Upon termination, does the All Team franchisee forfeit rights to customer accounts?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE will immediately cease providing services to all customers and candidates and forfeit any rights it may have to the customers, candidates and any customer accounts.
Upon request of ATFC, FRANCHISEE will assign to ATFC any or all of FRANCHISEE'S customer contracts and candidates and ATFC will have the right to either service the accounts or assign the servicing of the accounts to others.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, upon termination or expiration of the Franchise Agreement, the franchisee forfeits any rights to customers, candidates, and customer accounts. The franchisee must immediately cease providing services to all customers and candidates.
All Team has the right to request the franchisee to assign any or all customer contracts and candidates to All Team. All Team then has the right to either service these accounts or assign the servicing of the accounts to others. This means that upon termination, the franchisee loses the right to continue serving their existing customer base and All Team has the discretion to take over those accounts or reassign them.
This clause is significant for prospective franchisees as it highlights the potential loss of business and revenue upon termination of the franchise agreement. It is important to understand the conditions under which termination can occur and the implications for the franchisee's customer relationships. Franchisees should carefully consider this provision and its potential impact on their investment and future business prospects.