In the event of a dispute arising from the Fat Shack Development Agreement, which agreement's provisions govern?

According to Fat Shack's 2025 Franchise Disclosure Document, in the event of a conflict between the terms of the Development Agreement and any franchise agreement executed under it, the terms of the Development Agreement will take precedence. This means that if there is a disagreement or inconsistency between the two agreements, the conditions outlined in the Development Agreement will be the controlling factors in resolving the issue.

This clause is significant for prospective Fat Shack franchisees because it clarifies the hierarchy of agreements. The Development Agreement sets the stage for the overall relationship, while the Franchise Agreement governs the operation of individual Fat Shack locations. If a franchisee has a Development Agreement and later signs a Franchise Agreement, they should be aware that the Development Agreement holds more weight in case of conflicting terms.

This type of clause is relatively standard in franchise agreements, especially when a development agreement is involved. It is crucial for franchisees to carefully review both the Development Agreement and the Franchise Agreement to understand their rights and obligations under each document and to be aware of which agreement will govern in case of a conflict.