What is the Carbones Pizzeria franchisee required to do regarding the operation of the Restaurant?

nses of Franchisee's owners and employees to attend this training. Said training will be conducted at such location or locations as Franchisor shall designate. Franchisee or the representatives of Franchisee will receive no compensation or reimbursement from Franchisor for any services performed or expenses incurred by Franchisee or its representatives during any training period or seminar.

8. Opening and Operation of the Franchise.

• a. Franchisee shall operate the Restaurant from the location approved by Franchisor. Franchisee must secure the approved location within 120 days of signing this Agreement. Franchisee shall operate the Restaurant on a full-time basis and if Franchisee does not have an owner involved in the operation of the Restaurant on a fulltime basis, Franchisee shall appoint an operations manager who shall be involved in the operation of the Restaurant on a full-time basis.
• b. Franchisee shall open the Restaurant to the general public within one (1) year from the date of this Agreement. However, Franchisee may not commence operation of the Restaurant until Franchisee has satisfied all conditions set forth in this Agreement required to be satisfied by Franchisee prior to opening. If Franchisee fails to timely open the Restaurant, Franchisor may terminate this Agreement and retain all amounts Franchisee has paid to Franchisor or its affiliates.
• c. At the time this Agreement is executed by Franchisee, Franchisee shall complete the Statement of Ownership and Management attached hereto as Exhibit B, and, if Franchisee is a corporation, partnership, or limited liability company, each owner as of

the date hereof along with their spouse, as well as any future owners and their spouses, must sign Franchisor's then-current Guaranty at the time such individual becomes an owner of Franchisee, the current form of which is attached hereto as Exhibit C. Franchisee shall immediately notify Franchisor of any change in any of the information in the Statement of Ownership and Management last submitted to Franchisor. Further, upon request of Franchisor, Franchisee shall provide Franchisor with an updated Statement of Ownership and Management.

• d. Prior to opening Franchisor will provide Franchisee with its:
  • (1) Prototypical design package and approve or disapprove Franchisee's design package if different than the one provided; and
  • (2) The Manual.
• e. Franchisee shall operate the Restaurant in accordance with the Carbone System and maintain sufficient supplies of products and employ sufficient staff so as to operate the Restaurant at its maximum capacity and with maximum efficiency. The Restaurant shall be open to the general public for those days and hours as required by Franchisor, subject to applicable law and any limitations in Franchisee's lease for the Restaurant premises. Franchisee acknowledges and agrees that Franchisor has the right to add or delete items from the standard menu. Franchisee will not offer or sell any items not authorized by Franchisor, which authorization will not be unreasonably withheld.
• f. Franchisee shall ensure that all employees of Franchisee shall, while engaged in the operation of the Restaurant, wear uniforms conforming to such specifications as Franchisor shall from time to time designate for use by Franchisee, and said employees shall at all times during said employment present a neat and clean appearance and render competent, sober and courteous service to patrons of the Restaurant, and only such containers, cartons, sacks, napkins, flavorings and garnishments shall be used in the dispensing and sale of products from the Restaurant and such items shall comply with the specifications of Franchisor.
• g. Franchisee shall comply with all applicable laws affecting the operation of the Restaurant directly or indirectly. Franchisee shall pay on a timely basis all taxes required by law.
• h. Franchisee shall display the name Names and Marks specified by Franchisor on the Restaurant and on any stationery used in connection therewith and shall not display thereon the name of any other product or the name of any other person unless authorized in writing by Franchisor.
• i. Franchisee shall not obtain, use or purchase advertising of any kind without the specific consent of Franchisor. Franchisee shall adhere to the advertising and promotional requirements of Franchisor.
• j. All invoices for food, supplies, ingredients or other materials purchased from Franchisor shall be payable upon demand of Franchisor made to Franchisee, and when not paid on

demand all sums due on said invoices shall bear interest at the rate of one and a half percent (1.5%) per month; provided, however, that if any applicable state law limits the maximum legal interest rate to a lower amount, then in that event the lower interest rate will be applicable.

• k. Franchisee will keep current all mortgage, contract or lease and rental payments and equipment installment payments related to the operation of the Restaurant and shall advise Franchisor of any disputes or arguments that arise with respect to any of the foregoing.
• l. The accounts, books and records of Franchisee shall be open to inspection, examination and audit by Franchisor and its authorized representatives at all reasonable times. Any such inspection, examination and audit shall be at Franchisor's cost and expense unless the same is either necessitated by Franchisee's failure to prepare and deliver its financial statements, or to keep and preserve records as required by this Agreement, or unless such inspection discloses that any such statements made and delivered by Franchisee are in error by two percent (2%) or more of Gross Sales for any month, in either of which event such costs and expenses shall be borne and paid by Franchisee upon demand.
• m. Franchisee shall, at its sole expense, acquire and use the point-of-sale system required by Franchisor from time to time (the "POS System"). Franchisee shall, and shall ensure that, all sales of food, beverages and any other items of any kind by Franchisee shall be recorded through the POS System. Sales records produced by the POS System shall be maintained by Franchisee and open to inspection, examination and audit by Franchisor and its authorized representatives at all reasonable times.
• n. Only such vending machines as have been approved in writing by Franchisor may be installed on the premises of the Restaurant by Franchisee.
• o. The POS System shall maintain daily records indicating the Gross Sales for each day. Franchisee shall record all voided sales in the POS System. The POS System sales data, or any previous continuous cash register tapes, shall be maintained for each week and shall be preserved for at least five (5) years by Franchisee in a condition sufficient for Franchisor or its representative to be able to easily identify the week and year to which such data relates during any examination of Franchisee's records pursuant to this Agreement. Franchisee shall furnish Franchisor by the 5th of each month a full and complete sales report for the previous month. The report shall be in such form and shall require such information from Franchisee as Franchisor may require from time-to-time. In addition, Franchisee shall furnish Franchisor with a financial statement for each quarter and annually in such form as Franchisor shall require and shall further provide such other and additional financial statements as Franchisor may determine from time to time. All operating records shall be maintained and provided in accordance with Franchisor's requirements. Franchisor shall have independent direct access to all data in the POS System. Franchisor may access this data at any time and Franchisee will assist to facilitate this access.

Source: Item 23 — RECEIPTS (FDD pages 30–116)