What is the consequence if the Amorino franchisee's business entity is dissolved?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
) The Organizational Documents of such Business Entity may not be amended or revised without our prior written consent.
- (6) The Business Entity must remain in existence and in good standing during the term of this Agreement, and you shall not take any actions to dissolve the Business Entity.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to the 2025 Amorino FDD, if a franchisee operates as a business entity, the entity must remain in existence and in good standing during the term of the Franchise Agreement. The franchisee is prohibited from taking any actions to dissolve the business entity.
Further, the FDD states that any transfer made without Amorino's prior written consent will be considered null and void and will be considered a material breach of the Franchise Agreement. This would include a transfer resulting from the dissolution of the franchisee's business entity.
In the event of a prohibited transfer, Amorino would likely have grounds to terminate the Franchise Agreement, resulting in the loss of the franchise. The franchisee would also likely be subject to post-termination obligations, such as non-compete and confidentiality requirements.