What is the relevance of Section 8.6 to the termination rights of the Southern Steer Franchisor?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
hose obligations of the Multi-Unit Developer that continue beyond the termination of this Agreement.
- Obligations Upon Termination or Expiration. If this Agreement is terminated by the Franchisor in accordance with this Section 8, the rights and duties of the Franchisor and the Multi-Unit Developer will be as follows:
- (a) the Multi-Unit Developer will have no rights to open additional Southern Steer Businesses within the Development Territory;
- (b) the Multi-Unit Developer and Controlled Entity (if any) will continue to pay all required Fees and to operate its Southern Steer Business opened in the Development Territory pursuant to the terms of the applicable Franchise Agreements signed by the Multi-Unit Developer or Controlled Entity (if any) prior to the date of the termination of this Agreement, and will in all other respects continue to comply with such Franchise Agreements;
- (c) the Franchisor will have the absolute right to develop Southern Steer Businesses in the Development Territory or to contract with other persons for the development of additional Southern Steer Businesses in the Development Territory;
- (d) the Multi-Unit Developer will have no right to obtain a refund of any monies it paid to the Franchisor pursuant to this Agreement or the Franchise Agreements;
- (e) the indemnities and covenants contained in this Agreement will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement; and
- (f) the Multi-Unit Developer and the Franchisor will not have any rights or obligations with respect to the future Franchise Agreements required to be signed pursuant to the Development Schedule, but which were not executed prior to the termination of this Agreement by the Franchisor.
- Notice of Termination.
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 Franchise Disclosure Document, Section 8 pertains to the termination rights of Southern Steer regarding the Multi-Unit Development Agreement. Specifically, if Southern Steer terminates the Multi-Unit Development Agreement per Section 8, the multi-unit developer loses the right to open additional Southern Steer businesses within the designated Development Territory. However, the existing Franchise Agreements for Southern Steer businesses already operating in the Development Territory remain in effect, and the developer must continue to pay required fees and comply with those agreements.
Southern Steer retains the right to develop or contract with others to develop Southern Steer businesses in the Development Territory after termination. The multi-unit developer is not entitled to a refund of any monies paid to Southern Steer under the Development Agreement or Franchise Agreements. Furthermore, the indemnities and covenants within the agreement remain in effect even after termination or expiration.
In addition to the rights granted to Southern Steer upon termination under Section 8, Southern Steer has the right to acquire any currently open and operating Southern Steer businesses in the Development Territory from the Multi-Unit Developer or any Controlled Entity. The acquisition will follow the terms of the individual Franchise Agreement for each Southern Steer business, and the purchase price will be calculated as specified in those agreements. This ensures that Southern Steer can maintain its presence and control within the Development Territory even if the Development Agreement is terminated.