Does the Multi-Unit Development Agreement for Southern Steer constitute the sale of a franchise to the Multi-Unit Developer?

According to Southern Steer's 2025 Franchise Disclosure Document, the Multi-Unit Development Agreement does not constitute the sale of a franchise. Instead, it grants the Multi-Unit Developer the right and obligation to enter into separate Franchise Agreements with Southern Steer to own and operate franchised businesses within a specific Development Territory. This agreement sets the stage for future franchise agreements but is not itself a franchise sale.

This distinction is important because the Multi-Unit Development Agreement outlines the terms under which the developer can acquire the rights to open multiple Southern Steer locations. It defines the Development Territory and the schedule for opening new locations. The developer must still sign individual Franchise Agreements for each location, and these agreements may have different terms and conditions than the initial agreement. The Multi-Unit Developer also undertakes the obligation to develop and open franchised Southern Steer Businesses using the System in the Development Territory in strict compliance with the terms and conditions of this Agreement for the Term of this Agreement.

Southern Steer retains certain rights, even within the Development Territory. The rights granted to the Multi-Unit Developer are non-exclusive, and Southern Steer can operate or license others to operate within the territory after a certain period. Southern Steer also reserves the right to use the System, sell products under other names, and acquire similar businesses, subject to the terms in the individual Franchise Agreements regarding Protected Areas. The Multi-Unit Developer cannot purchase or lease property for a proposed site until they have signed the corresponding Franchise Agreement with Southern Steer for such Southern Steer Business and has complied with the applicable provisions of the corresponding Franchise Agreement relating to the selection of the site for the Franchised Location.

Prospective Multi-Unit Developers should understand that the Development Agreement is a preliminary step. They will need to negotiate and sign separate Franchise Agreements for each location they plan to open. These agreements will govern the day-to-day operations of each Southern Steer business. The FDD advises that the Multi-Unit Developer acknowledges that this Agreement constitutes a legal document which grants certain rights to and imposes certain obligations upon the Multi-Unit Developer and has been advised by the Franchisor to retain an attorney or advisor prior to the execution of this Agreement to review the Southern Steer Franchising International, LLC Franchise Disclosure Document, to review this Agreement in detail, to review all legal documents, to review the economics, operations and other business aspects of the Southern Steer Businesses, to determine compliance with franchising and other applicable laws, to advise the Multi-Unit Developer on economic risks, liabilities, obligations and rights under this Agreement and to advise the Multi-Unit Developer on tax issues, financing matters, applicable state and federal laws, liquor laws, health and safety laws, environmental laws, employee issues, insurance, structure of the butcher shop and specialty grocery store business, and other legal and business matters.