What constitutes 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 the 2025 Southern Steer Franchise Disclosure Document, if the franchisee, operating principal, or owner(s) are unable to operate the Southern Steer business for 45 days or longer for any reason, Southern Steer is authorized to appoint an interim manager to operate the business. However, if the reason for the inability to operate is due to specific circumstances outlined in Section 18.2, this period is shortened to 15 days.
During the period an interim manager operates the Southern Steer franchise, all revenue 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 franchise during the franchisee's inability to do so, and the decision to appoint an interim manager is at Southern Steer's sole discretion. This clause aims to prevent any interruption of the Southern Steer business that could harm the brand. This is a fairly common clause in franchise agreements to ensure business continuity and protect the brand's reputation.