What is the specific section of the 360 Painting Franchise Agreement that is supplemented regarding assignment by the franchisor in New York?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
New York Law Modification
In recognition of the requirements of the New York General Business Law, Article 33, the parties to the Franchise Agreement agree as follows:
- Section 17.1, "Assignment by Franchisor," of the Franchise Agreement shall be supplemented with the following paragraph:
No assignment shall be made except to an assignee, who, in the good faith judgment of Franchisor, is willing and possesses the economic resources to fulfill Franchisor's obligations under such Franchise Agreement.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to the 2025 FDD, for franchisees in New York, Section 17.1, titled "Assignment by Franchisor," of the 360 Painting Franchise Agreement is supplemented. The supplement specifies that any assignment by 360 Painting can only be made to an assignee who, in 360 Painting's judgment, is willing and has the financial resources to fulfill 360 Painting's obligations under the Franchise Agreement.
This modification ensures that if 360 Painting decides to assign the Franchise Agreement to another party, that party must be capable of meeting the obligations outlined in the agreement. This provides a level of protection for the franchisee, ensuring that the new franchisor has the willingness and resources to support the franchise system.
This type of clause is specific to New York due to its franchise laws, and it is included as an addendum to the standard franchise agreement. Prospective franchisees in New York should carefully review this section to understand their rights and the franchisor's obligations in the event of an assignment.