What is the Southern Steer franchisee's responsibility regarding the enforceability, economics, and legality of the lease provisions?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchisee will be solely responsible for all terms of the Lease, including the enforceability, economics and legality of all provisions in the Lease.
The enforceability of the Lease must be conditioned on Franchisor approving the Franchisee as a Southern Steer Franchisee and the enforceability of this Agreement.
The Franchisee will not sign the Lease until (a) this Agreement has been signed by both the Franchisee and the Franchisor; and (b) the Lease contains the terms required under this Section and the terms set forth in the Form of Lease Addendum attached to this Agreement as Attachment F.
The Franchisee will use its best efforts to negotiate and secure from the lessor of the Franchised Location the terms and conditions set forth herein and in the Form of Lease Addendum attached hereto.
In addition, the terms of the Lease must also give the Franchisor the right to enter the premises of the Franchised Location to conduct inspections during regular business hours.
Further, the Franchisee must execute a Collateral Assignment of Lease attached to this Agreement as Attachment F-1, whereby the Franchisee agrees to assign the Franchisee's rights in the Lease to the Franchisor in the event of a termination or expiration of the term of this Agreement or a default under the Lease.
The Franchisee will provide executed copies of the Lease or purchase closing documents for the Franchised Location within 10 days after their execution.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, the franchisee bears the sole responsibility for all terms of the lease, including the enforceability, economics, and legality of all provisions within the lease agreement. This means that Southern Steer franchisees must ensure that the lease they sign is legally sound, financially viable for their business, and compliant with all applicable laws and regulations.
Southern Steer requires the franchisee to provide a copy of the proposed lease to the franchisor at least 30 days before signing. While Southern Steer may offer assistance in negotiating the lease terms, they are not obligated to do so. The franchisor's review is limited to determining compliance with the franchise agreement's terms and conditions, and does not extend to providing business, economic, legal, or real estate advice.
To protect Southern Steer's interests, the enforceability of the lease must be conditional upon the franchisor approving the franchisee and the franchise agreement itself. Additionally, the lease must grant Southern Steer the right to inspect the premises during business hours and include a Collateral Assignment of Lease, allowing Southern Steer to assume the lease in the event of termination, expiration, or default. The franchisee must also use their best efforts to negotiate terms and conditions from the lessor that are favorable and as set forth in the Form of Lease Addendum attached to the Franchise Agreement.