When is the Development Fee due for a Southern Steer Multi-Unit Developer?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
[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.]
4. FEES.
- Development Fee. In consideration of Franchisor granting the Multi-Unit Developer the right to develop multiple Southern Steer Businesses in the Development Territory, Multi-Unit Developer will pay the Franchisor a development fee ("Development Fee") in an amount equal to:
- (a) The Initial Franchise Fee set out in the Initial Franchise Agreement for the first Southern Steer Business that the Multi-Unit Developer is committed to develop under the Development Schedule;
- (b) $49,500 for the second Southern Steer Business that the Multi- Unit Developer is committed to develop under the Development Schedule; and
- (c) $42,000 for the third Southern Steer Business that the Multi-Unit Developer is committed to develop under the Development Schedule.
For the avoidance of doubt, the total amount of the Development Fee is set forth in Attachment A of this Agreement.
- Development Fee Due. The Development Fee set out in Attachment A is due upon the Multi-Unit Developer's execution of this Agreement.
- Fees are Non-Refundable. The Development Fee will be nonrefundable and will be fully earned by the Franchisor when the Development Fee is paid by the Multi-Unit Developer even if Multi-Unit Developer fails to develop any Southern Steer Businesses under the terms of this Agreement.
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, the Development Fee for a Multi-Unit Developer is generally due upon the execution of the Multi-Unit Development Agreement. However, Item 5 of the FDD states that payment of the development fee will be deferred until Southern Steer has satisfied its pre-opening obligations, and the franchisee has commenced business operations.
The Development Fee compensates Southern Steer for granting the Multi-Unit Developer the right to develop multiple Southern Steer businesses within a specific Development Territory. The fee structure is as follows: the Initial Franchise Fee for the first Southern Steer Business, $49,500 for the second, and $42,000 for the third. The total amount of the Development Fee is detailed in Attachment A of the agreement.
Despite the deferral, the Development Fee is non-refundable and is considered fully earned by Southern Steer once paid by the Multi-Unit Developer, even if the developer fails to open any Southern Steer Businesses under the agreement. The portion of the Development Fee paid will be applied as the initial franchise fee at the time the Franchise Agreement is executed by the Multi-Unit Developer for each subsequent Southern Steer business.