In the context of the B Bops Franchise Agreement, what is the role of the entity identified as 'Franchisee'?

• 1. TERM. The term of this Agreement and of the nonexclusive right, license and franchise granted hereunder shall commence upon the effective date of this Agreement and shall continue until the fifteenth (15th) anniversary thereof, or until the termination of this Agreement in accordance with the provisions hereof, whichever shall first occur (hereinafter the "Term"). Franchisee agrees to operate the Franchise on a continual basis throughout the Term, subject to the terms and conditions of this Agreement. Any renewal of the Franchise shall be governed by Section 18 of this Agreement.
• 1. DEVELOPMENT OF FRANCHISE PREMISES. Franchisee agrees to secure, at its sole expense, a site for the Franchise Premises which shall be approved in writing by Company as being suitable for use as a B-Bop's Restaurant. Using the construction plans and specifications

CONTINUING OBLIGATIONS OF FRANCHISEE.

Franchisee agrees to comply with the following obligations during the Term of this Agreement:

A. Management and Operation. Franchisee agrees to devote Franchisee's fulltime and best efforts to the active management and operation of the Franchise, or to appoint a manager to devote such manager's full-time and best efforts to operation of the business. Franchisee shall have the right to appoint a full-time manager to operate the Franchise on a day-to-day basis, provided that: (i) Company shall have the right to approve the qualifications of such manager; and (ii) Franchisee shall remain active in the business by monitoring such manager's performance in operating the Franchise. Company's approval of Franchisee's manager shall not be unreasonably withheld, provided such manager has completed the training course (to the satisfaction of Company) required pursuant to Section 7(A) of this Agreement. The individual responsible for the daily management and supervision of the Franchise shall assume such responsibilities on a full-time basis and shall not engage in any other business or activity that requires significant time commitments or that may otherwise be detrimental to or interfere with the management obligations imposed hereunder. If Franchisee is a partnership, corporation or limited liability company, Franchisee shall not be involved in any business or activities apart from ownership and operation of the Franchise (and the ownership of any other B-Bop's Restaurant pursuant to a franchise agreement between Company and Franchisee).

Franchisee shall operate the Franchise only on the Franchise Premises and only in accordance with the business standards, procedures and policies set forth in the Operations Manual, as modified from time to time, or as specified in other manuals or written material provided by Company. Franchisee acknowledges that Franchisee shall be required to sell each of the items contained in the standard B-Bop's Restaurant menu as established from time to time by Company, and that each of such items will be prepared, packaged and sold in strict conformance with Company's standard operating procedures set forth in the Operations Manual.

Upon termination of this Agreement, or upon expiration of the Term of this Agreement without renewal, Franchisee agrees as follows:

• A.

Franchisee shall no longer be entitled to operate a B-Bop's Restaurant on the Franchise Premises or at any other location, nor in any other manner at any location whatsoever utilize all or any portion of the Licensed System (including, but not limited to, the proprietary recipes) or any of the Licensed Marks, provided that termination or expiration of this Agreement shall not affect the right of Franchisee to operate any other B-Bop's Restaurant in accordance with the terms of a franchise agreement between the parties;

• B.

Franchisee shall cease to hold itself out to the public as being a B-Bop's Restaurant and shall avoid any other conduct which would suggest or indicate any relationship between Company and Franchisee, except to the extent permitted by paragraph A above;

• E.

Franchisee shall, at its sole expense, immediately make such modifications to the exterior and interior of the Franchise Premises as Company shall reasonably request to effectively distinguish the Franchise Premises from its former appearance and from the appearance of any other B-Bop's Restaurant, including, without limitation, discontinuing use of the unique blue color scheme which is a distinguishing characteristic of the Licensed System.

Franchisee shall promptly pay when due all accounts payable and other invoices or obligations of whatever nature incurred by Franchisee in operation of the Franchise, whether such payments are to be made to Company or to third parties.

Company shall have the right from time to time to enter the Franchise Premises during business hours, without prior notice, for the purpose of making periodic inspections of the Franchise to ensure compliance of Franchisee's operations with the standards and policies of the Operations Manual and with the terms of this Agreement.

Franchisee agrees to cooperate with Company's representatives in all such inspections and render such assistance as may reasonably be requested.

Franchisee agrees to remedy any noncompliance with Company policies or standards noted during any inspection within ten (10) days of the date of inspection, or within such longer period as Company may in its discretion grant.

Franchisee acknowledges and agrees that such confidential information is disclosed to Franchisee solely on the condition that Franchisee agrees that Franchisee: (a) will not use the confidential information in any other business or activity; (b) will comply with the provisions of the noncompete covenant contained herein; (c) will maintain confidentiality with respect to such information and will not, directly or indirectly, divulge, disclose or otherwise communicate to any person or entity any of such information; (d) will not make, use or retain unauthorized copies of any portion of such confidential information that may appear in writing; and (e) will adopt and implement all reasonable procedures prescribed from time to time by Company to prevent unauthorized use of disclosure of such information, including the requirement that managerial employees of Franchisee execute

That during the Term of this Agreement, Franchisee, its directors, officers, shareholders, partners, members, employees and agents will not, directly or indirectly, enter into or engage in any business as a director, officer, shareholder, proprietor, partner, consultant, employee or in any other position or capacity, which business is engaged at any location in a business the same as or substantially similar to that of a B-Bop's Restaurant (except for any other B-Bop's Restaurant owned and operated by Franchisee pursuant to a franchise agreement with Company);

In the event Franchisee is a partnership (general or limited), corporation or limited liability company on the effective date of this Agreement, or if the Franchise or any ownership interest in Franchisee is thereafter transferred to a partnership,

Source: Item 22 — CONTRACTS (FDD page 53)