What deductions are made from the 80% balance of Accounts Receivables advanced to All Team franchisees?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
The Funding Agreement provides that we will purchase your customer invoices which become our Accounts Receivables each week minus a Deferred Share. Currently this Deferred Share is 20% of the Accounts Receivables. We will advance to you the 80% balance of your Accounts Receivables less: (i) Funding Fee and Processing Fee; (ii) out-of-pocket expenses incurred by us on your behalf; (iii) any adjustments for Late Accounts or Delinquent Accounts; (iv) any discounts made available or extended to the Customer; and (v) Continuing License Fee, Advertising Fee, Technology Fee required under the Franchise Agreement, Funding Agreement and Processing Agreement and any other payments due ("Purchase Price"). The Purchase Price will be sent to you no later than Friday of each week based on the Accounts Receivables purchased for the prior week. You are responsible to deposit these amounts you receive from us into your business account to make sure adequate funds are in place to cover your payroll checks, related payroll taxes and operating expenses. In the event that our finance agreements with our banks are reduced, we have the right to reduce the 80% accordingly.
Source: Item 10 — FINANCING (FDD pages 17–18)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, if All Team approves a franchisee for temporary payroll funding, they will purchase the franchisee's customer invoices, which become All Team's Accounts Receivables, less a Deferred Share. The Deferred Share is currently 20% of the Accounts Receivables. The franchisee will receive 80% of the Accounts Receivables balance, but this amount is subject to several deductions.
The 80% balance is reduced by the following: (i) Funding Fee and Processing Fee; (ii) out-of-pocket expenses incurred by All Team on the franchisee's behalf; (iii) adjustments for Late Accounts or Delinquent Accounts; (iv) any discounts made available or extended to the Customer; and (v) Continuing License Fee, Advertising Fee, Technology Fee required under the Franchise Agreement, Funding Agreement and Processing Agreement and any other payments due. These deductions collectively determine the Purchase Price, which All Team sends to the franchisee no later than Friday of each week, based on the Accounts Receivables purchased for the prior week.
Franchisees are responsible for depositing the Purchase Price into their business account to cover payroll checks, related payroll taxes, and operating expenses. All Team retains the right to reduce the 80% advance if their finance agreements with their banks are reduced. This comprehensive deduction system ensures that All Team can recoup various fees, expenses, and potential losses associated with the payroll funding service, while also ensuring franchisees meet their financial obligations to All Team.