Under what circumstances does Benihana define a franchisee's actions as a non-curable default?

According to Benihana's 2024 Franchise Disclosure Document, certain franchisee defaults are considered non-curable, meaning Benihana can terminate the franchise agreement immediately without providing an opportunity for the franchisee to correct the issue. These situations are outlined in Sections 13.2.1, 13.2.2, 13.2.4, 13.2.9, 13.2.11, 13.2.22, 13.2.23, 13.2.25, and 13.2.26 of the Franchise Agreement.

Specifically, Benihana defines non-curable defaults as including events such as the franchisee's bankruptcy or insolvency, the appointment of a receiver or custodian for the business, or the knowing submission of false reports. Immediate failure to rectify hazardous situations, misuse of Benihana's Confidential Information or Marks, and any assignment of the Franchise Agreement that violates its terms also constitute non-curable defaults.

Furthermore, Benihana considers the commission of three or more defaults within a consecutive 12-month period as a non-curable default. Finally, a felony conviction or any offense involving fraud, dishonesty, or moral turpitude is also classified as a non-curable default, allowing Benihana to terminate the agreement immediately. These stipulations are important for prospective franchisees to understand, as they represent serious breaches of the agreement that can lead to immediate termination without a chance to rectify the situation.