Who is included in the definition of parties whose actions can trigger immediate termination of the Southern Steer franchise, besides the franchisee?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchisee will be deemed to be in Default subject to immediate termination of this Agreement and the rights granted herein or the exercise of any other remedies in accordance with Sections 20.4 and 20.5, without prior notice of the default from the Franchisor and without an opportunity to cure the Default unless precluded by applicable law or otherwise as stated herein, if any of the following events occur:
- (a) the Franchisee, Owners, Operating Principal or the Designated Manager(s) are convicted of, or plead guilty to a charge of violating any law relating to the Franchisee's Southern Steer Business or that adversely affects the operation, maintenance, reputation, or goodwill of the Southern Steer Business, System, the Marks or the Franchisor;
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, the actions of several parties besides the franchisee can trigger immediate termination of the franchise agreement. These parties include the Owners, Operating Principal, or the Designated Manager(s). This means that the conduct of these individuals is critical, as their actions can have the same consequences as the franchisee's own actions regarding the termination of the agreement.
Specifically, if the Franchisee, Owners, Operating Principal or the Designated Manager(s) are convicted of, or plead guilty to a charge of violating any law relating to the Franchisee's Southern Steer Business or that adversely affects the operation, maintenance, reputation, or goodwill of the Southern Steer Business, System, the Marks or the Franchisor, it can lead to immediate termination. This provision underscores the importance of ensuring that all individuals in these key roles maintain a high standard of legal and ethical conduct.
For a prospective Southern Steer franchisee, this highlights the need to carefully vet and monitor the individuals who will serve as Owners, Operating Principal, and Designated Managers. The franchisee should ensure that these individuals understand the importance of compliance with all applicable laws and regulations, as their actions could put the franchise agreement at risk. This also emphasizes the need for clear communication and training to ensure that everyone involved is aware of the standards expected by Southern Steer.