Does the non-compete restriction for Spray Net extend to locations where Spray Net has only offered franchises?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
B. After the Term of this Agreement.
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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.
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 extends to locations where Spray Net has offered or sold franchises. Specifically, for two years after the franchise agreement ends, the franchisee cannot be involved with a competing business in any location where Spray Net can demonstrate it has offered or sold franchises as of the date the agreement is terminated or expires.
This means that even if a Spray Net franchise hasn't been established in a particular location, the franchisee is still restricted from operating a competing business there if Spray Net has offered or sold franchise opportunities in that area. This restriction applies to the franchisee, their principals, owners, guarantors, and immediate family members.
This non-compete clause is broad, potentially limiting a former Spray Net franchisee's business opportunities beyond areas with existing Spray Net locations. A prospective franchisee should carefully consider the geographic scope of Spray Net's franchising activities and how this non-compete might affect their future business ventures.