- Notwithstanding the terms, provisions, or conditions of any franchise, except as provided in section 133, it shall be a violation of this subchapter for any franchisor directly or through any officer, agent, or employee to terminate, cancel, or fail to renew a franchise except that it shall be a complete defense under this subchapter for the franchisor to prove that the cancellation was for good cause. For purposes of this subchapter, good cause for terminating, canceling, or failing to renew a franchise shall be—
-
(1) failure by the franchisee to substantially comply with those requirements imposed upon him by the franchise which requirements are both essential and reasonable; or
-
(2) use of bad faith by the franchisee in carrying out the terms of the franchise.
-
