For a Brueggers Bagels franchise, what is the franchisee required to use the premises for?

r's" and "Bruegger's Bagels" and such other trade names, service marks, trademarks, logos, emblems, and indicia of origin as we may hereafter designate for use in connection with the System (the "Proprietary Marks").

• E. Franchisee understands and acknowledges the importance of Franchisor's uniformly high standards of quality and service and the necessity of operating the Bakeries in strict conformity with Franchisor's quality control standards and specifications.
• F. Franchisee wishes to obtain the right to establish and operate a Bruegger's Bakery at the Premises (as defined below);

NOW, THEREFORE, the parties agree as follows:

1. DEFINITIONS

The terms defined in the "Background" section and this Section 1 have the meanings set forth in those Sections. Other capitalized terms used in this Agreement are defined where they appear within the text of the Agreement.

• 1.1. "Bakery" means a bakery restaurant operated by us, our affiliate, or an authorized franchisee using the System and the Proprietary Marks.
  • 1.2. "BEI" means Bruegger's Enterprises, Inc., our parent company.
• 1.3. "Brand Marketing Fund" means the common pool of funds for advertising and promotion to which Bruegger's Bagels franchisees contribute and which we administer as provided in Section 14.
• 1.4. "Co-Branded Location" means a facility at which a BRUEGGER'S-branded outlet and an outlet of another brand operate in conjunction with each other.
• 1.5. "Designated Supplier" means a manufacturer, wholesaler, distributor, dealer, retailer, or other vendor or source that we designate as the source for particular for products or services.
• 1.6. "Development Agreement" means the Bruegger's Bagels Development Agreement in effect between you and us, if any.
• 1.7. "Franchisee Affiliate" means any business entity that controls, is controlled by, or is under common control with Franchisee.
• 1.8. "Gross Sales" means all sales generated through the Bakery including fees for any products or goods you sell, whether for cash or credit (regardless of collectability, except as provided below), and income of every kind or nature related to the Bakery, including, without limitation, revenues from the sale of branded merchandise and food products, whether from sales on the Premises, by delivery, from catering if the Bakery provides the product, by on-line, internet or phone-app ordering if picked up at the Bakery or at wholesale (whether the sales method is permitted or not) and from the use of vending machines or similar arcade-like machines. In the event your business operations are interrupted and you receive business interruption insurance proceeds, then the amount of Gross Sales used by you to determine your loss will be deemed the Gross Sales for that period and deemed made when you receive the insurance proceeds. "Gross Sales" does not include any sales tax or other taxes you collect from customers for transmittal to the appropriate taxing authority. Gross Sales includes the retail value of all products sold in connection with the redemption of coupons, gift certificates, gift cards or vouchers; however, at the time such coupons, gift certificates, gift cards or vouchers are purchased, the

retail price may be excluded from Gross Sales for the purpose of determining the amount of Gross Sales upon which fees are due. When calculating Gross Sales, you may deduct that portion of the normal full menu price of any item that you do not collect as a result of BFC-approved promotions (whether local or system-wide, including coupons) and manager discounts (collectively, "Sales Discounts"), as well as discounted employee meals. Sales Discounts and discounted employee meals must be fully disclosed on all reports you submit to BFC, and BFC reserves the right, in its sole discretion, to disallow any Sales Discounts not meeting the requirements we set forth. We reserve the right to modify our policies consistent with restaurant industry practices regarding revenue recognition, revenue reporting, and the inclusion in or exclusion of certain revenue from "Gross Sales" as circumstances, business practices, and technology change. We reserve the right to modify our policies consistent with restaurant industry practices regarding revenue recognition, revenue reporting, and the inclusion in or exclusion of certain revenue from "Gross Sales" as circumstances, business practices, and technology change.

• 1.9. "Non-Traditional Location" means a facility where the primary function is not a restaurant business, such as (but not limited to) a performing arts center, arena, stadium, shopping mall, department store, retail store, wholesale club, grocery store, supermarket, casino, amusement park, fairground, college or university, factory, hospital, penal institution, military base, airport, turnpike, limited access highway rest stop, or other transportation facility.
• 1.10. "Operating Partner" means the individual whose role is defined in Section 8.21 and who is identified in Exhibit A.
• 1.11. "Premises" means the location that we have approved for the Bakery, as specified in Exhibit A.
• **1.12.

Source: Item 22 — CONTRACTS (FDD page 61)