Does the Southern Steer Personal Guaranty include the covenant not to compete?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (f) Guaranty.
If Franchisee is a corporation, partnership, limited liability company, or other entity, or in the future become a corporation, partnership, limited liability company, or other entity, Franchisor will require Franchisee's officers, directors, shareholders, partners, members, managers, owners, and owner's spouses or domestic partners to sign the Personal Guaranty attached hereto as Attachment C.
- (k) the Transferee's Owners and Designated Manager sign the Non-competition and Non-Disclosure Agreement, if required by the Franchisor;
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer FDD, if the franchisee is a corporation, partnership, limited liability company, or other entity, Southern Steer will require the franchisee's officers, directors, shareholders, partners, members, managers, owners, and owner's spouses or domestic partners to sign the Personal Guaranty attached to the Franchise Agreement.
However, the FDD also states that the franchisee's owners and designated manager must sign a Non-competition and Non-Disclosure Agreement, if required by Southern Steer. This suggests that the Personal Guaranty and the Non-competition agreement are separate documents.
Therefore, it is not clear whether the Personal Guaranty includes the covenant not to compete. A prospective franchisee should review Attachment C (Personal Guaranty) and Attachment I-1 (Non-competition and Non-Disclosure Agreement) of the Franchise Agreement to confirm whether the Personal Guaranty includes the covenant not to compete or if it is addressed solely in the Non-competition and Non-Disclosure Agreement.