When is the final installment due for the loan associated with Aunt Millies Bakeries?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
| Routes held for sale | $ | 1,096,406 | $ | 1,720,086 |
|---|---|---|---|---|
| Deferred revenue | 2,098,000 | 1,399,000 | ||
| (Losses)/Gains recognized from sale of territories and delivery trucks | (89,851) | (170,920) | ||
| Interest income from distributor notes receivable (reflected in | ||||
| other income on the consolidated income statements) | 913,501 | 485,497 | ||
| Company repurchase obligation for territories previously sold | 2,268,021 | 440,000 | ||
| Interest rate on notes receivable – distributor routes | 8.75 | 5% to 9.75% | 8.7 | 5% to 9.75% |
(Continued)
NOTE 5 - DEBT ARRANGEMENTS
The Company had a Credit and Security Agreement ("Credit and Security Agreement") with a commercial lender. The Credit and Security Agreement provided a term loan of $8,000,000, advances in the form of a revolving loan up to $25,000,0000, and letters of credit up to $2,500,000. The term loan required monthly principal payments of $95,238 beginning June 1, 2021. The term loan, revolving loan, and letters of credit was set to mature November 30, 2023. All unpaid principal and interest was due upon maturity.
In May 2024, the Company amended their Credit and Secu
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to Aunt Millies Bakeries's 2025 Franchise Disclosure Document, the company had an Amended Credit and Security Agreement in May 2024, which extended the maturities of a term loan, revolving loan, and letters of credit to April 2027. The original Credit and Security Agreement included an $8,000,000 term loan that required monthly principal payments of $95,238 beginning June 1, 2021.
The Amended Credit and Security Agreement continued the term loan monthly principal payments of $95,238. Any remaining outstanding borrowings are due upon maturity in April 2027.
For a prospective franchisee, this indicates that Aunt Millie's Bakeries has significant debt and has refinanced it. While this debt is not directly the franchisee's responsibility, it is important to understand the financial health of the franchisor, as it can impact the support and resources available to franchisees. It is important to note that the term loan, revolving loan, and letters of credit bear interest at a variable rate for varying amounts based on LIBOR or a rate not to exceed the prime rate, both rates adjusted by a factor tied to a quarterly finance.