After the termination of a Spray Net franchise agreement, what activities are franchisees prohibited from engaging in with a Competing Business within a 50-mile radius of any Spray Net franchised business?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
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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:
- 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:
- iii. within a fifty (50) mile radius of any Spray-Net franchised business
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, for two years after the termination of the franchise agreement, a franchisee is restricted from certain activities related to a Competing Business. This restriction applies to the franchisee, their principals, owners, guarantors, and their immediate family members.
Specifically, within a 50-mile radius of any Spray-Net franchised business, the franchisee cannot own, maintain, engage in, or be employed as an officer, director, or principal of a Competing Business. They are also prohibited from lending money to, extending credit to, or leasing/subleasing space to a Competing Business. Furthermore, they cannot have any interest in or involvement with any other Competing Business within that 50-mile radius.
This non-compete clause is designed to protect Spray Net's market and franchise network by preventing former franchisees from using their knowledge and resources gained during their franchise term to directly compete with existing Spray Net franchisees or the franchisor itself. The restrictions apply regardless of the reason for termination, emphasizing the importance of understanding these limitations before entering into a franchise agreement with Spray Net.