What is a Spray Net franchisee prohibited from using after termination or expiration of the agreement?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
- I. Disconnection of Telephone Number on Termination/Renewal.
Franchisee acknowledges that there will be substantial confusion among the public if, after the termination or expiration and non-renewal of this Agreement, Franchisee continues to use advertisements and/or the telephone number listed in the telephone directory under the name "SPRAY-NET" or any name similar to it.
Thus, effective upon the termination or expiration and non-renewal of this Agreement, Franchisee agrees to direct the telephone company servicing Franchisee, per Franchisor's request, to disconnect the telephone number used in connection with the Franchised Business or transfer such number to Franchisor or to any person or location of Franchisor's choosing.
If Franchisee fails to take these steps, Franchisee shall be deemed to have hereby irrevocably appointed Franchisor as Franchisee's attorney-in-fact for purposes of directing and accomplishing such transfer.
-
- 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.
-
- 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
In the event Franchisee or its personnel saves or prints out a hard copy of any Manual, then such electronic/hard versions of said Manuals must be immediately returned upon expiration or termination of this Agreement for any reason (and never used for any competitive purpose).
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, a franchisee faces several restrictions upon termination or expiration of the franchise agreement. Specifically, the franchisee cannot continue to use the telephone number associated with the Spray Net business. To prevent public confusion, Spray Net requires the franchisee to disconnect the phone number or transfer it to Spray Net. If the franchisee fails to do so, Spray Net is irrevocably appointed as the attorney-in-fact to direct the transfer.
Additionally, for two years after the agreement's expiration, nonrenewal, transfer, or termination, the franchisee (including their principals, owners, guarantors, and immediate family members) is restricted from involvement with any business that competes with Spray Net. This includes offering or granting licenses or franchises, or establishing joint ventures for a competing business. This restriction applies in any location where Spray Net has offered or sold franchises as of the termination or expiration date.
Furthermore, the franchisee is prohibited from owning, maintaining, engaging in, or being employed by any 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. Finally, upon termination or expiration of the agreement, the franchisee must return all electronic or hard copies of the manuals and must not use them for any competitive purpose.