How are lease liabilities determined for Aunt Millies Bakeries?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
| HIS ADVERTISING AGREEMENT | C (this " | Agreen | nent") is |
|---|---|---|---|
| made effective, 20 | , by | and | between |
| PERFECTION BAKERIES, INC., d/b | /a AUN] | MIL | LIE'S an |
| Indiana business corporation with its prin | ncipal of | ice at 3 | 350 Pearl |
| Street, Fort Wayne, Indiana 46802 (herein referred to as "A | AUNT M | ILLIE | 'S") and |
| [DISTRIBUTOR'S CORPORATE NAME], a | busii | ess co | rporation |
| with its principal office at [DISTRIBUTOR'S ADDRES | S], (here | n refei | rred to as |
| LESSOR"). |
In consideration of the mutual promises contained herein the parties agree as follows:
- DELIVERY VEHICLE ADVERTISING AGREEMENT: LESSOR agrees to rent to AUNT MILLIE'S for the limited purposes of advertising AUNT MILLIE'S Products, the outside painted surfaces of the primary delivery vehicle utilized by LESSOR in the operation of its business. AUNT MILLIE'S agrees, in consideration of this rental, to provide and pay for the cost of applying advertising decals or materials to said vehicle, and to further pay as and for a space rental fee, the sum of $60/week. In consideration of such rental payments, LESSOR agrees to maintain said vehicle in a clean and neat condition, consistent with the best possible image for AUNT MILLIE'S in the marketplace, to repaint the vehicle from time to time as AUNT MILLIE'S may reasonably require, and to make the vehicle available to AUNT MILLIE'S on reasonable notice and at reasonable times, for the purpose of enabling AUNT MILLIE'S to place or
amend its advertising materials on the vehicle. AUNT MILLIE'S shall be solely responsible for the content of any advertising material and shall bear all expenses incurred in connection with placing, amending and/or removing of such advertising materials in the advertising space. In the event AUNT MILLIE'S, in its sole judgment, determines that LESSOR is not complying with the requirements of this Article AUNT MILLIE's may withhold rental payments, and if LESSOR fails to take reasonable steps to comply after notice from AUNT MILLIE'S, AUNT MILLIE'S shall be entitled to terminate this Vehicle Advertising Agreement on ten (10) days notice to LESSOR, and LESSOR shall immediately make the vehicle available to AUNT MILLIE'S for the purpose of having the advertising materials removed.
2. CLOTHING ADVERTISING AGREEMENT: LESSOR agrees to rent to AUNT MILLIE'S for the limited purposes of advertising AUNT MILLIE'S Products, all items of approved clothing worn by LESSOR's personnel in connection with the operation of its business appropriate for such use. AUNT MILLIE'S agrees to pay for such space rental the sum of $60/week. In consideration of such rental payments, LESSOR agrees to maintain all such items of clothing in a clean and neat condition, to maintain standards of dress and personal grooming consistent with AUNT MILLIE'S clothing advertising policy, as the same may be amended from time to time, and consistent with the best possible image for AUNT MILLIE'S in the marketplace, and to make such items of clothing available to AUNT MILLIE'S on reasonable notice and at reasonable times for the purpose of enabling AUNT MILLIE'S to place or amend its advertising materials on the clothing. AUNT MILLIE'S shall be solely responsible for the content of any advertising material and shall bear all expenses incurred in connection with placing, amending and/or removing of such advertising materials in the advertising space.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
Based on the 2025 Aunt Millies Bakeries Franchise Disclosure Document, the document outlines advertising agreements that function as leases, but it does not specify how general lease liabilities for real estate or equipment are determined. The document describes two advertising agreements where Aunt Millie's leases space on delivery vehicles and clothing worn by personnel from the LESSOR for $60 per week in both cases.
Under the Delivery Vehicle Advertising Agreement, Aunt Millie's pays for applying advertising decals and materials to the vehicle. The LESSOR is responsible for maintaining the vehicle in a clean condition and repainting it as reasonably required by Aunt Millie's. Aunt Millie's can withhold rental payments or terminate the agreement with ten days' notice if the LESSOR does not comply with the agreement terms. Similarly, under the Clothing Advertising Agreement, Aunt Millie's pays $60 per week for advertising space on clothing worn by the LESSOR's personnel. The LESSOR must maintain the clothing in a clean condition and adhere to Aunt Millie's clothing advertising policy.
However, the FDD does not provide details on how Aunt Millies Bakeries determines lease liabilities for typical business operations, such as leasing a physical store location or equipment. A prospective franchisee should inquire with Aunt Millies Bakeries about the typical lease terms, conditions, and liabilities associated with securing a location or equipment necessary to operate the franchise.