Under what conditions can a Southern Steer Franchisee transfer the agreement to an entity they wholly own?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
in a separate account and the expenses of Franchisee's Southern Steer Business, including reasonable compensation and expenses of Franchisor and its agents will be charged to the account. Additionally, Franchisor will retain 50% of Gross Revenues for Franchisee's Southern Steer Business' as a management fee. Nothing contained herein will be construed to require Franchisor to operate Franchisee's Southern Steer Business in the case of Franchisee's inability to operate same, and the rights set forth herein may be exercised in the sole and absolute discretion of Franchisor.
- 18.4. Transfer of Agreement to Entity Owned by Original Signatories. If the Franchisee is an individual, this Agreement may be Transferred by the Franchisee to an Entity that is wholly owned by Franchisee without the payment of a Transfer Fee and without complying with Section 19 if the Franchisee is an individual or a general partnership, provided that the Owner or Owners of the Entity are the same person or perso
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, a franchisee who is an individual can transfer the franchise agreement to an entity they wholly own under specific conditions. This transfer can occur without paying a transfer fee or complying with the standard transfer requirements, provided certain stipulations are met.
The primary conditions are that the owner(s) of the new entity must be the same person or persons who originally signed the franchise agreement. Additionally, the transfer must not result in a change of control of the Southern Steer business. The franchisee must also provide Southern Steer with prior written notice of the transfer and must not be in default of any obligations under the existing franchise agreement.
However, even when transferring the agreement to a wholly-owned entity, the franchisee must pay Southern Steer $1,000 prior to the transfer. This fee covers legal expenses incurred by Southern Steer to prepare the necessary transfer documents. This condition ensures that Southern Steer is compensated for the administrative and legal work involved in processing the transfer, even when it's a transfer to a franchisee's own entity.