Does the Amorino franchise agreement allow Amorino to purchase an existing non-competitive business?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
ary Marks and Marks will provide a competitive advantage, and is the primary reason you are entering into this Agreement. You and each Principal covenant and agree that during the term of this Agreement, except as otherwise
approved in writing by Amorino, you and, if applicable, such Principal, shall not, either directly or indirectly, for yourselves, or through, on behalf of, or in conjunction with any person, or legal entity:
- (1) Divert or attempt to divert any present or prospective customer or supplier of the Franchised Business to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Proprietary Marks and the System.
- (2) Employ or seek to employ any person who is or has been within the previous 30 days employed by Amorino or an Affiliate of Amorino as a salaried managerial employee, or otherwise directly or indirectly induce such person to leave his or her employment.
- (3) Own, maintain, advise, operate, engage in, be employed by, make loans to, invest in, provide any assistance to, or have any interest in (as owner or otherwise) or relationship or association with, any business that engages in the production or sale at retail or wholesale of gelato or other ice cream products, and any other products or services offered by your Store or proposed to be offered by your Store or similar Amorino Stores, other than a Amorino Store operated pursuant to a then-currently effective franchise agreement with Amorino at any location within the United States, its territories or commonwealths, or any other country, province, state or geographic area in which Amorino or its Affiliates have used, sought registration of or registered the Proprietary Marks or similar marks or operate or license others to operate a business under the Proprietary Marks or similar marks.
- D. Non-Competition After Expiration or Termination of Agreement.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
Based on the 2025 Amorino Franchise Disclosure Document, the agreement does not explicitly address whether Amorino can purchase an existing non-competitive business. However, the document does state that during the term of the agreement, franchisees and their principals are restricted from owning, maintaining, or being involved with any business that sells ice cream products, unless it is an Amorino store operating under a current franchise agreement, except as otherwise approved in writing by Amorino.
This clause implies that while franchisees are restricted from engaging in competitive businesses, Amorino itself might have the option to purchase such businesses, especially if it aligns with their strategic interests. The FDD specifies that franchisees need written approval from Amorino to engage in activities that might be seen as competitive.
For a prospective franchisee, this means that while they are bound by strict non-compete clauses, Amorino retains the flexibility to make business decisions that could include acquiring businesses that might seem competitive but are ultimately integrated into the Amorino system. It would be prudent for a potential franchisee to seek clarification from Amorino regarding their long-term business strategies and potential acquisitions to fully understand the competitive landscape.