Does 'Competitive Activity' for a Southern Steer include participating in the management of a business that offers food preparation classes?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) "Competitive Activity" means (i) offering products and services that are the same as, similar to or competitive with a Southern Steer Business; (ii) operating a business or selling goods or providing services that features butcher, specialty grocer, marinated meats, or food preparation classes or that employs or incorporates one or more distinctive elements of the System; (iii) providing services of the type provided by Franchisor and/or its Affiliates where those services are provided in relation to businesses of the type described in Sections (i)-(ii); (iv) Ownership, whether directly or indirectly, and whether beneficially or of record of any capital stock, partnership interest, membership interest or any other interest in a business or entity that engages in the activities described in Sections (i) - (ii); (v) participation, either directly or indirectly, in the management or operation of a business as a partner, investor, shareholder, owner, director, officer, employee, principal, agent, advisor, manager, franchisee, licensee, contractor or consultant or in any other capacity of any entity, business or person that engages in the activities described in Sections (i) - (ii); (vi) Franchise, license, conduct or be connected with or assist any person, entity or business to franchise, license, conduct or be connected with the activities described in Sections (i) - (ii); and (vii) divert or attempt to divert, directly or indirectly, any business related to, or any customer or account of, Franchisee's Southern Steer Business, Franchisor, Affiliates, any Other Business operated by Franchisor its franchisees, licensees or Affiliates, or any other business then being offered or operated by Franchisor or its Affiliate(s) in the Protected Area.
Source: Item 5 — and 7 of the FDD, Section 3.1 of the Franchise Agreement and Section 4.1 of the Multi-Unit Development Agreement are hereby amended to state that payment of the initial franchise fee and development fee will be deferred until We have satisfied Our pre-opening obligations, and You have commenced business operations. (FDD pages 168–290)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, 'Competitive Activity' is comprehensively defined. This definition includes various actions that could be seen as competitive to a Southern Steer franchise. Specifically, it encompasses offering similar products or services, operating a business with similar features, or providing services related to such businesses.
One key aspect of 'Competitive Activity' is the participation in the management or operation of a business. This includes involvement as a partner, investor, shareholder, owner, director, officer, employee, principal, agent, advisor, manager, franchisee, licensee, contractor, or consultant. This broad definition extends to any entity, business, or person engaged in activities similar to a Southern Steer business.
Notably, the definition explicitly includes businesses that feature butcher services, specialty grocers, marinated meats, or food preparation classes. Therefore, according to the FDD, if a franchisee or related party participates in the management of a business that offers food preparation classes, it would be considered a 'Competitive Activity' under the terms of the Southern Steer franchise agreement. This has significant implications for franchisees, as engaging in such activities could be a breach of the franchise agreement and could lead to legal or financial repercussions.