What is the definition of 'Affiliate' in the Amorino franchise agreement?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company's primary purpose is to act as the U.S. franchisor for Amorino. Substantially all services as the franchisor are provided by the Parent and Amorino Trading, LLC (the "Affiliate", an affiliated company under common control).
(1) All of your accrued monetary obligations to Amorino and its Affiliates, and all other outstanding obligations related to the Store shall be up to date, fully paid and satisfied.
(2) You must be in full compliance with this Agreement and any other agreements between you and Amorino, its Affiliates and your suppliers.
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;
- (iii) that as of the date of any such assignment, the Area Developer shall have fully complied with all of its obligations to Company, whether under this Agreement or any other agreement, arrangement or understanding with Company;
- (iv) that Area Developer provides a general release to Company, its owners, officers, directors, and affiliates;
- (v) that Area Developer shall pay to Company a transfer fee equal to $1,000 which is reasonably required to cover Company's legal and administrative expenses in connection with this transfer of these rights.
- (vi) that Area Developer and Affiliate demonstrate to Company's satisfaction that Affiliate has sufficient capital to undertake the obligations of the Franchise Agreement.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, an 'Affiliate' is defined within the context of the company's operations. Specifically, Amorino Trading, LLC is identified as an 'Affiliate,' characterized as an affiliated company under common control. This definition appears in the section discussing the company's role as the U.S. franchisor for Amorino, where the Parent company and Amorino Trading, LLC provide substantial services.
For a prospective franchisee, understanding the role of affiliates is crucial because it clarifies the relationships between different entities involved in the franchise system. In Amorino's case, knowing that Amorino Trading, LLC is an affiliate under common control suggests that it is closely tied to the parent company and likely plays a significant role in supporting the franchise operations. This could include supplying goods, providing training, or offering other essential services.
The franchise agreement also stipulates that franchisees must keep their monetary obligations to Amorino and its affiliates up to date. Furthermore, franchisees must be in full compliance with all agreements between themselves, Amorino, its affiliates, and their suppliers. This highlights the importance of maintaining good standing with all related entities, not just Amorino itself. Any failure to meet these obligations could potentially lead to breaches of the franchise agreement.
Additionally, the agreement specifies that Area Developers can form a new legal entity ('Affiliate') to sign a Franchise Agreement, provided certain conditions are met. These conditions include the affiliate having the same owners as the area developer with 51% or more of its property or voting rights, the affiliate expressly assuming all rights and obligations of the Area Developer, and the Area Developer providing a general release to the company and its affiliates. This clause allows for flexibility in structuring the business but also imposes requirements to ensure that Amorino's interests are protected.