Regarding the Bonchon Area Development Agreement, what is the effect of tendering the agreement to a potential area developer?

referenced above. The System makes use of the mark "Bonchon" and certain other trademarks, service marks, trade names, related emblems, designs, labels, trade dress, signs and symbols, copyrighted materials and other intellectual property (together, the "Proprietary Marks").

1.02 The Area Franchise

You wish to obtain the right to acquire and operate no fewer than two Bonchon Businesses in the geographical territory (the "Development Territory") defined below and set forth in Exhibit A to this Agreement and pursuant to a development schedule (the "Development Schedule") defined and set forth in Section 6.01 of this Agreement. We wish to grant you the right to acquire and operate no fewer than two Bonchon Businesses in the Development Territory and pursuant to the Development Schedule upon the terms and subject to the conditions set forth in this Agreement.

2. GRANT OF AREA DEVELOPMENT RIGHTS

2.01 Area Development Rights

We grant you, and you accept, the right to and obligation to acquire and operate no fewer than two Bonchon Businesses in the Development Territory and pursuant to the Development Schedule upon the terms and subject to the provisions of this Agreement (the "Area Development Business") and the terms of each Unit Franchise Agreement (referred to individually as a "Franchise Agreement" and collectively as the "Franchise Agreements") entered into between you and us, and all agreements related to the Franchise Agreements.

3. TERRITORY

3.01 Territorial Grant

You undertake to own and operate the Bonchon Businesses listed in Section 6.01 of this Agreement within the Development Territory set forth by map or written description in Exhibit A of this Agreement. If we use both a written description and a map to define your Development Territory, you acknowledge and expressly agree that should there be a conflict between the written description and the map, the written description will control. Pursuant to the Franchise Agreements which this Agreement contemplates will be entered into between you and us, your right to operate a Bonchon Business will be limited to each of the Protected Territories (as defined in the Franchise Agreement) that we will grant you under the Franchise Agreement for each respective Bonchon Business that you obtain the right to develop hereunder.

3.02 Our Restrictions

For so long as this Agreement is in effect, neither we nor any affiliate (meaning any individual or entity we control, which controls us or which is under common control with us, together our "affiliates") will, within the Development Territory, operate or grant a franchise for a restaurant business operated under the Proprietary Marks of the type franchised to you hereunder, or a similar or competitive business, except as provided in Section 3.03 ("Rights We Reserve"). These restrictions, which are subject to the Trade Area Satisfaction Exception (as defined below), will terminate immediately upon the expiration or termination of this Agreement for any reason. Notwithstanding the foregoing, you acknowledge, understand and expressly agree that if your Development Territory is comprised of various geographic trade areas within a particular or one or more cities, states or regions and we designate a specific number of Businesses that you may develop or operate within each geographic trade area, your exclusive right to develop and operate Bonchon Businesses within a certain geographic trade area will terminate once you have developed the specified number of Bonchon Businesses in the subject geographic trade area. For the avoidance of doubt, if your Development Territory includes City A, City B and City C and we grant you the right to develop two Bonchon Businesses in each city, then your right to develop Bonchon Businesses in City A will cease once you developed and commenced operations of two Bonchon Businesses. Accordingly, we will have the right to develop and operate or grant a third party the right to develop and operate additional Bonchon Businesses in City A, even if you have not fully satisfied your development obligations under Section 6.01 of this Agreement with respect to the other geographic territories within the Development Territory (e.g. in City B and City C) (the "Trade Area Satisfaction Exception"); provided, however that neither we nor any third party will have the right to develop and operate a Bonchon Business within the Protected Territory granted under the Franchise Agreement for each of the Bonchon Restaurants that you developed in City A pursuant to this Agreement except as we are otherwise permitted in Section 3.03 below or under the Franchise Agreement.

Outside of the Development Territory, we and/or our affiliates reserve the right to operate any number of Bonchon Businesses, and/or authorize others to operate same, at any location whatsoever (including one or more locations that may be proximate to, but not within, the Development Territory).

You acknowledge that this Agreement confers no marketing exclusivity in the Development Territory on you, and that all Bonchon Businesses (whether Company-owned, Company joint-ventured, franchised or otherwise) may solicit, service, advertise and offer their products and services to any individual or entity, regardless of your or its geographic location, including your Development Territory.

3.03 Rights We Reserve

You agree that we and/or our affiliates may engage in any business activity whatsoever in or outside the Development Territory except as we are restricted by Section 3.02 of this Agreement, and that this Agreement does not confer upon you any right to participate in or benefit from any such other business activity (regardless of whether it is conducted under the Proprietary Marks or not). Our rights to engage in other business activities are specifically reserved and may not be qualified or diminished in any way by implication. We thus may engage in, or authorize others to engage in, any form of business offering and selling any type of product or service except as we are restricted by Section 3.02 of this Agreement. By way of example, we and/or our affiliates may own, operate or authorize others to own or operate any type of business at any location we choose, including within your Development Territory, so long as such other business does not sell under the Proprietary Marks the type of products or services which your Bonchon Businesses offer and sell (except as permitted below). Further, we and/or our affiliates may own, operate or authorize others to own or operate Bonchon Businesses at any location outside of your Development Territory (including immediately proximate thereto).

In addition, you understand and agree that we and/or our affiliates alone have the right to offer and sell within and outside your Development Territory, and under the Proprietary Marks, any and all products or services and/or components or ingredients thereof, (including those used or sold by your Bonchon Businesses), and whether or not a part of the Bonchon System, through any alternate channels of distribution, that is, any method of distribution other than a Bonchon Business situated within your Development Territory including, without limitation, the internet/worldwide web;

Source: Item 23 — RECEIPTS (FDD pages 92–536)