According to the Amorino agreement, who is considered a 'Principal' of the franchisee?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Supervising Principal; Manager.
- (1) One of your individual Principals must directly supervise the Store and its daily operations, on-site (the "Supervising Principal"). Mobile Outlets shall not be required to have daily on-site supervision by a Supervising Principal but, Mobile Outlets must still have a Supervising Principal (or a Manager as permitted in (2) below, primarily responsible for the operations of the Store. If you are a Business Entity, the Supervising Principal should be the individual Principal who owns a controlling interest in Franchisee. The Supervising Principal shall have full control over day-to-day Store management and operations. The Supervising Principal must attend and successfully complete Amorino's initial training program and all additional training that Amorino requires, to Amorino's satisfaction. Except as may be permitted under subsection (2) below, and except where such obligations are inconsistent with the on-site daily supervision exception for Mobile Outlets, the Supervising Principal shall devote his or her full time efforts to Store operations, and shall not engage in any other business or Activity, directly or indirectly, that requires substantial management responsibility or time commitment. Amorino shall have approved the Supervising Principal as meeting its then-current qualifications for such position.
- (2) If you operate more than one Amorino Store, or if the Supervising Principal will not devote full time efforts to the management and operation of the Store governed by this Agreement then, in addition to the Supervising Principal, you must appoint an individual to serve as the Manager, who must be approved in advance by us and who must complete to our satisfaction our initial training and any other additional training that we may require. The
Manager shall have full control over, and devote his or her full-time efforts to, day-to-day management and operation of the Store. The Manager shall not engage in any other business or activity, directly or indirectly, that requires substantial management responsibility or time commitment. If the Manager ceases to serve in, or no longer qualifies for, such position, you shall designate another qualified person to serve as the Manager within 30 days after the date the prior Manager ceases to serve or no longer qualifies to serve. Any proposed replacement Manager must be approved in advance by us and must complete to our satisfaction our initial training and any other additional training that we may require.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
Based on the 2025 Amorino Franchise Disclosure Document, the agreement refers to 'Principals' of the franchisee, especially when the franchisee is a business entity. One of the individual Principals must be the Supervising Principal, directly overseeing the store's daily operations on-site. If the franchisee operates more than one Amorino store, or if the Supervising Principal cannot dedicate full-time efforts to the store, a Manager must be appointed, subject to Amorino's approval and training requirements.
Amorino requires that if the franchisee is a Business Entity, the Supervising Principal should be the individual Principal who owns a controlling interest in Franchisee. This individual has full control over the store's day-to-day management and operations and must complete Amorino's initial and additional training programs. The Supervising Principal is expected to devote their full-time efforts to the store, unless an approved Manager is in place or the franchise is a Mobile Outlet.
Furthermore, Principals are subject to certain obligations, such as executing confidentiality and non-competition agreements. These agreements remain in effect even if a Principal ceases to own an interest in the franchisee during the franchise term, extending for a two-year period from the date they no longer meet the definition of a Principal. This ensures that individuals with significant knowledge of Amorino's operations and confidential information remain bound by non-competition terms, protecting Amorino's interests.
In the context of transferring the franchise, Amorino emphasizes that it enters the agreement relying on the personal skills and qualifications of the franchisee or, if a business entity, its Principals. This highlights the importance Amorino places on the individuals behind the franchise and their commitment to the brand's standards and operations. Any transfer of the franchise is contingent on the transferee meeting Amorino's standards, underscoring the critical role Principals play in maintaining the integrity and success of the Amorino franchise.