What happens if an involuntary bankruptcy petition is filed against an Amorino franchisee?

According to Amorino's 2025 Franchise Disclosure Document, a franchisee's rights to the franchise agreement can be terminated if an involuntary bankruptcy petition is filed against them. Amorino is entering into the agreement based on the franchisee's personal skills and qualifications. If the franchisee is a business entity, Amorino relies on the skills and qualifications of the business's principals.

Except for a transfer to a business entity owned by the franchisee, the franchisee cannot assign or transfer the agreement or any rights or obligations, whether voluntarily or involuntarily, including due to bankruptcy. This means that if a franchisee faces bankruptcy, Amorino can terminate the franchise agreement, preventing the franchisee from continuing to operate under the Amorino brand unless the transfer is to a business entity already owned by the franchisee.

This provision protects Amorino by ensuring that the franchise remains in the hands of someone they have approved and who meets their standards. It also means that a potential franchisee should be aware of the risks of bankruptcy and its potential impact on their franchise agreement with Amorino. The franchisee's personal financial stability is crucial, as financial distress could lead to the termination of their franchise.