factual

Under what conditions can Southern Steer terminate a franchise agreement prior to its expiration?

Southern_Steer Franchise · 2025 FDD

Answer from 2025 FDD Document

ranchise Agreement between the Multi-Unit Developer (or a Controlled Entity) and the Franchisor is terminated by either party for any reason;

  • (m) the Multi-Unit Developer, its Owners, Operating Principal, Guarantors, Controlled Entity or any individual breaches the non-compete and confidentiality covenants set out in the Franchise Agreement or the Non-Competition and Non-Disclosure Agreement;
  • (n) the Multi-Unit Developer has previously received notices of three or more defaults (whether different defaults noticed together or three separate instances of the same default) pursuant to Section 8.2 in a Development Period and is again in default of this Agreement within the Development Period, regardless of whether the previous defaults were cured by the Franchisee; or
  • (o) the Multi-Unit Developer transfers or otherwise assigns this Agreement or the rights to develop a Southern Steer Business hereunder, or an interest in the Multi-Unit Developer Entity, without complying with the provisions of Section7.2.
  • Termination by Franchisor- Thirty Days-Notice. The Franchisor shall have the right to terminate this Agreement (subject to any state laws to the contrary, where state law shall prevail), effective upon 30 days written notice to the Franchisee ("Breach Notice"), if the Franchisee breaches any provision of this Agreement other than those provisions listed in Section 8.1 above and fails to cure the default during such 30 day period. In that event, effective upon expiration of the 30 day period, this Agreement will terminate without further notice to the Franchisee. Defaults shall include, but not be limited to, the following:
    • (a) the Multi-Unit Developer or Controlled Entity fails to maintain the then current operating procedures and adhere to the specifications and standards established by the Franchisor as set forth herein or in the Brand Manual, defined and described in the Franchise Agreement, or as otherwise communicated to the Franchisee;
    • (b) the Multi-Unit Developer fails, refuses or neglects to obtain the Franchisor's prior written approval or consent as required by this Agreement; or
  • (c) the Multi-Unit Developer commits any other act that constitutes good cause under applicable law or court decisions.
  • Failure to Comply with Development Schedule. Termination of this Agreement as a result of the Multi-Unit Developer's failure to meet the Development Schedule will not affect the individual Franchise Agreements for the Southern Steer Businesses opened and operating in the Development Territory pursuant to this Agreement which were signed by the parties prior to termination of this Agreement; however, upon termination of this Agreement, all rights to open and operate additional Southern Steer Businesses in the Development Territory and all other rights granted to the Multi-Unit Developer under this Agreement will immediately revert to the Franchisor, without affecting those obligations of the Multi-Unit Developer that continue beyond the termination of this Agreement.
  • Obligations Upon Termination or Expiration.

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, Southern Steer has the right to terminate the Multi-Unit Development Agreement with a 30-day written notice if the Multi-Unit Developer breaches any provision of the agreement, except for those listed in Section 8.1, and fails to correct the default within that 30-day period. This termination is subject to any state laws to the contrary, where state law prevails.

The defaults that can lead to termination include failing to maintain current operating procedures, not adhering to the standards established by Southern Steer, or neglecting to obtain the franchisor's prior written approval when required. Additionally, Southern Steer can terminate the agreement if the Multi-Unit Developer commits any act that constitutes good cause under applicable law or court decisions.

Southern Steer can also terminate the agreement if the Multi-Unit Developer, its Owners, Operating Principal, Guarantors, Controlled Entity, or any individual breaches the non-compete and confidentiality covenants in the Franchise Agreement or the Non-Competition and Non-Disclosure Agreement. Furthermore, if the Multi-Unit Developer has received notices of three or more defaults in a Development Period and is again in default, Southern Steer can terminate the agreement, regardless of whether the previous defaults were cured. Transferring or assigning the agreement or the rights to develop a Southern Steer Business without complying with the provisions of Section 7.2 also constitutes grounds for termination.

The failure of the Multi-Unit Developer or the Controlled Entity to provide Southern Steer with an executed Franchise Agreement by the end of any applicable Development Period set out in the Development Schedule will constitute a material breach of this Agreement, and Southern Steer will have the right to terminate this Agreement as provided for herein.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.