What constitutes a curable default under the Aunt Millies Bakeries Distribution Agreement?
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 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 33–36)
What This Means (2025 FDD)
According to the 2025 Aunt Millies Bakeries FDD, a curable default refers to any failure of performance under the Distribution Agreement, except for those specifically defined as non-curable. Examples of curable defaults include failing to pay amounts due or failing to deliver products in a timely and proper manner, as well as the termination of any agreements with Aunt Millie's Bakeries' affiliates.
If a distributor breaches the Distribution Agreement or any agreement with an Aunt Millie's Bakeries affiliate (excluding breaches considered non-curable), Aunt Millie's Bakeries will provide a written notice, giving the distributor three business days to correct the breach. An "Affiliate" of AUNT MILLIE's includes any company which has common ownership with AUNT MILLIE's and which provides goods and services, including financing services, to DISTRIBUTOR. Should the distributor fail to cure the breach within this three-day period, Aunt Millie's Bakeries has the right to terminate the agreement, and the distributor loses any further right to cure the default.
However, repeated violations are considered a chronic breach that threatens significant harm to Aunt Millie's Bakeries, its trademarks, or its commercial reputation. In such cases, Aunt Millie's Bakeries is entitled to terminate the agreement immediately, and the distributor does not have the right to cure the breach. This distinction is important for prospective franchisees to understand, as it highlights the importance of consistent compliance with the agreement to avoid termination without an opportunity to correct the issue.