What constitutes a failure to commence design, construction, equipping and process of opening a Benihana Restaurant with due diligence, according to the franchise agreement?

According to Benihana's 2024 Franchise Disclosure Document, a franchisee must commence operation of the Restaurant within twelve (12) months from the date of the Franchise Agreement. The franchise agreement states that the franchisee will be deemed to have commenced operation of the Restaurant on the date the Restaurant opens to the public, constructed, furnished, and equipped in accordance with the agreement.

This means a Benihana franchisee has a year from the date they sign the agreement to have their restaurant fully built, equipped, and open for business. Failing to meet this deadline would be considered a failure to proceed with due diligence in the design, construction, and opening process.

This requirement underscores the importance of careful planning and project management for prospective Benihana franchisees. Delays in site selection, permitting, construction, or equipment procurement could jeopardize the franchisee's ability to meet the 12-month deadline, potentially leading to a breach of the franchise agreement.