What happens if the Area Developer does not exercise their right to additional development for Amorino?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
At the time Company delivers to Area Developer Company's written notice of its determination to undertake additional development in the Area Development Territory, Company shall also deliver to Area Developer a copy of Company's then-current Franchise Disclosure Document or its equivalent as may be required by applicable law (the "Disclosure Document") and two copies of the then-current area development agreement. ("Then-current," as used in this Agreement and applied to the Franchise Disclosure Document and Area Development Agreement shall mean the form then currently provided to prospective franchisees or Area Developers, or if not then being so provided, then such form selected by the Company in its sole discretion which previously has been delivered to and executed by a franchisee of Company). The new area development agreement may vary substantially from this Agreement, except that: (a) the new area development agreement shall provide for the same percentage discounts for the initial franchise fees to be paid on the individual franchise agreements for the third and additional Stores as provided in Schedule C to this Area Development (provided that Area Developer has opened at least two Stores during the term of this Area Development Agreement); and (b) Area Developer shall not be required to pay another Area Development Franchise Fee, although Company may impose other types of fees or charges. The new area development agreement will reflect Area Developer's new development obligation consistent with Company's plan for additional development set forth in its notice to Area Developer. Within thirty (30) days after Area Developer's receipt of the Franchise Disclosure Document and the new area development agreement, but no sooner than immediately after any applicable waiting periods prescribed by law ("Disclosure Period") have passed, Area Developer shall execute two copies of the Area Development Agreement described in the Franchise Disclosure Document and return them to Company. If Area Developer has so executed and returned the copies and has satisfied the
conditions set forth in Section 4.5, Company will execute the copies and return one fully executed copy to Area Developer.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
Based on the 2025 Amorino Franchise Disclosure Document, if the Area Developer does not exercise their right to additional development in the Area Development Territory, Amorino has the right to undertake additional development in that territory. When Amorino decides to proceed with additional development, they will provide the Area Developer with a written notice, a copy of the current Franchise Disclosure Document, and two copies of the current area development agreement.
The new area development agreement may differ significantly from the original agreement, with two exceptions: it must offer the same percentage discounts on initial franchise fees for the third and subsequent stores, assuming the Area Developer has opened at least two stores, and the Area Developer won't be required to pay another Area Development Franchise Fee, although other fees or charges may apply. The new agreement will align with Amorino's plan for additional development in the territory.
Within 30 days of receiving these documents, and after any legally required waiting periods, the Area Developer must execute and return two copies of the new Area Development Agreement to Amorino. If the Area Developer meets the conditions outlined in Section 4.5 of the agreement and returns the executed copies, Amorino will then execute the copies and return one fully executed copy to the Area Developer.