What happens if Fat Shack does not approve the proposed site for a Fat Shack restaurant?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
You must select the premises for your FAT SHACK Restaurant and sign a lease or otherwise acquire the right to use the location. We do not generally own the premises that franchisees lease for their FAT SHACK Restaurants, and instead the property is typically leased from a third party. If we approve the location, we may assist you in negotiating your lease, or, if applicable, purchase agreement, to ensure that it meets our minimum requirements, although we have no obligation to do so. If we do not approve your site, you must propose a new site. You must not, without our prior written approval, enter into any contract or letter of intent to contract to purchase or lease the premises you intend to use as a Restaurant
Location. We consider the following factors when we approve or disapprove your proposed Restaurant Location: the nature and location of other competitive FAT SHACK Restaurants and potential customers, population density, location to college campuses, traffic patterns and other factors we deem relevant on a case by case basis. There is no contractual limit on the time it takes us to approve or disapprove your proposed site and lease. Once we have all of the necessary documentation for review, we typically take 30 days to approve or disapprove your proposed Restaurant Location and lease.
We usually submit our initial lease review comments to you, or if we agree, to your landlord, within one to two weeks after receiving your lease but the entire lease negotiation process typically takes anywhere from two weeks to two months depending on the landlord's responsiveness. Our review and approval of your lease, or, if applicable, purchase agreement, is conducted solely for the purpose of determining that it meets our minimum criteria for the operation of a FAT SHACK Restaurant and that our interests and those of our affiliates are protected. The legal counsel and any other professional advisors we engage to assist with the review will be acting only on our behalf and will not be representing you or your interests in relation to the review and approval. We recommend that you have your own attorney review the lease on your behalf.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 28–36)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, if Fat Shack does not approve a franchisee's proposed site, the franchisee must propose a new site. The franchisee is prohibited from entering into any contract or letter of intent to purchase or lease the premises without Fat Shack's prior written approval.
Fat Shack considers several factors when approving or disapproving a proposed restaurant location, including the nature and location of other competitive Fat Shack restaurants and potential customers, population density, location to college campuses, and traffic patterns. Fat Shack states there is no contractual limit on the time it takes them to approve or disapprove a proposed site and lease. However, once Fat Shack has all the necessary documentation for review, it typically takes 30 days to approve or disapprove a proposed restaurant location and lease.
If a franchisee does not agree with the lease provisions that Fat Shack provides or has negotiated with the landlord, the franchisee need not move forward with that particular site but must find another suitable site for the restaurant location. If Fat Shack objects to a lease provision during its review of the lease, then the lease provision must be changed in a manner that is acceptable to them or removed, or the franchisee must find another suitable site for the restaurant location with lease terms that are acceptable to Fat Shack. Fat Shack may charge an additional fee for reviewing another lease. If a franchisee fails to obtain Fat Shack's approval for their site within the specified time frame, Fat Shack may terminate the Franchise Agreement.