Must a Fat Shack lease include the landlord's consent to use the Fat Shack marks and signage?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
The primary lease must contain certain provisions granting us certain rights, as your franchisor, including:
- (i) The initial term of the lease, or the initial term together with any renewal terms (for which rent must be specified in the lease) must be for at least seven years;
- (ii) The lease must give the landlord's consent to your use of the Marks and signage which we initially prescribe for the FAT SHACK Restaurant;
- (iii) We must have the right to enter the premises to make any modification necessary to protect the Marks and the Licensed Methods;
- (iv) We or our designee, without the landlord's approval, must have the option to assume your occupancy rights under the existing lease terms and have the right to assign the lease or sublet the premises, for all or any part of the lease term, if you are in default under the lease or the Franchise Agreement or if the lease or Franchise Agreement is terminated;
- (v) Your landlord must agree to provide us with a notice of default and an opportunity to cure any default; and
- (vi) The lease must contain a use provision which is acceptable to us, including the requirement that only a FAT SHACK Restaurant may be operated on the premises without our prior written consent.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 22–26)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, a primary lease for a Fat Shack restaurant must include the landlord's consent to the franchisee's use of Fat Shack's marks and signage. This requirement ensures that the franchisee can legally display Fat Shack's branding at their location. The franchisor also retains the right to enter the premises to make modifications necessary to protect the marks and licensed methods.
This provision is crucial for maintaining brand consistency and protecting Fat Shack's intellectual property. Without the landlord's explicit consent, a franchisee could face legal challenges or restrictions on their ability to use Fat Shack's trademarks and signage, which are essential for attracting customers and building brand recognition.
Furthermore, the lease must grant Fat Shack, as the franchisor, certain rights, including the option to assume the franchisee's occupancy rights and the right to assign the lease or sublet the premises if the franchisee defaults or if the Franchise Agreement is terminated. The landlord must also agree to provide Fat Shack with notice of default and an opportunity to cure any default. These stipulations protect Fat Shack's interests in maintaining a consistent brand presence and operational standards across all franchise locations. The lease must also contain a use provision acceptable to Fat Shack, ensuring that only a Fat Shack Restaurant may be operated on the premises without prior written consent.
Prospective franchisees should carefully review the lease agreement and ensure that all these provisions are included and acceptable to both themselves and the landlord. It is also the franchisee's responsibility to obtain the landlord's consent to the conditional assignment of the lease to Fat Shack.