What is the process for Aunt Millies Bakeries purchasing receivables from the distributor?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
ed from the weekly settlement, whether or not DISTRIBUTOR signs said form. DISTRIBUTOR acknowledges and agrees that the charges on Schedule C" (Form IO13) are subject to change by AUNT MILLIE's at any time.
- §3.5 PURCHASE OF RECEIVABLES: AUNT MILLIE'S shall purchase from DISTRIBUTOR, and the DISTRIBUTOR HEREBY sells, assigns and transfers to AUNT MILLIE'S, all of DISTRIBUTOR'S right, title and interest in and to all of DISTRIBUTOR'S properly filled out and executed charge slips, all existing and future Accounts arising from the sale of Products to Chains or Outlets in the Sales Area and all proceeds thereof from the DISTRIBUTOR, at their face value, net of all discounts, free and clear of all liens, security agreements and encumbrances, other than in favor of, or permitted (in writing) by, AUNT MILLIE'S and its principal lender. AUNT MILLIE'S shall credit DISTRIBUTOR'S account therefor. DISTRIBUTOR shall promptly remit all such slips to AUNT MILLIE'S. If any Chain elects to settle with DISTRIBUTOR on the basis of scan results, rather than charge slips, the credit to DISTRIBUTOR shall be adjusted for any difference between the charge slip and the actual sales reflected by the scan sale data. The foregoing sale and purchase shall continue until termination of this Distribution Agreement, or until DISTRIBUTOR gives written notice of the termination of the foregoing sale to AUNT MILLIE'S, or, with respect to specific Accounts only, AUNT MILLIE'S gives notice that such Account's Chain's or Outlet's credit has not been approved by AUNT MILLIE'S. For purposes of this Section 3.5, "Accounts" shall
mean accounts as defined in the Uniform Commercial Code as in effect in the state of organization of Distributor.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to the 2025 Aunt Millies Bakeries FDD, Aunt Millie's Bakeries purchases receivables from its distributors. Aunt Millie's Bakeries will purchase all of the distributor's rights, titles, and interests in properly filled out and executed charge slips and all existing and future accounts from the sale of products to chains or outlets in the sales area. This transfer includes all proceeds from the distributor, at their face value, net of all discounts, free and clear of all liens, security agreements, and encumbrances, other than those in favor of Aunt Millie's Bakeries and its principal lender. Aunt Millie's Bakeries will then credit the distributor's account for the receivables. The distributor is required to promptly remit all charge slips to Aunt Millie's Bakeries.
If a chain chooses to settle with the distributor based on scan results instead of charge slips, the credit to the distributor will be adjusted to reflect any difference between the charge slip and the actual sales data from the scan. This sale and purchase agreement continues until the termination of the Distribution Agreement. The distributor can provide written notice to end the sale, or Aunt Millie's Bakeries can give notice that a specific account's chain or outlet's credit has not been approved.
For the purposes of this section, "Accounts" are defined as accounts under the Uniform Commercial Code in the distributor's state of organization. On or before Friday of each week, the parties will settle their accounts for all products delivered to the distributor during the preceding week. This settlement acknowledges the distributor's credit for any off-code or damaged products repurchased and receivables purchased according to the agreement.