What constitutes 'Major Assets' in the context of a Southern Steer Multi-Unit Development Agreement?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Multi-Unit Developer will not Transfer or otherwise dispose of any interest in or any part of any Ownership Interest in the Multi-Unit Developer ("Major Assets") to any purchaser without first offering the same to the Franchisor in a written offer that contains the purchase price, payment terms, and all other material terms and conditions of the proposed transaction with the third party, including price and payment terms ("Multi-Unit Developer's Offer").
The Franchisor will have 30 days after receipt of the Multi-Unit Developer's Offer to give the Multi-Unit Developer written notice of the Franchisor's desire to either waive its option to purchase ("Waiver Notice") or its intention to exercise its rights to purchase or acquire the Major Assets according to the terms contained in the Multi-Unit Developer's Offer ("Notice of Intent to Purchase").
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, 'Major Assets' refers to any interest in or part of any Ownership Interest in the Multi-Unit Developer. This definition is relevant when discussing the option of the franchisor to purchase the assets.
A Multi-Unit Developer cannot transfer or dispose of any interest in the Multi-Unit Development Agreement, including the right to develop Southern Steer businesses in the Development Territory, except as explicitly provided in Section 7.2 of the agreement. Similarly, they cannot transfer or dispose of any interest in their Ownership Interest without first offering it to Southern Steer.
Before a Multi-Unit Developer can proceed with a sale to a third party, they must provide Southern Steer with a written offer detailing the purchase price, payment terms, and all other material conditions of the proposed transaction. Southern Steer then has 30 days to either waive their option to purchase or express their intention to exercise their right to purchase the Major Assets under the same terms.