What is the meaning of 'court of competent jurisdiction' in relation to legal actions against Fat Shack?

According to the 2025 Fat Shack Franchise Disclosure Document, a 'court of competent jurisdiction' refers to a court that has the legal authority to hear and decide a particular type of case. In the context of the Fat Shack franchise agreement, this term is relevant when Fat Shack or its affiliates initiate legal proceedings against a franchisee outside of mandatory arbitration.

Specifically, Fat Shack retains the right to bring legal actions against a franchisee in any court that has the appropriate jurisdiction in the country, state, province, or geographic area where the Fat Shack restaurant is located or where the franchisee resides or owns assets. This means Fat Shack is not limited to the courts in Colorado (where they are headquartered) if they choose to sue a franchisee; they can pursue legal action in the franchisee's local jurisdiction.

This clause provides Fat Shack with flexibility in choosing the venue for legal proceedings, potentially making it more convenient and cost-effective for them to pursue claims against franchisees. However, it could create additional burdens and expenses for franchisees who may be required to defend themselves in a distant or unfamiliar legal environment. Franchisees should be aware of this clause and consider the potential implications for legal disputes with Fat Shack.