Under the Fat Shack Development Agreement, is the guarantor's liability joint or several?

According to Fat Shack's 2025 Franchise Disclosure Document, the guarantor's liability under the Development Agreement is joint and several. Specifically, the guarantor consents and agrees that their direct and immediate liability under the guaranty will be joint and several. This means that Fat Shack can pursue one or more of the guarantors for the full amount of the obligation, rather than having to pursue each guarantor for a proportionate share.

This type of liability is significant for potential Fat Shack franchisees because it increases the risk for each guarantor. If one guarantor is unable to pay, the other guarantors may be held responsible for the entire debt. This clause is designed to protect Fat Shack by ensuring that they have multiple avenues for recovering any losses or unpaid obligations.

It is important for anyone considering becoming a guarantor to fully understand the implications of joint and several liability and to seek legal advice before signing any agreement. This ensures they are aware of the potential financial risks and obligations they are undertaking. The guaranty also includes waivers of certain rights, such as the right to require Fat Shack to first pursue action against the franchisee, further emphasizing the guarantor's direct and immediate liability.