What is the meaning of 'proper venue' in the context of legal proceedings against Fat Shack?

According to Fat Shack's 2025 Franchise Disclosure Document, the term 'proper venue' defines where a lawsuit can be initiated against Fat Shack. The document specifies that Fat Shack can bring legal proceedings not subject to mandatory arbitration in any court of competent jurisdiction where the Fat Shack restaurant is located, or where the franchisee resides or owns assets. This means Fat Shack isn't restricted to Colorado courts in these situations.

For a Fat Shack franchisee, this clause has significant implications. If Fat Shack initiates a lawsuit against them that isn't subject to mandatory arbitration, the franchisee could be compelled to defend themselves in a court located in the state, province, or geographic area where their Fat Shack restaurant is located or where they reside or own assets. This could involve considerable travel expenses, legal fees, and time away from their business, especially if the franchisee is not located in Colorado.

This arrangement is generally favorable to Fat Shack, as it allows them to choose a venue that may be more convenient or advantageous for them. Franchisees should be aware of this clause and consider the potential costs and burdens associated with defending against a lawsuit in a potentially distant jurisdiction. It is advisable for prospective franchisees to seek legal counsel to fully understand the implications of this venue provision.