What constitutes 'good cause' for Chem Dry to terminate or cancel a franchise in Minnesota?

According to Chem Dry's 2024 Franchise Disclosure Document, Minnesota statute §80C14 defines what constitutes 'good cause' for termination or cancellation of a franchise agreement. 'Good cause' is defined as the failure of the franchisee to substantially comply with the reasonable requirements imposed upon them by the franchise agreement. This definition sets a general standard that Chem Dry must adhere to when considering terminating a franchise in Minnesota.

The statute provides specific examples of what constitutes failure to comply with reasonable requirements. These include the bankruptcy or insolvency of the franchisee, assignment for the benefit of creditors or similar disposition of the assets of the franchise business, and voluntary abandonment of the franchise business. Additionally, conviction or a plea of guilty or no contest to a charge of violating any law relating to the franchise business can be considered 'good cause'.

Furthermore, any act by, or conduct of, the franchisee which materially impairs the goodwill associated with Chem Dry's Trademark, trade name, service mark, logotype, or other commercial symbol also constitutes 'good cause' for termination. This broad clause allows Chem Dry to terminate a franchise if the franchisee's actions negatively impact the brand's reputation. Prospective franchisees in Minnesota should be aware of these conditions, as failure to meet these requirements could lead to termination of their franchise agreement.