What is the significance of Section 15.C in relation to transferring the Amorino franchise?

According to Amorino's 2025 Franchise Disclosure Document, Section 15.C outlines specific conditions under which a franchisee can transfer their franchise to a business entity they own. This is an exception to the general rule that Amorino franchisees cannot freely assign or transfer their franchise agreements due to Amorino's reliance on the franchisee's personal skills and qualifications.

Specifically, a transfer to a business entity owned by the franchisee, as described in Section 15.C, is not subject to Amorino's right of first refusal, which normally applies to other types of transfers. However, any other transfer of the franchise is subject to Amorino's right of first refusal. This means Amorino has the option to either approve the transfer, reject it, or take over the franchise itself under the same terms offered to the proposed transferee.

To gain approval for a transfer under Section 15.C, the franchisee must meet several conditions. These include being current on all financial obligations to Amorino, complying with all agreements, providing Amorino with a completed "Amorino Transfer Disclosure Form" along with proposed transfer agreements and the lease agreement at least 30 days before the proposed transfer. Amorino must also determine that the terms of the sale will not negatively impact the franchise's viability post-transfer. The potential transferee must also meet Amorino's standards for franchisees, including demonstrating adequate financial resources, good character, and business acumen. Additionally, both the franchisee and their principals must execute a general release of claims against Amorino, and the transferee must execute Amorino's current franchise agreement, which may have different terms than the original agreement.