For how long after the termination, transfer, assignment, or expiration of the Southern Steer franchise agreement does the post-term covenant not to compete apply?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
(c) Post Term Covenant Not to Compete.
For a period of 24 months after the later of (1) the termination, transfer, assignment or expiration of this Agreement; or (2) the entry of a final order by an arbitrator or a court of competent jurisdiction enforcing this covenant, Franchisee and those persons identified in Section 16.3 will not engage in any Competitive Activity within:
i. the Franchised Location;
ii. the Protected Area;
iii. within 50 miles of the outer boundaries of the Protected Area;
iv. within 50 miles from the Franchised Location;
v. within 50 miles of any other Southern Steer Business, or
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 post-term covenant not to compete lasts for 24 months. This restriction begins after the later of either the termination, transfer, assignment, or expiration of the franchise agreement, or the entry of a final order by an arbitrator or court enforcing the covenant.
During this 24-month period, the franchisee and any individuals identified in Section 16.3 of the agreement are prohibited from engaging in any competitive activities within specific geographic areas. These areas include the franchised location itself, the protected area granted to the franchisee, and areas within 50 miles of the outer boundaries of the protected area, the franchised location, or any other Southern Steer Business.
This non-compete clause is a standard provision in franchise agreements to protect the franchisor's brand and market. For a prospective Southern Steer franchisee, this means that after leaving the system, they will be restricted from operating a similar business in the defined geographic area for two years. Franchisees should carefully consider these restrictions and their potential impact on their future business ventures before entering into the agreement.