What happens if an involuntary petition in bankruptcy is filed against an Amorino franchisee?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Amorino is entering into this Agreement in reliance upon your singular personal skills and qualifications, or if you are a Business Entity, upon the singular personal skills and qualifications of your Principals.
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.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, the franchise agreement cannot be transferred involuntarily, including as a result of bankruptcy. Amorino is entering into the agreement based on the franchisee's personal skills and qualifications.
Specifically, except for a transfer to a business entity owned by the franchisee, the franchisee may not assign or transfer the agreement or any rights or obligations under the 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 the franchisee, is subject to Amorino's right of first refusal.
This means that if an involuntary petition in bankruptcy is filed against an Amorino franchisee, Amorino has the right to prevent the transfer of the franchise agreement to another party. This protects Amorino's interests by ensuring that the franchise is operated by someone who meets their standards and qualifications. The franchisee may be in default of their agreement, which could lead to termination of the franchise agreement.