What are the exceptions to the restrictions on competitive activities related to Costa Vida Fresh Mexican Grill?

According to Costa Vida Fresh Mexican Grill's 2025 Franchise Disclosure Document, there are specific exceptions to the restrictions on competitive activities for franchisees. These exceptions allow a franchisee to engage in certain activities that would otherwise be considered competitive without violating the franchise agreement.

Specifically, the restrictions do not apply to (1) the ownership of shares of a class of securities listed on a public stock exchange or traded on the over-the-counter market that represent two percent (2%) or less of the number of shares of that class of securities issued and outstanding; or (2) the ownership or operation of other Costa Vida Restaurants that are licensed or franchised by Costa Vida Fresh Mexican Grill or any of its Affiliates.

These exceptions provide some flexibility for Costa Vida Fresh Mexican Grill franchisees. For example, a franchisee can invest in a publicly traded company, even if that company operates a competitive business, as long as their ownership stake is minimal (2% or less). Also, franchisees are allowed to own and operate multiple Costa Vida Fresh Mexican Grill locations, as this is seen as expanding the brand rather than competing against it.