What was the principal payment on the related party note for All Team in 2024?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
$ | 667,144 | $ | 787,144 |
ALL TEAM FRANCHISE CORPORATION STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023
| 2024 | 2023 | ||
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Net income | $ (43,528) | $ 201,944 | |
| Adjustments to reconcile net income to net cash | |||
| provided by operating activities: | |||
| Allowance for credit losses | 6,000 | 5,501 | |
| Changes in account balances: | |||
| Accounts receivable - trade | 479,748 | 1,387,458 | |
| Prepaid expenses | (61,295) | (16,270) | |
| Advances | (434,801) | (605,008) | |
| Due from IRS | 49,780 | (49,780) | |
| Accounts payable-trade | (882) | 3,528 | |
| Accrued expenses | (107,077) | (45,671) | |
| Other funding liabilities | 213,416 | (326,541) | |
| Total Adjustments | 144,889 | 353,217 | |
| Total Cash Provided by Operating Activities | 101,361 | 555,161 | |
| CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Payments on note receivable - franchises | - | - | |
| Total Cash Provided by Investing Activities | - | - | |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Proceeds from credit line payable | 9,972,228 | 15,371,492 | |
| Principal payments on credit line payable | (10,433,329) | (15,758,708) | |
| Principal payment on related party note | (24,606) | (30,000) | |
| Stockholder distributions | (2,261) | (16,373) | |
| Total Cash Used in Financing Activities | (487,968) | (433,589) | |
| NET IN |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 33)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the principal payment on the related party note in 2024 was $24,606. This information is derived from the statement of cash flows, which outlines the movement of cash both into and out of the company. Principal payments on a related party note are classified as a cash flow from financing activities. These activities reflect transactions related to how the company is funded, including debt and equity.
For a prospective All Team franchisee, understanding these related party transactions is crucial. It shows how All Team manages its finances and interacts with its stakeholders. A related party note typically involves a loan or credit arrangement between the company and its owners, executives, or their close relatives or affiliated entities. The terms of these notes, such as interest rates and repayment schedules, may not always be the same as those available from traditional lenders.
The fact that All Team made a principal payment of $24,606 on a related party note in 2024 indicates that the company is actively managing and reducing its debt obligations to related parties. This could be seen as a positive sign, suggesting financial discipline and a commitment to reducing potential conflicts of interest. However, it is essential to consider the overall context of these transactions, including the total amount of related party debt, the terms of the notes, and the company's overall financial health.
Prospective franchisees should seek clarification from All Team regarding the nature and terms of these related party transactions. Understanding the details of these arrangements can provide valuable insights into the company's financial practices and its relationship with its key stakeholders. This information can help franchisees assess the financial stability and transparency of All Team, which are critical factors in making an informed investment decision.