Is Southern Steer required to post a bond for injunctive relief?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchisee and each Owner, and the Recipients agree therefore that, if the Franchisor alleges that the Franchisee, any of the Owners, or any of the Recipients breach this Agreement, then the Franchisor will have the right to petition a court of competent jurisdiction for injunctive relief against the Franchisee, each Owner and the Recipients, in addition to all other remedies that may be available to the Franchisor.
The Franchisor will not be required to post a bond or other security for any injunctive proceeding.
If the Franchisor is granted ex parte injunctive relief against the Franchisee, any of its Owners, and/or the Recipients, then the Franchisee, its Owners, and/or the Recipients will have the right to petition the court for a hearing on the merits at the earliest time convenient to the court.
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)
According to Southern Steer's 2025 Franchise Disclosure Document, Southern Steer is not required to post a bond or other security for any injunctive proceeding against a franchisee, its owners, or recipients. This means that if Southern Steer seeks a court order to stop a franchisee from violating the franchise agreement, the court can grant that order without Southern Steer having to put up money or assets as a guarantee. This waiver extends to injunctive relief sought against associates of the franchisee as well.
This provision is designed to protect Southern Steer's interests by making it easier and faster to enforce the franchise agreement. Without the bond requirement, Southern Steer can act more swiftly to prevent potential damage from breaches of contract, such as the unauthorized disclosure of confidential information or operation of a competing business. This is a common practice in franchising, as franchisors often seek to protect their brand standards and trade secrets.
However, the franchisee and its associates have the right to request a hearing on the merits of the injunction at the earliest time convenient to the court if an ex parte injunctive relief is granted against them. This provides a safeguard for the franchisee, ensuring they have an opportunity to present their case and challenge the injunction. While Southern Steer does not have to post a bond, the franchisee is not without recourse if they believe the injunction is unwarranted.