After termination, is an Associate of a Southern Steer franchisee prohibited from assisting any entity engaged in Competitive Activity within 50 miles of any other Southern Steer Business?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Post-Term Covenant Not to Compete. For a period of 24 months after the termination or expiration of the Associate's employment or affiliation with the Franchisee, Associate will not, on Associate's own account or as an employee, principal, agent, franchisee, independent contractor, consultant, affiliate, licensee, partner, officer, director, shareholder, member, manager, governor or owner of any other person or entity, own, operate, lease, franchise, conduct, engage in, be employed by or connected with, have any interest in or assist any person or entity engaged in any Competitive Business or Competitive Activity within:
- (i) the Protected Area;
- (ii) within 50 miles of the outer boundaries of the Protected Area;
- (iii) within 50 miles from the Franchised Location;
- (iv) within 50 miles of any other Southern Steer Business, or
- (v) within any Protected Area or territory granted by the Franchisor pursuant to a Multi-Unit Development Agreement, franchise agreement, license agreement or other territorial agreement.
The Associate expressly agrees that the nature of both the Franchisee's and the Franchisor's business is such that if Associate were to directly or indirectly act in violation hereof in connection with a Competitive Business or Competitive Activity it would be virtually impossible for the Associate not to rely on or use the Confidential Information and Trade Secrets.
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 the 2025 Southern Steer Franchise Disclosure Document, an Associate of a Southern Steer franchisee faces certain restrictions regarding competitive activities after their employment or affiliation ends. Specifically, for 24 months after the termination or expiration of their association with the franchisee, the Associate is prohibited from engaging in or assisting any Competitive Business or Competitive Activity within several defined areas.
These restricted areas include the Protected Area of the franchise, within 50 miles of the outer boundaries of that Protected Area, within 50 miles from the Franchised Location itself, and importantly, within 50 miles of any other Southern Steer Business. This broad geographic restriction means that an Associate cannot work for a competitor or start a competing business near any Southern Steer location, not just the one they were directly affiliated with. The restrictions also extend to any Protected Area or territory granted by Southern Steer through a Multi-Unit Development Agreement, franchise agreement, license agreement, or other territorial agreement.
Southern Steer emphasizes that these restrictions are in place to protect the company's confidential information, trade secrets, and the goodwill of its franchisees. The FDD states that due to the nature of the business, it would be virtually impossible for a former Associate working with a competitor not to rely on confidential information acquired during their time with Southern Steer. This highlights the importance Southern Steer places on safeguarding its business model and proprietary information across its franchise network.