What is the meaning of 'Notice Date' in the context of Southern Steer's option to purchase?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
If the Franchisor provides the Franchisee with a Notice of Intent to Purchase within 30 days after receipt of the Franchisee's Offer, then the Franchisor will have 90 days after the date the Notice of Intent to Purchase is received by the Franchisee ("Notice Date") to conduct a "due diligence" review.
The Franchisee will promptly provide the Franchisor with all Financial Records and other information requested by the Franchisor or its representatives to conduct its due diligence review.
The Franchisor will have the absolute and unconditional right to terminate the Notice of Intent to Purchase and any obligation to purchase the Southern Steer Business or Major Assets from the Franchisee for any reason and at any time during the 90-day due diligence review period by giving the Franchisee written notice.
- 19.3.
Good Faith Negotiations.
Unless the Franchisor terminates its Notice of Intent to Purchase as provided in Section 19.2 the Franchisee and the Franchisor will act in good faith to agree on the terms and conditions of the definitive agreement or agreements for the purchase of the Southern Steer Business or Major Assets (other than those objective terms and conditions contained in the Franchisee's Offer) and the closing date for the sale of the Southern Steer Business or Major Assets to the Franchisor will take place within 120 days after the Notice Date.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, the 'Notice Date' is a crucial point in the process if a franchisee intends to transfer or sell their Southern Steer business. It marks the date the franchisee receives the Franchisor's 'Notice of Intent to Purchase'. This notice indicates Southern Steer's desire to potentially buy the franchise business or its major assets, based on the terms the franchisee has offered.
Following the Notice Date, Southern Steer has 90 days to conduct a due diligence review. During this period, the franchisee must provide all necessary financial records and information to facilitate the review. Southern Steer retains the right to terminate the 'Notice of Intent to Purchase' at any point during these 90 days, for any reason, without obligation to proceed with the purchase.
If Southern Steer does not terminate the notice, both parties are expected to negotiate in good faith to finalize the purchase agreement. The closing date for the sale must occur within 120 days after the Notice Date. This timeline is important for franchisees to understand, as it sets the schedule for the potential sale of their business back to Southern Steer.