What is the obligation of each party regarding representation at the mediation conference between Southern Steer and the Multi-Unit Developer?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Parties recognize and any mediator, arbitrator and judge is affirmatively advised, that certain provisions of this Agreement reflect rights of Franchisor and Multi-Unit Developer and Controlled Entity (if any) to take (or refrain from taking) certain actions in exercise of its business judgment based on its assessment of the long term interests of the franchised system as a whole.
Where such discretion has been exercised and is supported by the business judgment of Franchisor or Multi-Unit Developer and Controlled Entity (if any), a mediator, arbitrator or judge shall not substitute his or her judgment for the judgment so exercised by Franchisor or Multi-Unit Developer and Controlled Entity (if any).
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)
Based on the 2025 Southern Steer Franchise Disclosure Document, the agreement between Southern Steer and the Multi-Unit Developer recognizes that certain provisions reflect the rights of both parties to make business judgments based on their assessment of the long-term interests of the franchised system. This acknowledgment extends to any mediator involved in dispute resolution.
Specifically, the FDD advises that any mediator, arbitrator, and judge should acknowledge that certain provisions of the agreement allow Southern Steer and the Multi-Unit Developer to take actions or refrain from taking actions based on their business judgment. This is tied to their assessment of what is in the best long-term interests of the entire Southern Steer franchise system.
Therefore, if such discretion is exercised and supported by the business judgment of either Southern Steer or the Multi-Unit Developer, the FDD stipulates that a mediator, arbitrator, or judge should not substitute their own judgment for the judgment exercised by Southern Steer or the Multi-Unit Developer. This clause aims to ensure that decisions made using reasonable business judgment are respected during dispute resolution processes.