Is an Amorino franchisee prohibited from diverting prospective customers to a competitor?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Covenantor agree that during the term of Covenant's employment with and/or ownership of Franchisee (and for a two (2) year uninterrupted period following the termination or expiration of such employment and ownership for any reason), except as otherwise approved in writing by Amorino, Covenantor shall not, either directly or indirectly, for himself/herself, 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 that (i) is, or is intended to be, located at the location of the former Franchised Business; (ii) within the former Protected Area of the Store (or, if there was no protected area, within a three-mile radius of the Store); or (iii) within a three-mile radius of any other Store operating under the System and Proprietary Marks in existence or under development at the time of such expiration, termination or transfer. The obligations described in this Section shall be tolled during any period of noncompliance.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, franchisees are restricted from diverting customers to competitors. During the term of the franchise agreement, franchisees are prohibited from diverting or attempting to divert any present or prospective customer or supplier of the Franchised Business to any competitor, by direct or indirect inducement or otherwise. They also cannot perform any act injurious or prejudicial to the goodwill associated with the Proprietary Marks and the System, unless Amorino provides written approval.
This non-compete clause extends beyond the termination or expiration of the franchise agreement. For a two-year period after the agreement ends, the franchisee is still prohibited from diverting customers or suppliers to competitors. This restriction applies to any officer, director, shareholder, or general/limited partner of a corporate or partnership franchisee.
These restrictions are designed to protect Amorino's brand and customer base. The non-compete obligations are tolled during any period of noncompliance, meaning the clock stops on the restriction if the franchisee violates the agreement, and resumes once compliance is restored. This ensures that Amorino can fully enforce the non-compete agreement for the full term.
Prospective franchisees should carefully consider these non-compete clauses, as they significantly limit their business activities both during and after the franchise term. It is important to understand the scope and duration of these restrictions and how they might impact future business opportunities.