What restrictions does the Cool Binz Franchise Agreement impose on the resale of Equipment?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
- 5. TRANSFER OF OWNERSHIP. Franchisee acknowledges that the Franchise Agreement imposes restrictions and limitations on the resale of the Equipment. Franchisee acknowledges that the Equipment may not be sold, leased, or rented to or used by any other party, except under the conditions stated below, as provided in the Franchise Agreement, or as permitted in writing by CBI. The Equipment is proprietary and authorized for use only within the COOL BINZ franchise network. Franchisee covenants that Franchisee will not transfer title to the Equipment except in one of these two ways:
- a. Sell the Equipment to another COOL BINZ Franchisee in good standing under its franchise agreement at a mutually acceptable price. CBI has first right of refusal to purchase the Equipment and must approve any transaction. If CBI financed any portion of the purchase price of the Equipment, the transferee will pay the proceeds to CBI if there is any outstanding balance under the Promissory Note for the Equipment prior to transfer of the Equipment. At the time of transfer Franchisee's account with CBI must be current and the purchasing Franchisee may not have any pending default under any agreement with CBI.
- b. If Franchisee is terminating or not renewing the Franchise Agreement and Franchisee owns another COOL BINZ franchise, the Equipment (and the liability for any amount owing on the purchase price of the Equipment) will be transferred to that franchise upon written request.
- c. CBI will repurchase the storage containers bins (the "Bins") in accordance with the table below. The percentages shown assume reasonable wear and tear and regular maintenance. If any components of the original Bins are missing, or there is damage or excessive wear and tear, CBI reserves the right to make a corresponding adjustment to the repurchase price. The original Bins pricing under its Schedule will be reduced to the applicable percentage in effect based on the time elapsed after original purchase.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to the 2025 Cool Binz Franchise Disclosure Document, franchisees face several restrictions regarding the resale of equipment. The equipment, considered proprietary to the Cool Binz franchise system, can only be used for Cool Binz authorized services. Any unauthorized use is a breach of the Franchise Agreement.
The Franchise Agreement imposes limitations on reselling equipment. Franchisees cannot sell, lease, or rent the equipment to any other party unless explicitly permitted by CBI (Cool Binz International) in writing or under specific conditions outlined in the Franchise Agreement. The equipment is exclusively for use within the Cool Binz franchise network.
A franchisee can only transfer title to the equipment in two specific ways: selling to another Cool Binz franchisee in good standing, subject to CBI's first right of refusal and approval, or transferring the equipment to another Cool Binz franchise owned by the same franchisee if the original franchise is being terminated or not renewed. CBI also has the option to repurchase the storage containers (bins), with the repurchase price adjusted based on wear and tear and maintenance. These restrictions ensure that the equipment remains within the Cool Binz system and that CBI maintains control over its use and disposition.