Can Dog Haus terminate the franchise agreement immediately if the franchisee abandons the restaurant?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
ent of termination, for any cause, of this Agreement or any other agreement between the Parties, Franchisor may, at its option, terminate any or all of the agreements.
- 16.6 Notice Required By Law. Notwithstanding anything to the contrary contained in this Article 16, if any valid Applicable Law of a competent Governmental Authority having jurisdiction over this Agreement and the Parties shall limit Franchisor's rights of termination under this Agreement or shall require longer notice periods than those set forth above, this Agreement shall be deemed amended to conform to the minimum notice periods
or restrictions upon termination required by that Applicable Law. Franchisor shall not, however, be precluded from contesting the validity, enforceability or application of Applicable Laws in any action, hearing or dispute relating to this Agreement or the termination of this Agreement.
- 16.7 Interim Management. To protect the Dog Haus System, the Dog Haus Marks, the Dog Haus Trade Secrets and the goodwill associated with the same, after Franchisor has given Franchisee written notice that Franchisee is in Default, Franchisor may (but is not obligated to) assume interim management of the Franchised Restaurant during the pendency of any cure period or in lieu of immediately terminating this Agreement. If Franchisor elects to assume interim management of the Franchi
Source: Item 22 — CONTRACTS (FDD page 87)
What This Means (2025 FDD)
According to the 2025 Dog Haus Franchise Disclosure Document, it is not explicitly stated whether Dog Haus can immediately terminate the franchise agreement if the franchisee abandons the restaurant. However, the document does outline various conditions under which Dog Haus can terminate the agreement.
Specifically, Section 16.2 lists several scenarios that could lead to termination, such as operating in a way that poses an imminent danger to public health, knowingly falsifying records, conviction of a felony, misuse of Dog Haus trademarks, unauthorized use of trade secrets, failure to maintain required inventory, or purchasing products from unapproved suppliers. While abandonment isn't directly mentioned, some of these clauses could potentially be interpreted to apply to a situation where a franchisee abandons the restaurant, particularly if it leads to operational failures or damages the brand's reputation.
Additionally, Section 16.7 discusses interim management, stating that after providing written notice of default, Dog Haus may assume interim management of the restaurant during any cure period or instead of immediately terminating the agreement. If Dog Haus elects to assume interim management, the franchisee remains responsible for their obligations, and Dog Haus will charge an Interim Management Fee, currently $500 per day, plus out-of-pocket costs. This suggests that Dog Haus might initially opt for interim management rather than immediate termination, though the option to terminate remains.
To fully understand Dog Haus's policy on termination due to abandonment, a prospective franchisee should seek clarification from the franchisor regarding the specific conditions under which abandonment would lead to immediate termination versus other courses of action, such as a cure period or interim management.