What is the All Team franchisee's responsibility regarding the Purchase Price received?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
for additional 1 year terms.
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.
Pursuant to the Franchise Agreement, Funding Agreement and the Processing Agreement, we will bill your customers directly on behalf of your Agency and under "All Team Staffing" and your name, with instructions to remit payment directly to our designated financial institution. Your customers make their payments to us and we will apply the funds as follows:
- a. Apply full payment to each invoice paid by your customers;
- b. Pay you the reserve amount held out by our funding source (currently 20%) with your next payment for your weekly sales no later than Friday of each week.
Regarding garnishment or wage withholding, you are responsible for entering any garnishment into the software program before the payroll is processed. Also, you are responsible to make the payments to the proper authority as required in the withholding order.
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.
Source: Item 10 — FINANCING (FDD pages 17–18)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the franchisee has specific responsibilities regarding the Purchase Price they receive under the Funding Agreement. All Team purchases the franchisee's customer invoices each week, which become All Team's Accounts Receivables, minus a Deferred Share, which is currently 20% of the Accounts Receivables. The franchisee receives the balance, which is 80% of the Accounts Receivables, less certain deductions, which All Team refers to as the Purchase Price.
The franchisee is responsible for depositing the Purchase Price amounts received from All Team into their business account. This ensures that there are adequate funds to cover payroll checks, related payroll taxes, and operating expenses. This means the franchisee must manage their finances carefully to ensure they can meet their financial obligations.
Additionally, if a customer's account becomes a "Delinquent Account" (remaining unpaid for more than 90 days or due to bankruptcy/insolvency), the full amount of the Delinquent Account will be deducted from the Purchase Price or, at All Team's election, must be paid by the franchisee to All Team upon demand. However, if All Team subsequently collects a Delinquent Account, that amount (less any other amounts due to All Team) will be added to the next payment of the franchisee's Purchase Price. This places the risk of customer non-payment, to some extent, on the franchisee. All Team also retains a security interest in the franchisee's Accounts Receivable until all amounts due are paid, and the franchisee is required to sign a Security Agreement. The franchisee must also indemnify All Team in the event of any suit resulting from the Funding Agreement, including responsibility for paying reasonable attorneys' fees.