceeding due to highly populated areas. Each Territory will have a maximum of 500,000 people. The purchase of more than 500,000 in population in the aggregate at any time during the term of the Agreement will require the payment of an additional Initial Franchise Fee.

The Initial Franchise Fee offsets the expenses we incur in registering, marketing, awarding, training, and opening new franchises, and is non-refundable.

Initial Equipment Package

Upon signing of the Franchise Agreement, you must also pay a fee ranging from $579,995 to $979,000 ("Initial Equipment Fee") to us for the initial purchase of the truck, bins, mule, and other equipment needed for the operation of the COOL BINZ Business (the "Initial Package"). The Initial Equipment Fee varies based upon the number of containers you elect to purchase to service your Territory and the industry prices at the time you purchase your COOL BINZ Business. The Initial Equipment Fee is deemed fully earned upon payment and non-refundable under any circumstances and does not include shipping charges for delivery to your location. A full list of equipment being purchased in the Initial Package and the Initial Equipment Fee will be confirmed at least seven (7) days prior to execution of the Franchise Agreement.

Container Assembly and Set-Up Fee

Prior to opening your COOL BINZ Business, you must also pay a fee of $5,000 for two days of initial assembly and set-up of the Equipment needed for the operation of the COOL BINZ Business (the "Container Assembly and Set-Up Fee"). The Container Assembly and Set-Up Fee is deemed fully earned upon payment and non-refundable under any circumstances.

Initial Promotional Package Fee

You must also obtain an initial promotional package ("Initial Promotional Package") that will cost $7,500 (the "Initial Promotional Package Fee"). This fee is fully earned upon payment and non-refundable under any circumstances. The Initial Promotional Package includes supplies needed to begin operation which will include logo wear, stationery, the Kickstart digital marketing program, consumables, promotional items and a $799 convention allowance ("the Convention Allowance") for the COOL BINZ convention (the "Convention"). The Convention Allowance covers the registration fee for one person to attend the first COOL BINZ Convention that is scheduled following your successful completion of our Business Manager and Technical Operations Training Program. The Convention Allowance cannot be used to offset any other expenses or requirements associated with your Business and is not refundable. If you do not attend the Convention, the Convention Allowance will be applied to the Convention Non Attendance Fee.

Discounts

If you wish to purchase multiple Territories at the time you sign your first Franchise Agreement with us, then we will reduce the Initial Franchise Fee for the second Territory to $49,900 and the Initial Franchise Fee for the third Territory to $39,900. The discount is only applicable if you purchase additional Territories at the same time as your initial Franchise purchase, and the discount will be applied to the Initial Franchise Fee for up to two additional Territories only. The discount cannot be combined with any other discount and will not be granted toward any future Territory expansions.

We provide a 20% discount on the Initial Franchise Fee for the first Franchise to veterans of U.S. Armed Forces who have been honorably discharged or otherwise meet the requirements of IFA's VetFran program. We reserve the right to require proof that the applicant qualifies for this discount. This discount may not be used in conjunction with the First Responders or Related Franchisee discounts.

We also offer a $2,500 discount on the Initial Franchise Fee on the first Franchise to first responders, which include sworn police officers, paid and volunteer firefighters, and paid and volunteer emergency medical technicians and paramedics. This discount may not be used in conjunction with the Veteran discount. We reserve the right to require proof that the applicant qualifies for this discount.

We also offer additional financing to those franchisees that meet our credit standards. Our financing is described in more detail in Item 10. From time to time, we may offer incentives of cash grants, equipment, product, or other items as an inducement to prospective franchisees when business circumstances warrant and in states where such incentives can be offered without restrictions. We reserve the right to change or cancel any offer at any time.

Related Franchisee Package

If you are currently a franchisee in good standing, as determined by us, with of one of our franchising affiliates (a "Related Franchisee"), then you may qualify to purchase a COOL BINZ Business with a discounted Initial Franchise Fee. The initial fees for a Related Franchisee will be twenty-five percent (25%) off of the then-current Initial Franchise Fee, and such discounted fee is limited to up to two (2) Franchises, which must be purchased at the same time.

A Related Franchisee cannot use any other discounts.

Source: Item 5 — INITIAL FEES (FDD pages 17–19)