What are the exceptions to the mediation requirement in the Spray Net franchise agreement?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
SPRAY-NET INC. ILLINOIS ADDENDUM TO THE FRANCHISE AGREEMENT
The following are revisions to the Franchise Agreement:
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- Definitions. Capitalized terms used but not defined in this Rider have the meanings given in the Agreement. The "Illinois Act" means the Illinois Franchise Disclosure Act of 1987.
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- Governing Law and Jurisdiction. Notwithstanding any provision of this Agreement to the contrary, this Agreement is governed by Illinois law. The parties irrevocably submit to the jurisdiction and venue of the federal and state courts in Illinois, except for matters which the Agreement provides will be resolved by arbitration.
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- Limitation of Claims. No action can be maintained to enforce any liability created by the Illinois Act unless brought before the expiration of 3 years from the act or transaction constituting the violation upon which it is based, the expiration of 1 year after Franchisee become aware of facts or circumstances reasonably indicating that Franchisee may have a claim for relief in respect to conduct governed by the Illinois Act, or 90 days after delivery to the Franchisee of a written notice disclosing the violation, whichever shall first expire.
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- Waivers Void. Notwithstanding any provision of the Agreement to the contrary, any condition, stipulation, or provision purporting to bind Franchisee to waive compliance with any provision of the Illinois Act or any other law of the State of Illinois is void. This Section shall not prevent Franchisee from entering into a settlement agreement or executing a general release regarding a potential or actual lawsuit filed under any of the provisions of this Act, nor shall it prevent the arbitration of any claim under the provisions of Title 9 of the United States Code. No statement, questionnaire or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on behalf of the Franchisor. This provision supersedes any other term of any docume
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
Based on the 2025 Spray Net Franchise Disclosure Document, the addenda for Illinois, Maryland, and Minnesota provide exceptions and clarifications to various clauses within the standard franchise agreement. Specifically, these addenda address waivers, governing law, and franchisee rights in relation to state franchise laws. These addenda indicate that certain provisions of the franchise agreement do not apply or are modified to comply with state-specific regulations.
In Illinois, any condition that binds a franchisee to waive compliance with the Illinois Franchise Disclosure Act or any other Illinois law is void. However, a franchisee can enter into a settlement agreement or execute a general release regarding a potential or actual lawsuit, or arbitrate a claim under Title 9 of the United States Code. Maryland's addendum specifies that the general release required for renewal, sale, or transfer does not apply to liabilities under the Maryland Franchise Law. Franchisees in Maryland also retain the right to file lawsuits under the Maryland Franchise Law in a Maryland court.
For Minnesota, the addendum ensures that nothing in the Franchise Disclosure Document or agreements can reduce a franchisee's rights under Minnesota Statute 80C or their rights to any procedure, forum, or remedies provided by law. Minnesota law also protects the franchisee's right to use trademarks and service marks. These state-specific addenda collectively serve to protect franchisees' rights and ensure compliance with local laws, potentially overriding or modifying standard terms in the franchise agreement to align with state regulations.