After the Spray Net Franchise Agreement expires, is terminated, or is not renewed, can a Spray Net franchisee solicit business from clients of their former Franchised Business?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
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- For a period of two (2) years after the expiration and nonrenewal, transfer or termination of this Agreement, regardless of the cause, neither Franchisee, its principals, owners and guarantors, nor any member of the immediate family of Franchisee, its principals, owners or guarantors, may, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership or corporation, be involved with any business that competes in whole or in part with Franchisor by offering or granting licenses or franchises, or establishing joint ventures, for the ownership or operation of a Competing Business. The geographic scope of the covenant contained in this Section is any location where Franchisor can demonstrate it has offered or sold franchises as of the date this Agreement is terminated or expires.
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- For a period of two (2) years after the expiration and nonrenewal, transfer or termination of this Agreement, regardless of the cause, neither Franchisee, its principals, owners and guarantors, nor any member of the immediate family of Franchisee, its principals, owners or guarantors, may, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership or corporation:
- a. Own, maintain, engage in, be employed as an officer, director, or principal of, lend money to, extend credit to, lease/sublease space to, or have any interest in or involvement with any other Competing Business:
- i. within the Designated Territory;
- ii. within a fifty (50) mile radius of the Designated Territory;
- iii. within a fifty (50) mile radius of any Spray-Net franchised business
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to the 2025 Spray Net Franchise Disclosure Document, after the franchise agreement expires, is terminated, or is not renewed, a franchisee is restricted from engaging in activities that compete with Spray Net. For a period of two years, the franchisee (including their principals, owners, guarantors, and immediate family members) cannot be involved with any business that competes with Spray Net by offering or granting licenses or franchises, or establishing joint ventures for a Competing Business. This restriction applies to any location where Spray Net can demonstrate it has offered or sold franchises as of the date the agreement is terminated or expires.
Additionally, for two years post-termination, the franchisee and related parties are prohibited from owning, maintaining, or being involved with any other Competing Business within the Designated Territory, within a 50-mile radius of the Designated Territory, within a 50-mile radius of any Spray-Net franchised business that is open and operating, or within a 50-mile radius of any other designated territory granted by Spray Net.
These restrictions prevent a former Spray Net franchisee from leveraging their knowledge and experience gained during the franchise term to directly compete with Spray Net. This includes soliciting former clients or establishing a competing business in close proximity to existing Spray Net franchises. The non-compete terms are designed to protect Spray Net's market share and franchise system.
Prospective franchisees should carefully consider the implications of these restrictions, as they could significantly limit their business opportunities for two years after leaving the Spray Net system. It is important to understand the geographic scope of these restrictions and how they might impact future business ventures.