What is the interest rate charged on late payments to All Team?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
If any or all of the amounts due under this Agreement 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 (1½%) per month or the maximum legal rate in the jurisdiction where the Agency is located.
FRANCHISEE acknowledges that the foregoing does not constitute ATFC agreement to accept payments after same are due or a commitment by ATFC to extend credit to, or otherwise finance FRANCHISEE's operation of the Agency.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, if a franchisee fails to make payments on time, All Team has the right to charge interest on the overdue amount. The interest rate will be the lesser of 1.5% per month or the maximum legal rate applicable in the jurisdiction where the All Team agency is located.
This interest charge applies to any amounts due under the Franchise Agreement that are not paid when due. This includes, but is not limited to, Continuing License Fees, Advertising Fees, Technology Fees, and amounts due under the Funding and Processing Agreements. The imposition of interest on late payments is a standard practice in franchising, designed to encourage timely payments and compensate the franchisor for the administrative costs and potential cash flow disruptions caused by late payments.
It is important to note that All Team's right to charge interest on late payments does not obligate them to accept payments after they are due or to extend credit to the franchisee. Franchisees should ensure they understand the payment terms outlined in the Franchise Agreement and maintain sufficient funds to cover all fees and other amounts due to All Team in order to avoid incurring interest charges and potential penalties.