Does the Fat Shack certificate outline any geographic limits related to the guarantee?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
Subject to Section 3.4 and Section 3.5 of this Agreement regarding Special Venues and Channels and Captive Audience Venues, Franchisee is granted a geographic area around the Restaurant Location (the "Protected Territory") in which FSI will not operate, nor permit a third party to operate, a FAT SHACK Restaurant as long as Franchisee is in substantial compliance with all the provisions of this Agreement. The Protected Territory is an area encompassing a three mile radius around the Restaurant Location as measured from the front door of the Restaurant. A FAT SHACK Restaurant at a Captive Audience Venue does not have a Protected Territory. Because there are exceptions where FSI, its affiliates or other third parties may operate a FAT SHACK Restaurant in Franchisee's Protected Territory, Franchisee's Protected Territory is not considered an exclusive territory.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, a franchisee is granted a Protected Territory, which is a geographic area around the Restaurant Location. Fat Shack will not operate, nor permit a third party to operate, a Fat Shack Restaurant within this territory as long as the franchisee remains in substantial compliance with the Franchise Agreement.
The Protected Territory encompasses a three-mile radius around the Restaurant Location, measured from the front door of the Restaurant. However, this protection is subject to certain exceptions. Fat Shack retains the right to operate or authorize third parties to operate Fat Shack Restaurants in Special Venues and Channels and Captive Audience Venues within the franchisee's Protected Territory. A Fat Shack Restaurant at a Captive Audience Venue does not have a Protected Territory.
Because of these exceptions, the franchisee's Protected Territory is not considered an exclusive territory. This means that while Fat Shack grants a certain level of geographic protection, there are circumstances under which Fat Shack or other parties may operate within the franchisee's three-mile radius. Prospective franchisees should carefully consider these limitations and assess the potential impact on their business before investing in a Fat Shack franchise.