What is considered abandonment of the Southern Steer business that would lead to immediate termination?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- 18.3.
Operation of the Southern Steer Business.
In order to prevent any interruption of the Southern Steer Business which would cause harm to the Southern Steer Business, if Franchisee, the Operating Principal or Owner(s) are unable or fail to operate Franchisee's Southern Steer Business for a period of 45 days or longer for any reason whatsoever (except as provided in Section18.2, in which case the period is 15 days) Franchisee authorize Franchisor to appoint an interim manager to operate Franchisee's Southern Steer Business for so long as Franchisor deems necessary and practical.
In the event that Franchisor appoints an interim manager, during the time period such interim manager operates the Franchisee's Southern Steer Business, all revenue from the operation of Franchisee's Southern Steer Business will be kept in a separate account and the expenses of Franchisee's Southern Steer Business, including reasonable compensation and expenses of Franchisor and its agents will be charged to the account.
Additionally, Franchisor will retain 50% of Gross Revenues for Franchisee's Southern Steer Business' as a management fee.
Nothing contained herein will be construed to require Franchisor to operate Franchisee's Southern Steer Business in the case of Franchisee's inability to operate same, and the rights set forth herein may be exercised in the sole and absolute discretion of Franchisor.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, if the franchisee, operating principal, or owners are unable or fail to operate the Southern Steer Business for a period of 45 days or longer for any reason, it can be considered a cause for the franchisor to appoint an interim manager. However, if the reason falls under Section 18.2, the period is 15 days. This action is taken to prevent any interruption of the Southern Steer Business that could cause harm.
In the event that Southern Steer appoints an interim manager, all revenue generated during this period will be kept in a separate account. The expenses of the Southern Steer Business, including reasonable compensation and expenses for Southern Steer and its agents, will be charged to this account. Additionally, Southern Steer will retain 50% of the gross revenues as a management fee.
It's important to note that Southern Steer is not required to operate the franchisee's Southern Steer Business in case of the franchisee's inability to do so. The decision to exercise these rights is at the sole and absolute discretion of Southern Steer. This clause protects Southern Steer's brand and ensures continuity of operations, while also outlining the financial implications for the franchisee during such a period.