What does Fat Shack use the financial information transmitted by the franchisee for?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
FSI reserves the right to disclose data derived from all financial and accounting reports received from Franchisee. All financial information transmitted by Franchisee to FSI pursuant to this Agreement shall be owned by FSI, with no duty on the part of FSI to account to Franchisee with respect to the use and exploitation of the same. Franchisee expressly authorizes FSI to utilize this information to prepare a financial performance representation, to release this information as necessary to substantiate any financial performance representation made by FSI, to share such information in summary form as FSI deems necessary or desirable with other franchisees at any annual convention or other franchise business meetings, and to share such information in any other manner and with any other parties that FSI deems appropriate without obtaining any further written consent of Franchisee.
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, Fat Shack Inc. (FSI) has broad rights regarding the financial information franchisees transmit. FSI owns all financial information transmitted by the franchisee and has no obligation to account to the franchisee for its use.
Specifically, Fat Shack is authorized to use this financial data to prepare financial performance representations. This means Fat Shack can use franchisee data to create projections or examples of potential financial outcomes for prospective franchisees. Fat Shack can also release the information as necessary to substantiate any financial performance representation made by FSI, meaning they can share the data with potential franchisees to back up their claims.
Furthermore, Fat Shack can share the financial information in summary form with other franchisees at annual conventions or other business meetings. They can also share the information in any other manner and with any other parties that Fat Shack deems appropriate, without needing further consent from the franchisee. This gives Fat Shack considerable latitude in how they use and distribute franchisee financial data.