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STANDARD FORM APPLEBEE'S NEIGHBORHOOD GRILL & BAR FRANCHISE AGREEMENT

Franchise Agreement

STANDARD FORM

                       APPLEBEE'S NEIGHBORHOOD GRILL & BAR

                               FRANCHISE AGREEMENT
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APPLEBEES INTERNATIONAL INC

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Title: STANDARD FORM APPLEBEE'S NEIGHBORHOOD GRILL & BAR FRANCHISE AGREEMENT
Date: 3/10/2006
Industry: Restaurants     Sector: Services

STANDARD FORM

                       APPLEBEE'S NEIGHBORHOOD GRILL & BAR

                               FRANCHISE AGREEMENT
, Parties: applebees international inc
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                                                                    EXHIBIT 10.2












                                  STANDARD FORM

                       APPLEBEE'S NEIGHBORHOOD GRILL & BAR

                               FRANCHISE AGREEMENT





                       -----------------------------------
                               (Location Address)


                       -----------------------------------
                                (Franchisee Name)


                       -----------------------------------
                                     (Date)



                                      F-1

<PAGE>


                                TABLE OF CONTENTS
<TABLE>
<S>      <C>    <C>                                                                                                   <C>
RECITALS       ..........................................................................................           F-3

         1.    FRANCHISE GRANT AND TERM..................................................................           F-4
         2.    UNIFORM STANDARDS.........................................................................           F-5
         3.    COMPLIANCE WITH THE SYSTEM................................................................            F-6
         4.    GENERAL SERVICES OF FRANCHISOR............................................................           F-6
         5.    RESTAURANT SYSTEM AND PROCEDURES..........................................................           F-7
         6.     TRAINING..................................................................................          F-10
         7.    RESTAURANT MAINTENANCE....................................................................          F-10
         8.    ADVERTISING...............................................................................          F-11
         9.    FEES......................................................................................          F-13
        10.    RECORD   KEEPING...........................................................................          F-15
        11.    FRANCHISEE ORGANIZATION, AUTHORITY,
              FINANCIAL CONDITION AND SHAREHOLDERS......................................................          F-15
        12.    TRANSFER..................................................................................          F-18
        13.    CONFIDENTIALITY; RESTRICTIONS.............................................................          F-22
        14.    INSPECTIONS...............................................................................          F-23
        15.    RELATIONSHIP OF PARTIES AND INDEMNIFICATION...............................................          F-25
        16.    INSURANCE.................................................................................          F-27
        17.    DEBTS AND TAXES...........................................................................          F-28
        18.    TRADE NAMES, SERVICE MARKS AND TRADEMARKS.................................................          F-28
        19.    EXPIRATION AND TERMINATION; OPTION TO
              PURCHASE RESTAURANT; ATTORNEYS' FEES......................................................          F-30
        20.    NO WAIVER OF DEFAULT......................................................................          F-35
        21.    CONSTRUCTION, SEVERABILITY,
              GOVERNING LAW AND JURISDICTION............................................................          F-36
        22.    INTERFERENCE WITH EMPLOYMENT RELATIONS....................................................          F-37
        23.    LIQUOR LICENSE............................................................................          F-37
        24.    FORCE MAJEURE.............................................................................          F-37
        25.    MISCELLANEOUS.............................................................................          F-38
        26.    ACKNOWLEDGMENTS...........................................................................          F-39


EXHIBIT 1:               ROYALTY FEE.....................................................................          F-41

APPENDIX A:              STATEMENT OF OWNERSHIP INTERESTS................................................          F-42

APPENDIX B:              REVIEW AND CONSENT WITH
                        RESPECT TO TRANSFERS............................................................          F-43

APPENDIX C:              CONFIDENTIALITY AGREEMENT.......................................................          F-44
</TABLE>

                                      F-2

<PAGE>


                       APPLEBEE'S NEIGHBORHOOD GRILL & BAR
                               FRANCHISE AGREEMENT

This Agreement is made this ________ day of _____________________,   20______, by
and    between    APPLEBEE'S    INTERNATIONAL,    INC.,    a    Delaware    corporation
("FRANCHISOR"),          _____________________________________________,          a
(_______________ corporation, sole proprietorship,   _______________ partnership,
_______________     limited    partnership    [strike    inappropriate     language])
("FRANCHISEE")             and              ______________________________________
______________________________   (collectively, the "PRINCIPAL SHAREHOLDERS" and,
individually,   a "PRINCIPAL   SHAREHOLDER"   of   Franchisee   if a   corporation   or
general   partner if   Franchisee is a limited   partnership   having as its general
partner                    a                    corporation)                     and
______________________________________________________________________________
("GENERAL PARTNER" of Franchisee if Franchisee is a limited partnership).*

    *     (If Franchisee is not a   corporation   or a sole   proprietorship,   or if
Franchisee is a limited liability company,   the parties hereto hereby agree that
an Addendum   shall be attached to this   Agreement   so as properly to reflect the
responsibilities of the partners of any general partnership, the general partner
of any limited partnership and the shareholders of any corporate general partner
of any partnership, or the members of any limited liability company.)


WITNESSETH:

                                    RECITALS

    A.    Franchisor owns the rights to develop   and   operate a unique   system of
restaurants which specialize in the sale of high quality, moderately priced food
and   alcoholic   beverages   in an   attractive,   casual   setting,   which   includes
proprietary    rights   in   certain   valuable   trade   names,    service   marks   and
trademarks,   including the service mark Applebee's   Neighborhood Grill & Bar and
variations   of such   mark,   designs,   decor and   color   schemes   for   restaurant
premises,   signs,   equipment,   procedures   and formulae for   preparing   food and
beverage   products,   specifications   for   certain   food and   beverage   products,
inventory   methods,   operating   methods,   financial control   concepts,   training
facilities and teaching techniques ("the System").

    B.    Franchisor established, through its own development and operation,   and
through the granting of franchises,   a chain of Applebee's   Neighborhood Grill &
Bar restaurants which are distinctive;   which are similar in appearance,   design
and decor; and which are uniform in operation and product consistency.

    C.    The value of Franchisor's trade names,   service marks and trademarks is
based upon: (1) the maintenance of uniform high quality   standards in connection
with the preparation and sale of Franchisor-approved food and beverage products,
(2) the uniform high standards of appearance of the individual   restaurant units
in the System, (3) the use of distinctive   trademarks,   service marks,   building
designs and advertising   signs   representing a uniformly high quality of product
and services,   and (4) the assumption by Franchisor   and its   franchisees of the

                                      F-3

<PAGE>


obligation   to maintain and enhance the goodwill   and public   acceptance   of the
System (and of Franchisor's trade names, service marks and trademarks) by strict
adherence to the high standards required by Franchisor.

    D.    Franchisor, Franchisee and the Principal Shareholders have entered into
a Development Agreement    dated     __________________,     20____    ("Development
Agreement"),    relating   to   the    development    by    Franchisee   of   Applebee's
Neighborhood Grill & Bar restaurants.

    E.    Franchisee desires   to use the System in   connection with the operation
of an Applebee's Neighborhood Grill & Bar   restaurant   at the location   which is
specified in Subsection 1.1 of this Agreement, pursuant to the terms, conditions
and provisions hereinafter set forth.

NOW, THEREFORE,   in consideration of the mutual obligations contained herein, it
is hereby agreed as follows:


1.   FRANCHISE GRANT AND TERM

    1.1   Franchisor   grants   Franchisee,   for the term stated below,   the right,
license and privilege:

         (a)   to use the   System   incident   to the   operation   of an   Applebee's
    Neighborhood Grill & Bar restaurant at   ____________________________________
    (the "Restaurant");

         (b)   to use   the   trade   names,   service   marks   and   trademarks   which
    Franchisor shall from time to time designate as part of the System, but only
    in   connection   with the sale at the   Restaurant   of   those   products   which
    Franchisor has designated and approved; and

         (c)   to hold itself out to the public as a Franchisee of Franchisor.

    1.2   The term of the franchise   shall commence as of the   Commencement Date,
as hereinafter defined, and shall end twenty (20) years thereafter,   unless this
Agreement is terminated   prior to that date in accordance   with its   provisions.
"Commencement   Date,"   as used   herein,   shall   mean the   date   upon   which   the
Restaurant   opens for business.   The parties agree to affix to this Agreement an
addendum   expressly setting forth the Commencement Date, which, when so affixed,
shall become a part of this Agreement.

    1.3   At the   expiration of the   term hereof, Franchisee shall have an option
to operate   the Restaurant for   four (4)   successive   terms   of   five (5)   years
(unless the franchise agreement with respect to that additional term   is   sooner
terminated in accordance with its provisions),   provided that immediately   prior
to each such five (5) year term (a) Franchisee   satisfies the requirements which
Franchisor   then-imposes on its new franchisees,   (b) all other restaurant units
within the System which Franchisee   then-operates   substantially   comply, in the
opinion of Franchisor, with Franchisor's then-current standards, specifications,
requirements and instructions, and (c) Franchisee executes the form of franchise
agreement which Franchisor is then using with respect to new restaurants   within

                                       F-4

<PAGE>


the System, with the amount of royalty and advertising fees payable at the rates
then-prevailing   under the franchise   agreements   which Franchisor is then using
for new   restaurants   within the System,   and Franchisee   pays to Franchisor for
each of said five (5) year periods a franchise fee equal to ten percent (10%) of
the prevailing franchise fee paid by new franchisees at that time. Any franchise
agreement which   Franchisee   executes for such additional term will also contain
options to obtain an assignment of Franchisee's   lease with a third party and/or
to purchase   certain   property or to purchase or lease the   Restaurant   premises
exercisable by Franchisor upon termination   thereof and an option to purchase or
lease the Restaurant   premises   exercisable by Franchisor upon expiration of the
renewal term (subject to any then-existing   renewal rights of Franchisee).   Such
options will   contain   provisions   substantially   similar to the   provisions   of
Franchisor's options described in Subsection 19.4 hereof.   Franchisee shall give
Franchisor   written   notice of its desire to exercise   its option to operate the
Restaurant   for an   additional   term no earlier than twelve (12) months,   and no
later than   seven (7)   months,   prior to   expiration   of the   initial   term.   If
Franchisee gives that notice,   Franchisor,   in its sole   discretion,   reasonably
exercised,   shall   determine   whether   Franchisee   has   satisfied   the foregoing
requirements.   Within   forty-five   (45) days of receiving   the notice   described
above,   Franchisor shall notify   Franchisee in writing whether or not Franchisee
is eligible to exercise the option described in this Subsection.

    1.4   During the period from the date of this Agreement to the   expiration or
earlier   termination   of   this   Agreement,   Franchisor   shall   not   establish   a
restaurant unit utilizing the System, or license another franchisee to establish
a restaurant   unit utilizing the System,   at any location within the lesser of a
three (3) mile radius of the   Restaurant or a radius from the   Restaurant   which
includes either a daytime or residential   population of forty thousand   (40,000)
or more   people.   Notwithstanding   the   foregoing,   Franchisor   may   establish a
restaurant   unit or may license a   restaurant   unit to a third party   within the
geographic   area set forth in the   preceding   sentence,   provided   that (i) such
restaurant   is located   within an   airport   (serviced   by one or more   public or
charter carrier), arena, stadium, state or national park, or military fort, post
or base,   (ii) is   located   across an   international   border,   or (iii) does not
utilize the System or utilize the   Applebee's   Neighborhood   Grill & Bar service
mark.

    1.5   Franchisee, in consideration of the benefits and privileges provided to
it by this   Agreement,   agrees to operate the Restaurant and perform as required
hereunder for the full term of this Agreement.

    1.6   This Agreement is entered into pursuant to and subject to the terms and
conditions which are set forth in the Development Agreement.


2.   UNIFORM STANDARDS

    2.1   The System is a comprehensive   restaurant   system for the   retailing of
certain   uniform and quality food and   beverage   products   (including   alcoholic
beverages),   emphasizing a varied menu of high quality,   moderately   priced food
products   (including   appetizers,    creative   sandwiches,    dinner   entrees   and
desserts),   a   selection   of   alcoholic   and other   beverages,   and   prompt   and
courteous service in a clean,   wholesome,   casual atmosphere.   The foundation of
the System is the establishment and maintenance of a reputation among the public
for the operation of high quality restaurant units. A fundamental requirement of

                                      F-5

<PAGE>


the System,   this Franchise Agreement and franchises which Franchisor will grant
to others is adherence by all franchisees to Franchisor's standards and policies
providing for the uniform   operation of all restaurant   units within the System,
including,   but not limited to, (a) selling only those products which Franchisor
has designated and approved,   (b) using only   Franchisor's   prescribed   building
layout and   designs,   equipment,   signs,   interior   and   exterior   decor   items,
fixtures and furnishings,   (c) adhering   strictly to Franchisor's   standards and
specifications   relating   to   the   selection,   purchase,   storage,   preparation,
packaging,   service and sale of all food and beverage products being sold at the
Restaurant,   and (d)   satisfying   all of   Franchisor's   prescribed   standards of
quality,   service   and   cleanliness.   Compliance   by all   franchisees   with   the
foregoing   standards and policies in   conjunction   with the use of   Franchisor's
trade names, service marks and trademarks provides the basis for the wide public
acceptance   of   the   System   and   its   valuable   goodwill.   Accordingly,   strict
adherence   by all   franchisees   to all   aspects of the System is required at all
times.

    2.2   The provisions of the Agreement   shall be interpreted to give effect to
the intent of the parties   stated in this   Section 2 to assure   that   Franchisee
shall   operate the   Restaurant   in conformity   with the System,   through   strict
adherence to   Franchisor's   standards and policies as they now exist and as they
may be modified from time to time.


3.   COMPLIANCE WITH THE SYSTEM

    Franchisee   acknowledges   that every component of the System is important to
Franchisor, to all franchisees and to the operation of the Restaurant, including
the   requirements   (a) that only those   products   designated and approved by the
Franchisor are sold at the Restaurant,   and (b) that there is uniformity of food
and beverage specifications,   preparation methods, quality, appearance, building
and interior design, color and decor, landscaping,   facilities and service among
all restaurant units in the System. Accordingly,   Franchisee agrees to and shall
comply   with   all   aspects   of the   System   (as it now   exists   and as it may be
modified from time to time).   Franchisee   recognizes and agrees that   Franchisor
may   prohibit   the use of the System and its trade   names,   notwithstanding   the
granting of this Agreement, if Franchisee fails to design,   construct,   equip or
furnish its   Restaurant   in   compliance   with the   specifications   designated by
Franchisor, unless prior written approval has been received from Franchisor.


4.   GENERAL SERVICES OF FRANCHISOR

    4.1   Franchisor   shall advise and consult with   Franchisee   periodically   in
connection with the operation of the Restaurant,   and at other   reasonable times
upon   Franchisee's   request.   Franchisor   will provide to Franchisee such of its
know-how,   new developments,   techniques and improvements in areas of restaurant
design, management,   food and beverage preparation,   sales promotion and service
concepts as may be pertinent to the construction and operation of the Restaurant
under the   System.   Franchisor   may   provide the   foregoing   information   (a) by
sending   representatives   to visit the Restaurant,   (b) by providing   written or
other   material,   (c) at meetings or seminars,   and (d) at training   sessions at
Franchisor's training facility and/or such other locations as may be selected by
Franchisor from time to time. Franchisor also shall make available to Franchisee
all additional   services,   facilities,   rights and privileges   which   Franchisor
makes available from time to time to its franchisees of the System generally.

                                      F-6

<PAGE>


    4.2   For approximately eight (8) days prior to the opening of the Restaurant
and the first six (6) days that the Restaurant is open for business,   Franchisor
shall provide Franchisee,   at Franchisor's expense, with the services of up to a
maximum of six (6) of   Franchisor's   training   personnel   to   facilitate   proper
operation   of the   kitchen,   bar and dining room areas during that period and to
assist in correcting any operational problems which may arise.   Franchisee shall
reimburse Franchisor for any additional training support required or requested.

    4.3   From time to time during the term of this   Agreement,   Franchisor   will
develop and test new menu items. The menu consists of approved national food and
beverage   selections.   Franchisee   shall   comply   with   all menu   changes   which
generally   occur every six (6) months.   The menu may be modified to reflect food
and beverage items peculiar to Franchisee's   local area, subject to Franchisor's
testing and approval.


5.   RESTAURANT SYSTEM AND PROCEDURES

    5.1   Franchisor   shall   furnish   Franchisee   with advice and   assistance   in
managing and operating the Restaurant,   and   Franchisor's   representatives   will
visit   the   Restaurant   periodically.    Franchisor   will   assist   Franchisee   in
coordinating   the   Restaurant's   pre-opening   activities,    and   as   noted   more
particularly   in   Subsection   4.2   hereof,   shall   provide   Franchisee   with the
services of certain of Franchisor's   personnel to facilitate proper operation of
the Restaurant when it opens for business.

    5.2   Franchisee    shall    designate   an   employee   who   will   supervise   the
Restaurant,   and devote his or her full time, best efforts and constant personal
attention to the day-to-day operation of the Restaurant (the "General Manager").
Franchisee   also shall   designate an employee who will   supervise the Restaurant
kitchen,   and devote his or her full time,   best efforts and   constant   personal
attention to the day-to-day   operation of the   Restaurant   kitchen (the "Kitchen
Manager").

    5.3   Franchisee shall require that the General   Manager, the Kitchen Manager
and each of Franchisee's   employees who serve as Restaurant managers to maintain
his or her principal   personal residence within a usual driving time of not more
than   approximately   one (1) hour from the Restaurant.   Franchisor   reserves the
right to require   that,   as a condition   of his or her   employment,   the General
Manager   must   successfully   complete   Franchisor's    interview   process   and   a
psychological   profile   test in a manner   which   satisfies   a   uniform   standard
established by Franchisor. The test shall be administered by Franchisor, or by a
testing agency designated by Franchisor, at Franchisee's expense.

    5.4   Unless    Franchisor   shall   have   given   its   prior   written   approval,
Franchisee   shall keep the   Restaurant   open for business   only during the hours
which are specified by Franchisor in the Franchise   Operations Manual or in such
other   materials   or   manuals   provided   or   made   available   by   Franchisor   to
Franchisee   (collectively   the   "Manuals"),   provided   that   such   hours   do not
conflict with state laws or local   ordinances   relating to the sale of alcoholic
beverages or governing the hours during which restaurant   establishments   may be
open for business. In addition, Franchisee expressly agrees to:

                                      F-7

<PAGE>


         (a)   operate   the   Restaurant   in a   clean,   safe and   orderly   manner,
    providing courteous, first-class service to the public;

          (b)   diligently   promote and   make every   reasonable effort to increase
    the business of the Restaurant;

         (c)   advertise   the   business   of   the   Restaurant   by   the   use of the
    Franchisor's   trade   names,   service   marks and   trademarks   and such   other
    insignia,    slogans,    emblems,    symbols,   designs   and   other   identifying
    characteristics   as may be   developed   or   established   from time to time by
    Franchisor   and   included   in the   Manuals,   subject to the   limitations   of
    Subsections 8.4 and 8.5 hereof;

         (d)   prohibit and, to the best of Franchisee's ability, prevent the use
    of the   Restaurant   for any   immoral   or illegal   purpose,   or for any other
    purpose,    business   activity,   use   of   function   which   is   not   expressly
    authorized hereunder or in the Manuals; and

         (e)   comply fully with all applicable laws and   regulations, including,
    but not limited to, those relating to building construction, maintenance and
    safety,   environmental,   fire prevention, food safety, public access and the
    sale of alcoholic beverages.

    5.5   Franchisee   hereby   acknowledges   receipt   and   loan of a   copy of   the
Manuals   heretofore   or   hereinafter   furnished   to   Franchisee, and   agrees   to
faithfully, completely and continuously perform, fulfill, observe and follow all
instructions,   requirements,   standards, specifications,   systems and procedures
contained   therein,   including (a) those relating to the   construction,   design,
decor,   building and   equipping   of the   Restaurant,   (b) those   relating to the
selection,   purchase, storage,   preparation,   packaging, service and sale of all
products being sold at the Restaurant, (c) those relating to the maintenance and
repair of Restaurant building,   grounds, equipment, signs, interior and exterior
decor   items,   fixtures   and   furnishings,   and (d) those   relating   to employee
uniforms   and   dress,   accounting,   bookkeeping,   record   retention,   and   other
business systems, procedures and operations. The Manuals are incorporated herein
by reference and hereby made part of this Agreement. Franchisee acknowledges and
agrees that the materials   contained in the Manuals are integral,   necessary and
material elements of the System.

    5.6   Franchisee   understands, acknowledges and agrees that strict conformity
with the System, including the standards,   specifications,   systems, procedures,
requirements and instructions contained in this Agreement and in the Manuals, is
vitally important, not only to the success of Franchisor,   but to the collective
success of all of   Franchisor's   other   franchisees,   by reason of the   benefits
which   Franchisor   and all of its   franchisees   will derive from   uniformity   in
products sold, identity, quality,   appearance,   facilities and service among all
restaurant   units which are part of the System.   Without limiting the generality
of the   foregoing   provisions,   Franchisee   agrees   to   adhere   strictly   to the
requirements in the Manuals   relating (a) to the   construction,   design,   decor,
building and equipping of the Restaurant,   (b) to the maximum   permissible ratio
of sales of alcoholic   beverages to sales of food at the Restaurant,   and (c) to
the   limitations   on the number of video games or similar   devices   which may be
placed on the   Restaurant   premises.   Any   failure   to adhere to the   standards,
specifications,    systems,    requirements   or   instructions   contained   in   this
Agreement   or in   the   Manuals   shall   constitute   a   material   breach   of   this
Agreement.

                                      F-8

<PAGE>


    5.7   Franchisor shall have the right,   at any time and from time to time, in
the good faith exercise of its reasonable business judgment, consistent with the
overall   best   interests   of the   System   generally,   having   due regard for the
financial   burden which may be placed upon its   franchisees,   to revise,   amend,
delete from and add to the System and the   material   contained   in the   Manuals.
Franchisee   expressly   agrees to   comply   with all such   revisions,   amendments,
deletions and additions.

    5.8   Franchisee shall offer for sale from the Restaurant,   at all times when
the   Restaurant   is open for   business,   only the products   which are   expressly
designated in the Manuals, except, as noted more particularly in Subsection 4.3,
to the extent that Franchisee has obtained Franchisor's prior written consent to
a modification   of that   requirement.   No product shall be offered or sold at or
from the Restaurant   under, or in connection with, any trademark or service mark
other   than   Franchisor's    designated   trademarks   and   service   marks   without
Franchisor's prior written consent.

    5.9   Franchisee   shall   obtain all food and beverage   products,   equipments,
signs, interior and exterior decor items, fixtures,   furnishings,   supplies, and
other   products   and   materials   required   for the   operation   of or sold at the
Restaurant   solely from suppliers   (including   manufacturers,   distributors   and
other   sources)   who    demonstrate,    to   Franchisor's    continuing    reasonable
satisfaction,   the   ability   to meet   Franchisor's   then-current   standards   and
specifications   for such   items;   who   possess   adequate   quality   controls   and
capacity to supply   Franchisee's needs promptly and reliably;   and who have been
approved in writing by Franchisor   and not thereafter   disapproved.   The Manuals
contain a list of approved   suppliers.   If   Franchisee   desires to purchase   any
items from an   unapproved   supplier,   Franchisee   shall   submit to   Franchisor a
written   request for such approval,   which   approval   shall not be   unreasonably
withheld,   or shall request the supplier itself to do so.   Franchisor shall have
the right to inspect the supplier's facilities, and to require that samples from
the supplier be delivered, at Franchisor's option, either to Franchisor or to an
independent,    certified   laboratory    designated   by   Franchisor   for   testing.
Franchisee   or the   supplier   shall pay the costs of any such   test.   Franchisor
shall notify   Franchisee in writing within sixty (60) days of receiving any such
request whether it disapproves the supplier.   Failure by Franchisor to so notify
Franchisee   within   that   period   shall be   deemed   to   constitute   Franchisor's
approval of such   supplier.   Franchisor   reserves the right,   at its option,   to
reinspect the   facilities and retest   products of any such approved   supplier at
any time and to revoke its approval upon the   supplier's   failure to continue to
meet any of Franchisor's criteria.   Notwithstanding the foregoing,   any supplier
of goods having any trademark, trade name, service mark, logo or symbol owned by
Franchisor   shall not be   approved   to supply   Franchisee   such goods until such
supplier   has   entered   a   written   agreement   with   Franchisor    regarding   the
production, use and sale of such goods.

    5.10 No food or beverage   product,   interior or exterior   decor item,   sign,
item of   equipment,   fixtures,   furnishings   or   supplies,   or other   product or
material   required   for the   operation   of the   Restaurant,   which   bears any of
Franchisor's trade names, service marks or trademarks,   shall be used or sold in
or upon the Restaurant   premises unless the same shall have been first submitted
to and approved in writing by Franchisor.

    5.11 The Manuals and all related material furnished to Franchisee   hereunder
are and shall   remain   the   property   of   Franchisor,   and must be   returned   to
Franchisor, along with any copies made thereof, immediately upon request or upon
the expiration or earlier termination of this Agreement.


                                      F-9

<PAGE>


6.   TRAINING

    6.1   Franchisor shall make its operations   training course   available to the
General Manager,   the Kitchen Manager,   and Franchisee's   Assistant Managers and
other Restaurant managers.

    6.2   Before the Restaurant opens for business, and thereafter as replacement
personnel are employed by Franchisee,   the General Manager,   the Kitchen Manager
and   each   Assistant   Manager   shall   attend   Franchisor's   operations   training
facility for such period of time as Franchisor shall deem reasonably   necessary,
and   shall   successfully    complete   that   course   to   Franchisor's    reasonable
satisfaction.   If the General Manager,   Kitchen Manager or an Assistant   Manager
fails   to   successfully   complete    Franchisor's    operations   training   course,
Franchisor may require designation of a new General Manager,   Kitchen Manager or
Assistant   Manager,   as the case may be, and   Franchisee   shall   designate a new
General Manager,   Kitchen Manager or Assistant Manager, who shall be required to
successfully complete such training course.

    6.3   The General Manager,   the Kitchen   Manager and each   Assistant   Manager
shall,   from time to time as   reasonably   required   by   Franchisor,   attend   and
successfully     complete    to     Franchisor's     reasonable     satisfaction     a
Franchisor-provided refresher course in restaurant operations.

    6.4   Franchisee   shall be responsible   for the   Restaurant's compliance with
the operating standards, methods, techniques and material taught at Franchisor's
operations   training course,   and shall cause the employees of the Restaurant to
be trained in such   standards,   methods and   techniques   as are   relevant to the
performance of their respective duties.

    6.5   Attendance   of the   General   Manager,   the   Kitchen   Manager   and   each
Assistant Manager at any of Franchisor's training courses shall be tuition-free.
Franchisee shall pay all other costs and expenses   relating to the attendance of
Franchisee's   personnel   at any of   Franchisor's   training   courses,   including,
without limitation,   the cost of travel,   lodging,   meals, and other related and
incidental expenses.


7.   RESTAURANT MAINTENANCE

    7.1   Franchisee   shall, at Franchisee's   sole cost and expense, maintain the
Restaurant in conformity with the standards,   specifications and requirements of
the   System,   as the same may be   designated   by   Franchisor   from time to time.
Franchisee   specifically   agrees to repair or replace,   at Franchisee's cost and
expense,    equipment,   signs,   interior   and   exterior   decor   items,   fixtures,
furnishings,   supplies,   and   other   products   and   materials   required   for the
operation   of the   Restaurant   as   necessary   or   desirable,   and to obtain,   at
Franchisee's cost and expense, any new or additional equipment,   signs, interior
and exterior decor items,   fixtures,   furnishings,   supplies, and other products

                                       F-10

<PAGE>


and materials which may be reasonably required by Franchisor for new products or
procedures.   Except as may be expressly provided in the Manuals,   no alterations
or improvements, or changes of any kind in design, equipment, signs, interior or
exterior   decor   items,   fixtures or   furnishings   shall be made in or about the
Restaurant   or   Restaurant   premises   without   the   prior   written   approval   of
Franchisor in each instance.

    7.2   In order to assure the continued   success of the Restaurant, Franchisee
shall, at any time from time to time after ________________,   _________,   (i.e.,
six [6] years   after   the date of this   Agreement)   as   reasonably   required   by
Franchisor (taking into   consideration the cost and then-remaining   term of this
Agreement),   modernize the Restaurant premises,   equipment,   signs, interior and
exterior decor items,   fixtures,   furnishings,   supplies, and other products and
materials   required   for   the   operation   of   the   Restaurant,   to   Franchisor's
then-current standards and specifications,   provided that at the time Franchisor
requires Franchisee to so modernize the Restaurant premises at least twenty-five
percent (25%) of Franchisor-owned   and operated   Restaurants meet such standards
and   specifications.   Franchisee's   obligations   under   this   Subsection   are in
addition to, and shall not relieve Franchisee from, any of its other obligations
under this Agreement, including those contained in the Manuals.

    7.3   If Franchisee   is or   becomes   a   lessee   of the   Restaurant   premises,
Franchisee shall have included in the lease provisions expressly permitting both
Franchisee and Franchisor to take all actions and make all alterations   referred
to under Subsections 7.1 and 7.2 hereof, requiring the lessor thereunder to give
Franchisor reasonable notice of any contemplated termination, and providing that
Franchisee has the unrestricted   right to assign the lease to Franchisor without
the lessor having any right to impose conditions on such assignment or to obtain
any payment in connection   therewith.   Franchisee   shall not,   without the prior
written   consent   of   Franchisor,   execute   any lease or other   agreement   which
imposes,   or purports to impose,   any   limitations   on the ability of Franchisee
and/or   of   Franchisor   to   operate   additional   restaurants   at any   particular
location   beyond the geographic   limitation set forth in Section 1.4 hereof,   or
any lease the term of which is shorter than the term of this Agreement.


8.   ADVERTISING

    8.1   Franchisor shall develop and administer   advertising,   public relations
and sales   promotion   programs   designed to promote   and enhance the   collective
success of all   restaurant   units in the   System.   It is   expressly   understood,
acknowledged   and agreed that in all phases of such   advertising   and promotion,
including,   without limitation,   type, quantity, timing, placement and choice of
media and medium, market areas, advertising agencies and public relations firms,
Franchisor's   decisions   shall be final and binding.   Franchisee   shall have the
right to   participate   actively in all such   advertising,   public   relations and
sales   promotion   programs,   but only in full and complete   accordance with such
terms and conditions as may be established by Franchisor for each such program.

     8.2 Franchisee   shall pay Franchisor,   in the manner described in Section 9
hereof, a minimum dollar amount equal to two and seventy-five hundredths percent
(2.75%) of Franchisee's   gross sales, as defined in Subsection 9.3 hereof.   Such
funds shall become the sole and absolute property of Franchisor, to be allocated
to a separate "advertising account" established by Franchisor.   Franchisor shall
use such   funds   for   market   studies,   advertising   and   marketing   studies   or
services, production of commercials, advertising copy and layouts, traffic

                                      F-11

<PAGE>


     costs, agency fees, marketing personnel, or any other costs associated with
the development,   marketing and testing of advertising,   and for the purchase of
advertising time, space or materials in national,   regional or other advertising
media, in a manner   determined by Franchisor in its sole discretion.   Within six
(6) months   following   the end of   Franchisor's   fiscal year,   Franchisor   shall
provide all franchisees with an accounting of all amounts received from them and
expended by Franchisor for the matters set forth above. In addition,   Franchisee
shall   expend a minimum   dollar   amount   equal to one and one percent   (1.0%) of
Franchisee's   gross   sales,   for local   promotional   activities,   subject to the
provisions of Subsections 8.4 and 8.5 hereof. Franchisor shall have the right at
all times to review Franchisee's books and records, and to require Franchisee to
produce evidence of its gross sales and local promotional activities,   to ensure
Franchisee's   compliance with this Section.   Any amount determined by said audit
to be due Franchisor as part of the   advertising   fee will be paid to Franchisor
by Franchisee   within ten (10) days   thereafter.   At any time after execution of
this Agreement,   Franchisor may in its sole discretion increase, to a maximum of
four percent (4%) of gross sales, the percentage of gross sales which Franchisee
shall be required to pay to Franchisor for allocation to a separate   advertising
account   pursuant to this   Subsection 8.2.   Franchisor   shall use the funds paid
pursuant to that   increased   percentage   requirement   solely for the purchase of
advertising time, space or materials in national,   regional or other advertising
media,   in a manner   determined by Franchisor in its sole   discretion,   provided
that in each   calendar   year (or other twelve [12] month period   established   by
Franchisor) in which Franchisor makes   expenditures for advertising from such an
advertising account, so long as Franchisee is in compliance with its obligations
hereunder,    Franchisor's    expenditures    for    advertising   in   the   Territory
encompassed by the Development Agreement (including expenditures for national or
regional   advertising in media which reach that   Territory)   shall be on a basis
which is roughly   proportional to Franchisee's   contribution to that advertising
account during that calendar year or other twelve (12) month period.   Franchisor
also may   increase   the   percentage   of gross   sales which   Franchisee   shall be
required to spend for local promotional activities, provided however, that in no
event shall Franchisee be required to make payments   pursuant to this Subsection
8.2 in a dollar amount in excess of five percent (5%) of gross sales.

    8.3   Franchisee   shall submit to Franchisor, for Franchisor's   approval,   an
advertising   campaign   plan   relating   to the   promotion   of the   opening of the
Restaurant   which is   sufficient   to meet the needs of the   market.   The Manuals
contain a Press   Release kit to assist   Franchisee   in this   regard.   Franchisee
shall conduct the approved   advertising   campaign and make all   expenditures for
advertising   to promote the opening of the   Restaurant   no later than sixty (60)
days after the Restaurant   opens for business.   Franchisor   will reimburse fifty
percent (50%) of Franchisee's   out-of-pocket opening advertising expenditures up
to a maximum of two thousand five hundred dollars ($2,500),   if Franchisee meets
the following criteria:

         (a)   Franchisee's   opening   advertising   expenditures   are   made within
    sixty (60) days after the opening of the Restaurant;

         (b)   Franchisee   submits to Franchisor   within one hundred twenty (120)
    days   after the   opening of the   Restaurant   documentation   for the   opening
    advertising   expenditures,   such as paid invoices from suppliers of goods or
    services evidencing expenditure on the opening advertising promotion; and

                                      F-12

<PAGE>


         (c)   Franchisee's opening advertising expenditures are made pursuant to
    the approved   advertising   campaign   plan and in   accordance   with the Grand
    Opening Reimbursement Program Policy Guidelines set forth in the Manuals.

    8.4   Nothing   in the   foregoing   Subsections   shall be   deemed   to   prohibit
Franchisee from making additional expenditures for local promotional activities.
All of the   Franchisee's   local   promotional   activities   shall utilize approved
advertising media. "Approved advertising media" are limited to the following:

         (a)   Newspapers, magazines and other such periodicals;

         (b)   Radio and television;

         (c)   Outdoor advertising by signs displayed on billboards or buildings;
    and

         (d)   Handbills, flyers, door-hangers and direct mail.

In the event Franchisee wants to use a form of advertising   medium not set forth
above,   Franchisee   shall submit a description of such medium and advertising to
Franchisor.   Franchisor shall notify   Franchisee   whether it approves the use of
such   medium   within   thirty   (30)   days of   Franchisee's   request.   Failure   by
Franchisor   to so   notify   Franchisee   within   that   period   shall be   deemed to
constitute    Franchisor's   approval   of   such   request.    Guidelines   for   local
promotional   activities   are   contained in the Manuals,   including   Franchisee's
required participation in any co-operative marketing program.

    8.5   All   advertising   copy and   other   materials   employed by Franchisee in
local promotional   activities shall be in strict accordance and conformity   with
the standards, formats   and specimens contained in the Manuals and shall receive
the prior approval of Franchisor. In the event Franchisee wishes to deviate from
the   materials contained in   the   Manuals,   Franchisee   shall   submit,   in   each
instance, the proposed advertising copy and materials to Franchisor for approval
in advance of publication. Franchisor shall notify Franchisee in writing, within
fifteen   (15)   days of such   submission,   whether   Franchisor   disapproves   such
advertising   copy and materials.   Failure by Franchisor to so notify   Franchisee
within that period shall be deemed to constitute   Franchisor's   approval of such
advertising   copy and   materials.   In no event   shall   Franchisee's   advertising
contain any statement or material   which may be   considered   (a) in bad taste or
offensive to the public or to any group of persons, (b) defamatory of any person
or an   attack   on   any   competitor,   (c)   to   infringe   upon   the   use,   without
permission,   of any   other   persons'   trade   name,   trademark,   service   mark or
identification,   or (d)   inconsistent   with the public image of Franchisor or of
the System.


9.   FEES

    9.1   As partial consideration for the rights granted   hereunder,   Franchisee
shall pay Franchisor:

                                      F-13

<PAGE>


         (a)   an   initial    franchise   fee   of    _____________________    dollars
    ($__________),   to be paid in the manner prescribed in Subsection 4.l of the
    Development Agreement as payment for the grant of the franchise;

         (b)   a monthly royalty fee as determined by   Franchisor,   not to exceed
    five   percent (5%) of each   calendar   month's   gross   sales,   as provided in
    Subsection 4.3 of the   Development   Agreement,   as payment for   Franchisee's
    continuing   right to   operate   the   Restaurant   as part of the   System   (see
    Exhibit 1); and

         (c)   a   monthly   advertising   fee   equal   to   such   percentage of   each
    calendar   month's   gross   sales   as    Franchisor   may   require   pursuant   to
    Subsection 8.2 hereof.

     9.2 The fees referred to in   Subsections   9.l(b) and (c) (the "Fees") shall
be paid by check on or before the twelfth day of the next full month immediately
following   the month to which the Fees relate.   Any Fees,   including the initial
franchise   fee,   which are not paid when due shall bear   interest from and after
the due dates   thereof at the rate of   eighteen   percent   (18%) per annum or the
highest rate permitted by applicable law, whichever is less.

     9.3 (a) Except for the sale of a gift card (on which   royalty   shall be due
and payable   upon   redemption   of the gift card and as   provided   in   Subsection
9.3(b) hereof, the term "gross sales," as used in this Agreement, shall mean all
receipts   (cash,   cash   equivalents   or credit) or revenues   from sales from all
business   conducted upon or from the Restaurant   premises,   whether evidenced by
check, cash, credit, charge account,   exchange or otherwise,   including, but not
limited   to,   amounts   received   from the sale of goods,   wares and   merchandise
(including   sales of food   beverages   and   tangible   property   of every kind and
nature,   promotional or otherwise),   from all services   performed from or at the
Restaurant   premises,   and from all orders   taken or received at the   Restaurant
premises,   regardless   of where such orders are filled   (including   any payments
received from the sale of meals to employees).   Gross sales shall not be reduced
by any deductions for cash shortages incurred in connection with the transaction
of   business   with   customers,   credit   card   company   charges or theft which is
reimbursed   by   insurance   or   is   not   reported   to   the    appropriate    police
authorities.   Each charge or sale upon installment or credit shall be treated as
a sale for the full price in the month during which such charge or sale shall be
first made,   irrespective   of the time when   Franchisee   shall   receive   payment
(whether full or partial) therefor.

          (b) Gross sales shall not   include:   (i) the sale of   merchandise   for
     which cash has been refunded or, except as provided in the second   sentence
     of Subsection 9.3(a), not received, or allowances made for merchandise,   if
     the sales of any such   returned or   exchanged   merchandise   shall have been
     previously   included   in gross   sales,   (ii) the   amount   of any   sales tax
     imposed by any federal,   state,   municipal or other governmental   authority
     directly on sales and intended to be   collected   from   customers,   provided
     that the amount   thereof is added to the selling price and actually paid by
     the   Franchisee   to   such   governmental    authority,    (iii)   the   sale   of
     merchandise   for which a gift card is redeemed,   if the initial sale of the
     gift card shall have been previously included in gross sales, (iv) the sale
     of waste   products   of the   Restaurant,   (v)   telephone,   game and   vending
     machine   revenues,   (vi)   the sale of   non-food   items   or   beverages   at a
     discount in connection with a promotional campaign,   (vii) one-time sale of
     furniture,   fixtures or equipment, and (viii) theft which is not covered by
     insurance   and   is   reported   to the   appropriate   police   authorities.   In
     addition,   Franchisor   may, from time to time, in writing,   permit or allow
     certain other items to be excluded from gross sales. Any such permission or
     allowance may be revoked or withdrawn at Franchisor's discretion.

                                      F-14

<PAGE>


10. RECORD KEEPING

    10.1 Franchisee   shall employ a point of sale system approved by Franchisor,
without   modification,   in   connection   with   the   business   of the   Restaurant.
Franchisee   shall use such   bookkeeping   and   record   keeping   forms as shall be
prescribed in the Manuals.

    10.2 Franchisee   shall   complete   and submit to   Franchisor,   on a   regular,
continuous   basis, each of the following   reports,   in the form specified in the
Manuals:

         (a)   monthly   Restaurant   reports, on or before the twelfth day of each
    calendar month following the month to which the report relates;

         (b)   annual Restaurant reports, on or before the fifteenth day of April
    of each year; and

         (c)   weekly gross sales reports, on or before the Tuesday following the
    calendar week to which the report relates.

    10.3 The annual Restaurant reports referred to above shall include a balance
sheet dated as of the end of   Franchisee's   fiscal   year or calendar   year and a
profit and loss statement for such year, together with such additional financial
information as Franchisor may reasonably request.   Such balance sheet and profit
and loss   statement   shall be prepared in   accordance   with   generally   accepted
accounting   principles,   certified as correct and complete by Franchisee's chief
executive officer, president, chief financial officer or controller and reported
on and reviewed by an independent state-licensed certified public accountant. If
Franchisee   fails to provide   Franchisor   with such balance sheet and profit and
loss   statement,   Franchisor   shall have the right to have an independent   audit
made of Franchisee's books and records,   and Franchisee shall promptly reimburse
Franchisor for the cost thereof.

    10.4 Each of the reports   referred to in this   Section 10 shall be completed
by   Franchisee   or its   accountant   in the   respective   specimen   forms,   and in
accordance   with the   instructions,   contained in the Manuals.   Subsection   10.3
notwithstanding,   time is of the   essence   with   respect to the   completion   and
submission of each such report.


11. FRANCHISEE ORGANIZATION, AUTHORITY, FINANCIAL CONDITION AND SHAREHOLDERS

    11.1 Franchisee and each Principal   Shareholder   represent and warrant that:
(a) Franchisee is a corporation duly incorporated,   validly existing and in good
standing   under the laws of the State of its   incorporation;   (b)   Franchisee is
duly   qualified   and is   authorized   to do business and is in good standing as a
foreign corporation in each jurisdiction in which its business activities or the
nature   of the   properties   owned by it   requires   such   qualification;   (c) the

                                      F-15

<PAGE>


execution and delivery of this Agreement and the transaction contemplated hereby
are within Franchisee's   corporate power; (d) the execution and delivery of this
Agreement   has been duly   authorized   by the   Franchisee;   (e) the   articles   of
incorporation   and   by-laws of   Franchisee   delivered   to   Franchisor   are true,
complete   and   correct,   and there have been no changes   therein   since the date
thereof;   (f) the   certified   copies of the   minutes   electing   the   officers of
Franchisee   and   authorizing   the execution   and delivery of this   Agreement are
true,   correct and   complete,   and there have been no changes   therein since the
date(s) thereof; (g) the specimen stock certificate delivered to Franchisor is a
true   specimen of   Franchisee's   stock   certificate;   (h) the   balance   sheet of
Franchisee   as of   ____________________,   ________   ("Balance   Sheet")   and   the
balance   sheets   of   its   Principal   Shareholders   as   of   ____________________,
________,   heretofore   delivered to Franchisor,   are true, complete and correct,
and fairly   present the   financial   positions of Franchisee   and each   Principal
Shareholder,   respectively,   as of the dates thereof;   (i) the Balance Sheet and
each such balance sheet have been prepared in accordance with generally accepted
accounting principles;   and (j) there have been no materially adverse changes in
the condition,   assets or   liabilities   of Franchisee or Principal   Shareholders
since the date or dates thereof.

    11.2 Franchisee and each Principal Shareholder covenant that during the term
of this   Agreement:   (a)   Franchisee   shall do or   cause   to be done all   things
necessary to preserve and keep in full force its   corporate   existence and shall
be in good standing as a foreign   corporation in each   jurisdiction in which its
business   activities or the nature of the   properties   owned by it requires such
qualification;   (b) Franchisee   shall have the corporate   authority to carry out
the terms of this   Agreement;   and (c) Franchisee   shall print, in a conspicuous
fashion on all   certificates   representing   shares of its stock when   issued,   a
legend   referring to this Agreement and the   restrictions   on and obligations of
Franchisee and Principal Shareholders   hereunder,   including the restrictions on
transfer of Franchisee's shares.

    11.3 In addition to the financial   information   which Franchisee is required
to provide to Franchisor under Subsections 10.2 and 11.1 hereof,   Franchisee and
Principal   Shareholders   shall   provide   Franchisor   with such   other   financial
information as Franchisor may reasonably   request from time to time,   including,
on an annual basis,   copies of the   then-most   current   financial   statements of
Franchisee   and   each   Principal   Shareholder,   dated   as of the end of the last
preceding   fiscal   year   of   the   Franchisee   or   Principal   Shareholder,    said
statements   to be delivered to   Franchisor   no later than April 15 of each year,
which   financial   statements   shall   conform   to   the   standards   set   forth   in
Subsection 11.1 hereof.

    11.4 Franchisee   and   each   Principal   Shareholder   represent,   warrant   and
covenant that all Interests (as defined in Subsection 12.4 hereto) in Franchisee
are owned as set forth on Appendix A hereto,   that no Interest   has been pledged
or hypothecated   (except in accordance with Section 12 of this   Agreement),   and
that no change will be made in the ownership of any such Interest   other than as
permitted by this Agreement, or otherwise consented to in writing by Franchisor.
Franchisee   and Principal   Shareholders   agree to furnish   Franchisor   with such
evidence   as   Franchisor   may   request,   from time to time,   for the   purpose of
assuring Franchisor that the Interests of Franchisee and Principal   Shareholders
remain as represented herein.

    11.5 Each Principal   Shareholder,   jointly and severally,   hereby personally
and   unconditionally   guarantees each of Franchisee's   financial   obligations to
Franchisor   (including,   but not   limited   to, all   obligations   relating to the
payment of fees by Franchisee to Franchisor).   Each Principal Shareholder agrees

                                      F-16

<PAGE>


that   Franchisor may resort to such Principal   Shareholder   (or any of them) for
payment of any such financial   obligation,   whether or not Franchisor shall have
proceeded   against   Franchisee,   any other   Principal   Shareholder   or any other
obligor   primarily or secondarily   obligated to Franchisor   with respect to such
financial   obligation.    Each   Principal   Shareholder   hereby   expressly   waives
presentment,   demand,   notice   of   dishonor,   protest,   and   all   other   notices
whatsoever   with   respect   to   Franchisor's   enforcement   of this   guaranty.   In
addition,    each   Principal   Shareholder   agrees   that   if   the   performance   or
observance by   Franchisee of any term or provision   hereof is waived or the time
of performance thereof extended by Franchisor,   or payment of any such financial
obligation is accelerated in accordance   with any agreement   between   Franchisor
and any party liable in respect   thereto or extended or renewed,   in whole or in
part, all as Franchisor   may   determine,   whether or not notice to or consent by
any Principal Shareholder or any other party liable in respect to such financial
obligations   is given or obtained,   such   actions   shall not affect or alter the
guaranty of each Principal Shareholder described in this Subsection.

    11.6 Franchisee   and   each   Principal   Shareholder   represent and warrant to
         Franchisor that:

         (a)   Neither   Franchisee   nor any   Principal   Shareholder   or any other
         person with a direct or indirect   ownership   interest in   Franchisee is
         identified,   either by name or an alias,   pseudonym or nickname, on the
         list of "Specially Designated Nationals and Blocked Persons" maintained
         by the U.S.   Treasury   Department's   Office of Foreign   Assets   Control
         (texts available at www.treas.gov/offices/enforcement/ofac/).   Further,
         Franchisee   and its Principal   Shareholders   represent and warrant that
         neither has   violated   and agree that   neither will violate any law (in
         effect now or which may become   effective   in the   future)   prohibiting
         corrupt business   practices,   money laundering or the aid or support of
         persons or entities who   conspire to commit acts of terror   against any
         person or government, including acts prohibited by the U.S. Patriot Act
          (text available at   http://www.epic.org/privacy/terrorism/hr3162.html),
         U.S.       Executive       Order      13244      (text      available      at
         http://treas.gov/offices/enforcement/ofac/sanctions/terrorism.html), or
         similar law;

         (b)   Franchisee has not made, nor has any Principal   Shareholder   made,
         any   expenditures   other   than   for   lawful   purposes   or   directly   or
         indirectly offered, gave, promised to give or authorized the payment or
         the gift of any money,   or anything of value,   to any person or entity,
         while   knowing   or having   reason to know that all or a portion of such
         money   or thing of value   would   be   given   or   promised,   directly   or
         indirectly,   to any government   official,   official of an international
         organization,   officer or   employee of a foreign   government   or anyone
         acting   in an   official   capacity   for a   foreign   government,   for the
         purpose of (1)   influencing   any   action,   inaction or decision of such
         official   in a manner   contrary   to his or her   position or creating an
         improper   advantage;   or (2) inducing   such   official to influence   any
         government or instrumentality thereof to effect or influence any act or
         decision of such government or instrumentality.

         (c)   Franchisee   nor any Principal   Shareholder   or any other person or
         entity who has any direct or   indirect   ownership   interest   is or will
          become   directly or   indirectly   owned or   controlled   by   governmental
         authorities of any country that is subject to a United States   embargo;
         and

                                      F-17

<PAGE>


    Franchisee   understands and its Principal   Shareholders   understand and have
been advised by legal counsel on the   requirements   of the United States Foreign
Corrupt          Practices         Act         (currently          located         at
www.usdoj.gov/criminal/fraud/fcpa.html, any local foreign corrupt practices laws
and        the         Patriot        Act         (currently         located        at
www.epic.org/privacy/terrorism/hr3162.html,    acknowledge    the    importance   to
Franchisor and the Restaurants and the parties' relationship of their respective
compliance   with   the   requirements   of these   laws,   including   any   applicable
auditing   requirements   and any   requirement   to   report   or   provide   access to
information to Franchisor or any government, that is made part of any applicable
law,   and agree to take all steps   required   by their   consultants,   agents   and
employees   to comply   with such laws prior to   engaging   or   employing   any such
individuals or entities.


12. TRANSFER

    12.1 There   shall be no   Transfer of any   Interest   of   Franchisee,   or of a
Principal Shareholder in Franchisee, in whole or in part (whether voluntarily or
by operation of law), directly, indirectly or contingently, except in accordance
with the provisions of this Section 12. "Transfer" and "Interest" are defined in
Subsections   12.2, 12.3 and 12.4. Any proposed Transfer also shall be subject to
the provisions of the Development   Agreement,   which are incorporated   herein by
reference.

    12.2 Except as   provided   in   Subsection   12.3,   "Transfer"   shall   mean any
assignment,   sale,   pledge,   hypothecation,   gift or any other event which would
change   ownership   of or   change or create a new   Interest,   including,   but not
limited to:

         (a)   any change in the   ownership   of or rights in or to any   shares of
    stock or other equity interest in Franchisee which would result from the act
    of any shareholder of Franchisee ("Shareholder"),   such as a sale, exchange,
    pledge or   hypothecation   of shares,   or any interest in or rights to any of
    Franchisee's   profits,   revenues or assets,   or any such change   which would
    result by operation of law; and

         (b)   any change in the percentage interest owned by any   Shareholder in
    the shares of stock of Franchisee,   or interests in its profits, revenues or
    assets which would result from any act of Franchisee such as a sale,   pledge
    or hypothecation of any Restaurant   assets (other than a pledge of assets to
    secure   bona   fide   loans   made   or   credit    extended   in   connection   with
    acquisition   of the assets   pledged,   provided that   immediately   before and
    after such   transaction   the net worth of Franchis


 
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