If I transfer my 360 Painting franchise, must I sign a general release?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
elevant time. References to a governmental agency also refer to any regulatory body that succeeds the function of such agency.
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- Sections 3.2(ix) and 17.4(iii) of the Franchise Agreement each contain a provision requiring a general release as a condition of renewal or transfer of the franchise. Such release will exclude claims arising under the General Business Law of New York State, Article 33, Sections 680 through 695, and the regulations issued thereunder.
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- No representation or acknowledgment by the Franchisee in the Franchise Agreement is intended to or shall act as a release, assignment, novation, waiver or estoppel which would relieve a person from any duty or liability imposed by Article 33, Sections 680 through 695, of the General Business Law of the State of New York and the regulations issued thereunder.
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- Each provision of this Amendment will be effective only to the extent, with respect to such provision, that the jurisdictional requirements of the New York General Business Law, Article 33, are met independently without reference to this Amendment.
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- Except as otherwise provided in this Amendment, all the other terms, covenants and agreements in the Franchise Agreement shall remain the same, and the Franchise Agreement, as amended, shall continue in full force and effect. To the extent this Amendment is inconsistent with any terms or conditions of the Franchise Agreement or the Attachments to the Franchise Agreement, the terms of this Amendment shall govern.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to the 2025 FDD, 360 Painting's franchise agreement generally requires franchisees to sign a general release as a condition of transferring their franchise. This means that as part of the transfer process, you may be asked to release 360 Painting from any potential claims you might have against them. However, this requirement is subject to certain state laws that may limit or prohibit such releases.
For example, the FDD includes addenda for franchisees in specific states like Indiana, Maryland, Minnesota and New York, which modify the general release requirement to comply with local franchise laws. In Indiana, the general release provision is inapplicable to the extent it's inconsistent with the Indiana Deceptive Franchise Practices Law. Similarly, in Maryland, the general release will not apply to any liability under the Maryland Franchise Registration and Disclosure Law. In Minnesota, state law prohibits a franchisor from requiring a franchisee to assent to a general release that would relieve any person from liability imposed by Minnesota Statute. For New York franchisees, the release will exclude claims arising under the General Business Law of New York State, Article 33, Sections 680 through 695, and the regulations issued thereunder.
Therefore, whether you must sign a general release, and the scope of that release, depends on the specific laws of the state in which your 360 Painting franchise operates. Prospective franchisees should carefully review the state-specific addenda in the FDD and consult with an attorney to understand their rights and obligations regarding general releases during a franchise transfer.