Does the Spray Net agreement allow for judicial enforcement of the non-compete provisions?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
In consideration of the grant by Franchisor to the Franchisee as herein provided, each of you hereby agree, in consideration of benefits received and to be received by each of you, jointly and severally, and for yourselves, your heirs, legal representatives and assigns, to be firmly bound by all of the terms, provisions and conditions of the foregoing SPRAY-NET Franchise Agreement, and any other agreement between Franchisee and Franchisor and/or its affiliates, and do hereby unconditionally guarantee the full and timely performance by Franchisee of each and every obligation of Franchisee under the aforesaid Franchise Agreement or other agreement between Franchisor and Franchisee, including, without limitation: (i) any indebtedness of Franchisee arising under or by virtue of the aforesaid Franchise Agreement; (ii) the prohibition of any change in the percentage of Franchisee owned, directly or indirectly, by any person, without first obtaining the written consent of Franchisor prior to said proposed transfer as set forth in the Franchise Agreement; (iii) those obligations related to confidentiality, non-disclosure and indemnification; and (iv) the in-term and post-term covenants against competition, as well as all other restrictive covenants set forth in the Franchise Agreement.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to the 2025 Spray Net Franchise Disclosure Document, the franchise agreement includes in-term and post-term covenants against competition. These covenants, along with other restrictive covenants in the Franchise Agreement, are guaranteed by the franchisee. This means that the franchisee is bound by the non-compete terms outlined in the agreement.
Specifically, the document states that each franchisee agrees to be firmly bound by all terms, provisions, and conditions of the Spray Net Franchise Agreement. This includes the in-term and post-term covenants against competition. The agreement also states that the franchisee guarantees the full and timely performance of every obligation under the Franchise Agreement.
However, it is important to note that the enforceability of non-compete agreements can vary by state. For example, the Illinois Addendum states that any provision purporting to bind the franchisee to waive compliance with any provision of the Illinois Act or any other law of the State of Illinois is void. This suggests that while Spray Net aims to enforce these covenants, state laws may place limitations on their enforceability. A prospective franchisee should consult with a legal professional to understand the specific enforceability of these provisions in their state.