What constitutes a wrongful termination of the Southern Steer franchise agreement regarding the transfer of the Southern Steer Business or Major Assets?

According to the 2025 Southern Steer Franchise Disclosure Document, a franchisee will be considered to have wrongfully terminated the franchise agreement if they transfer the Southern Steer business or its major assets without also transferring the franchise agreement to the new owner. This means that if a franchisee sells the physical location, equipment, or other significant assets of the business to someone else, but does not ensure that the buyer also assumes the responsibilities and obligations of the franchise agreement, Southern Steer will consider this a breach of contract.

Southern Steer includes an exception to this rule. The transfer of major assets to a bank, financial institution, or other lender is permitted if it is related to financing the real estate, leasehold improvements, FF&E (furniture, fixtures, and equipment), inventory, supplies, or working capital of the Southern Steer business. This exception allows franchisees to secure necessary financing without triggering a wrongful termination.

If a franchisee attempts to transfer their ownership interests (i.e., their stake in the franchise) they must first offer those interests to Southern Steer in writing, presenting the same terms and conditions offered to any other potential buyer. Southern Steer has 30 days to accept or decline this offer. This provision ensures that Southern Steer has the first opportunity to buy back the franchise before it is sold to an outside party. These restrictions on transfer are in place to protect the Southern Steer system, brand, and reputation, and to ensure consistency across all franchise locations.