What is the condition for a 360 Painting franchisee to waive rights in connection with a renewal or transfer of a franchise?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
e deferred until the franchisor completes its pre-opening obligations under the franchise agreement.
Item 17, Additional Disclosures:
Our termination of the Franchise Agreement because of your bankruptcy may not be enforceable under applicable federal law (11 U.S.C.A. 101 et seq.).
You may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within 3 years after the grant of the franchise.
The general release required as a condition of renewal, sale and/or assignment/transfer will not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
Additional Disclosures:
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
AMENDMENT TO 360 PAINTING, LLC FRANCHISE AGREEMENT FOR THE STATE OF MARYLAND
| ("Franchisee" or "you") and 360 Painting, LLC ("Franchisor"), dated | (the |
|---|---|
| "Franchise Agreement") shall be amended by the addition of the following language, which should be | |
| considered an integral part of the Franchise Agreement (the "Amendment"). |
Maryland Law Modification
The Maryland Franchise Registration and Disclosure Law requires that certain provisions contained in franchise documents, including the Franchise Agreement, be amended to be consistent with Maryland law. Therefore, to the extent that the Franchise Agreement contains provisions that are inconsistent with the following, the modifications set forth below shall be controlling:
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to the 2025 FDD, the conditions under which a 360 Painting franchisee may waive rights in connection with a renewal or transfer of a franchise vary by state. In general, the franchise agreement may require a general release as a condition of renewal or transfer. However, several states have laws that limit or prohibit such waivers, particularly concerning rights under state franchise laws.
For instance, in Maryland, the general release required as a condition of renewal, sale, or transfer will not apply to any liability under the Maryland Franchise Registration and Disclosure Law. Similarly, in New York, any release required as a condition of renewal or transfer will exclude claims arising under the General Business Law of New York State, Article 33, Sections 680 through 695.
In Indiana, Indiana law prohibits a prospective general release of claims subject to the Indiana Deceptive Franchise Practices Law. Furthermore, no representation or acknowledgment by the franchisee can act as a waiver to deprive the franchisee of rights under the Indiana Deceptive Franchise Practices Law. Illinois also voids any condition that binds a person acquiring a franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois. Therefore, prospective franchisees should be aware of the specific state laws that govern their franchise agreement and understand that certain waivers may not be enforceable.