Is there a maximum amount of financing that can be secured by the UCC-1 filing for Aunt Millies Bakeries?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
ENT,** made effective ___________, 20___, by and between Distribution Services of America, Inc., a Florida corporation with offices at 2900 Westchester Avenue, Purchase, New York (herein called the "Secured Party") and DISTRIBUTOR'S CORPORATE NAME, residing at DISTRIBUTOR'S ADDRESS, (herein called the "Borrower").
W I T N E S S E T H :
In consideration of the premises and agreements contained herein and other good and valuable consideration, the sufficiency and receipt of which is hereby acknowledged, the parties agree as follows:
- 1. GRANT OF SECURITY INTEREST: To secure the full and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of each of the Obligations (as hereafter defined), the Borrower hereby grants, conveys, assigns and transfers to Secured Party a security interest in and to the following personal property:
- a) any and all rights that the Borrower may have under the Distributor's Agreement between PERFECTION BAKERIES, INC., d/b/a AUNT MILLIE'S and Borrower;
- b) all equipment, inventory, accounts, goods, property, contract rights, chattel paper and general intangibles related to or arising from Borrower's business, whether now or hereafter existing or acquired and wherever located;
- c) any and all accessions, replacements and additions to or of the foregoing; and
- d) all cash or non-cash proceeds (including insurance proceeds) of the foregoing, the items described in a), b), c), and d) above being hereinafter collectively referred to as the "collateral".
- **2.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, the UCC-1 filing serves as a security interest granted by the borrower to the secured party. This security interest covers various assets, including rights under the Distributor's Agreement, equipment, inventory, accounts, and proceeds from the borrower's business. The purpose of this security interest is to ensure the full payment and performance of obligations when due.
The obligations secured by the UCC-1 filing include the outstanding principal and interest on a Promissory Note. The original principal amount of the note is specified as "LOAN AMOUNT ($____.00) DOLLARS." This indicates that the specific loan amount is determined at the time of the agreement and would be documented in the actual promissory note. The UCC-1 filing also secures all other debts, liabilities, obligations, covenants, and agreements of the borrower as outlined in the Financing Security Agreement.
In practical terms, this means that Aunt Millies Bakeries franchisees are granting a security interest in their business assets to secure financing. The maximum amount of financing is tied to the loan amount specified in the Promissory Note, which is not a fixed amount in the FDD but rather a variable to be determined. Prospective franchisees should carefully review the terms of the Promissory Note and Financing Security Agreement to understand the full extent of their obligations and the assets being used as collateral. They should also clarify with the franchisor or lender how the loan amount is determined and what factors might influence it.