What is the relationship between the Purchase Price and the Accounts Receivable for All Team?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
USER's sale and assignment of Customer Invoices to ATFC grants ATFC all of USER's rights, securities, guaranties and liens with respect to each Customer Invoice and all of USER's defenses and rights of offset with respect to any payments received by ATFC.
These Customer Invoices, as a result of the sale to ATFC, become the accounts receivable of ATFC ("Accounts Receivable") and therefore ATFC shall not be obligated to, and shall not be liable for, exercising or refusing to exercise any rights granted to ATFC hereby.
USER shall execute and deliver to ATFC assignments of the Customer Invoices, which will include, without limitation, copies of all original invoices, copies of the bills of lading, proofs of delivery, contracts or purchase orders, and/or purchase order numbers which correspond with such Customer Invoices, and time tickets or other proofs of service as may be required by ATFC.
USER shall send the foregoing documentation to ATFC no later than noon Wednesday following the previous week.
- D. Purchase Price.
The purchase price of each purchased Customer Invoice (the "Purchase Price") shall be Eighty percent (80%) of such Customer Invoice, less: (i) Funding Fee (as defined below); (ii) out-of-pocket expenses incurred by ATFC on behalf of USER; (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 Fund Fee, Technology Fees, Processing Fees and any other amounts due to ATFC as required under the Franchise Agreement and the Processing Agreement.
The Purchase Price is guided by the Centennial Agreement referred to herein.
Notwithstanding the foregoing, in the event that the Centennial Agreement is reduced, the 80% can be reduced accordingly.
ATFC shall send USER the Purchase Price no later than the Friday of each week following the Sunday close of the preceding week.
USER must deposit these funds in its account in order to have adequate funds to cover the checks ATFC will prepare in accordance with the Processing Agreement.
The difference between the Account Receivable and the Purchase Price percentage is called the "Deferred Share".
For example, if the percentage of the Purchase Price percentage is 80% of the Customer Invoice, then the Deferred Share is 20%.
As ATFC receives payment in full from the Customer on each Account Receivable, the Deferred Share will be remitted to USER no later than Friday of the following week after ATFC receives said payment.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the Purchase Price is directly related to the Accounts Receivable. All Team franchisees sell and assign their customer invoices to All Team Franchise Corporation (ATFC), which then become the accounts receivable of ATFC. The Purchase Price, which is what the franchisee receives, is a percentage of the Customer Invoice amount.
Specifically, the Purchase Price is 80% of the Customer Invoice, less several deductions. These deductions include the Funding Fee, out-of-pocket expenses incurred by ATFC, adjustments for late or delinquent accounts, discounts extended to the customer, and any fees due to ATFC under the Franchise Agreement and the Processing Agreement. The difference between the Accounts Receivable and the Purchase Price percentage is referred to as the "Deferred Share."
For example, if the Purchase Price is 80% of the Customer Invoice, the Deferred Share is 20%. This Deferred Share is remitted to the franchisee after ATFC receives full payment from the customer on each Account Receivable. This system ensures that All Team franchisees receive an initial payment for their invoices while ATFC manages the collection of the full amount from the customers, eventually passing the remaining share back to the franchisee upon full payment.