Is failure to pay all amounts when due by the User grounds for termination of the All Team agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
On all amounts which User owes to ATFC that are not paid when due, ATFC shall have the right to charge interest on late payments equal to the lesser of one and one-half percent (1-1/2%) per month or the maximum legal rate in the jurisdiction where the Agency is located. User acknowledges that this paragraph does not constitute ATFC's agreement to accept payments after same are due or a commitment by ATFC to extend credit to, or otherwise finance User's operation of the Agency. Further, User acknowledges that User's failure to pay all amounts when due constitutes grounds for termination of this Agreement.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, failure to pay amounts owed to ATFC (All Team Franchise Corporation) when due constitutes grounds for termination of the agreement. ATFC also has the right to charge interest on late payments, at a rate equal to the lesser of 1.5% per month or the maximum legal rate in the relevant jurisdiction. However, this does not obligate ATFC to accept late payments or extend credit to the franchisee.
This means that if an All Team franchisee fails to make timely payments, All Team has the right to terminate the franchise agreement. The franchisee is also responsible for late payment interest charges. This provision protects All Team's revenue stream and ensures franchisees meet their financial obligations.
It is important to note that even if a breach is cured, the occurrence of the same or a similar breach twice within a 12-month period gives All Team the right to terminate the agreement immediately upon written notice, without any opportunity to cure. This highlights the importance of consistent compliance with the agreement terms to avoid potential termination, even if previous breaches were resolved.