Must the assignee expressly assume all rights and obligations of the Amorino Area Developer in writing?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the foregoing, Company shall permit Area Developer to form a new legal entity ("Affiliate") to sign a Franchise Agreement under this Agreement and a lease for a Store to be opened under this Agreement, provided that:
- (i) The affiliate has the same owners as the area developer holding 51% or more of its property or voting rights, or the affiliate is a directly or indirectly controlled affiliate of the area developer, and the area developer provides written evidence of same;
- (ii) that the Affiliate expressly assumes in writing for the benefit of Company all rights and obligations of Area Developer under this Agreement and all franchise agreements executed pursuant hereto;
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, if an Area Developer forms a new legal entity (an "Affiliate") to sign a Franchise Agreement and lease for a store, the Affiliate must expressly assume in writing all the rights and obligations of the Area Developer. This written assumption is specifically for the benefit of Amorino.
This requirement ensures that Amorino has a direct contractual relationship with the Affiliate and can enforce the terms of the Area Development Agreement and Franchise Agreements against them. It also clarifies that the Affiliate is fully responsible for fulfilling all duties and obligations outlined in those agreements.
In addition to the written assumption, the Area Developer must meet other conditions for the assignment to an affiliate, including maintaining ownership control of the affiliate, being in full compliance with all obligations to Amorino, providing a general release to Amorino, paying a $1,000 transfer fee, and demonstrating that the Affiliate has sufficient capital to fulfill the Franchise Agreement obligations. These conditions protect Amorino's interests and ensure the Affiliate is qualified to operate the franchise.