What legal rights do I lose upon default of a Cool Binz financing agreement?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
may offer you.
| Source of Financing | Us | |-----------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Amount Financed | Up to 50% | | Down Payment | Minimum of 50% | | Term (number of years) | Up to 36 months | | Rate of Interest plus | 9% | | Finance Charge | | | Monthly Payment | Varies depending on amount financed and term. | | Prepayment Penalty | None | | Security Required | Personal Guaranty | | Guaranty | Personal Guaranty | | Liability upon Default | Termination or other loss of Franchise; you must also pay entire amount due and our attorneys' fees and court costs in collecting debt | | Loss of Legal Rights Upon Default | You must waive presentation for payment, demand, notice of non-payment, protest, and all other demands and notices required by law (statutory or otherwise) | If you would like to finance a portion of the Initial Franchise Fee, Initial Package, and the Initial Promotional Package, and you meet our credit standards, you may do so through a promissory note (the "Note"), which is currently attached as Exhibit A-5 to the Franchise Agreement. You must make a down payment of at least fifty percent (50%) of the total fee you are financing. We currently charge an interest rate of 9%, and no finance charges. We will not adjust APR of the Note once your Franchise Agreement has been signed. A late fee of 5% or $50, per week, whichever sum is greater, will be collected if you fail to make timely payments or your payments are returned to us with non-sufficient funds.
Source: Item 10 — FINANCING (FDD pages 35–36)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, if you default on a financing agreement with Cool Binz, you waive certain legal rights. Specifically, you must waive presentation for payment, demand, notice of non-payment, protest, and all other demands and notices required by law, whether statutory or otherwise. This means that Cool Binz is not obligated to formally present the payment request, send a demand for payment, notify you of non-payment, or issue a protest before taking action on the defaulted note.
Furthermore, the promissory note that Cool Binz uses requires you to waive notice of non-payment, protest, and all other demands and notices that may be required by law. This waiver streamlines the process for Cool Binz to pursue collections or other remedies in the event of a default. You will receive a notice of default and have a ten-day period to cure the default before your Franchise Agreement can be terminated.
In addition to waiving these legal rights, defaulting on the financing agreement can lead to the termination of your Cool Binz franchise. You will also be liable for the entire outstanding amount due, along with Cool Binz's attorneys' fees and court costs incurred in collecting the debt. The Note shall survive termination of the Franchise Agreement.