Does the All Team franchisor have any restrictions on assigning the Funding Agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
USER shall reimburse ATFC for any and all costs, damages, liabilities, losses, deficiencies, assessments and expenses, including reasonable attorney's fees and court costs that ATFC may suffer or incur or to which ATFC may be subject by reason of any of the foregoing.
- E. Assignment. This Funding Agreement is personal to USER and shall not be assignable or transferable by USER, in whole or in part, either voluntarily or by operation of law, except with the prior written consent of ATFC with a copy to Centennial, which consent shall not unreasonably be withheld.
For all purposes of this Funding Agreement, the transfer of the majority of the equity of USER to persons other than the present owners thereof, or of any substantial portion of the Business in one or more transactions, shall be deemed an assignment of this Funding Agreement requiring such consent.
Any assignment must be in conjunction with a corresponding assignment under the Franchise Agreement and the Processing Agreement.
This Funding Agreement is fully assignable by ATFC.
- F. Successors and Assigns. This Funding Agreement shall be binding upon and shall inure to the benefit of ATFC and USER, and their permitted successors and assigns.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 28–30)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the Funding Agreement contains specific restrictions on assignment by the franchisee. The Funding Agreement is personal to the franchisee and cannot be assigned or transferred, either voluntarily or by law, without All Team's prior written consent, as well as a copy to Centennial. This consent will not be unreasonably withheld. A transfer of the majority of the franchisee's equity to new owners or a substantial portion of the business is considered an assignment requiring consent. Any assignment of the Funding Agreement must occur alongside a corresponding assignment of both the Franchise Agreement and the Processing Agreement.
However, the FDD states that All Team has the right to fully assign the Funding Agreement. The Funding Agreement is binding on both All Team and the franchisee, as well as their permitted successors and assigns.
These provisions are typical in franchise agreements to ensure that any new party assuming the agreement meets the franchisor's standards and maintains the integrity of the franchise system. A prospective All Team franchisee should carefully consider these restrictions, as they could impact the franchisee's ability to sell or transfer their business.