Where is the Protected Area for the Fat Shack franchise described in the Addendum to the Development Agreement?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
| 1. | The Protected Area, as referred to in Section 1.1 of the Development Agreement, is described below by geographic boundaries or by zip codes and on the attached map and shall consist of the following area or areas: |
|---|---|
3.2. Protected Territory
Subject to Section 3.4 and Section 3.5 of this Agreement regarding Special Venues and Channels and Captive Audience Venues, Franchisee is granted a geographic area around the Restaurant Location (the "Protected Territory") in which FSI will not operate, nor permit a third party to operate, a FAT SHACK Restaurant as long as Franchisee is in substantial compliance with all the provisions of this Agreement. The Protected Territory is an area encompassing a three mile radius around the Restaurant Location as measured from the front door of the Restaurant. A FAT SHACK Restaurant at a Captive Audience Venue does not have a Protected Territory. Because there are exceptions where FSI, its affiliates or other third parties may operate a FAT SHACK Restaurant in Franchisee's Protected Territory, Franchisee's Protected Territory is not considered an exclusive territory.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the Protected Area granted to a franchisee under the Development Agreement is detailed in the Addendum. Specifically, Section 1.1 of the Development Agreement, as referenced in Item 23, states that the Protected Area is described either by geographic boundaries or by zip codes, and is visually represented on an attached map.
For a single Fat Shack Restaurant location, the franchisee is granted the right to operate at a specific address, referred to as the "Restaurant Location," which is also detailed in the Addendum to the Franchise Agreement. If a specific address hasn't been chosen when the agreement is signed, the franchisee must select a location within a nonexclusive "Target Area," also defined in the Addendum. The Restaurant Location must be a specific numbered street or mall address and cannot be defined as a geographic area.
Fat Shack grants a Protected Territory around the Restaurant Location, subject to certain exceptions. This Protected Territory typically encompasses a three-mile radius around the Restaurant Location, measured from the front door of the restaurant. However, this Protected Territory is not considered exclusive because Fat Shack retains the right to operate or permit third parties to operate Fat Shack Restaurants in Special Venues and Channels or Captive Audience Venues within the franchisee's Protected Territory. These include venues like grocery stores, wholesale distributors, and catering services.