If Aunt Millies Bakeries terminates the agreement, what is Aunt Millies Bakeries entitled to do with the business?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
- §9.4 ACTIONS FOLLOWING TERMINATION: Termination under either Section 9.2 or Section 9.3 above, shall entitle AUNT MILLIE'S to operate the business for the account of the DISTRIBUTOR, deducting from the revenues generated the reasonable expenses of such performance and delivering the balance, if any, to DISTRIBUTOR. Termination shall require DISTRIBUTOR to sell the Distribution Rights, and in the event that DISTRIBUTOR has not consummated a sale to a qualified purchaser within 90 days of the date of termination, AUNT MILLIE'S shall be authorized to sell DISTRIBUTOR'S Distribution Rights to such a purchaser at the best price which can be obtained after proper notice and advertisement. Said sale shall be for the account of the DISTRIBUTOR, and the provisions of Sections 7.3, 7.4 and 7.5 hereof shall apply.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, if the agreement is terminated under sections 9.2 or 9.3, Aunt Millies Bakeries has the right to operate the business on behalf of the distributor. From the revenues generated, Aunt Millies Bakeries can deduct reasonable expenses incurred during the operation. Any remaining balance after deducting these expenses will be delivered to the distributor.
Furthermore, the distributor is required to sell the Distribution Rights following termination. If the distributor fails to complete a sale to a qualified purchaser within 90 days from the termination date, Aunt Millies Bakeries is authorized to sell the distributor's Distribution Rights. This sale will be conducted at the best obtainable price after providing proper notice and advertisement.
The sale of the Distribution Rights will be for the distributor's account, and the provisions outlined in Sections 7.3, 7.4, and 7.5 of the agreement will be applicable to this sale. This ensures that the process is conducted fairly and in accordance with the established procedures for transferring Distribution Rights.