Does the definition of 'transfer' by the franchisee in the Amorino franchise agreement include the transfer of ownership by a business entity franchisee?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
| Franchisee' i. s obligations on termination/non -renewal | Sections 17 and 18.D of the franchise agreement | Immediately cease operating the Store, cease use of franchise system and Proprietary Marks, cancel assumed or equivalent name registrations containing the Proprietary Marks or the name "Amorino", cease to use and at our option, assign to us your rights to telephone numbers, email addresses, internet websites or webpages, make certain necessary modifications to premises and de-identify the premises completely of any association with Amorino, hide all physical aspects of the brand inside and outside the premises. In particular, any visible signage, recognizable artwork or decor must be dismantled, return any proprietary information relating to the franchised business, and comply with all post termination covenants (such as covenant not to compete) set forth in franchise agreement. |
|---|---|---|
| Assign j. ment of contract by franchisor | Section 15.A of the franchise agreement | No restrictions on our right to assign, provided the assignee is capable of performing and assumes our obligations under the franchise agreement. |
| "Transfe k. r" by franchisee - defined | Sections 15.B, 15.C and 15.D of the franchise agreement | Includes transfer of interest in agreement as well as transfer of ownership by business entity franchisee |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 55–67)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, the definition of "transfer" by the franchisee includes the transfer of ownership by a business entity franchisee. This means that if the franchisee is a corporation, LLC, or other business entity, any change in ownership of that entity is considered a transfer under the franchise agreement.
This has significant implications for prospective Amorino franchisees who plan to operate their franchise through a business entity. Any sale of stock, membership interests, or other ownership transfer in the business entity would be subject to the transfer provisions of the franchise agreement. This typically requires Amorino's consent and may involve transfer fees or other conditions.
Amorino retains certain rights regarding transfers, including the right of first refusal. This means that before a franchisee can transfer their business, Amorino has the option to purchase the franchise on the same terms as the proposed transfer. Franchisees need to carefully review the transfer provisions in Sections 15.B, 15.C, and 15.D of the franchise agreement to fully understand their obligations and Amorino's rights in the event of a proposed transfer.