Under what circumstances can Spray Net advise a franchisee to cease providing Ancillary Services?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
- o Your Franchised Business generating Gross Sales necessary to meet and exceed your thencurrent Minimum Gross Sales under the Franchise Agreement by 15% for a period of at least three (3) consecutive months; and
- o You entering into a form of addendum to the Franchise Agreement memorializing your satisfaction of the above conditions, the specific Ancillary Service(s) you will be authorized to offer moving forward until such time that we advise you that (a) you are in material default of your Franchise Agreement and must therefore cease provision of the Ancillary Services until such default is cured, or (b) we are no longer authorizing the provision of the Authorized Services by your Franchised Business and the bases for this decision (with at least 30 days' prior notice, if and as possible), which may also contain a general release by you of us and our related parties.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD pages 55–57)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, after a franchisee has been authorized to offer Ancillary Services, Spray Net can advise the franchisee to cease providing these services under specific circumstances. Spray Net may require the franchisee to stop offering Ancillary Services if the franchisee is in material default of the Franchise Agreement and the default has not been cured. In this case, the franchisee must cease providing the Ancillary Services until the default is resolved.
Additionally, Spray Net can require a franchisee to stop offering Ancillary Services if Spray Net is no longer authorizing the provision of those services by the Franchised Business. Spray Net must provide at least 30 days' prior notice, if possible, before discontinuing the authorization of Ancillary Services. This notice will also include the reasons for the decision. The notification from Spray Net may also contain a general release by the franchisee of Spray Net and its related parties.
These conditions are outlined in an addendum to the Franchise Agreement, which is signed when the franchisee meets certain performance criteria, including exceeding their minimum gross sales by 15% for three consecutive months. This addendum formalizes the franchisee's authorization to offer specific Ancillary Services, but also stipulates the conditions under which that authorization can be revoked by Spray Net.