What does Amorino warrant regarding affiliates opening similar outlets?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
BACKGROUND
- A. Amorino has a license to use and to sublicense the use of a unique and uniform method and concept relating to the establishment and operation of upscale stores, kiosk outlets, and mobile outlets to offer authentic, high quality gelato and sorbet and related products and services for dine-in consumption and take-out service in a clean, hospitable and sophisticated environment associated with the mark "Amorino" (the "System").
- B. The System's unique characteristics include products, recipes and menu items which incorporate Amorino's trade secrets and proprietary information and which may change from time to time at Amorino's discretion and as provided in this Agreement (the "Proprietary Products"); distinctive interior and exterior design and signage, decor, color scheme, fixtures, and furnishings; standards and specifications for products and supplies; service standards; uniform standards, specifications, and procedures for operations; procedures for inventory and management control; and training and assistance. Amorino's license grants it the exclusive right to open Stores in your Protected Area. Amorino warrants that during the term of this Agreement none of Amorino's affiliates will open, or permit others to open, in your Protected Area outlets substantially similar to those you establish pursuant to this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 80–81)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, Amorino provides a warranty to franchisees regarding the operation of similar outlets by its affiliates. Specifically, Amorino warrants that during the term of the agreement, none of Amorino's affiliates will open, or permit others to open, outlets substantially similar to those established by the Area Developer within their Development Territory. This warranty aims to protect the Area Developer's market exclusivity and investment within their designated territory.
Additionally, for franchisees operating a traditional store, kiosk outlet, or mobile outlet, Amorino grants an exclusive right to operate the Franchised Business at the Franchised Location within a defined "Protected Area." During the term of the agreement, Amorino will not operate, nor license to others, an Amorino store, kiosk outlet, mobile outlet, or other retail outlet under the Proprietary Marks within this Protected Area. This provision ensures that franchisees have a specific geographic area where they are the sole Amorino representative, free from direct competition from the franchisor or other franchisees.
However, the franchise granted is nonexclusive outside the Protected Area. Amorino retains the right to operate or franchise other businesses under different trademarks, even if they offer similar products or services. Furthermore, Amorino reserves the right to distribute Proprietary Products through alternative channels like grocery stores or online, both inside and outside the Protected Area. The exclusivity of the Protected Area can also be revoked if events occur that would allow Amorino to terminate the franchise agreement, as outlined in Section 16 of the agreement. Therefore, prospective franchisees should carefully consider the scope and limitations of the protected area and the potential for competition from other channels or businesses under different trademarks.