What conditions outlined in Section 18.5 must be met for a Southern Steer Franchisee to transfer their franchise?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
Subject to the provisions of Section 19, the Franchisee will not Transfer any interest in or any part of this Agreement, any direct or indirect interest in Franchisee, or the Southern Steer Business to any person or Entity ("Transferee") without the prior written approval of the Franchisor.
The Franchisor will not withhold its written consent to the Transfer by the Franchisee if Franchisor does not exercise its rights under Section 19 of this Agreement, the Transfer does not violate any of the terms of this Agreement, and the Franchisee is in full compliance with the following terms:
(a) Franchisee, Operating Principal and Owners are in full compliance with this Agreement and all other agreements between Franchisor or its Affiliate and Franchisee, Operating Principal and/or Owner(s);
(b) if the Transferee(s), its owners or affiliates are a party to any agreement with Franchisor or its Affiliates, they must be in full compliance with any such agreement;
(c) the Franchisee has provided written notice to the Franchisor of the proposed Transfer of this Agreement at least 30 days prior to the closing of the transaction;
(d) all of the Franchisee's monetary obligations due to the Franchisor have been paid in full;
(e) the Franchisee has agreed in writing to observe all applicable provisions of this Agreement, including the covenants not to compete contained in this Agreement;
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, Section 18.5 outlines the conditions a franchisee must meet to transfer their franchise. The franchisee cannot transfer any interest in the Franchise Agreement, any direct or indirect interest in the franchisee, or the Southern Steer business to another person or entity without prior written approval from Southern Steer.
Southern Steer will not withhold consent to the transfer if they do not exercise their rights under Section 19 of the agreement, the transfer does not violate any terms of the agreement, and the franchisee is in full compliance with specific terms. These terms include that the franchisee, operating principal, and owners are in full compliance with the Franchise Agreement and all other agreements with Southern Steer or its affiliates. Additionally, if the transferee(s), its owners, or affiliates are party to any agreement with Southern Steer or its affiliates, they must also be in full compliance.
To initiate a transfer, the franchisee must provide written notice to Southern Steer at least 30 days before the transaction's closing. All monetary obligations owed to Southern Steer must be paid in full. The franchisee must also agree in writing to adhere to all applicable provisions of the agreement, including non-compete covenants. These conditions ensure that Southern Steer maintains control over who operates its franchises and that all financial and contractual obligations are met before a transfer occurs.