What happens if an All Team USER transfers a substantial portion of the Business?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the transfer of a substantial portion of the Business is treated as an assignment of the Funding Agreement and Processing Agreement. Specifically, if an All Team USER transfers the majority of the equity to individuals other than the current owners, or a substantial portion of the business in one or more transactions, it is considered an assignment that requires the prior written consent of All Team. This consent cannot be unreasonably withheld.
This requirement means that an All Team franchisee cannot freely sell or transfer a significant part of their business without All Team's approval. This provision protects All Team by ensuring that any new owners or operators meet their standards and are capable of running the franchise effectively. It also allows All Team to maintain control over who is operating under their brand name.
Furthermore, any such assignment must occur in conjunction with a corresponding assignment under both the Franchise Agreement and the Processing Agreement. This indicates that all three agreements (Funding, Processing, and Franchise) are interconnected, and a change in ownership or control must be approved across all these agreements to be valid. This coordinated approval process ensures that all aspects of the franchise operation remain consistent with All Team's requirements and standards.