use our System and Marks. We are willing to grant you such a franchise on the terms and conditions set forth in this Agreement.

AGREEMENT

THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, the parties agree as follows:

1 GRANT OF FRANCHISE AND FRANCHISE TERRITORY

• 1.1 Grant of Franchise and Franchise Territory. We grant to you, and you accept from us, the franchise, license, and privilege to use the Marks, the System, and merchandise bearing the Marks, for 10 years from the date of this Agreement (the "Franchise"). This grant solely is for the operation by you of one Afuri Franchise at the location identified in the attached Exhibit 1 (the "Franchise Premises") and in the geographical territory identified in the same exhibit (the "Franchise Territory").
• 1.1.1 Franchise Territory. Except as otherwise provided in this Agreement, during the term of this Agreement, we agree not to locate, or license anyone else to locate, any business using the Marks or the System within the Franchise Territory, without your prior written consent. However, we may purchase

or be purchased by, or merge or combine with, competing businesses, wherever located.

• 1.1.2 Marketing Within Territory. Except with our prior written permission, you shall not do business from any location other than the Franchise Premises. Any catering and delivery services authorized by us must be within your Franchise Territory. Except with our prior written permission, you shall not place advertisements using our Marks in or originating from any area other than the Franchise Territory. This includes, but is not limited to, internet, catalog sales, telemarketing, or other direct marketing. You may not advertise in any media whose primary circulation is outside the Franchise Territory, except with our prior written permission and the prior written consent of any of our franchisees whose territory is reached by that media.
• 1.1.3 Additional Locations. You may not establish or operate any other Afuri establishment without executing a separate Franchise Agreement for that operation.

Among other things, we may require as a condition to our approval of your purchase of additional franchises (from our existing franchisees or affiliates, or from us) that you sign a general release in a form we prescribe, following applicable law, to release us from any claims you may have against us.

• 1.1.4 Co-Branding. Some Afuri franchises may be placed at a location where another, separate business is operated under another business name. If the Franchise Premises is at that type of location, it will be deemed "co-branded" for the purposes of this Agreement. If the Franchise Premises is located in a co-branded location, the exact basis and calculation of Revenue will follow the requirements and procedures we outline in the Operations Manual. If the Franchise Premises is in a co-branded location, you will obtain and keep, or make arrangements for us to have access to, a complete and accurate set of books and records of the operation of all businesses operated at and all business done through the cobranded location, although Revenue will be limited to Afuri related receipts. If the Franchise Premises is located in a co-branded location, we may enter upon the Franchise Premises at reasonable times to interview co-branded partners and to inspect and copy any books, records and documents related to the co-branded location in order to verify your compliance with the terms of the Franchise Agreement. The Operations Manual may contain additional information about co-branded locations.
• 1.2 One Location for Franchise. You will operate the Franchise only at the Franchise Premises. If not determined when this Agreement is executed, you are responsible for selecting the site for the Franchise Premises within the search area ("Search Area") outlined in Exhibit 1 and in accordance with this Agreement.

1.3 Assistance in Site Location.

• 1.3.1 Unless we approve otherwise, the Franchise Premises for your first location will have a commissary kitchen. Unless we approve otherwise, the Franchise Premises for each additional location will be serviced by your commissary kitchen at your first Franchise Premises. For the first Franchise Premises with a commissary kitchen, the location will typically be a single story to facilitate ventilation.
• 1.3.2 You are responsible for finding the location of the Franchise Premises subject to our approval. The factors we may consider in approving or rejecting proposed site selections include, but are not limited to, the following: general location and neighborhood; traffic patterns; parking; physical characteristics of existing buildings; lease terms; population density; and population demographics. Also, we typically require that the Franchise Premises be at a new building (as opposed to a "second generation" restaurant location). We may modify these factors at our discretion.
  • 1.3.3 If you request assistance in selecting a site for the Franchise Premises, we may provide

reasonable assistance in finding a location acceptable to you. If requested, you will pay for all reasonable out-of-pocket expenses related to any such site selection assistance, including travel and lodging expenses we incur to help you locate sites. Any on-site assistance is subject to our availability. You will bear all other site selection and lease negotiation expenses.

• 1.3.4 Neither we nor any of our employees have special expertise in selecting sites. We do not make guarantees with respect to any location you select or lease you sign. We will not be liable for any consequences of your choice of any franchise site. Any site recommendation or approval we make is not a representation that any particular site is available or legally appropriate for use as a franchise site. It is your responsibility to investigate all applicable zoning, licensing, leasing, and other requirements for any proposed site.

Source: Item 23 — Receipts (FDD pages 50–189)