Under the Southern Steer franchise agreement, are the Franchisee's obligations, including paying fees and operating as a Southern Steer Business, affected if the Franchisor doesn't accept the Franchisee's offer?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchisee's obligations under this Agreement including, but not limited to, its obligations to pay all Fees and to operate the Southern Steer Business as a Southern Steer Business, will in no way be affected or changed because of non-acceptance by the Franchisor of the Franchisee's Offer and, as a consequence, the terms and conditions of this Agreement will remain in full force and effect.
The decision by the Franchisor not to exercise the option to purchase granted to it pursuant to this Section will not, in any way, be deemed to grant the Franchisee the right to terminate this Agreement and will not affect the term of this Agreement.
Moreover, if the Franchisor does not exercise the option to purchase granted to it pursuant to this Section and if the Franchisee sells or otherwise disposes of its Southern Steer Business or Major Assets to a third party, then both the Franchisee and the purchaser will be required to comply in all respects with the terms and conditions of Section 18 of this Agreement.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, the franchisee's obligations remain in full force and effect, even if Southern Steer does not accept the franchisee's offer. This includes the franchisee's obligation to pay all fees and to operate the Southern Steer business as a Southern Steer business.
This clause ensures that the franchisee cannot avoid their contractual obligations simply because Southern Steer chooses not to exercise an option, such as purchasing the business. The terms and conditions of the agreement remain binding on the franchisee.
Furthermore, the decision by Southern Steer not to exercise its option to purchase the franchise does not grant the franchisee the right to terminate the agreement, and it does not affect the term of the agreement. If the franchisee sells the Southern Steer business to a third party, both the franchisee and the purchaser must comply with the terms and conditions outlined in the agreement.