Does the Southern Steer Franchisor have to provide notice of default before termination?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
ranchise 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;
- (n) the Multi-Unit Developer has previously received notices of three or more defaults (whether different defaults noticed together or three separate instances of the same default) pursuant to Section 8.2 in a Development Period and is again in default of this Agreement within the Development Period, regardless of whether the previous defaults were cured by the Franchisee; or
- (o) the Multi-Unit Developer transfers or otherwise assigns this Agreement or the rights to develop a Southern Steer Business hereunder, or an interest in the Multi-Unit Developer Entity, without complying with the provisions of Section7.2.
- Termination by Franchisor- Thirty Days-Notice. The Franchisor shall have the right to terminate this Agreement (subject to any state laws to the contrary, where state law shall prevail), effective upon 30 days written notice to the Franchisee ("Breach Notice"), if the Franchisee breaches any provision of this Agreement other than those provisions listed in Section 8.1 above and fails to cure the default during such 30 day period. In that event, effective upon expiration of the 30 day period, this Agreement will terminate without further notice to the Franchisee. Defaults shall include, but not be limited to, the following:
- (a) the Multi-Unit Developer or Controlled Entity fails to maintain the then current operating procedures and adhere to the specifications and standards established by the Franchisor as set forth herein or in the Brand Manual, defined and described in the Franchise Agreement, or as otherwise communicated to the Franchisee;
- (b) the Multi-Unit Developer fails, refuses or neglects to obtain the Franchisor's prior written approval or consent as required by this Agreement; or
- (c) the Multi-Unit Developer commits any other act that constitutes good cause under applicable law or court decisions.
- Failure to Comply with Development Schedule. Termination of this Agreement as a result of the Multi-Unit Developer's failure to meet the Development Schedule will not affect the individual Franchise Agreements for the Southern Steer Businesses opened and operating in the Development Territory pursuant to this Agreement which were signed by the parties prior to termination of this 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, Southern Steer can terminate the agreement with a 30-day written notice if the franchisee breaches any provision of the agreement, except for those listed in Section 8.1, and fails to correct the default within that 30-day period. Upon the expiration of the 30-day period, the agreement will terminate without any further notice to the franchisee. Defaults that trigger this include failing to maintain operating procedures, neglecting to obtain prior written approval from Southern Steer, or committing any act that constitutes good cause under applicable law.
However, Southern Steer can terminate the agreement without notice in certain situations. These include if 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.
For multi-unit developers, Southern Steer can also terminate the agreement without notice if the developer breaches non-compete and confidentiality covenants, has received notices of three or more defaults in a Development Period and is again in default, or transfers the agreement or development rights without complying with the provisions of Section 7.2.