What is the cure period allowed to 360 Painting for a material breach of the agreement?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
19.3 Termination by Franchisor with a Cure Period.
- (i) Franchisor shall have the right to terminate this Agreement upon 10 days written notice if defaults remain uncured in Franchisor's sole discretion for the following reasons:
- (a) Franchisee fails to pay when due any amount owed to Franchisor or its affiliates or subsidiaries, whether under this Agreement or not; or
- (b) Franchisee fails to operate the Business under supervision of an approved Manager.
- (ii) Franchisor shall have the right to terminate this Agreement upon 30 days written notice if any default under this Agreement remains uncured, in Franchisor's sole discretion and judgment. Notwithstanding the foregoing, if the breach is curable but is of a nature which cannot reasonably be cured within such 30 day period and Franchisee has commenced and is continuing to make good faith efforts to cure such breach, Franchisee shall be given an additional 30 day period to cure the same, and this Agreement shall not terminate. By way of example only, the following are some of the contract breaches for which Franchisee will be provided with notice and an opportunity to cure under this provision:
- (a) Franchisee fails or refuses to submit financial statements, reports or other operating data, information or supporting records when due;
- (b) Franchisee fails to relocate or commits a default (other than a monetary default which shall be subject to Section 19.3(i)(a) above) under the lease, sublease, purchase contract or other contract for the Business, the Vehicles or any equipment, tools or supplies utilized in the operation thereof;
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 56)
What This Means (2025 FDD)
According to 360 Painting's 2025 Franchise Disclosure Document, the cure period for a material breach of the franchise agreement varies depending on the nature of the breach. If a franchisee fails to pay amounts owed to 360 Painting or fails to operate the business under an approved manager, 360 Painting can terminate the agreement with only 10 days' written notice, provided the default remains uncured.
For other defaults under the agreement, 360 Painting must provide 30 days' written notice to allow the franchisee to cure the breach. However, if the breach is of a nature that cannot reasonably be cured within 30 days, and the franchisee has commenced and is continuing good faith efforts to cure the breach, an additional 30-day period will be granted to cure the breach.
Examples of breaches that qualify for the standard 30-day cure period, or potentially the extended 60-day cure period, include failing to submit financial statements or defaulting on a lease or purchase contract for the business. It is important to note that the franchisor retains sole discretion in determining whether a default remains uncured.