What options does Amorino have upon receiving notice of a proposed assignment from an Area Developer?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
- G. Right of First Refusal. Any assignment or transfer of this Agreement, or any interest herein, except for a transfer to a Business Entity by you as an individual in the manner described in Section 15.C, shall be subject to Franchisor's right of first refusal with respect thereto. Franchisor's said right of first refusal shall be exercised in the following manner:
- (a) Franchisee shall deliver to Franchisor a written notice clearly and unambiguously setting forth all of the terms and conditions of the proposed assignment and all available information concerning the proposed assignee, including but not limited to, information concerning the employment history, financial condition, credit history, skill and qualifications of the proposed assignee and, in the case of a partnership or corporate assignee, of its partners and shareholders as applicable.
- (b) Within thirty (30) days after Franchisor's receipt of such notice (or if Franchisor shall request additional information, within thirty (30) days after receipt of such additional information), Franchisor may either consent or withhold its consent to such assignment, or, at its option, accept the assignment to itself or to its nominee upon the terms and conditions specified in the notice. Franchisor may substitute an equivalent sum of cash for any consideration other than cash specified in said notice.
- (c) If Franchisor shall elect not to exercise its said right of first refusal and shall consent to such assignment, Franchisee shall, subject to the provisions of this Agreement, be free to assign this Agreement to such proposed assignee on the terms and conditions specified in said notice. If, however, Franchisor does not elect to exercise its right of first refusal and said terms shall be materially changed, or if more than 90 days shall pass without such assignment occurring, such changed terms or lapse of time shall be deemed a new proposal and Franchisor shall again have such right of first refusal with respect thereto.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, if an Area Developer seeks to assign their agreement, Amorino has a right of first refusal. The Area Developer must provide Amorino with a written notice detailing all terms and conditions of the proposed assignment, along with comprehensive information about the potential assignee, including their employment history, financial condition, credit history, skills, and qualifications. This information is crucial for Amorino to assess the suitability of the proposed assignee.
Within 30 days of receiving the notice (or additional requested information), Amorino has three options: consent to the assignment, withhold consent, or exercise its right to accept the assignment itself (or assign it to a nominee) under the same terms and conditions specified in the notice. If Amorino chooses to accept the assignment, it can substitute an equivalent cash amount for any non-cash consideration outlined in the notice.
If Amorino decides not to exercise its right of first refusal and consents to the assignment, the Area Developer is then permitted to assign the agreement to the proposed assignee, provided the terms remain materially unchanged and the assignment occurs within 90 days. Any material changes to the terms or a delay exceeding 90 days would constitute a new proposal, thereby reinstating Amorino's right of first refusal. This process ensures that Amorino maintains control over who becomes an Area Developer and that the terms of the agreement are upheld during any transfer.