Under what conditions can Fat Shack decline to offer a successor franchise agreement?

According to Fat Shack's 2025 Franchise Disclosure Document, Fat Shack is not obligated to offer a successor franchise agreement if the franchisee fails to comply with the conditions of exercising a successor franchise.

To be eligible for a successor franchise, a Fat Shack franchisee must meet several prerequisites. These include executing the current form of the Franchise Agreement, which may have substantially different terms, including changes to royalty and other fee amounts. The franchisee must not be in default or under notification of breach of the agreement at the time of giving notice for renewal and must have maintained compliance with all provisions during the current term, with 'compliance' meaning they haven't received more than three written breach notifications from Fat Shack.

Additionally, the franchisee must agree to upgrade and remodel the Fat Shack restaurant at their own expense to meet current Operations Manual requirements, if Fat Shack deems it necessary. They must also execute a successor franchise rider that includes a general release of claims against Fat Shack and pay a $6,000 successor franchise fee, along with any other fees specified in the successor franchise rider, to cover Fat Shack's expenses for reviewing the franchisee's operations and approving the option. Finally, the franchisee or their General Manager must successfully complete a refresher operations training program, unless waived by Fat Shack, with the franchisee responsible for all associated travel and living expenses.