What should a Fat Shack franchisee do if their lease expires before the franchise agreement?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall comply with all agreements with third parties related to the FAT SHACK Restaurant including, in particular, all provisions of any lease for the Restaurant Location.
If the term of the lease for the Restaurant Location ends before the term of this Agreement expires, Franchisee shall negotiate a renewal of the lease term in good faith.
If Franchisee is unable to renew the lease at the Restaurant Location, Franchisee may find a different site within the original Protected Territory, submit it to FSI for approval with, if applicable, the Relocation Fee, and, following FSI's approval, move Franchisee's FAT SHACK Restaurant to the new location, at Franchisee's sole cost.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, if the lease for the restaurant location ends before the franchise agreement expires, the franchisee must negotiate in good faith to renew the lease term. This is a critical obligation, as the franchisee needs a physical location to operate the Fat Shack restaurant.
If the franchisee is unable to renew the lease at the current location, they have the option to find a different site within their original protected territory. However, this new site is subject to approval by Fat Shack. If applicable, the franchisee must also pay a relocation fee. Once Fat Shack approves the new location, the franchisee can move the Fat Shack restaurant to the new site, but this relocation is at the franchisee's sole cost.
This clause places the responsibility and financial burden of securing and maintaining a suitable location squarely on the franchisee. It is important for prospective franchisees to understand that lease negotiations and potential relocation expenses are their responsibility, and failure to secure a lease could impact their ability to operate the Fat Shack franchise.