Does Section 14 of the Southern Steer agreement survive termination or expiration?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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
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, Section 8(e) of the Multi-Unit Development Agreement specifies that the indemnities and covenants contained within the agreement will remain in effect even after the agreement expires or is terminated. This means that certain obligations, such as those related to protecting the franchisor from liabilities and upholding specific promises, continue to bind the multi-unit developer even after the formal business relationship ends.
For a prospective Southern Steer multi-unit developer, this has significant implications. It means that even after the agreement's term concludes, they must continue to honor certain commitments made during the franchise period. These may include financial responsibilities, legal obligations, and promises related to non-disclosure or non-competition, depending on the specific covenants outlined in the agreement.
This survival clause is a standard practice in franchising, designed to protect the franchisor's interests and ensure ongoing compliance with essential terms. A potential franchisee should carefully review Section 8(e) and related sections of the Multi-Unit Development Agreement to fully understand the scope and duration of these surviving obligations. It is advisable to seek legal counsel to interpret these clauses and assess their potential impact on the franchisee's future business activities.