Does the Spray Net non-compete agreement restrict the franchisee from soliciting employees of the Franchisor's affiliates after the Franchise Agreement expires?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
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- During the Term of the Franchise Agreement and this Guaranty. During the term of the Franchise Agreement and this Personal Guaranty, each of the undersigned may not, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership or corporation:
- 1.2. Subject to and as permitted by applicable law, employ or seek to employ any person who is at that time employed by Franchisor, Franchisor's affiliates or any other System franchisee, or otherwise directly or indirectly induce or seek to induce such person to leave his or her employment thereat; or Divert or attempt to divert business or customers of any Franchisee-owned Franchised Businesses to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, the non-compete agreement does not explicitly restrict a franchisee from soliciting employees of Spray Net's affiliates after the Franchise Agreement expires. However, during the term of the Franchise Agreement and the Personal Guaranty, the franchisee cannot employ or seek to employ any person who is at that time employed by Spray Net, Spray Net's affiliates, or any other System franchisee. Additionally, the franchisee cannot directly or indirectly induce or seek to induce such person to leave their employment.
This restriction is in place to protect Spray Net's investment in its employees and franchisees, and to prevent franchisees from unfairly gaining a competitive advantage by poaching experienced staff from within the Spray Net system. This type of restriction is common in franchising, as franchisors want to maintain the stability and quality of their network.
After the termination or expiration of the Franchise Agreement, the franchisee is not explicitly restricted from soliciting or employing individuals who were previously employed by Spray Net or its affiliates. However, the franchisee is still subject to other non-compete restrictions, such as not being able to operate a competing business within a certain geographic area for a specified period of time. It is important for prospective franchisees to carefully review the terms of the Franchise Agreement and seek legal advice to fully understand the scope of these restrictions.