What does the security interest granted to CBI by a Cool Binz franchisee cover?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
- **8.
GRANT OF SECURITY INTEREST.** In the event Franchisee's purchase of the Equipment sold under the Invoice is financed by CBI, Franchisee hereby grants to CBI a continuing security interest in the Equipment sold to Franchisee, and any additions, accessions, accessories, attachments and replacements of such Equipment, any proceeds and products.
The security interest shall continue for the term of this Agreement to secure Franchisee's obligations under this Agreement.
Franchisee authorizes CBI to file a financing statement with regards to the Equipment without the necessity of obtaining an additional signature from Franchisee.
The rights and remedies of CBI as a secured party under this Agreement and under applicable law are cumulative and non-exclusive.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, if Cool Binz finances a franchisee's equipment purchase, the franchisee grants Cool Binz a security interest in that equipment. This security interest extends not only to the original equipment but also to any additions, accessions, accessories, attachments, and replacements made to the equipment. Furthermore, it covers any proceeds and products derived from the equipment.
This security interest remains in effect throughout the term of the Franchise Agreement, securing the franchisee's obligations to Cool Binz under the agreement. Cool Binz is authorized to file a financing statement related to the equipment without needing an additional signature from the franchisee.
The document specifies that Cool Binz's rights and remedies as a secured party are cumulative and non-exclusive, meaning Cool Binz can pursue multiple avenues to protect its interests. This arrangement protects Cool Binz's investment in the equipment and ensures that the franchisee fulfills their financial and contractual obligations.