What is considered 'Equipment' under the All Team agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. ATFC's Right to Purchase Personal Property. After the termination or expiration of this Agreement, but not upon an approved Transfer, ATFC shall have the right, but not the obligation, to purchase all of FRANCHISEE's equipment, inventory, supplies and other personal property used in connection with the operation of the business. Notwithstanding the foregoing, FRANCHISEE has the right to keep any and all personal effects and furnishings of sentimental value to FRANCHISEE, which FRANCHISEE elects to exclude. The purchase price shall be at fair market value (less the amount of any liens on the property), which shall be established (if the parties are unable to agree) by the average of two independent appraisals. FRANCHISEE and ATFC shall each select an independent appraiser within thirty (30) days after termination or expiration of this Agreement. If either party fails to select an appraiser within such time period, the appraised value shall be determined by the one appraiser selected. ATFC shall have thirty (30) days after the fair market value is determined as above, to exercise the rights granted hereunder, and shall thereafter have an additional thirty (30) days to pay for the property it desires to purchase.
- E. Operation of Franchise Because of FRANCHISEE's Inability. In order to prevent any interruption of the franchise business which would cause harm to the business, if FRANCHISEE is unable to operate the business for any reason whatsoever, FRANCHISEE authorizes ATFC and its agents and affiliates to operate the business for so long as ATFC deems necessary and practical. All income from the operation of the business shall be kept in a separate account, and the expenses of the business, including reasonable compensation and expenses of ATFC and its agents, shall be charged to said account. Nothing contained herein shall be construed to require ATFC to operate the business in the case of FRANCHISEE's inability to operate same, and the rights set forth herein may be exercised in the sole and absolute discretion of ATFC.
XIII. SOURCES OF PRODUCTS
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
The 2025 All Team Franchise Disclosure Document (FDD) does not explicitly define what constitutes 'equipment' within the context of the franchise agreement. However, it does mention equipment in relation to All Team's right to purchase a franchisee's personal property after termination or expiration of the agreement.
Specifically, the FDD indicates that All Team has the option to purchase a franchisee's "equipment, inventory, supplies and other personal property used in connection with the operation of the business" at fair market value, less any liens on the property. This suggests that 'equipment' refers to tangible assets necessary for running the All Team agency. The franchisee, however, retains the right to keep personal effects and furnishings of sentimental value.
Additionally, the FDD mentions that changes in software programs or other changes in the All Team system will require franchisees to upgrade their computer systems and incur costs in obtaining other or additional computer hardware, equipment, and software. This implies that computer-related items are considered equipment necessary for operating the franchise.
To gain a comprehensive understanding of what 'equipment' encompasses under the All Team franchise agreement, prospective franchisees should seek clarification from the franchisor regarding the specific types of equipment required to operate the franchise, as well as any approved or mandated vendors for such equipment.