Does the post-term non-compete apply to the Area Developer if they are non-compliant with the Amorino agreement?

According to Amorino's 2025 Franchise Disclosure Document, the post-term non-compete obligations for Area Developers are subject to tolling during any period of noncompliance. This means that if an Area Developer is in breach of the Area Development Agreement, the two-year clock on the non-compete period pauses for as long as the non-compliance continues.

Specifically, after the Area Development Agreement expires or terminates (regardless of the reason), the Area Developer is restricted from engaging in activities that compete with Amorino. These restrictions include involvement in businesses that produce or sell gelato or ice cream products similar to those offered by Amorino stores. The non-compete applies within the former territory, near former store locations, or near other Amorino stores. The tolling provision ensures that Amorino is protected from unfair competition even if the Area Developer delays compliance with the agreement.

For a prospective Amorino Area Developer, this tolling provision is a significant consideration. It means that any breach of the Area Development Agreement not only carries immediate consequences but also extends the period during which they are restricted from competing with Amorino after the agreement ends. This could substantially delay or complicate any plans to enter a similar business after their relationship with Amorino concludes. The Area Developer should seek legal counsel to fully understand the implications of this clause.