During the 30-day period after termination, expiration, or non-renewal, does Spray Net have the right to inspect the franchisee's equipment?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
- H. Purchase of Assets.
Franchisor shall have the option, but not the obligation, within thirty (30) days after the date of termination, expiration, and non-renewal of this Agreement to purchase any and all of Franchisee's operating assets from the Franchised Business at a purchase price equal to net depreciated book value.
If Franchisor elects this option, Franchisor will deliver written notice to Franchisee.
Franchisor will have the right to inspect equipment at any time during this thirty (30) day period.
If Franchisor elects to purchase equipment as part of the asset purchase, Franchisor will be entitled to, and Franchisee must provide, all customary warranties and representations as to compliance with law, the maintenance, function, and condition of the equipment and Franchisee's good title to the equipment (including, but not limited to, that Franchisee owns the equipment free and clear of any liens and encumbrances).
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, Spray Net has the option to purchase a franchisee's operating assets within 30 days after termination, expiration, or non-renewal of the franchise agreement. As part of this option, Spray Net retains the right to inspect the franchisee's equipment during this 30-day period.
If Spray Net chooses to exercise its option to purchase the equipment, it must provide written notice to the franchisee. In this case, the franchisee must provide customary warranties and representations regarding compliance with the law, the maintenance, function, and condition of the equipment, and the franchisee's clear title to the equipment, free of any liens or encumbrances.
This clause protects Spray Net by allowing them to assess the value and condition of the assets before committing to purchase them. For a franchisee, this means they must maintain their equipment in good working order and be prepared to provide documentation and warranties if Spray Net decides to buy the assets back. The franchisee should also ensure they have clear title to the equipment to avoid complications during the potential sale.