Does the internal dispute resolution agreement for Cool Binz survive the termination or expiration of the Franchise Agreement?

According to Cool Binz's 2025 Franchise Disclosure Document, the agreement to arbitrate survives any termination or expiration of the Franchise Agreement. This means that even after the franchise relationship ends, both Cool Binz and the franchisee are still bound to resolve disputes through arbitration rather than litigation, as specified in the agreement.

This survival clause is a common feature in franchise agreements, designed to provide a consistent and predictable method for resolving disputes that may arise even after the franchise term concludes. For a prospective Cool Binz franchisee, this implies that any claims or disputes, even those emerging post-termination, will be subject to arbitration in Ann Arbor, Michigan, under the rules of the American Arbitration Association (AAA).

However, Cool Binz retains the option to initiate litigation in court under certain circumstances, such as allegations of violations of intellectual property rights, warranty issues, restrictive covenants, fraud, misrepresentation, insolvency, or claims where the damages alleged are less than $50,000. This exception provides Cool Binz with avenues for immediate legal action in specific situations, while the franchisee remains bound by the arbitration agreement. Franchisees should be aware of these exceptions and understand the implications for dispute resolution.