Are there financial limits on the obligation to renovate, refurbish, or remodel a Cool Binz franchise?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
| Name of Fee (Note 1) | Amount | Due Date | Remarks (Note 1) |
|---|---|---|---|
| Indemnification | Actual costs, will vary under circumstances | As incurred | You must reimburse us if we are held liable for claims directly or indirectly arising out of your COOL BINZ Business’s operation. Your obligation to indemnify us will survive the termination or expiration of your Franchise Agreement. |
| Costs and | Actual costs, will vary | As incurred | See Note 7. |
| Attorneys’ Fees | under circumstances | ||
| NORA Fee | None currently assessed; if we manage accounts through a national or regional accounts program you will pay up to 5% of Gross Sales | As incurred | See Note 8, and Section 1F of Franchise Agreement |
| Approval of Alternative Suppliers | Actual costs | As incurred | If you ask us to evaluate alternative suppliers of required purchases, you must reimburse us regardless of whether subsequently approve your request. |
| Month in Operation | Min. Monthly Gross Sales Requirement | ||
| 0-12 | none | ||
| 13-24 | $9,750 | ||
| 25-36 | $10,500 | ||
| 37-48 | $12,600 | ||
| 48> | $15,375 | ||
| Name of Fee (Note | Amount | Due Date | Remarks |
| 1) | (Note 1) | ||
| Broker Fee - Resale | If you authorize us to enlist a third-party broker to locate the transferee, there will also be a broker fee, which currently is approximately 10% of the sale price, or $30,000, whichever is higher. | Due upon closing of the sale of the COOL BINZ Business | Payable only if the third party broker located the transferee. Payable to and imposed and collected by us if a broker fee was paid by us to the third party. Payable to and imposed and collected by the broker if we do not pay a broker fee to the third party. This fee is imposed by the third party broker and thus may be increased periodically by the broker. |
| Renewal Term Fee | Our then-current fee, which is presently, 10% of the then-current Initial Franchise Fee | At the time you sign a Franchise Agreement for a renewal term | You will sign our then current Franchise Agreement for the renewal term, which may include materially different terms, including the Royalty rate and/or Territory. We may increase this fee by up to 10% each year of the Term. |
| Renovation, Refurbishing, and Remodeling Fees | Actual Costs | When incurred | We may require you to replace, renew, refurbish, or remodel your leased premises, truck, truck wrap, and equipment to meet our current System Standards and condition requirements at any time during the Term, in our sole discretion, and at your expense. You must maintain all trucks in good working condition at all times. There are no financial limits on this obligation |
Source: Item 6 — OTHER FEES (FDD pages 19–27)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, there are no financial limits on a franchisee's obligation to renovate, refurbish, or remodel their franchise. Cool Binz has the sole discretion to require franchisees to replace, renew, refurbish, or remodel their leased premises, truck, truck wrap, and equipment to meet the brand's current System Standards and condition requirements at any time during the term of the agreement. These renovations are at the franchisee's expense. Franchisees are also obligated to maintain all trucks in good working condition at all times.
This lack of financial limits could pose a significant financial risk to Cool Binz franchisees. Unexpected or extensive remodeling requirements could place a heavy financial burden on the franchisee, potentially impacting their profitability or even leading to financial distress. The franchisee has no control over when or how often these renovations may be required, giving Cool Binz significant power over this aspect of the business.
In the franchise industry, it is not uncommon for franchisors to require periodic renovations to maintain brand standards and consistency across all locations. However, many franchise agreements include some form of financial limitation, such as a cap on the total cost of renovations or a schedule outlining when renovations will be required. The absence of such limitations in the Cool Binz franchise agreement is a notable deviation from standard practice and something prospective franchisees should carefully consider.
Potential Cool Binz franchisees should seek clarification from Cool Binz regarding the typical frequency and estimated costs of renovations. Understanding the potential financial implications of these requirements is crucial for making an informed investment decision. It would also be prudent to negotiate some form of financial protection or limitation on renovation costs before signing the franchise agreement.