What constitutes a breach of the Multi-Unit Development Agreement or Franchise Agreement that could lead to immediate termination for a Southern Steer franchisee?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
(g) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors or any Controlled Entity materially violates any federal, state or municipal law, rule, code or regulation applicable to the operations of the Multi-Unit Developer's or Controlled Entity's Southern Steer Businesses, including a violation of any health department rules or regulations relating to any food safety standards that would in any way endanger the health or well-being of any of the customers or guests of the Multi-Unit Developer's or Controlled Entity's Southern Steer Businesses;
(h) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors or a Controlled Entity breaches any provision, term or condition of this Agreement or any Franchise Agreement or other agreement between Multi-Unit Developer or Controlled Entity and Franchisor
or its Affiliates and fails to cure such default within the period prescribed in such Franchise Agreement or other agreement;
(i) any check or EFT issued by the Multi-Unit Developer or Controlled Entity is dishonored because of insufficient funds (except where the check is dishonored because of bank error or an error in bookkeeping or accounting) or closed accounts more than three times during the Term of this Agreement;
(j) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors or any Controlled Entity are involved in any act or conduct which materially impairs the goodwill associated with "Southern Steer Butcher," any other of the Marks or with the System and the Multi-Unit Developer, its Owners, Operating Principal, Guarantors or any Controlled Entity fails to correct the breach within 24 hours after receipt of written notice of the breach from the Franchisor;
(k) the Multi-Unit Developer or any Controlled Entity engages in any unauthorized business or practice or sells any unauthorized product or service under the Franchisor's Marks or under a name or mark which is confusingly similar to the Franchisor's Marks;
(l) any Franchise Agreement between the Multi-Unit Developer (or a Controlled Entity) and the Franchisor is terminated by either party for any reason;
(m) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors, Controlled Entity or any individual breaches the non-compete and confidentiality covenants set out in the Franchise Agreement or the Non-Competition and Non-Disclosure Agreement;
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, a Multi-Unit Developer can face immediate termination of their agreement under several circumstances. These include materially violating any applicable federal, state, or municipal law that endangers the health or well-being of customers, breaching any term of the Multi-Unit Development Agreement, Franchise Agreement, or any other agreement with Southern Steer and its affiliates without rectifying the breach within the specified period.
Dishonoring checks or EFTs due to insufficient funds or closed accounts more than three times during the agreement's term, engaging in actions that significantly harm the goodwill associated with the Southern Steer brand, or conducting unauthorized business practices or selling unapproved products under Southern Steer's trademarks can also lead to immediate termination. Furthermore, the termination of any Franchise Agreement between the Multi-Unit Developer (or a Controlled Entity) and Southern Steer by either party, breaching non-compete and confidentiality agreements, or transferring the agreement without proper authorization are grounds for immediate termination.
These stipulations highlight the critical importance of adhering to legal and contractual obligations, maintaining financial responsibility, and protecting Southern Steer's brand reputation. For a prospective franchisee, this underscores the need for careful legal and financial planning, as well as a commitment to upholding the brand's standards to avoid potential termination of the agreement.