• E. BNC has expended time, effort, and money to acquire develop experience and skill in the elements, implementation, and updating of the BENIHANA System and the BENIHANA Standards, and BNC continues to develop, use, and control the use of the Marks to identify to the public the source of services and products marketed and offered at BENIHANA Restaurants and to represent the high standards of quality, cleanliness, appearance, and service that are part of the BENIHANA System.
• F. Franchisee understands and acknowledges the importance of the BENIHANA System and the BENIHANA Standards relating to product quality, cleanliness, appearance, and customer service that are a critical part of the BENIHANA System, and Franchisee acknowledges the necessity of operating the BENIHANA Restaurant franchised under this Agreement in conformity with the BENIHANA System, including the BENIHANA Standards.
• G. Franchisee seeks a license to use the Marks and the BENIHANA System in connection with the operation of a BENIHANA Restaurant at a single location specified in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Agreement and other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

ARTICLE 1. GRANT OF FRANCHISE AND FRANCHISE TERM

• 3.1 BNC will make the BENIHANA Standards available to Franchisee in the Operations Manual (as defined in Section 4.1 of this Agreement) and in other forms of communications that BNC, in its sole discretion, may modify at any time during the Franchise Term.
• 3.2 Franchisee must comply with the BENIHANA System and operate the Restaurant in accordance with the BENIHANA Standards. Franchisee acknowledges that compliance with the BENIHANA System, the BENIHANA Standards, and the provisions of the Operations Manual are reasonable requirements necessary to promote the goodwill associated with the BENIHANA System and the Marks to the mutual benefit of BNC, Franchisee, and other franchisees of BENIHANA Restaurants. Franchisee further acknowledges that complete uniformity may not always be possible or practical throughout all BENIHANA Restaurants, and BNC may, from time to time, permit certain deviations from the BENIHANA System or the BENIHANA Standards by Franchisee or other franchisees, as BNC deems appropriate in its sole discretion.

• 3.3 Franchisee will use the Location solely for the operation of the Restaurant, and Franchisee must not, during the Franchise Term conduct, or permit others to conduct, any business activity at the Restaurant or the Location other than the operation of a BENIHANA Restaurant.

• 3.3.1 Franchisee will not operate, permit, or grant any concession or license to operate at the Restaurant or the Location any vending machines, video or entertainment machines, games of skill, games of chance, or other similar device, without the specific and prior written consent of BNC.

• 3.4 The Restaurant must be open for, at a minimum, the hours and days specified or approved by BNC in writing, which hours may be changed from time to time by BNC.

• 3.5 Franchisee must designate, and retain in its employment, a person to serve as the "General Manager" of the Restaurant; and the General Manager must be responsible for, and devote his or her full time and best efforts to, supervision and management of the Restaurant.

Franchisee also must otherwise staff the Restaurant with a sufficient number of employees trained in the BENIHANA System as required by BNC.

Franchisee also must otherwise staff the Restaurant with a sufficient number of employees trained in the BENIHANA System as required by BNC.

• 3.5.1 The General Manager must satisfy BNC's educational and business criteria and applicable training requirements and be individually approved by BNC.

If the General Manager ceases to be employed by Franchisee or is otherwise unavailable to manage the Restaurant, Franchisee must promptly, and in no event more than 120 days later, designate another person as General Manager, and that person must meet all criteria for a General Manager and be acceptable to and approved by BNC.

• 3.6 Franchisee must, at its expense, continuously during the Franchise Term, maintain the Restaurant in good condition and repair in accordance with the BENIHANA Standards.

The required maintenance, includes, but is not limited to, the replacement of worn carpeting or flooring, repainting and repair of walls, floors, wood trims, or ceilings, as needed, or the repair, refurbishment, or replacement of any damaged or worn fixtures, furniture, or decorative items, including all components of BNC's trade dress.

• 3.7 Franchisee may use in the Restaurant only those brands, types, and models of signs displaying the Marks, equipment, or fixtures approved by BNC and that meet all BNC specifications Franchisee must purchase approved brands, types, and models of equipment, fixtures, and signs only from approved suppliers, unless otherwise agreed in writing by BNC.

• 3.8 Franchisee must purchase, install, and maintain, at its expense, a point of sale data processing system and software as designated or approved from time to time by BNC (the "POS System).

The POS System must contain a device that records accumulated sales that cannot be turned back or reset, and it must include a back-up power system for memory storage in the event of power loss.

The POS System must provide a record of products sold, a menu mix report, and other reports required by BNC.

• 3.8.1 BNC has the right to retrieve all data and information directly from Franchisee's POS System as BNC deems necessary.

Franchisee is responsible for the telephonic or transmission costs of such retrieval.

• 3.17 Franchisee must operate the Restaurant in compliance with all applicable local, state, and federal laws, and compliance with those laws is a requirement of compliance with the BENIHANA Standards and the BENIHANA System. Franchisee must provide to BNC, within five (5) business days of receipt by Franchisee, all reports of any governmental agency related to the Restaurant, specifically including, but not limited to, reports of inspections by any health department or any agency with regulatory or supervisory jurisdiction over the Restaurant.
• 3.18 Franchisee must at all times during the Franchise Term comply with Payment Card Industry Data Security Standards Requirements ("PCI DSS"), and any other similar requirements or specifications designated by BNC.

ARTICLE 14. OBLIGATIONS UPON TERMINATION OR EXPIRATION

• 14.1 Upon termination or expiration of this Agreement for any reason, all rights granted to Franchisee under this Agreement will immediately terminate, and Franchisee must strictly comply with the following obligations:
• 14.1.1 Franchisee must immediately cease operating the Restaurant or using the fixtures, displays, decorations, stationery, forms, advertising materials, and other articles used in connection with the Restaurant.
• 14.1.2 Franchisee must immediately and permanently cease using in any manner whatsoever: (i) any Confidential Information; (ii) the BENIHANA System, and any of BNC's methods, procedures, and techniques associated with the BENIHANA System; and (iii) the BENIHANA trade dress and distinctive forms, slogans, signs, symbols and devices associated with the BENIHANA System.
• 14.1.3 Franchisee must, within five (5) days of expiration or termination, deliver to BNC all manuals, including the Manual, and all other records, correspondence, and instructions containing Confidential Information, or other information relating to the operation of the Restaurant, all of which are acknowledged to be BNC's property, and Franchisee will not keep any copy or record of any of the foregoing, with the exception of Franchisee's copy of this

Agreement, any correspondence between the parties, and any other documents Franchisee reasonably needs for compliance with any provision of law.

• 14.1.4 Franchisee must immediately and permanently cease using in any manner the Marks, or any confusingly similar trademark, service mark, trade name, or insignia.
• 14.1.5 Franchisee must not directly or indirectly identify itself in any manner as a franchisee, or former franchisee, of BNC or as an authorized user of the BENIHANA System or the Marks.
• 14.1.6 Franchisee must furnish BNC with evidence satisfactory to BNC of Franchisee's compliance with Franchisee's obligations under Sections 14.1.3, 14.1.4, and 14.1.5 within seven (7) days after termination or expiration of this Agreement.
• 14.1.7 Franchisee must immediately make or cause to be made modifications and alterations to the Restaurant to distinguish the appearance of the Restaurant from that of other BENIHANA Restaurants, including all specific changes BNC may request for that purpose. Franchisee must furnish BNC with evidence satisfactory to BNC of Franchisee's compliance with this obligation within seven (7) days after termination or expiration of this Agreement.
• 14.1.7.1 If Franchisee fails to comply with the requirements of this Section 14.1.7, in addition to any other rights BNC has under this Agreement, BNC has the right to enter upon the premises where the Restaurant was operated, without being guilty of trespass or any other tort, for the purpose of making or causing to be made, at Franchisee's expense, the changes required by this Agreement.
• 14.1.8 Franchisee must promptly pay all sums owing to BNC and its subsidiaries and affiliates.
• 14.1.9 Franchisee must take all actions necessary to cancel any assumed names or equivalent registrations containing any of the Marks.
• 14.1.10 Franchisee must: (i) at BNC's option, assign to BNC, or its designee, any interest Franchisee has in any lease for the Location and the Restaurant; and (ii) take all steps necessary to assign to BNC or its designee the telephone numbers used in connection with operating the Restaurant as provided in the Conditional Assignment of Telephone Numbers attached as Exhibit C hereto.

Source: Item 23 — Receipts (FDD pages 74–576)