What happens if a Southern Steer Multi-Unit Developer fails to pay uncontested obligations?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors or any Controlled Entity fails to timely pay any of its uncontested obligations or liabilities (where there is no reasonable commercial dispute) due and owing to the Franchisor, its Affiliate, suppliers, banks, purveyors, other creditors or to any federal, state or municipal government;
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, if a Multi-Unit Developer, its Owners, Operating Principal, Guarantors or any Controlled Entity fails to timely pay any of its uncontested obligations or liabilities (where there is no reasonable commercial dispute) due and owing to the Franchisor, its Affiliate, suppliers, banks, purveyors, other creditors or to any federal, state or municipal government, it constitutes a breach of the Multi-Unit Development Agreement.
This failure to pay uncontested obligations is one of several conditions that can lead to the termination of the Multi-Unit Development Agreement. Other conditions include failing to meet the development schedule, ceasing development activities, insolvency, bankruptcy, conviction of a crime, or violating laws applicable to the Southern Steer business.
If the Multi-Unit Development Agreement is terminated, the developer loses the rights to open additional Southern Steer businesses in the Development Territory. However, the individual Franchise Agreements for Southern Steer businesses already opened and operating remain in effect, requiring the developer to continue paying fees and operate those businesses according to the terms of their respective Franchise Agreements. The franchisor also gains the right to develop Southern Steer businesses in the territory themselves or contract with others to do so, and the Multi-Unit Developer will not receive a refund of any monies paid to Southern Steer.