What form will each Subsequent Franchise Agreement for a Fat Shack Restaurant take?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.4. Each Subsequent Franchise Agreement to be executed by Franchisee for each FAT SHACK Restaurant to be developed hereunder shall be in the form of Franchise Agreement then generally being offered to franchisees by FSI, which may contain terms subsequently different then the terms of the Initial Franchise Agreement. Notwithstanding the foregoing, FSI agrees that it will not charge an Initial Franchise Fee to Franchisee which is greater than the amounts set forth in Section 2.1. above. Franchisee acknowledges that FSI has the right, however, to charge then current published rates for the required products, royalty percentages, advertising contributions and other fees, products and services offered to Franchisee.
- 3.5. Franchisee acknowledges that FSI shall have the right, in FSI's sole discretion, to waive the initial training program, which is the same as or similar to the training provided under Section 7.1 of the Initial Franchise Agreement, for the second and each subsequent FAT SHACK Restaurant developed under the terms of this Development Agreement. Franchisee may request assistance from FSI in addition to the assistance provided to Franchisee as described in the Initial Franchise Agreement, in connection with site selection, site feasibility studies, lease negotiations and other issues related to development of its Protected Area. If FSI agrees to provide such assistance, in FSI's sole discretion, FSI reserves the right to charge Franchisee for all travel, lodging, living expenses, telephone charges and other identifiable expenses incurred in connection with such assistance, plus a fee based on hourly time spent by any of FSI's employees in connection with such assistance, which fee will be charged in accordance with the then current daily or hourly rates being charged by FSI for assistance.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, each Subsequent Franchise Agreement that a franchisee executes for each Fat Shack Restaurant will be in the form of the Franchise Agreement then generally being offered to franchisees by Fat Shack. This agreement may contain terms that differ from those in the Initial Franchise Agreement.
Despite potential differences in terms, Fat Shack agrees not to charge an Initial Franchise Fee greater than the amount specified in Section 2.1 of the agreement. However, Fat Shack retains the right to charge the then-current published rates for required products, royalty percentages, advertising contributions, and other fees, products, and services.
Fat Shack also has the discretion to waive the initial training program, similar to that in Section 7.1 of the Initial Franchise Agreement, for the second and subsequent Fat Shack Restaurants developed under the Development Agreement. Franchisees can request additional assistance from Fat Shack beyond what is provided in the Initial Franchise Agreement, related to site selection, feasibility studies, and lease negotiations. If Fat Shack agrees to provide this assistance, it reserves the right to charge the franchisee for all associated expenses, including travel, lodging, and hourly fees for its employees' time.