Is All Team Finance Company (ATFC) responsible for non-payment by a customer of All Team?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
ATFC shall have the right, but not the obligation, to contact and deal with Customers for the collection of Accounts Receivable in such manner, as it deems necessary, including without limitation, the right to advise Customers of ATFC's interest in and ownership of the Accounts Receivable of USER and to collect such amounts. Although ATFC provides as a service to USER a credit investigation of the client through a third party, the final decision on whether or not to extend credit shall rest with USER and ATFC is not responsible for non-payment by Customer or the creditworthiness of the Customer, nor is ATFC responsible for the accuracy of information provided by third parties. Any charge for credit reports may be passed on to USER
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, All Team Finance Company (ATFC) is generally not responsible for non-payment by a customer. While ATFC provides a credit investigation service through a third party, the final decision to extend credit rests with the All Team franchisee (referred to as USER). Therefore, ATFC is not responsible for a customer's non-payment or creditworthiness, nor is it responsible for the accuracy of information provided by third parties.
However, the FDD outlines specific procedures and consequences related to delinquent accounts. If a customer invoice remains unpaid for more than 90 days from the invoice date, it is considered a "Delinquent Account." The full amount of each Delinquent Account will be deducted from the franchisee's Purchase Price or, at ATFC's election, be paid by the franchisee to ATFC upon demand. This means that while ATFC isn't initially responsible, the franchisee ultimately bears the financial risk of customer non-payment after a certain period.
Despite deducting the amount of a Delinquent Account, ATFC retains the right to continue collection efforts as the franchisee's collection agent. Any amounts subsequently collected on Delinquent Accounts will be added to the franchisee's next Purchase Price payment, less any other amounts due to ATFC. The franchisee is responsible for all costs associated with the collection of delinquent accounts. This arrangement highlights the importance of the franchisee's role in making sound credit decisions and managing customer relationships to minimize the risk of non-payment and associated financial repercussions.