Under what conditions can Spray Net withhold approval of a transfer by the franchisee?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| names (if permitted) used in connection with the Franchised Business (as well as all related listings) to us or our designee. | |||
| j. | Assignment of contract by Franchisor | Section 13(G) | No restriction on our right to assign. |
| k. | "Transfer" by | Section 13(A) | Includes any transfer of Franchise Agreement, assets of the |
| Franchisor – | and Section | Franchised Business, or ownership change in you (as the | |
| defined | 13(C) | Franchisee). | |
| l. | Franchisor's approval of transfer by Franchisee | Section 13(A) | We must approve all transfers, but we will not unreasonably withhold our approval if you meet our conditions. |
| m. | Conditions for Franchisor's approval of transfer | Section 13(E) | We have the right to impose the following conditions on any transfer by you: (i) all of your accrued monetary obligations under the Franchise Agreement have been satisfied; (ii) you cure all existing defaults under the Franchise Agreement; (iii) you and your principals must execute a general release; (iv) you or the transferee provides us with a copy of the executed purchase agreement; (v) the transferee must meet our then-current qualifications and criteria for a new franchisee; (vi) the transferee executes our then-current franchise agreement; (vii) you or the transferee pays us a transfer fee of $10,000; (viii) the transferee satisfactorily completes our Initial Training Program; (ix) you must comply with all post-termination provisions of the Franchise Agreement; (x) the transferee must obtain all permits and licenses required for the continued operation of the Franchised Business; (xi) all applicable lessors consent to the proposed transfer; (xii) if applicable, you reimburse us for any |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–62)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, Spray Net must approve all transfers, but will not unreasonably withhold approval if the franchisee meets certain conditions. Spray Net has the right to impose conditions on any transfer. These conditions include the franchisee satisfying all accrued monetary obligations under the Franchise Agreement and curing all existing defaults.
Additional conditions include the franchisee and their principals executing a general release, and providing Spray Net with a copy of the executed purchase agreement. The transferee must meet Spray Net's then-current qualifications and criteria for a new franchisee and execute Spray Net's then-current franchise agreement.
Furthermore, the franchisee or the transferee must pay Spray Net a transfer fee of $10,000. The transferee must also satisfactorily complete Spray Net's Initial Training Program, and the franchisee must comply with all post-termination provisions of the Franchise Agreement. The transferee must obtain all permits and licenses required for the continued operation of the Franchised Business, and all applicable lessors must consent to the proposed transfer. If applicable, the franchisee must reimburse Spray Net for any and all costs of brokerage commissions, finder's fees, or similar charges, and the transfer must be made in compliance with all applicable laws.