Does the Amorino franchise agreement allow for a transfer as a result of bankruptcy?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Accordingly, except for a transfer to a Business Entity owned by you in the manner described in Section 15.C, you may not assign or transfer this Agreement or any rights or obligations under this Agreement, whether in whole or in part, voluntarily or involuntarily, by operation of law (including as a result of bankruptcy, divorce, death or disability).
Any transfer, except for a transfer to a Business Entity by you in the manner described in Section 15.C, is subject to our right of first refusal.
Amorino will not unreasonably withhold its consent to a transfer of any interest in the Franchised Business, but may, in its sole discretion, condition such consent on satisfaction of any or all of the following:
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, the franchise agreement does not generally allow for the transfer of the agreement or any rights or obligations under it as a result of bankruptcy. Amorino emphasizes that the agreement is based on the franchisee's personal skills and qualifications.
However, there is an exception for transfers to a business entity owned by the franchisee under specific conditions detailed in Section 15.C of the franchise agreement. Any transfer, except for this specific type of transfer to a franchisee-owned business entity, is subject to Amorino's right of first refusal.
This restriction on transfer during bankruptcy is a significant point for potential Amorino franchisees. It means that if a franchisee faces bankruptcy, they cannot simply transfer the franchise to another party to alleviate their financial distress unless it meets the specific conditions outlined in the franchise agreement. This could leave the franchisee with limited options and potentially result in the termination of the franchise agreement, as any transfer without Amorino's prior written consent is considered null and void and a material breach of the agreement.