What is the timeframe for satisfying a material judgment against a Fat Shack franchisee to avoid termination?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
If any material judgment (or several judgments which in the aggregate are material) is obtained against Franchisee and remains unsatisfied or of record for 30 days or longer (unless a supersedeas or other appeal bond has been filed); or if execution is levied against Franchisee's FAT SHACK Restaurant or any of the property used in the operation of the FAT SHACK Restaurant and is not discharged within five
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, a franchisee has a 30-day period to satisfy any material judgment(s) against them. If the judgment remains unsatisfied for 30 days or longer, Fat Shack has grounds for termination. However, this 30-day period is not applicable if a supersedeas or other appeal bond has been filed.
In practical terms, this means that if a significant legal judgment is made against a Fat Shack franchisee, they must resolve it promptly to avoid jeopardizing their franchise agreement. This could involve paying the judgment, negotiating a settlement, or successfully appealing the decision. The filing of an appeal bond acts as a temporary stay, preventing immediate enforcement of the judgment while the appeal is pending.
This clause protects Fat Shack from potential financial instability or reputational damage that could arise from a franchisee's unresolved legal issues. Franchisees should be aware of this requirement and maintain sufficient financial resources or insurance coverage to address potential judgments in a timely manner. It is also important to consult with legal counsel to understand options for appealing or otherwise addressing any material judgments.