What does Aunt Millies Bakeries do with the receivables purchased from the distributor?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
- §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 Aunt Millies Bakeries' 2025 Franchise Disclosure Document, Aunt Millie's purchases the distributor's rights, title, and interest in charge slips and accounts from product sales to chains or outlets within the sales area. This includes all proceeds from these sales, at face value, after deducting any discounts. These receivables must be properly filled out and executed, free of liens or encumbrances not approved by Aunt Millie's.
Upon purchasing these receivables, Aunt Millie's credits the distributor's account. The distributor is then required to promptly remit all charge slips to Aunt Millie's. If a chain chooses to settle payments 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.
The sale and purchase of receivables continue until the Distribution Agreement is terminated, the distributor provides written notice to end the sale, or Aunt Millie's notifies the distributor that a specific account's credit has not been approved. For the purposes of this agreement, "Accounts" are defined as per the Uniform Commercial Code in the distributor's state of organization.