What are the payment methods accepted by Fat Shack for royalties, as described in section 5.4?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees that the Royalty, Marketing and Promotion Fee (defined in Section 13.3), Noncompliance Service Charge (defined in Section 12.4), gift card purchases and fees, product purchases, advertising, promotional and point-of-purchase materials, and other payments due to FSI or an affiliate of FSI shall be sent to FSI by electronic funds transfer, unless FSI agrees to another form of payment in its sole discretion.
Upon the request of FSI and in no event later than 30 days prior to the opening of the FAT SHACK Restaurant, Franchisee shall execute an Authorization Agreement for preauthorized payment ("ACH Payment"), of any amounts due under this Agreement or otherwise by electronic transfer of funds from Franchisee's bank account to FSI's bank account, in the form attached to this Agreement as Exhibit III.
Franchisee agrees to advise FSI, within one business day thereafter, if Franchisee changes its bank account or transfers its bank account to another bank, and further agrees, within three business days of such change or transfer, to execute and return to FSI a replacement Authorization Agreement listing the new bank account information and all other information required.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, royalty, marketing and promotion fees, noncompliance service charges, gift card purchases and fees, product purchases, advertising, promotional and point-of-purchase materials, and other payments due to FSI or its affiliates must be sent via electronic funds transfer. However, Fat Shack may agree to another form of payment at its discretion.
Specifically, Fat Shack requires franchisees to execute an Authorization Agreement for preauthorized payment (ACH Payment) for any amounts due under the agreement. This agreement allows for electronic transfer of funds from the franchisee's bank account to Fat Shack's bank account. This agreement must be completed no later than 30 days before the Fat Shack restaurant opens.
If a franchisee changes their bank account or transfers it to another bank, they must notify Fat Shack within one business day. Within three business days of the change, the franchisee must provide a replacement Authorization Agreement with the new bank account information.