When must the Successor Franchise Fee be paid to FSI for a Fat Shack franchise?

According to Fat Shack's 2025 Franchise Disclosure Document, the Successor Franchise Fee, amounting to $6,000, is due upon the execution of Fat Shack's then-current Franchise Agreement when a franchisee exercises their successor franchise rights. This fee covers Fat Shack's expenses related to reviewing the franchisee's operations and approving the option for renewal.

This fee is nonrefundable under all circumstances once paid, meaning that if the franchisee's application is ultimately rejected or if the franchisee changes their mind, the $6,000 will not be returned. The Successor Franchise Fee is paid instead of an additional initial franchise fee, which is a benefit to the franchisee as it is generally lower than the initial franchise fee for a new franchise.

To be eligible for successor franchise rights, the franchisee must meet several prerequisites. These include executing the current Franchise Agreement, maintaining compliance with the existing agreement, agreeing to upgrade and remodel the Fat Shack restaurant if required, executing a successor franchise rider that includes a general release of claims against Fat Shack, and successfully completing a refresher operations training program. Meeting these conditions ensures that the franchisee is in good standing and prepared to continue operating the Fat Shack restaurant successfully.