Under what condition can Zoomin Groomin terminate a franchise agreement before its term expires?
Zoomin_Groomin Franchise · 2025 FDDAnswer from 2025 FDD Document
CA Bus & Prof Code Section 20021
Except as otherwise provided by this chapter, no franchisor may terminate a franchise prior to the expiration of its term, except for good cause. Except as provided in Section 20021, good cause shall be limited to the failure of the franchisee to substantially comply with the lawful requirements imposed upon the franchisee by the franchise agreement after being given notice at least 60 days in advance of the termination and a reasonable opportunity, which in no event shall be less than 60 days from the date of the notice of noncompliance, to cure the failure. The period to exercise the right to cure shall not exceed 75 days unless there is a separate agreement between the franchisor and franchisee to extend the time.
CA Bus & Prof Code Section 20021
If during the period in which the franchise is in effect, there occurs any of the following events which is relevant to the franchise, immediate notice of termination without an opportunity to cure, shall be deemed reasonable:
(a) The franchisee or the business to which the franchise relates has been the subject of an order for relief in bankruptcy, judicially determined to be insolvent, all or a substantial part of the assets thereof are assigned to or for the benefit of any creditor, or the franchisee admits his or her inability to pay his or her debts as they come due;
(b) The franchisee abandons the franchise by failing to operate the business for five consecutive days during which the franchisee is required to operate the business under the terms of the franchise, or any shorter period after which it is not unreasonable under the facts and circumstances for the franchisor to conclude that the franchisee does not intend to continue to operate the franchise, unless such failure to operate is due to fire, flood, earthquake, or other similar causes beyond the franchisee's control;
(c) The franchisor and franchisee agree in writing to terminate the franchise;
(d) The franchisee makes any material misrepresentations relating to the acquisition of the franchise business or the franchisee engages in conduct which reflects materially and unfavorably upon the operation and reputation of the franchise business or system;
Source: Item 9 — 01. Financial Statements and Exhibits. (FDD pages 68–156)
What This Means (2025 FDD)
According to the 2025 Zoomin Groomin Franchise Disclosure Document, Zoomin Groomin may terminate the franchise agreement prior to its expiration for good cause. Except when specified otherwise, good cause is defined as the franchisee's failure to substantially comply with the lawful requirements outlined in the franchise agreement. In such cases, Zoomin Groomin must provide the franchisee with a notice of noncompliance at least 60 days in advance of the termination, offering a reasonable opportunity to cure the failure, which shall not be less than 60 days from the date of the notice. The period to exercise the right to cure cannot exceed 75 days unless both Zoomin Groomin and the franchisee agree to extend the time.
However, the 2025 Zoomin Groomin FDD outlines specific events that allow for immediate termination without an opportunity to cure. These events include instances where the franchisee or the business is subject to bankruptcy, is judicially determined to be insolvent, assigns assets for the benefit of creditors, or admits inability to pay debts as they come due. Immediate termination is also warranted if the franchisee abandons the franchise by failing to operate the business for five consecutive days, unless such failure is due to events beyond the franchisee's control like fire, flood, or earthquake.
Additionally, Zoomin Groomin can immediately terminate the agreement if both parties agree in writing to terminate the franchise. Termination without an opportunity to cure is also permissible if the franchisee makes any material misrepresentations relating to the acquisition of the franchise business or engages in conduct that reflects materially and unfavorably upon the operation and reputation of the franchise business or system. These conditions are based on California Bus & Prof Code Section 20021, indicating that these terms are legally mandated within franchise agreements in California.