What constitutes an 'Affiliate' of Aunt Millies Bakeries for the purposes of breach notification?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
- §9.3 CURABLE BREACH: A breach of this Agreement or a breach of any agreement with any Affiliate of AUNT MILLIE's, other than a breach under Section 9.2, AUNT MILLIE'S shall give DISTRIBUTOR three (3) business days written notice within which DISTRIBUTOR may cure the breach. "Affiliate" of AUNT MILLIE's shall include any company which has common ownership with AUNT MILLIE's and which provides goods and services, including financing services, to DISTRIBUTOR. If DISTRIBUTOR fails to cure such breach within said three (3) business day period, AUNT MILLIE'S may thereafter terminate this Agreement and DISTRIBUTOR shall have no further right to cure; provided, further, that the parties agree that repeated violations constitute a chronic breach and threaten significant harm to AUNT MILLIE'S, its trademarks or commercial reputation, and in such event AUNT MILLIE'S shall be entitled to terminate this Agreement pursuant to Section 9.2 and DISTRIBUTOR shall have no further right to cure.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, an 'Affiliate' is defined specifically within the context of breach of agreement. For the purposes of curing a breach, an 'Affiliate' of Aunt Millie's Bakeries includes any company that shares common ownership with Aunt Millie's Bakeries. This affiliate must also provide goods and services, including financing services, to the distributor (franchisee).
This definition is important because a breach of any agreement with such an affiliate, other than a non-curable breach, triggers a three-business-day notice period for the distributor to cure the breach. If the distributor fails to cure the breach within this period, Aunt Millies Bakeries has the right to terminate the agreement. This clause ensures that distributors are held accountable not only for their direct agreements with Aunt Millies Bakeries but also for their agreements with related entities that provide essential services.
It is important to note that repeated violations, even if curable individually, can be considered a chronic breach that threatens significant harm to Aunt Millies Bakeries' trademarks or commercial reputation. In such cases, Aunt Millies Bakeries may terminate the agreement immediately without providing an opportunity to cure. This highlights the importance of maintaining consistent compliance with all agreements, both with Aunt Millies Bakeries and its affiliates, to avoid potential termination of the distribution agreement.