What is the deadline for an All Team customer invoice to be considered a Delinquent Account?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
You will pay us a one-time Funding Fee of 1.5% of the Customer Invoice value at the time we purchase the Customer Invoice. If the Customer Invoice is not paid within 30 days from the Customer Invoice date, then we will charge you an Accounts Receivable Service Charge of 0.05% per day of the outstanding amount for any delinquent amount up until 90 days from the Customer Invoice date.
The balance of any Accounts Receivable remaining unpaid in whole or in part for more than 90 days from the Customer Invoice date and the balance of any Accounts Receivable owing by any Customer who is bankrupt or insolvent or who voluntarily seeks protection under the federal bankruptcy laws or against whom involuntary relief in bankruptcy is sought, or who has filed an assignment for the benefit of creditors prior to the expiration of such 90 day period, or as to whom we have a reasonable basis for believing that such Customer is about to become subject to one of the foregoing conditions or events shall be deemed a "Delinquent Account." The full amount of each Delinquent Account shall be deducted from the Purchase Price or, at our election, be paid by you to us upon demand. Any Delinquent Account that is subsequently collected by us shall be added to the next payment of your Purchase Price (less any other amounts due to us, including without limitation any interest, deductions or offsets permitted hereunder).
Source: Item 10 — FINANCING (FDD pages 17–18)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, a customer invoice is considered a "Delinquent Account" if it remains unpaid, either in whole or in part, for more than 90 days from the invoice date. Additionally, an invoice is immediately classified as a "Delinquent Account" if the customer declares bankruptcy, seeks protection under federal bankruptcy laws, makes an assignment for the benefit of creditors before the 90-day period expires, or if All Team has a reasonable basis to believe the customer is about to become subject to any of these conditions.
This classification as a "Delinquent Account" has significant financial implications for the franchisee. The full amount of each Delinquent Account will be deducted from the franchisee's Purchase Price, which is the weekly payment All Team makes to the franchisee for their sales. Alternatively, All Team can demand that the franchisee pay the amount of the Delinquent Account directly. However, if All Team subsequently collects a Delinquent Account, the amount collected (less any other amounts the franchisee owes All Team) will be added to the franchisee's next Purchase Price payment.
This policy creates a financial risk for All Team franchisees, as they are essentially responsible for customer invoices being paid in a timely manner. Franchisees need to be diligent in assessing the creditworthiness of their customers and managing accounts receivable to minimize the risk of invoices becoming delinquent. The franchisee also carries the risk of a customer declaring bankruptcy, which would immediately classify the invoice as a "Delinquent Account" regardless of how close it is to the 90-day mark. Franchisees should factor this risk into their financial planning and consider strategies for mitigating potential losses from delinquent accounts.
Furthermore, All Team charges an Accounts Receivable Service Charge of 0.05% per day of the outstanding amount for any delinquent amount up until 90 days from the Customer Invoice date. This charge applies if the Customer Invoice is not paid within 30 days from the Customer Invoice date.