Over what period are insufficient funds tracked for Cool Binz franchise termination purposes?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provisions | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| or any other lien is placed against you and not released or bonded within 30 days; (xx) you become insolvent; (xxi) you order or purchase supplies, signs, furnishings, fixtures, equipment or inventory from an unapproved supplier; (xxii) you misuse or make unauthorized use of any COOL BINZ /Required Software; (xxiii) you fail to comply with the anti-terrorism provision; (xxiv) you take for your own personal use any assets or property of the COOL BINZ Business; or (xxv) if there are insufficient funds in your bank account to cover a check or EFT payment 3 or more times within any 12-month period or you fail to achieve minimum sales for 3 consecutive months. These provisions are subject to state law. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 53–58)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, Cool Binz may terminate a franchise agreement if there are insufficient funds in the franchisee's bank account to cover a check or EFT payment three or more times within any 12-month period.
This means that Cool Binz franchisees need to maintain diligent oversight of their finances. If a franchisee has issues with payments due to insufficient funds on multiple occasions within a year, Cool Binz has grounds to terminate the franchise agreement. This could lead to a loss of the business and any investments made into it.
Many franchise agreements include clauses that allow the franchisor to terminate the agreement for financial mismanagement or failure to meet financial obligations. The Cool Binz policy of monitoring insufficient funds over a 12-month period is a fairly standard practice, giving franchisees a limited window to correct any financial issues before facing potential termination.