What role must a Benihana franchisee designate and retain at all times?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 3.4 Franchisee must designate and retain in its employment at all times a person to serve as the "General Manager" of the Restaurant.
Franchisee shall at all times otherwise staff the Restaurant with a sufficient number of employees trained in the BENIHANA System as required by BNC.
The General Manager must satisfy BNC's educational and business criteria and must be individually acceptable to BNC.
In addition, the General Manager must be responsible for the supervision and management of the Restaurant, and must devote full time and best efforts to this activity.
The General Manager also must satisfy BNC's applicable training requirements.
If the General Manager ceases to be employed by Franchisee and available 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 and approved by BNC.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 57–58)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, a franchisee must designate and retain a General Manager for the restaurant at all times. This individual is responsible for the supervision and management of the Benihana restaurant, devoting their full time and best efforts to this role. The General Manager must also meet Benihana's educational and business criteria, as detailed in the operations manual or other written instructions, and must be individually acceptable to Benihana.
If the franchisee is an individual, Benihana recommends that they personally serve as the General Manager. However, if the franchisee is a legal entity, the General Manager is not required to have an ownership interest in the entity. Regardless of the franchisee's structure, if the current General Manager leaves their position, the franchisee must promptly appoint a replacement who meets all the necessary criteria and receives Benihana's approval. This replacement must occur no more than 120 days after the previous General Manager's departure.
Furthermore, Benihana requires franchisees to obtain covenants not to compete from the General Manager and any other personnel who receive training or have access to confidential information. These covenants also apply to anyone holding a beneficial interest in the franchise, with some exceptions for limited partners. All management personnel must sign agreements to maintain the confidentiality of information they receive or have access to through their relationship with the franchise. Benihana reserves the right to modify or eliminate these non-competition covenants at its discretion.