What must the All Team Debtor deliver to the Secured Party to secure financial accommodations?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
Secured Party has agreed to make advances and other financial accommodations to Debtor according to the terms and conditions of a Funding Agreement executed on the same date as this Agreement, but only if Debtor delivers to Secured Party the Guaranty Agreement (as defined below) and grants Secured Party a security interest in all property currently owned or later acquired by Debtor to secure the prompt payment and performance of all liabilities, obligations, and indebtedness of Debtor owing to Secured Party. Accordingly, Debtor and Secured Party execute this Agreement to record their understanding.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, to secure financial accommodations from the Secured Party, the Debtor must deliver the Guaranty Agreement and grant the Secured Party a security interest in all property currently owned or later acquired by the Debtor. This security interest ensures the prompt payment and performance of all liabilities, obligations, and indebtedness the Debtor owes to the Secured Party. This arrangement is documented to record the understanding between the Debtor and Secured Party. The definition of Collateral includes Accounts, Chattel Paper, Documents, Fixtures, Goods (including Equipment, Inventory, farm products, and consumer goods), General Intangibles, Instruments, money and all other personal property now owned or later acquired by Debtor and all Proceeds and products thereof.
In addition to the Guaranty Agreement and granting a security interest, the Debtor may be required to execute and deliver additional documents and provide additional information as the Secured Party may reasonably require. This ensures the Secured Party can carry out the terms of the agreement and stay informed about the Debtor's financial status and business affairs. The Debtor is also obligated to promptly notify the Secured Party of any changes related to the Collateral, any occurrence of Default, any litigation affecting the Collateral, and any changes in the Debtor's name, address, state of formation, ownership, or business structure.
Furthermore, if the Collateral includes Accounts or Chattel Paper, the Debtor must, upon the Secured Party's request, assign all documents and paper evidencing every Account and Chattel Paper Collateral. The Debtor must also mark the paper evidencing the Collateral to show it has been assigned to the Secured Party, deliver an endorsement or assignment of all Chattel Paper and instruments, furnish a copy of the invoice applicable to every Account and Chattel Paper with a statement of assignment, provide a schedule describing the Debtor's Accounts and Chattel Paper, and furnish all information received affecting the financial standing of any account debtor. The Debtor must also refrain from making any changes to any Account or Chattel Paper assigned to the Secured Party.