factual

Did the settlement agreement in the Amorino lawsuit include termination of the non-competition provisions?

Amorino Franchise · 2025 FDD

Answer from 2025 FDD Document

  • D.

Non-Competition After Expiration or Termination of Agreement.

Commencing upon the later of: (a) a transfer permitted under this Agreement, expiration of this Agreement, or termination of this Agreement (regardless of the cause for termination) or (b) a final court order (after all appeals have been taken) with respect to any of the foregoing events or with respect to enforcement of this Section, and continuing for an uninterrupted period of two years thereafter, you and each of your Principals, shall not either directly or indirectly, for yourselves, or through, on behalf of, or in conjunction with any person, persons, or legal entity, own, maintain, advise, operate, engage in, be employed by, make loans to, or have any interest in or relationship or association with a business that engages in the production or sale at retail or wholesale of ice cream products, other than a Amorino Store operated pursuant to a then currently effective franchise agreement with Amorino, and (i) is, or is intended to be, located at the location of the former Franchised Business; (ii) within the former Protected Area of the Store (or, if there was no protected area, within a three-mile radius of the Store); or (iii) within a three-mile radius of any other store operating under the System and Proprietary Marks in existence or under development at the time of such expiration, termination or transfer.

If any Principal ceases to own an interest in the Franchisee for any reason during the franchise time, the foregoing covenants shall apply to the departing Principal for a two-year period beginning on the date such person ceases to meet the definition of a Principal.

The obligations described in this Section shall be tolled during any period of noncompliance.

  • E.

Confidentiality and Non-Competition Agreements to Be Executed by Your Principals and Managers.

Each of your Principals and managers shall execute and deliver to us a Confidentiality and Non-Competition Agreement in the form of Attachment C.

  • F.

Additional Provisions.

The parties acknowledge and agree that Amorino shall have the right, in its sole discretion, to reduce the scope of any covenant set forth in this Section 18, or any portion thereof, without your consent or the consent of any Principal, effective immediately upon delivery of written notice to the affected party; and you and each Principal agree that such person shall comply forthwith with any covenant as so modified.

You and each Principal expressly agree that the existence of any claims you may have against Amorino, whether or not arising from this Agreement, shall not constitute a defense to Amorino's enforcement of the covenants in this Section 18.

You and each Principal agree to pay all costs and expenses (including reasonable attorneys' fees) incurred by Amorino in connection with the enforcement of this Section 18.

  • G.

Breach of Covenants Causes Irreparable Injury.

You acknowledge that your violation of any covenant of this Section 18 would result in irreparable injury to Amorino for which no adequate remedy at law may be available, and you consent to the issuance of, and agree to pay all court costs and reasonable attorneys' fees incurred by Amorino in obtaining, without the posting of any bond, an ex parte or other order for injunctive or other legal or equitable relief with respect to such conduct or action.

  • H.

Exception for Publicly Held Companies.

The foregoing restrictions shall not apply to your ownership or any Principal's ownership of less than a 5% beneficial interest in the outstanding equity securities of any company registered under the Securities Act of 1933 or the Securities Exchange Act of 1934.

Source: Item 3 — LITIGATION (FDD pages 13–14)

What This Means (2025 FDD)

Based on the 2025 Amorino Franchise Disclosure Document, there is no mention of a settlement agreement in an Amorino lawsuit that includes the termination of non-competition provisions. However, the document does outline Amorino's non-competition terms and conditions.

Specifically, the FDD states that after the agreement expires or terminates, the franchisee and their principals are restricted from engaging in any business involving the production or sale of ice cream products. This restriction applies for two years, within the location of the former franchised business, the former protected area, or within a three-mile radius of any other Amorino store. Principals who cease to have interest in the franchise are subject to the same two-year non-compete obligations.

Amorino also retains the right to modify the scope of any non-compete covenant without the franchisee's consent. The franchisee acknowledges that violating these covenants would cause irreparable injury to Amorino, entitling Amorino to injunctive relief and recovery of legal fees. These non-compete obligations do not apply if the franchisee or principal owns less than a 5% beneficial interest in a publicly held company. Prospective franchisees should seek clarification from Amorino regarding any past or pending litigation and the potential impact on these non-competition clauses.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.