Regarding the Amorino franchise agreement, what happens if the franchisee violates post-termination obligations?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
icers, directors, managers, members, shareholders, and partners in our/their corporate/company and individual capacities.
- (10) You shall comply with any covenants contained in this Agreement that survive termination or expiration of this Agreement, including the covenants set forth in Section 18.D.
- (11) You shall pay us a
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to the 2025 Amorino FDD, a franchisee who violates post-termination obligations will be subject to a delay fee. Specifically, Amorino will charge a fee of $500 per day for each day the franchisee remains in violation of these obligations.
Post-termination obligations are designed to protect Amorino's brand and system after a franchise agreement ends. These obligations typically include ceasing to operate the store, removing Amorino's branding, and not competing with Amorino in a specific area for a certain period. The daily delay fee serves as a financial disincentive for franchisees who fail to comply with these requirements.
This penalty underscores the importance of understanding and adhering to the post-termination obligations outlined in the franchise agreement. Prospective Amorino franchisees should carefully review Section 18.D and other relevant sections to fully understand their responsibilities upon termination or expiration of the agreement. Failure to comply can result in significant financial penalties, impacting the franchisee's financial standing after the business closes.