What is Amorino's management's expectation regarding the continuation of the business as a going concern?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company was formed to act as the franchisor for Amorino, and is wholly owned by its parent. Since inception, the Company has incurred net losses and has reported a deficit of member's equity. As described previously, the operations of the Company are interrelated with its parent and affiliate. Management expects to continue operating the business as a going concern. Management believes that the Company has sufficient cash on hand and that liabilities such as deferred revenue do not represent amounts that will require future settlement in cash. Should it become necessary, the Parent has committed to provide additional financing if the Company is unable to meet its obligations on its own.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, management expects to continue operating the business as a going concern. The company was formed to act as the franchisor for Amorino and is wholly owned by its parent company. The operations of the company are interrelated with its parent and affiliate.
Even though the company has incurred net losses and has reported a deficit of member's equity since its inception, management believes that the company has sufficient cash on hand. They also believe that liabilities such as deferred revenue do not represent amounts that will require future settlement in cash.
Furthermore, the parent company has committed to providing additional financing should it become necessary for Amorino to meet its obligations. This commitment from the parent company provides a safety net for Amorino, ensuring its ability to continue operations even if it faces financial difficulties.