What is the definition of 'Bound Parties' in relation to criminal convictions and Fat Shack franchise termination, and where is it defined?

Based on the 2025 Fat Shack Franchise Disclosure Document, the term "Bound Parties" is referenced in the context of criminal convictions as a condition for franchise termination. Specifically, if a franchisee or any of its Bound Parties is convicted of a felony, a crime involving moral turpitude, or any crime or offense likely to materially and unfavorably affect Fat Shack's licensed methods, marks, goodwill, and reputation, Fat Shack Inc. (FSI) has grounds for termination. The FDD excerpt indicates that the definition of 'Bound Parties' is located in Section 21.1.

However, the provided excerpts do not include the actual definition of "Bound Parties" from Section 21.1. Without this definition, it is unclear who, besides the franchisee, would be included in this category. This could potentially include family members, business partners, or investors, and their actions could impact the franchisee's standing with Fat Shack.

A prospective Fat Shack franchisee should carefully review Section 21.1 of the Franchise Agreement to fully understand who is included in the definition of "Bound Parties." It is crucial to understand the scope of this definition, as the criminal convictions of these parties could lead to the termination of the Fat Shack franchise. Understanding this term is essential for assessing the risks associated with the franchise agreement.