What is the late fee for a missed monthly installment on the Cool Binz Promissory Note?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
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EXHIBIT A-5 TO THE DISCLOSURE DOCUMENT
PROMISSORY NOTE
| 2024 | 2023* | |
|---|---|---|
| Balance, January 1, | $1,115 | $1,746 |
| Additions charged to expense | 358 | 292 |
| Deductions (write-offs) | (259) | (923) |
| Balance, December 31, | $1,214 | $1,115 |
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- Monthly installments shall be applied first upon interest and the balance upon principal. This Promissory Note may be prepaid in full at any time without restriction or penalty.
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- Should any monthly installment not be paid when due, then the Holder shall elect to either (a) require that the whole sum of the remaining principal and interest shall become due immediately and payable upon notice to the Undersigned or (b) charge a late fee of 5% or $50, per week, whichever sum is greater. All unpaid amounts owing on this Promissory Note shall immediately become due and payable at the option of Holder without notice or demand upon the occurrence of any of the following events of default: (i) the default of any provision of the Promissory Note; or (ii) the death, dissolution, insolvency (however expressed or indicated) or the filing of a petition in bankruptcy, reorganization or for the adjustment of debts for, by or against the Undersigned; (iii) the sale of substantially all of the Undersigned's stock or assets; (iv) the Undersigned's failure to permit Holder to collect amounts via EFT.
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Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to the 2025 Cool Binz Franchise Disclosure Document, if a franchisee fails to make a monthly installment payment on their Promissory Note when due, Cool Binz has the option to impose a late fee. This late fee will be the greater of 5% of the unpaid installment amount or $50 per week that the payment is overdue.
Alternatively, instead of charging a late fee, Cool Binz can demand immediate payment of the entire remaining principal and interest owed on the Promissory Note. This decision is at the discretion of Cool Binz.
Additionally, the FDD states that failure to pay all amounts when due constitutes grounds for termination of the Franchise Agreement, as provided in Section 12.B of the agreement. This highlights the importance of franchisees meeting their financial obligations to avoid potential penalties, acceleration of debt, and even termination of their franchise agreement.