Is Spray Net obligated to operate the franchised business during or after the 180-day period following a franchisee's incapacitation?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor is under no obligation to operate the Franchised Business, or incur any obligation on behalf of any incapacitated franchisee, during or after the 180 Day Period.
If necessary, Franchisee (or Franchisee's legal representative, as applicable) shall appoint a previously approved acting interim manager to operate the Franchised Business during the 180 Day Period.
In the event of Franchisee's death, disability, absence or otherwise, Franchisor may (but is not required to) operate the Franchised Business on Franchisee's behalf and at Franchisee's expense for such period of time (and under such terms and conditions) as Franchisor determines, including paying out the assets and/or revenues of the Franchised Business to cover any or all past, current and/or future obligations of the Franchised Business (including any amounts owed to Franchisor and/or any affiliate) in such priorities as Franchisor determines in Franchisor's sole discretion.
Franchisor may pay itself a reasonable amount to reimburse Franchisor for Franchisor's management services and other costs.
Franchisor may obtain approval of a court or arbitrator for any such arrangements, the attorney's fees and other costs incurred in connection with obtaining such approval to be charged against the assets and/or revenues of the Franchised Business.
Franchisee (and/or Franchisee's estate) will indemnify Franchisor against any costs and/or liabilities incurred by it in connection with, or related in any way to, the operation (or otherwise) of the Franchised Business.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, Spray Net is not obligated to operate the franchised business or incur any obligations on behalf of an incapacitated franchisee during or after a 180-day period. However, in the event of a franchisee's death, disability, absence, or other incapacitation, Spray Net has the option, but is not required, to operate the franchised business on the franchisee's behalf and at the franchisee's expense.
This operation by Spray Net can occur for a period of time and under terms and conditions that Spray Net determines. This includes using the assets or revenues of the franchised business to cover past, current, or future obligations, including amounts owed to Spray Net or its affiliates, with the priority of payments determined at Spray Net's discretion. Spray Net may also pay itself a reasonable amount to cover management services and other costs incurred.
Spray Net can seek court or arbitrator approval for these arrangements, with the legal fees and costs associated with obtaining such approval charged against the assets or revenues of the franchised business. The franchisee or their estate will also be required to indemnify Spray Net against any costs or liabilities incurred in connection with the operation of the franchised business.
For a prospective Spray Net franchisee, this means that in the event of incapacitation, the responsibility for managing the business falls primarily on the franchisee or their legal representative, who must appoint an approved interim manager within 180 days. While Spray Net has the option to step in and manage the business, it is not obligated to do so, and if it does, it will be at the franchisee's expense.