What costs are included when calculating the proceeds from the sale of Aunt Millies Bakeries Distribution Rights?

According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, when a distributor sells their distribution rights, the proceeds from the sale are calculated by deducting several items from the total sale amount. These deductions include any monies the distributor owes to Aunt Millies Bakeries.

Additionally, a reasonable reserve against open accounts is deducted, likely to cover any outstanding payments or potential financial discrepancies. The calculation also accounts for all reasonable costs and expenses associated with the sale itself. This includes, but is not limited to, the cost of removing any off-code or damaged products from the distributor's sales area, ensuring that only fresh and sellable products are transferred to the new distributor.

Finally, the proceeds are further reduced by satisfying any outstanding debts, liens, security interests, legal fees, and similar expenses. After all these deductions are made, the remaining amount is then turned over to the distributor, representing their net proceeds from the sale of the distribution rights. This comprehensive approach ensures that all financial obligations and costs are accounted for before the distributor receives their final payment.