Under what circumstances is a Fat Shack franchisee NOT obligated to indemnify the franchisor?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
- The following is added to Section 20.3:
However, Franchisee shall not be required to indemnify FSI for any liabilities which arose as a result of FSI's breach of this Agreement or other civil wrongs committed by FSI.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, a franchisee is generally required to indemnify Fat Shack and its related parties against claims and liabilities arising from the operation of the Fat Shack restaurant. However, a New York Rider modifies this requirement.
Specifically, the New York Rider states that a Fat Shack franchisee in New York is not required to indemnify Fat Shack for liabilities that arise as a result of Fat Shack's breach of the Franchise Agreement or other civil wrongs committed by Fat Shack. This provides a specific carve-out to the standard indemnification clause, offering some protection to New York franchisees.
This modification is only applicable to Fat Shack franchisees operating in New York, as it is part of the New York Rider to the Franchise Agreement. Franchisees in other states are subject to the standard indemnification clause, which requires them to indemnify Fat Shack unless the claims are caused by Fat Shack's negligence.