Must a Southern Steer franchisee have insurance to renew the franchise agreement?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
L, TERMINATION, TRANSFER AND DISPUTE RESOLUTION
THE FRANCHISE RELATIONSHIP
This table lists certain important provisions of the Franchise Agreement and related agreements. You should read these provisions in the agreements attached to this Disclosure Document.
| Provision | Agreement | Summary | |
|---|---|---|---|
| a. | Length of the franchise term | 2.1 | 10 years beginning as of the Effective Date (which may be extended under certain circumstances to coincide with the term of the lease for Your Southern Steer Business, as described in Section 2.1 of the Franchise Agreement). |
| b. | Renewal or extension of the term | 2.2 | One additional 10-year term. |
| c. | Requirements for franchisee to renew or extend | 2.2 Section in Franchise | You must: give written notice at least 180, but not more than 365 days before expiration; have complied with all material terms and conditions of Your current Franchise Agreement; have paid all monetary obligations owed to Us during the term of the Franchise Agreement; agree in writing to remodel Your Southern Steer Business (and provide evidence of Your financial capability to make such expenditures); have the right to continue to occupy the premises for the Southern Steer Business for at least five additional years;; pay the Successor Franchise Fee; execute a general release of claims against Us, Our parent, subsidiaries, affiliates, and related people; and You and Your Designated Manager must complete the required training. |
Source: Item 17 — ITEM. 17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–50)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, maintaining the required insurance is a condition for renewing the franchise agreement. To renew for an additional 10-year term, a franchisee must have all licenses, insurance, registrations, and approvals required by Southern Steer and applicable governing authorities to operate the Southern Steer Business in the Protected Area.
This requirement ensures that franchisees continue to meet the operational and legal standards set by Southern Steer throughout the entire term of the franchise. Failing to maintain the required insurance could prevent a franchisee from being able to renew their agreement.
It is common practice in franchising to require franchisees to maintain adequate insurance coverage, as this protects both the franchisee and the franchisor from potential liabilities and financial losses. Prospective Southern Steer franchisees should carefully review the insurance requirements outlined in the Franchise Agreement to ensure they can comply with these obligations, both during the initial term and if they choose to renew.