Does the Spray Net franchisee's consent need to be obtained before Spray Net reduces the scope of any covenant or provision?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
ance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Based upon the franchisor's financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the franchise agreement. In addition, all development fees and initial payments by area developers shall be deferred until the first franchise under the multi-unit development agreement opens.
SPRAY-NET INC. MINNESOTA ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT
Minnesota Statute 80C.21 and Minnesota Rule 2860.4400(j) prohibit us from requiring litigation to be conducted outside Minnesota, requiring waiver of a jury trial, or requiring the franchisee to consent to liquidated damages, termination penalties or judgment notes.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
The 2025 Spray Net Franchise Disclosure Document includes addenda for Minnesota and Maryland that address franchisee rights and waivers, but it does not explicitly state whether a Spray Net franchisee's consent is required before Spray Net reduces the scope of any covenant or provision within the franchise agreement.
However, the Minnesota addendum indicates that nothing in the Franchise Disclosure Document or agreements can reduce any of the franchisee's rights as provided for in Minnesota Statute 80C, or franchisee's rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction. This suggests that any attempt by Spray Net to unilaterally reduce the scope of a covenant or provision could be challenged if it infringes upon the franchisee's legal rights under Minnesota law.
Similarly, the Maryland addendum states that no statement signed by a franchisee can waive claims under state franchise law or disclaim reliance on statements made by the franchisor. This implies that a franchisee's consent to reduce the scope of a covenant might not be enforceable if it contradicts Maryland franchise law. A prospective Spray Net franchisee should clarify with the franchisor under what specific conditions the scope of any covenant or provision can be reduced and whether franchisee consent is required, especially in light of state-specific franchise laws.