What financial obligations does the Southern Steer franchisee have as of the date of the agreement?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
transferred to any person or entity unless it is in strict compliance with the terms, conditions and restrictions contained in this Agreement;
- (j) Each of the Franchisee's Owners will execute the Personal Guaranty attached hereto as Attachment C and the Non-competition and Non-Disclosure Agreement attached hereto as Attachment I-1; and
- (k) The Franchisee will, at all times, maintain sufficient working capital to operate the Southern Steer Business and to fulfill its obligations under this Agreement, and will take steps to ensure availability of capital to fulfill the Franchisee's obligations to maintain, remodel and modernize the Southern Steer Business premises as required under this Agreement.
- 24.2. Financial Obligations. The Franchisee has no material liabilities, adverse claims, commitments or obligations of any nature as of the date of this Agreement, whether accrued, unliquidated, absolute, contingent or otherwise, except as disclosed to the Franchisor in writing or set forth in the financial statements of the Franchisee that have been provided to the Franchisor.
- 24.3. Compliance with Agreement. The Franchisee and the Owners represent, warrant and covenant that they will comply with all requirements and will perform all obligations in accordance with the terms and conditions of this Agreement.
- 24.4.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, a franchisee has no material liabilities, adverse claims, commitments, or obligations of any nature as of the date of the Franchise Agreement. This is with the exception of what has been disclosed to Southern Steer in writing or is set forth in the franchisee's financial statements provided to Southern Steer. This clause protects Southern Steer from undisclosed liabilities of the franchisee that could affect the business.
However, the franchisee is obligated to maintain sufficient working capital to operate the Southern Steer business and fulfill its obligations under the Franchise Agreement. This includes ensuring the availability of capital to maintain, remodel, and modernize the Southern Steer business premises as required by the agreement. This requirement ensures that the franchisee has the financial resources to keep the business running smoothly and to meet Southern Steer's standards for the premises.
Furthermore, the franchisee and its owners must comply with all requirements and perform all obligations in accordance with the terms and conditions of the Franchise Agreement. This includes signing a general release in favor of Southern Steer if Southern Steer chooses to waive its rights to collect any amounts that would have become due if the franchisee had continued in business for the initial term of the agreement. This provision ensures that the franchisee understands and agrees to adhere to all aspects of the agreement, maintaining a consistent standard across all Southern Steer franchises.