IN THE UNITED STATES BANKRUPTCY COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

In re:

TGI Friday’s Inc., et al.,

1

Debtors.

Chapter 11

Case No. 24-80069-sgj11

(Jointly Administered) 

SUPPLEMENTAL ORDER APPROVING (I) BIDDING PROCEDURES, 

THE SALE TIMELINE, AND THE FORM AND MANNER 

OF NOTICE THEREOF; (II) THE DEBTORS’ ENTRY INTO AND 

PERFORMANCE UNDER THE STALKING HORSE APA; (III) ASSUMPTION 

AND ASSIGNMENT PROCEDURES; AND (IV) GRANTING RELATED RELIEF

1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification 

number are: TGI Friday's Inc. (7117); TGI Friday's NY, LLC (2281); TGIF Holdings, LLC (7999); TGIF Midco, 

Inc. (7296); TGIF Parent, Inc. (1781); Burlington Towne Crossing, Inc. (7501); T G I Friday's of Greenbelt, Inc. 

(5617); T G I Friday's of Towson, Inc. (5450); T G I Friday's of Wisconsin, Inc. (7600); T.G.I. Friday's Marketing 

Advisory Council (6527); T.G.I. Friday's of Charles County, Inc. (3516); T.G.I. Friday's of Frederick County, 

Inc. (2547); T.G.I. Friday's of Harford County, Inc. (0072); T.G.I. Friday's of Washington County, Inc. (6174); 

TGI Friday's of Annapolis, Inc. (8315); TGI Friday's of Howard County, Inc. (0119); TGI Friday's of Rockville, 

Inc. (2004); TGI Friday's of Texas LLC (3931); TGI Friday's of the Rockies, Inc. (7885); TGIF/DFW Manager, 

LLC (N/A); TGIF/DFW Partner, LLC (N/A); TGIF/JDC Restaurant Development, LLC (N/A); WEBCO 

Products Incorporated (3014). The Debtors’ service address is 19111 North Dallas Parkway, Suite 200, Dallas, 

TX 75287.

Signed December 6, 2024

______________________________________________________________________

The following constitutes the ruling of the court and has the force and effect therein described.

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Upon consideration of the motion (the “Motion”)2 of the above-captioned debtors and 

debtors in possession (collectively, the “Debtors”) for, inter alia, the entry of an Order: 

(i) approving certain bidding procedures for the Sale (collectively, the “Bidding Procedures”), and 

the form and manner of notice thereof; (ii) authorizing the Debtors’ entry into the Asset Purchase 

Agreement attached hereto as Exhibit 1 (the “Stalking Horse APA”) with a potential Stalking 

Horse Purchaser; (iii) approving the Bid Protections; (iv) scheduling an Auction and the Sale 

Hearing; (v) approving procedures for the assumption and assignment of certain executory 

contracts and unexpired leases (each, an “Assumed Contract” and collectively, the “Assumed 

Contracts”); and (vi) granting related relief; and upon consideration of the Motion; and due and 

proper notice of the Motion having been given; and it appearing that no other or further notice of 

the Motion is required except as set forth herein; and it appearing that this Court has jurisdiction 

to consider the Motion in accordance with 28 U.S.C. §§ 157 and 1334; and it appearing that this 

is a core proceeding pursuant to 28 U.S.C. § 157(b)(2); and it appearing that venue of this 

proceeding and the Motion is proper pursuant to 28 U.S.C. §§ 1408 and 1409; and this Court 

having reviewed the Motion; and the Court having reviewed the Declarations and the testimony 

set forth therein; and the Bidding Procedures Hearing having been held; and this Court having 

found and determined that the relief set forth herein is in the best interests of the Debtors, their 

estates and creditors and all parties in interest, and that the legal and factual bases set forth in the 

Motion and the evidence adduced at the Bidding Procedures Hearing establish just cause for the 

relief granted herein; and after due deliberation and sufficient cause appearing therefor,

2 Capitalized terms used but not defined herein shall have the meanings given them in the Bidding Procedures (as 

defined below), or to the extent not defined therein, the Motion or the Stalking Horse APA.

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IT IS HEREBY FOUND AND DETERMINED THAT:3

A. Stalking Horse APA. The Stalking Horse APA provides the Debtors with the 

opportunity to sell such Assets in a manner designed to preserve and maximize their value and 

provides a floor for a further marketing and auction process. Without the Stalking Horse APA, 

the Debtors are at a significant risk of realizing a lower price for the Assets. The Stalking Horse 

Purchaser shall act as a “stalking horse purchaser” pursuant to the Stalking Horse APA and shall 

be subject to higher or otherwise better offers in accordance with the Stalking Horse APA and the 

Bidding Procedures. Designation of the Stalking Horse Purchaser as a “stalking horse purchaser” 

and the Stalking Horse APA as a “stalking horse purchase agreement” is in the best interests of 

the Debtors and the Debtors’ estates and their creditors, and it reflects a sound exercise of the 

Debtors’ business judgment. Notwithstanding the foregoing, all parties rights to object to the Sale 

in connection with the Stalking Horse APA shall be preserved until the Sale Objection Deadline.

B. Bid Protections. The Bid Protections are reasonable and appropriate under the 

circumstances and on the terms set forth in the Bidding Procedures, including in light of the time, 

cost, and resources expended by the Stalking Horse Purchaser and the commitments made by the 

Stalking Horse Purchaser. Payment of the Bid Protections as set forth herein shall survive 

termination of the Stalking Horse APA and shall constitute an administrative expense of the 

Debtors’ estates.

3 The findings and conclusions set forth herein constitute the Court’s findings of fact and conclusions of law 

pursuant to Bankruptcy Rule 7052, made applicable to this proceeding pursuant to Bankruptcy Rule 9014. To 

the extent that any of the following findings of fact constitute conclusions of law, they are adopted as such. To 

the extent any of the following conclusions of law constitute findings of fact, they are adopted as such.

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C. Auction. The Auction, if held, is necessary to determine whether any entity other 

than the Stalking Horse Purchaser is willing to enter into a definitive agreement on terms and 

conditions more favorable to the Debtors and their estates than the Stalking Horse APA.

NOW, THEREFORE, IT IS HEREBY ORDERED THAT:

1. Those portions of the Motion seeking approval of (a) the Debtors’ entry into the 

Asset Purchase Agreement attached hereto as Exhibit 1 (the “Stalking Horse APA”) with the 

Stalking Horse Purchaser and (b) the Bid Protections, are hereby GRANTED to the extent set forth 

herein.

2. For all purposes under the Bidding Procedures: (a) the Stalking Horse Purchaser 

shall be considered a Qualifying Bidder, and the Stalking Horse APA shall be considered a 

Qualifying Bid; (b) the Stalking Horse Purchaser will be deemed to be a Qualifying Bidder for all 

purposes under the Bidding Procedures without regard to any of the requirements or conditions set 

forth herein or the Bidding Procedures and without any other or further action by the Stalking 

Horse Purchaser; and (c) in determining whether any Potential Bidders constitute Qualifying 

Bidders, the Debtors may consider a combination of bids for the Assets. 

3. The Debtors are authorized to enter into and perform all of their respective 

pre-closing obligations under the Stalking Horse APA; provided that for the avoidance of doubt, 

approval and consummation of the transactions contemplated by the Stalking Horse APA shall be 

subject to the terms and conditions herein and the entry of an order approving the Sale of the Assets 

and the satisfaction or waiver of the other conditions to closing on the terms set forth in the Stalking 

Horse APA.

4. This Order shall be effective immediately upon entry, and any stay of orders 

provided for in Bankruptcy Rules 6004(h) or 6006(d) or any other provision of the Bankruptcy 

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Code, the Bankruptcy Rules or the Local Rules is expressly waived. The Debtors are not subject 

to any stay in the implementation, enforcement or realization of the relief granted in this Order, 

and may, in its sole discretion and without further delay, take any action and perform any act 

authorized or approved under this Order.

5. The Debtors are authorized to take all steps necessary or appropriate to implement 

the relief granted in this Order.

6. This Court shall retain exclusive jurisdiction with respect to all matters arising from 

or related to the implementation or interpretation of the Order.

# # # End of Order # # #

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Order submitted by:

/s/ Holland N. O’Neil

FOLEY & LARDNER LLP

Holland N. O’Neil (TX 14864700)

Mark C. Moore (TX 24074751)

Zachary C. Zahn (TX 24137675)

2021 McKinney Avenue, Suite 1600

Dallas, TX 75201

Telephone: (214) 999-3000

Facsimile: (214) 999-4667

honeil@foley.com

mmoore@foley.com

zzahn@foley.com

-ANDROPES & GRAY LLP

Chris L. Dickerson (admitted pro hac vice)

Rahmon J. Brown (admitted pro hac vice) 

191 North Wacker Drive, 32nd Floor

Chicago, Illinois 60606

Telephone: (312) 845-1200 

Facsimile: (312) 845-5500

chris.dickerson@ropesgray.com 

rahmon.brown@ropesgray.com

Proposed Counsel for the Debtors

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EXHIBIT 1

The Stalking Horse APA

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Execution Version 

Confidential

148483277_14 

ASSET PURCHASE AGREEMENT 

This ASSET PURCHASE AGREEMENT (this “Agreement”) is made and entered into as 

of December 2, 2024 (“Effective Date”) by and among TGI FRIDAY’S INC., a New York 

corporation, as debtor and debtor-in-possession (collectively, with the other parties listed as 

“Sellers” on the signature pages hereto, “Seller”) and SUGARLOAF CONCESSIONS LLC, a 

Delaware limited liability company (“Buyer” and, together with Seller, the “Parties”). 

RECITALS 

WHEREAS, on November 2, 2024 (the “Petition Date”), Seller and certain of its affiliates, 

as debtors and debtors in possession, commenced case No. 24-80069-sgj11 (the “Bankruptcy 

Case”) by filing voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the 

United States Bankruptcy Court for the Northern District of Texas, Dallas Division (“Bankruptcy 

Court”); 

WHEREAS, Seller is the owner of a restaurant company providing full service restaurant 

services to the general public through a number of company owned restaurant locations (such 

businesses, as presently conducted by Seller, shall be collectively referred to herein as the 

“Business”), as debtor and debtor-in-possession pursuant to Sections 1107(a) and 1108 of the 

Bankruptcy Code; 

WHEREAS, Seller owns all of the issued and outstanding Equity Interests (the “Transferred 

Interests”) of each of TGIF/DFW Partner, LLC and TGIF/DFW Manager, LLC (the “Acquired 

Companies”); 

WHEREAS, Seller wishes to sell, transfer, convey, assign and deliver to Buyer, in 

accordance with Sections 363 and 365 and the other applicable provisions of the Bankruptcy 

Code, all of the Acquired Assets (defined below), including the assets of certain company owned 

restaurants owned by Seller and/or one or more of its Affiliates and the Transferred Interests, 

together with the Assumed Liabilities of Seller (defined below), upon the terms and subject to the 

conditions set forth in this Agreement (hereinafter collectively referred to as the “Transaction”); 

WHEREAS, Buyer wishes to purchase and take delivery of such Acquired Assets and 

assume such Assumed Liabilities upon such terms and subject to such conditions; 

WHEREAS, in connection with the Transaction, Buyer intends to take assignment of or 

enter into new franchise agreements with TGI Fridays Franchisor, LLC (“Franchisor”) for the 

operation of the Restaurants by Buyer as TGI FridaysTM Restaurants (such assigned or new 

franchise agreements, the “Franchise Agreements”), all upon the terms and subject to the 

conditions set forth in the Franchise Agreements and this Agreement; 

WHEREAS, the Acquired Assets will be sold pursuant to a Sale Order of the Bankruptcy 

Court approving such sale under Section 363 of the Bankruptcy Code and such Sale Order will 

include the assumption and assignment of certain executory contracts and unexpired leases under 

Section 365 of the Bankruptcy Code and pursuant to the terms and conditions of this Agreement; 

and 

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WHEREAS, the performance under this Agreement and the Seller’s ability to consummate 

the transactions set forth in this Agreement are subject to, among other things, the entry of the 

Sale Order by the Bankruptcy Court. 

AGREEMENT 

NOW, THEREFORE, in consideration of the mutual covenants, agreements, 

representations and warranties contained in this Agreement, the Parties hereby agree as follows: 

ARTICLE I 

DEFINITIONS 

1.1 Defined Terms. Unless otherwise defined in this Agreement, all capitalized terms 

shall have the meanings set forth in Exhibit 1.1, attached hereto. For the sake of clarity, as of the 

Closing, certain entities listed as “Sellers” party hereto may or may not have any right, title or 

interest in or to any Acquired Asset or any Excluded Asset or any obligation with respect to any 

Assumed Liability or any Excluded Liability. 

ARTICLE II 

PURCHASE AND SALE 

2.1 Purchase and Sale; Acquired Assets. Pursuant to Sections 363 and 365 of the 

Bankruptcy Code, subject to the entry and terms of the Sale Order and on the terms and subject to 

the conditions of this Agreement, at the Closing, Seller hereby agrees to sell, transfer, convey, 

assign and deliver to Buyer, and Buyer agrees to purchase, acquire and assume from Seller, all of 

Seller’s right, title and interest in and to, as of the Closing, all of the Acquired Assets, free and 

clear of all Liens (other than Permitted Liens). 

2.2 Excluded Assets. Notwithstanding anything to the contrary in this Agreement, the 

Acquired Assets shall not include, and Seller shall not sell, convey, transfer, assign and deliver, 

the Excluded Assets, which Seller shall specifically retain. For the avoidance of doubt, Seller shall 

have the right to remove the Excluded Assets from the Restaurants prior to Closing. 

2.3 Assumption of Liabilities. Subject to the terms and conditions of this Agreement, 

at the Closing, Buyer shall irrevocably assume only the Assumed Liabilities. Buyer agrees, 

effective as of the Closing, to pay, perform, discharge when due or otherwise satisfy in accordance 

with their terms, the Assumed Liabilities. 

2.4 Excluded Liabilities. Notwithstanding anything to the contrary contained in this 

Agreement, Buyer shall not assume and shall not be responsible to pay, perform, or discharge any 

liabilities of Seller or any of its Affiliates of any kind or nature whatsoever other than the Assumed 

Liabilities (all such Liabilities that are not Assumed Liabilities being referred to collectively herein 

as the “Excluded Liabilities”) and such Excluded Liabilities shall be retained by and remain the 

Liabilities of Seller or its Affiliates, as applicable. Without limiting the generality of the foregoing, 

the Excluded Liabilities shall include, but not be limited to, the enumerated Excluded Liabilities 

(that are not enumerated Assumed Liabilities) set forth in the definition of “Excluded Liabilities” 

set forth on Exhibit 1.1. For the avoidance of doubt, in the event any Liability included in the 

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definition of “Assumed Liabilities” would also be included in one of the categories listed as 

“Excluded Liabilities” on Exhibit 1.1, such Liability shall be considered an Assumed Liability. 

2.5 Transferred Interests. Notwithstanding anything to the contrary contained in this 

Agreement, the Parties acknowledge and agree (a) that Sections 2.1, 2.3, 2.4 and 2.6 and associated 

definitions set forth therein speak only to the directly owned assets and liabilities of Seller, and (b) 

that no provision of this Agreement or any Ancillary Document limits or shall be construed to limit 

the assets, properties, claims, rights, obligations and liabilities of each Acquired Company that are 

acquired or assumed by Buyer through its acquisition of the Transferred Interests, it being 

understood that Buyer will indirectly assume by way of its acquisition of the Transferred Interests 

all assets, properties, claims and rights of, and assume all obligations and liabilities of, each 

Acquired Company. 

2.6 Assumption/Rejection of Contracts; Assignment of Contracts. 

(a) Assumption and Assignment of Executory Contracts. Prior to Closing, 

Seller shall provide timely and proper written notice of the motion to approve the Sale Order to all 

parties to any executory Contracts to which Seller is a party that are Assigned Contracts and take 

all other actions reasonably necessary to cause such Contracts to be assumed by Seller and assigned 

to Buyer pursuant to Section 365 of the Bankruptcy Code to the extent that such Contracts are 

Assigned Contracts at Closing. The Sale Order shall provide that as of and conditioned on the 

occurrence of the Closing, Seller shall assign or cause to be assigned to Buyer, as applicable, the 

Assigned Contracts, each of which shall be identified by the name or appropriate description and 

date of the Assigned Contract (if available), the other party to the Assigned Contract and the 

address of such party for notice purposes, a notice filed in connection with the motion to approve 

Sale Order or a separate motion for authority to assume and assign such Assigned Contracts. Such 

notice shall also set forth Seller’s good faith estimate of the amounts necessary to cure any defaults 

under each of the Assigned Contracts as determined by Seller based on Seller’s Records or as 

otherwise determined by the Bankruptcy Court. At the Closing, Seller shall, pursuant to the Sale 

Order assume and assign to Buyer (the consideration for which is included in the Purchase Price), 

all Assigned Contracts that may be assigned by Seller to Buyer pursuant to Sections 363 and 365 

of the Bankruptcy Code, subject to adjustment pursuant to Section 2.6(b). Any Contracts not listed 

as an Assigned Contract on Schedule 2.1 of the Disclosure Schedule as of the Bid Deadline and 

any Contract not assumed and assigned at Closing may be rejected pursuant to Section 365 of the 

Bankruptcy Code at any time after the Bid Deadline and/or the Closing, as applicable. 

(b) Excluding or Adding Contracts; Omitted Contracts. Buyer shall have the 

right to notify Seller in writing of any Assigned Contract (other than purchase orders) that it does 

not wish to assume or a Contract to which Seller is a party that Buyer wishes to add as an Assigned 

Contract no later than one (1) Business Day prior to the Bid Deadline (as defined in the Bidding 

Procedures Order), and (i) any such previously considered Assigned Contract that Buyer no longer 

wishes to assume shall be automatically deemed removed from Schedule 2.1 of the Disclosure 

Schedule and automatically deemed added to Schedule 2.2 of the Disclosure Schedule, in each 

case, without any adjustment to the Cash Payment, and (ii) any such previously considered 

Excluded Contract that Buyer wishes to assume as an Assigned Contract shall be automatically 

deemed added to Schedule 2.1 of the Disclosure Schedule, automatically deemed removed from 

Schedule 2.2 of the Disclosure Schedule, and assumed by Seller to sell and assign to Buyer, in 

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each case, without any adjustment to the Cash Payment. Buyer shall be solely responsible for the 

payment, performance and discharge when due of the Liabilities under the Assigned Contracts 

arising or that are otherwise payable from the time of and after the Closing. With Seller’s prior 

written consent (given or withheld in its sole discretion), from and after the Bid Deadline (as 

defined in the Bidding Procedures Order), Buyer may request an amendment to Schedule 2.1 of 

the Disclosure Schedule and Schedule 2.2 of the Disclosure Schedule to add any Contract to 

which Seller is a party as an Assigned Contract or to remove any Assigned Contract that Buyer no 

longer wishes to assume. Notwithstanding anything to the contrary set forth herein, Buyer may 

not add as an Assigned Contract (i) any Contract which would increase, or would reasonably be 

expected to increase, the Pre-Closing Tax Amount or (ii) any Contract that relates to any TGI 

FridaysTM restaurant(s) that are not listed on Exhibit 1.0 as of the date hereof, in each case, without 

the prior written consent of Seller. 

(c) Cure Costs. 

(i) At the Closing, Buyer shall pay all Cure Costs (up to the Cure Cost 

Cap) and assume, and thereafter in due course and in accordance with its respective terms, pay 

and fully satisfy, discharge and perform all of the obligations under each Assigned Contract 

pursuant to Section 365 of the Bankruptcy Code. If Buyer does not pay all Cure Costs associated 

with the assignment and assumption of an Assigned Contract (including in the event that Buyer 

does not pay the Cure Costs associated with the proposed Assigned Contract because the Cure 

Costs (individually or in the aggregate for all Assigned Contracts) exceed the Cure Cost Cap) or 

fails to satisfy the counterparty to the proposed Assigned Contract and the Bankruptcy Court as 

to adequate assurance of future performance, (x) such Contract(s) shall not be an Assigned 

Contract(s) and such Contract(s) shall be automatically deemed removed from Schedule 2.1 of 

the Disclosure Schedule without any adjustment to the Cash Payment and (y) Buyer is and shall 

remain obligated to timely consummate the Closing (including paying the Purchase Price in full 

at Closing) and comply with its obligations under this Agreement and any Ancillary Document 

and shall not have the right to terminate this Agreement as a result of the failure to assume and 

assign any such Contract. Notwithstanding anything to the contrary herein, no Seller Party shall 

be required to pay or assume any Cure Costs or provide any assurances, and Seller shall not be 

obligated to assume and assign any Contract with respect to which Buyer fails to pay the full 

Cure Costs at Closing (including in the event that Buyer does not pay the Cure Costs associated 

with the proposed Assigned Contract because the Cure Costs (individually or in the aggregate 

for all Assigned Contracts) exceed the Cure Cost Cap) or fails to satisfy the party to the proposed 

Assigned Contract and the Bankruptcy Court as to adequate assurance of future performance. 

(ii) To the extent a counterparty to a Contract objects or otherwise 

challenges the Cure Costs determined by Seller and asserts a different monetary amount that 

must be paid and/or nonmonetary obligations that otherwise must be satisfied, including pursuant 

to Section 365(b)(1)(A) and (B) of the Bankruptcy Code, in order for Buyer to assume such 

Contract to this Agreement (any such Contract, a “Disputed Contract”), and such objection or 

challenge has not been resolved prior to the Closing, then Buyer shall provide written notice no 

later than three (3) Business Days prior to the Closing Date (or such earlier date on which the 

Bankruptcy Code or Bankruptcy Court otherwise would require a determination to assume or 

reject any such Contract) either (x) electing to remove any such Disputed Contract from 

Schedule 2.1 of the Disclosure Schedule, in which case the Contract will be an Excluded 

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Contract and not assigned to Buyer or (y) requesting an extension of the period of time following 

the Closing to resolve any such dispute (such period, an “Extension Period”); provided that any 

such extension period shall be no longer than thirty (30) days following the Closing Date (or 

such shorter period of time as required in order to wind-down or liquidate Seller); provided, 

further, that Seller’s obligations to provide such Extension Period is subject to (1) Buyer’s 

ongoing compliance with Buyer’s obligations pursuant to the final sentence of this Section 

2.6(c)(ii) and (2) Seller determining, in its sole discretion, that the counterparty will not accept 

assignment of such Disputed Contract to another buyer prior to the expiration of the Extension 

Period. If Buyer does not deliver written notice agreeing to assume such Disputed Contract and 

pay all Cure Costs (disregarding the Cure Cost Cap) associated with such Disputed Contract 

within three (3) Business Days prior to the expiration of the Extension Period or such dispute is 

not resolved by the expiration of the Extension Period, such Disputed Contract shall 

automatically be deemed an Excluded Contract. Buyer shall be responsible for and reimburse 

Seller for any Liabilities or obligations of Seller arising following the Closing during any 

Extension Period, including any incremental costs or expenses (A) that arise out of Seller’s 

extension and continuation of the Bankruptcy Cases that is attributable to the Extension Period 

and (B) are incurred as a result of the Seller’s performance of its obligations under this Section 

2.6(c)(ii). 

(d) Non-Assignment. 

(i) To the extent that any Acquired Asset, Assigned Contract or any claim, 

right or benefit arising thereunder or resulting therefrom (the “Non-Assignable Asset”) is not 

capable of being sold, assigned, transferred or conveyed without the approval, consent or waiver 

of another party thereto, or any third person (including a Governmental Authority), or if such 

sale, assignment, transfer or conveyance or attempted sale, assignment, transfer or conveyance 

would constitute a breach thereof or a violation of any law, decree, order, regulation or other 

governmental edict, this Agreement shall not constitute a sale, assignment, transfer or 

conveyance thereof, or an attempted assignment, transfer or conveyance thereof. From the date 

hereof until the earlier of the termination of this Agreement and the Closing Date, Seller shall, if 

requested by Buyer, use its commercially reasonable efforts, subject to the Conditions, and Buyer 

shall reasonably cooperate with Seller, to obtain all necessary approvals, consents or waivers, or 

to resolve any such impediments to transfer as necessary to convey to Buyer each such NonAssignable Asset as soon as practicable; provided, however, that neither Seller nor Buyer shall 

be obligated to pay any fees or other consideration to obtain such third party consent for the 

transfer thereof, except for Cure Costs which shall be paid by Buyer (up to the Cure Cost Cap) 

and filing fees and other ordinary administrative or other charges provided for in the Assigned 

Contracts which shall be paid by Buyer to the third party from whom such approval, consent or 

waiver is requested. 

(ii) To the extent that any of the approvals, consents or waivers referred 

to in Section 2.6(d)(i) herein have not been obtained by Seller and Buyer as of the Closing, or 

until the impediments to transfer referred to in Section 2.6(d)(i) are resolved, Seller shall, if 

requested by Buyer, during the remaining term of such Non-Assignable Asset, use its 

commercially reasonable efforts to (x) obtain the consent of any such third party, (y) cooperate 

with Buyer in any reasonable and lawful arrangements designed to provide the benefits of such 

Non-Assignable Asset to Buyer so long as Buyer cooperates with Seller in such arrangements 

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and reimburses Seller for all expenses incurred by Seller (including ongoing expenses of Seller 

operating in bankruptcy) and payments made by Seller in connection therewith and indemnifies 

Seller with respect thereto; and (z) enforce, at the reasonable request of Buyer and at the expense 

and for the account of Buyer, any rights of Seller arising from such Non-Assignable Asset against 

such issuer thereof or the other party or parties thereto (including the right to elect to terminate 

any such Non-Assignable Asset in accordance with the terms thereof upon the advice of, and 

together with indemnification from, Buyer); provided, that (A) the foregoing shall not restrict or 

limit wind-down or liquidating plan of Seller following the Closing Date and (B) the foregoing 

shall be subject to (1) any Orders entered, or approvals or authorizations granted or required, by 

or under the Bankruptcy Court or the Bankruptcy Code, obligations or limitations arising under 

or related to the DIP Facility or the DIP Credit Agreement, and each of Seller’s obligations to 

comply with any Order of the Bankruptcy Court (including the Bidding Procedures Order and 

the Sale Order) and Seller’s duty to seek and obtain the highest or otherwise best price for its 

assets as required by the Bankruptcy Code, (2) limitations on operations imposed by the 

Bankruptcy Court or the Bankruptcy Code or agreements governing Seller’s debtor-inpossession financing or use of cash collateral and (3) limitations arising out of or related to the 

financial distress of Seller and its Affiliates and the Bankruptcy Cases, including limitations on 

personnel, funds and other resources ((x) and (y), collectively, and as applicable as used herein, 

the “Conditions”). 

(iii) Notwithstanding anything to the contrary herein, Seller shall not be 

required to compensate any applicable third party, commence or participate in any proceeding 

or offer or grant any accommodation (financial or otherwise, including any accommodation or 

arrangement to indemnify, remain primarily, secondarily or contingently liable for any Liability) 

to any applicable third party in connection with the Seller’s obligations under this Section 2.6 or 

otherwise. Receipt of any third party consent, approval or waiver shall not be a condition to 

Buyer’s obligation to timely consummate the Closing (including Buyer’s obligation to pay the 

Purchase Price in full) or comply with Buyer’s obligations under this Agreement or any Ancillary 

Document and the failure to receive any third party consent, approval or waiver or any actions 

taken by Seller in connection therewith shall not give Buyer the right to terminate this 

Agreement. 

2.7 Transition Services Agreement. The Parties acknowledge and agree that both 

Seller and one or more potential buyers of other restaurants and business of the Seller that are not 

being acquired pursuant to this Agreement (the “Retained Business”) may require certain postClosing transition services from Buyer and Buyer may require certain post-Closing transition 

services from Seller. After the date hereof, the Parties shall, subject to the Conditions, use 

commercially reasonable efforts to negotiate and document the terms of a transition services 

agreement between the Parties on terms mutually acceptable to both Parties to be effective from 

and after the Closing (the “Transition Services Agreement”). For the avoidance of doubt, entry 

into any Transition Services Agreement shall not be a condition to Buyer’s obligation to timely 

consummate the Closing (including Buyer’s obligation to pay the Purchase Price in full) or comply 

with Buyer’s obligations under this Agreement or any Ancillary Document and the failure to enter 

into any Transition Services Agreement or any actions taken by Seller in connection therewith 

shall not give Buyer the right to terminate this Agreement. If the Parties have not entered into a 

Transition Services Agreement prior to the Closing, the Parties shall, subject to the Conditions, 

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use commercially reasonable efforts to enter into such a Transition Services Agreement as 

promptly as reasonably practicable following the Closing. 

2.8 Real Property Leases. Buyer has reviewed, or prior to the Bid Deadline will review, 

all Real Property Leases and, except as may be otherwise provided below, acknowledges that the 

amount of term remaining under each such lease (specifically excluding any option renewals) is 

acceptable to Buyer. Buyer further acknowledges the items set forth on Schedule 2.8 of the 

Disclosure Schedule with respect to the Real Property Leases and agrees Seller may take actions 

reasonably related to or in furtherance of the matters set forth on or contemplated by such schedule. 

Seller will reasonably consult with the Buyer in connection with any negotiations relating to 

renewals, extensions or amendments of the Real Property Leases. 

2.9 Assumption of Liabilities under Assigned Contracts. At the Closing, Buyer shall 

assume, discharge and become liable for, all liabilities and obligations arising after the Closing 

Date under the Assigned Contracts, but only to the extent such liabilities and obligations are 

required to be performed and satisfied after the Closing Date and excluding liabilities and 

obligations arising as a result of any breach of or default or failure to perform by Seller under any 

Assigned Contract prior to the Closing Date, other than Cure Costs or any Assumed Liabilities. 

2.10 Inspection and Due Diligence. 

(a) From the date hereof until the earlier of the termination of this Agreement 

and the Closing Date, Seller will use commercially reasonable efforts to (i) make available for 

Buyer’s inspection and copying such material information and other materials requested in writing 

by Buyer related to the Acquired Assets as may reasonably be in Seller’s possession and control, 

and (ii) promptly respond to any written requests from Buyer for additional information as long as 

such information is reasonably within Seller’s possession and control. 

(b) Buyer hereby acknowledges and agrees, on its own behalf and on behalf of 

the Buyer Group, that the sale of the Acquired Assets is and will be made on an “as is, where is 

and with all faults” basis (except for the express representations contained in Article IV, as 

qualified, amended, supplemented and modified by the Disclosure Schedule and in accordance 

with the express terms and conditions (including limitations and exclusions) of this Agreement 

(the “Express Representations”)). The occurrence of Closing shall constitute an acknowledgement 

by Buyer, on its own behalf and on behalf of the Buyer Group, that the Acquired Assets have been 

accepted without representation or warranty, express or implied (except for the Express 

Representations). Except for the Express Representations, Seller and any other Person on behalf 

of Seller hereby specifically negates and disclaims any further representations, warranties, or 

guaranties of any kind or character, whether express or implied, oral or written, past, present, 

future, or otherwise, of, as to, concerning, or with respect to Seller, the Acquired Assets, or the 

Assumed Liabilities or with respect to any information, statements, disclosures, documents, 

projections, forecasts or other material of any nature made available or provided by any Person, or 

elsewhere to Buyer or any of its Affiliates or advisors on behalf of Seller or any of its Affiliates or 

Representatives, including (i) any implied representation of merchantability or fitness for any 

particular use or purpose, (ii) any implied representation regarding the use or operation of the 

Acquired Assets after the Closing in any manner, and (iii) any implied representation regarding 

the probable success or profitability of the Acquired Assets. Buyer further acknowledges that the 

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information provided and to be provided with respect to Seller, the Acquired Assets and the 

Assumed Liabilities was obtained from a variety of sources and, except as set forth in the Express 

Representations, Seller, and any other Person on behalf of Seller, (x) has not made any independent 

investigation or verification of such information and (y) has not made any express or implied, oral 

or written, representations as to the accuracy or completeness of such information. 

Notwithstanding the generality of the foregoing, Buyer, on its own behalf and on behalf of the 

Buyer Group, acknowledges and agrees that it and its Buyer Group have received from Seller (and 

their Affiliates and Representatives) certain projections, forward-looking statements, forecasts, 

and prospective or third-party information relating to Seller, the Acquired Companies, the 

Acquired Assets, the Business, the Excluded Assets, the Assumed Liabilities and the Excluded 

Liabilities (whether in written, electronic, or oral form) (collectively, “Projections”). Buyer, on 

behalf of itself and its Buyer Group, acknowledges that (1) such Projections are being provided 

solely for the convenience of Buyer and its Buyer Group to facilitate their own independent 

investigation; (2) there are uncertainties inherent in attempting to make such Projections; (3) Buyer 

and its Buyer Group are familiar with such uncertainties and are taking responsibility for making 

their own evaluation of the adequacy and accuracy of all such Projections (including the 

reasonableness of the assumptions underlying such Projections); and (iv) none of the Seller nor 

any other Person makes any representations or warranties with respect to such Projections. Buyer, 

on its own behalf and on behalf of its Buyer Group, hereby disclaims reliance on any such 

Projections. Buyer acknowledges, on its own behalf and on behalf of the Buyer Group, that it has 

conducted to its reasonable satisfaction an independent investigation and verification of the 

business including the Acquired Assets, its financial condition, results of operations, assets, 

Liabilities, properties, Contracts, environmental compliance, employee matters, regulatory 

compliance, business risks and prospects of Seller, and, in making its determination to proceed 

with the transactions contemplated by this Agreement, Buyer has relied solely on the results of the 

Buyer Group’s own independent investigation and verification, and has not relied on, is not relying 

on, and will not rely on, Seller, the Projections or any information, statements, disclosures, 

documents, projections, forecasts or other material made available to Buyer or any of its Affiliates 

or Representatives in the Dataroom or otherwise, in each case, whether written or oral, made or 

provided by, or as part of, any of the foregoing or Seller or any of their respective Affiliates or 

Representatives, or any failure of any of the foregoing to disclose or contain any information, 

except for the Express Representations. Without limiting the foregoing, except for breach of the 

Express Representations, neither Seller nor any other Person will have or be subject to any Liability 

whatsoever to Buyer, or any other Person in the Buyer Group, resulting from the distribution to 

Buyer or any of its Affiliates or advisors, or Buyer’s or any of its Affiliates’ or advisors’ reliance 

on, any such information. This Section 2.10(b) shall survive the termination of this Agreement 

and the Closing. 

2.11 Approval by Bankruptcy Court. This Agreement is subject to and conditioned upon 

approval by the Bankruptcy Court. At Closing, Seller will convey to Buyer the Acquired Assets 

pursuant and subject to an Order entered by the Bankruptcy Court approving the sale of the 

Acquired Assets, which order shall be, prior to submission to the court, in a form reasonably 

acceptable to Buyer and shall include, without limitation, the following provisions: (x) pursuant to 

Section 363 of the Bankruptcy Code, sale of the Acquired assets shall be free and clear of all Liens 

(other than Permitted Liens), interests and rights of set-off, whether known or unknown, disputed, 

contingent, actual or otherwise arising prior to the Closing, (y) Buyer shall be deemed a good faith 

purchaser and (z) Buyer shall have no successor liability (the “Sale Order”). 

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ARTICLE III 

PURCHASE CONSIDERATION 

3.1 Consideration. 

(a) The aggregate consideration to be paid by Buyer for the acquisition of the 

Acquired Assets shall be (i) a cash payment of Thirty Million and Five Hundred Thousand and 

No/100 Dollars ($30,500,000) (the “Cash Payment”); (ii) payment of the Cure Costs (in an amount 

not to exceed the Cure Cost Cap) and (iii) the assumption by Buyer of the Assumed Liabilities (the 

sum of the amount of clauses (i), (ii) and (iii), the “Purchase Price”). 

(b) At the Closing, Buyer shall deliver, or cause to be delivered, to Seller the 

Cash Payment less (x) the Deposit and (y) the Pre-Closing Tax Amount (the “Closing Date 

Payment”). The Closing Date Payment and any payment required to be made pursuant to any 

other provision hereof shall be made in cash by wire transfer of immediately available funds to 

such bank account as shall be designated in writing by the applicable Party at least two (2) Business 

Days prior to the date such payment is to be made. In addition, at the Closing, Buyer shall pay all 

Cure Costs (up to the Cure Cost Cap). 

3.2 Deposit. 

(a) Buyer has, on or prior to the date hereof, made an earnest money deposit 

(the “Deposit”) into escrow, to be held in an account of Buyer’s with Texas Partners Bank, in the 

amount of ten percent (10%) of the Cash Payment by wire transfer of immediately available funds. 

The Deposit shall not be subject to any Lien, trustee process or any other judicial process of any 

creditor of any of Seller or Buyer and, at the Closing, shall be deemed automatically released from 

escrow and credited toward payment of the Cash Payment in accordance with Section 3.1(b). 

(b) If this Agreement has been validly terminated by Seller pursuant to Section 

11.1(e) (Buyer Breach) or Section 11.1(f) (Buyer Failure to Close) (or by Buyer pursuant to 

Section 11.1(b) (Court Order) or Section 11.1(c) (Outside Date), in each case, in circumstances 

where Seller would be entitled to terminate this Agreement pursuant to Section 11.1(e) or Section 

11.1(f) (a “Buyer Default Termination”)), then the Deposit shall be deemed automatically released 

from escrow and shall be retained by the Seller for Seller’s own account (including, for the 

avoidance of doubt, any investment income, if any, in respect of the Deposit). 

(c) If this Agreement has been terminated by any Party other than as 

contemplated by Section 3.2(b) in connection with the Buyer Default Termination, then Seller 

shall, in accordance with the Bidding Procedures Order, by wire transfer of immediately available 

funds, return the Deposit to Buyer (provided, for the avoidance of doubt, that Seller shall retain 

any investment income, if any, in respect of the Deposit) one (1) Business Day after the date of 

such termination. 

(d) The Parties agree that Seller’s right to retain the Deposit, as set forth herein, 

is not a penalty, but rather is liquidated damages in a reasonable amount that will compensate 

Seller for its efforts and resources expended and the opportunities foregone while negotiating this 

Agreement and in reliance on this Agreement and on the expectation of the consummation of the 

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transactions contemplated hereby, which amount would otherwise be impossible to calculate with 

precision. 

3.3 Franchise Agreement. On or before the Bid Deadline, Buyer, as franchisee, shall 

either (a) obtain Franchisor’s binding written consent to include Seller’s existing franchise 

agreements as an Assigned Contract or (b) enter into, for each Restaurant (other than the DFW 

Stores), Franchisor’s form of franchise agreement attached hereto as Exhibit 3.3, unless otherwise 

mutually agreed between Buyer and Franchisor, together with any applicable state addendum and 

ancillary documents; provided, that any such new franchise agreement entered into pursuant to 

Section 3.3(b) must be, for the benefit of Seller, fully executed and binding on the Buyer and 

Franchisor as of the Bid Deadline, but effective as of the Closing. In any event and 

notwithstanding anything in this Agreement or any Ancillary Document to the contrary, 

assignment of any franchise agreement or entry into a new franchise agreement with Franchisor 

shall not be a condition to Buyer’s obligation to timely consummate the Closing (including Buyer’s 

obligation to pay the Purchase Price in full) or comply with Buyer’s obligations under this 

Agreement or any Ancillary Document and the failure to assign of any franchise agreement or 

enter into a new franchise agreement with Franchisor or any actions taken by Seller in connection 

therewith shall not give Buyer the right to terminate this Agreement. 

3.4 Allocation of Purchase Price; Withholding; Tax Matters. 

(a) Seller and Buyer agree that the purchase price (for Tax purposes) shall be 

allocated for tax purposes among the Acquired Assets in accordance with Section 1060 of the Code 

and the Treasury regulations promulgated thereunder (and any similar provision of state, local or 

foreign law, as appropriate) and in accordance with the allocation methodology set forth on 

Schedule 3.4 of the Disclosure Schedule (the “Allocation”). The Allocation shall be prepared 

and delivered by Buyer to Seller within 30 days following the determination of the final Purchase 

Price pursuant to this Agreement for Seller’s review and comment. Buyer shall incorporate any 

reasonable comments of Seller on such Allocation. If, within 30 days after the delivery of the 

Allocation, Seller notifies Buyer in writing that Seller objects to any allocation set forth thereon, 

Buyer and Seller shall negotiate in good faith to resolve such objection. Seller and Buyer agree 

that said allocation of the Purchase Price shall be used by Seller and Buyer in reporting the 

transactions covered by this Agreement for income and state sales tax purposes and neither Seller 

nor Buyer will take any position (or will allow any of their respective Affiliates to take any 

position) (whether in audits, Tax Returns, or otherwise) that is inconsistent with the Allocation, 

except, in each case, to the extent otherwise required by a final determination pursuant to Section 

1313(a) of the Code (or any comparable provision of state, local or foreign law). 

(b) Buyer, the Acquired Companies, and their Affiliates and designees shall be 

entitled to deduct and withhold any amounts as are required to deduct and withhold under any 

applicable Tax Law in connection with payments required to be made pursuant to the terms of this 

Agreement. To the extent any such withheld amounts are properly deducted and withheld pursuant 

to applicable Tax Law, such amounts shall be treated for all purposes of this Agreement as having 

been paid to the person in respect of which such withholding was made and shall be timely paid 

to the appropriate Taxing Authority. Any Person intending to withhold will notify such Persons 

of any amounts otherwise payable to such Persons that it intends to deduct and withhold at least 

ten (10) Business Days prior to the due date for any relevant payment and the Parties shall 

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reasonably cooperate with each other, as and to the extent reasonably requested by the other Party, 

to minimize or eliminate any potential deductions and withholdings that may be required pursuant 

to this Agreement to make under applicable Tax Law. Notwithstanding anything to the contrary, 

the Parties agree that there shall be no withholding or deduction permitted under this Agreement 

to the extent Seller (or other applicable Person) provides a duly executed and properly completed 

IRS Form W-9. 

(c) In the case of any Straddle Period, Taxes shall be treated as attributable to 

the portion of such period that ends on the Closing Date as follows: (i) in the case of any sales, 

use, value-added, employment, or withholding Tax or any Tax based on or measured by income, 

profits, gains, receipts, or activities, the level of any item shall be determined based on an interim 

closing of the books as of the end of the Closing Date (and for such purpose, the taxable period 

shall be deemed to terminate at such time), except that exemptions, allowances or deductions that 

are calculated on an annual basis (including depreciation and amortization deductions), other than 

with respect to property placed in service after the Closing, shall be allocated on a per diem basis 

ending on the Closing Date and (ii) in the case of all other Taxes, shall be deemed to be the amount 

of such Taxes for the entire period multiplied by a fraction, the numerator of which is the number 

of calendar days in the portion of the period ending on the Closing Date and the denominator of 

which is the number of calendar days in the entire period. 

(d) Buyer and Seller shall reasonably cooperate, as and to the extent reasonably 

requested by the other, in connection with the filing of Tax Returns and any Action, audit, 

litigation, or other proceeding with respect to Taxes. 

(e) Buyer shall not make any Tax election, file any amended Tax Return, or 

settle any Action, audit, litigation, or other proceeding with respect to Taxes, in each case, with 

respect to any Acquired Asset (including, for the avoidance of doubt, the Acquired Companies and 

the DFW Entities) that would have retroactive effect to a Pre-Closing Tax Period (including a 

portion of a Straddle Period) of Seller or any of its Affiliates or the Securitization Entities without 

the prior written consent of Seller, such consent not to be unreasonably withheld, conditioned or 

delayed. 

(f) None of the Acquired Companies, the DFW Entities, or any entity acquired 

in the transactions contemplated by this Agreement, in each case, that is treated as a partnership 

for U.S. federal income tax purposes, shall make an election under Section 6226 of the Code (or 

any similar or corresponding provision of state, local, or foreign law) with respect to any PreClosing Tax Period (including a portion of a Straddle Period) without the prior written consent of 

Seller. 

3.5 Employees. 

(a) At least five (5) days prior to the Closing, Buyer shall offer at-will 

employment to all Restaurant Employees, on the terms and subject to the conditions specified by 

Buyer in its sole discretion; provided, however, that, Buyer shall not be required to offer the same 

health benefit packages or any other benefits or compensation that may be offered to such 

employees of Seller as of the Effective Time. As of the Closing, all Transferred Employees shall 

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have resigned from their employment with Seller or its Affiliates, or Seller or its Affiliates shall 

have terminated their employment with Seller or its Affiliates. 

(b) Buyer’s hiring of the Restaurant Employees is conditioned upon the 

occurrence of the Closing, and upon satisfaction of such reasonable standard hiring requirements 

as Buyer may include in its employment letter to such employees (including, without limitation, 

completion of Form I-9, typical background checks and similar requirements that are imposed on 

similarly-situated employees of Buyer). Only upon the reasonable satisfaction of all such 

conditions shall a Restaurant Employee become a Transferred Employee, and until such time (i) 

the Restaurant Employees shall not be eligible for compensation from, or to participate in, any 

benefit plans of Buyer, and (ii) Buyer shall have no liability with respect to the Restaurant 

Employees. 

(c) Effective as of the Closing, Buyer shall assume all obligations and 

Liabilities of Seller and its Affiliates for the accrued, unused vacation time and other paid time off 

of the Transferred Employees; provided, that to the extent any such amounts must be paid to a 

Transferred Employee upon termination of employment with Seller (or an Affiliate thereof) 

pursuant to Applicable Law, Buyer shall be responsible for payment of, or shall indemnify and 

reimburse Seller for, any such payments (collectively, the “Accrued PTO”). 

(d) Buyer or one of its Affiliates shall be responsible for satisfying the 

continuation coverage requirements of COBRA for all individuals who are M&A qualified 

beneficiaries (as such term is defined in Treasury Regulation Section 54.4980B-9, Q&A-4(a)) 

(“Post-Closing COBRA Liabilities”); provided that Seller shall make available to Buyer all 

applicable personnel records and personnel files and such other information as Buyer may 

reasonably request in order to satisfy its obligations under this Section 3.5(d), to the extent 

compliant with Applicable Laws. 

(e) Seller shall be responsible for payment of all wages up to the Effective Time 

for all Restaurant Employees. Buyer shall be responsible for the payment of, or shall reimburse 

Seller for, any severance and other Liabilities that arise as a result of Buyer’s failure to provide an 

offer of employment to any Restaurant Employees pursuant to this Section 3.5. 

ARTICLE IV 

REPRESENTATIONS AND WARRANTIES OF SELLER 

Seller represents and warrants, excepting those matters reflected in a disclosure schedule 

attached to this Agreement (the “Disclosure Schedule”), which disclosures shall be deemed to 

constitute representations and warranties of Seller, the following to Buyer as of the date hereof 

and as of Closing Date: 

4.1 Organization. Seller is a corporation, limited liability company or limited 

partnership, as applicable, duly incorporated or organized, validly existing and in good standing 

under the laws of the jurisdiction of its incorporation or formation. 

4.2 Power and Authority; Authorization. Seller has all requisite power and authority to 

enter into, and perform its respective obligations under, this Agreement and related agreements, 

subject to the applicable Conditions, including the requisite Bankruptcy Court approvals. The 

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execution, delivery and performance of this Agreement and the other agreements contemplated 

hereby to which Seller is a party, the performance by Seller of its obligations hereunder and 

thereunder and the consummation by Seller of the transactions contemplated hereby and thereby 

have been or will be duly authorized by all requisite corporate action prior to the Closing Date, 

subject to the applicable Conditions, including the requisite Bankruptcy Court approvals. 

4.3 Capitalization; DFW Entities. 

(a) All of the Transferred Interests are duly authorized, validly issued, fully 

paid and nonassessable and are owned beneficially and of record by Seller, free and clear of any 

Liens, other than Permitted Liens. None of the Transferred Interests have been issued in violation 

of, or are subject to, any preemptive, subscription or similar rights, and none of the Transferred 

Interests were issued in violation of applicable securities Laws. There is no (i) option, warrant, 

call, right, convertible or exchangeable securities, commitment or agreement pursuant to which 

any Person may acquire or vote any Equity Interests of any Acquired Company or pursuant to 

which any Acquired Company may become obligated to issue, sell, purchase, return or redeem 

any of its Equity Interests, (ii) Equity Interests in any Acquired Company that are reserved for 

issuance, or (iii) bonds, debentures, notes or other indebtedness having the right to vote on any 

matters on which the equityholders of any Acquired Company may vote. There are no outstanding 

or authorized appreciation, phantom interest, profit participation or similar rights with respect to 

any Acquired Company. 

(b) Schedule 4.3(b) of the Disclosure Schedule sets forth true, correct and 

complete list of (i) the issued and outstanding Equity Interests of the Acquired Companies and (ii) 

to the Knowledge of Seller, the issued and outstanding Equity Interests of any Person in which any 

Acquired Company holds any Equity Interests (the “DFW Entities”). 

(c) Each DFW Entity operates DFW Stores pursuant to (i) franchise agreements 

and ancillary documents with Franchisor and (ii) Concession Lease Agreements with Dallas/Fort 

Worth International Airport Board set forth on Schedule 4.3(c)(i) of the Disclosure Schedule (the 

“Concession Lease Agreements”). Schedule 4.3(c)(ii) of the Disclosure Schedule sets forth a list 

of the DFW Stores owned by each DFW Entity. 

4.4 Enforceability. This Agreement and each of the other agreements contemplated 

hereby to which Seller is a party constitutes a valid and legally binding obligation of Seller, 

enforceable in accordance with the terms hereof, except as such enforceability (a) may be limited 

by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws 

of general application affecting or relating to the enforcement of creditors’ rights generally and (b) 

is subject to general principles of equity, whether considered in a proceeding at law or in equity 

(collectively, the “Enforceability Exceptions”) and as subject to the applicable Conditions. 

4.5 No Consents or Approvals. No consent, approval, or authorization of, or 

declaration, filing, or registration with, any Governmental Authority, or, to the Knowledge of 

Seller, any other persons is required to be made or obtained by Seller in connection with the 

execution, delivery, and performance of this Agreement and related agreements and the 

consummation of the transactions contemplated by this Agreement, other than the Transaction 

Consents. 

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4.6 Agreement Will Not Cause Breach or Violation. Subject to obtaining the 

Transaction Consents, neither the execution, delivery nor performance of this Agreement or related 

agreements nor the consummation of the transactions contemplated by this Agreement or any other 

agreement contemplated hereby will result in or constitute (a) a violation of any constitution, 

statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of 

any Governmental Authority to which Seller is subject, (b) a conflict or breach under Seller’s 

organizational documents, (c) a default or an event that, with notice or lapse of time or both, would 

be a default, breach or violation of the Assigned Contracts or any other material lease, license, 

promissory note, conditional sales contract, commitment, indenture, mortgage, deed of trust or 

other agreement, instrument or arrangement to which Seller is a party or by which the Restaurants 

or Acquired Assets are bound or affected, or (d) the creation or imposition of any Lien (other than 

a Permitted Lien) on the Acquired Assets or the material assets of any DFW Stores, except, in the 

case of clause (a), (c) and (d), for such conflicts, breaches, defaults, accelerations, rights or failures 

to give notice as would not, individually or in the aggregate, result in a Material Adverse Change. 

4.7 Financial Statements. Seller has previously furnished Buyer with true and complete 

copies of all requested unaudited profit and loss statements for each of the Restaurants for Seller’s 

Fiscal Years 2021, 2022, and 2023, and for the ten (10) Fiscal Months from January 1, 2024, to 

October 31, 2024 (collectively, the “Actual Financials”). The Actual Financials are true, complete, 

and correct in all material respects and present fairly and accurately the results of operations of 

each of the Restaurants for the periods indicated. The Records of Seller relating to the Restaurants 

fully and fairly reflect all transactions, properties, assets and liabilities of the Restaurants.

4.8 Title; Condition of Acquired Assets. 

(a) Schedule 4.8 of the Disclosure Schedule lists in all material respects the 

Fixed Assets owned by, in the possession of, or used by Seller in connection with the Restaurants. 

The Parties acknowledge and agree that Schedule 4.8 of the Disclosure Schedule may be updated 

by Seller prior to Closing, pursuant to the provisions of Section 6.5 hereof. At Closing, subject to 

the applicable Conditions, requisite Bankruptcy Court approvals and assumption by the applicable 

Seller of any applicable Contracts (and satisfaction of any Cure Costs), Seller: (i) shall be the sole 

owner, beneficially and of record (as applicable), of all of the Acquired Assets; and (ii) shall have 

good and marketable title to all of the Acquired Assets, whether real, personal, mixed, tangible or 

intangible. The Acquired Assets along with the inventory that shall be in each Restaurant on the 

Closing Date, constitute all the assets and interests in assets, other than Intellectual Property, 

Shared Contracts and any Excluded Assets, that are used in the operation of each Restaurant and 

are, together with the Franchise Agreements and, with respect to the DFW Stores, together with 

assets of the Acquired Companies or DFW Entities, and subject to removal or rejection of certain 

Contracts as Assigned Contracts pursuant to Section 2.6, sufficient to operate each Restaurant in 

a manner consistent with Seller’s Ordinary Course of Business for such Restaurant. At Closing, 

subject to the applicable Conditions, requisite Bankruptcy Court approvals and assumption by the 

applicable Seller of any applicable Contracts (and satisfaction of any Cure Costs), all of the 

Acquired Assets are or will be free and clear of Liens other than Permitted Liens. 

(b) Except as set forth on Schedule 4.8(b) of the Disclosure Schedule, to the 

Knowledge of Seller, all Acquired Assets have been maintained in all material respects in 

accordance with generally accepted industry practice, are in all material respects in good operating 

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condition and repair, ordinary wear and tear excepted, and are adequate for the uses to which they 

are currently being put. 

4.9 Restaurants; Leased Property. Schedule 4.9 of the Disclosure Schedule lists all the 

Restaurants and the related Real Property Leases. The Restaurants shall have been continuously 

open and operated consistent with the Ordinary Course of Business from the date of this 

Agreement until the Effective Time, subject to the applicable Conditions. The Real Property 

Leases (a) are valid and in full force and effect, and (b) are not the subject of any default by Seller 

or event which with notice or lapse of time, or both, would constitute a default, except, in each 

case, as would not individually in the aggregate reasonably have a Material Adverse Change. To 

the Knowledge of Seller, Seller has provided to Buyer true, correct and complete copies of the 

Real Property Leases. To the Knowledge of Seller, Seller does not occupy or use the premises 

where the Restaurants are located in material violation of any law, regulation, decree or other 

restriction. 

4.10 Contracts. Schedule 4.10 of the Disclosure Schedule lists all Assigned Contracts 

(other than the Real Property Leases). The Parties acknowledge and agree that Schedule 4.10 of 

the Disclosure Schedule may be updated prior to Closing, pursuant to the provisions of 

Section 6.5 hereof; provided, for all purposes of the representations and warranties, the Assigned 

Contracts include only those Contracts listed on Schedule 4.10 of the Disclosure Schedule on the 

date hereof. Seller has provided, or upon finalization of the Disclosure Schedule will provide, to 

Buyer true, correct and complete copies of the Assigned Contracts. Subject to the applicable 

Conditions, requisite Bankruptcy Court approvals and assumption by the applicable Seller of any 

applicable Contracts (and satisfaction of any Cure Costs) and except as a result of the 

commencement of the Bankruptcy Cases, to the Knowledge of Seller, the Assigned Contracts (a) 

are in full force and effect and are not subject to any default or event that, with notice or lapse of 

time or both, would constitute a default by Seller or any other party, (b) are valid, legal, and binding 

agreements between the parties thereto, enforceable against each party thereto in accordance with 

its terms, and (c) were entered into in the Ordinary Course of Business. Seller has not received 

written notice that any party to any agreement intends to cancel or terminate any of the Assigned 

Contracts or to exercise or not exercise any options under any such agreements with respect to the 

Restaurants that would reasonably be expected have a Material Adverse Change. 

4.11 Tax Matters. Except as set forth on Section 4.11 of the Disclosure Schedule: 

(a) Seller has timely filed with the appropriate Governmental Authority (taking 

into account available extensions of time to file) all income and other material Tax Returns with 

respect to the Acquired Assets required to be filed by it. Each such Tax Return (taking into account 

all amendments thereto) is complete and correct in all material respects. All material Taxes with 

respect to the Acquired Assets owed by Seller that are due have been paid or have been adequately 

reserved against in accordance with United States generally accepted accounting principles. Seller 

is not currently the beneficiary of any extension of time within which to file any Tax Return with 

respect to the Acquired Assets (other than pursuant to extensions of time to file Tax Returns 

obtained in the Ordinary Course of Business). To the knowledge of Seller, there are no Liens for 

Taxes on any of the Acquired Assets other than Permitted Liens. 

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(b) Seller has withheld, collected and paid over to the appropriate Taxing 

Authority, or is properly withholding for such payment, all Taxes with respect to the Acquired 

Assets required to have been withheld and paid in connection with any amounts paid or owing to 

any employee, independent contractor, creditor, member, or other third party. 

(c) Seller is not a party to any Tax allocation or Tax sharing or Tax 

indemnification or similar agreement; in each case, with respect to the Acquired Assets (other than 

an agreement entered into in the Ordinary Course of Business the principal subject of which is not 

Taxes). 

(d) Seller is not (i) a member of an “affiliated group” within the meaning of 

Section 1504(a) of the Code (or any similar group defined under a similar provision of state, local, 

or foreign law), (ii) filing a consolidated U.S. federal income Tax Return with any other person, 

or (iii) liable for the Taxes of any person under Treasury Regulation Section 1.1502-6 or any 

analogous or similar provision of state, local or foreign law, as a transferee or successor; in each 

case, with respect to Taxes or Tax Returns of the Acquired Assets. Seller is not an S corporation 

as defined under the Code. 

(e) Seller has not been notified in writing that it is currently under audit by any 

Taxing Authority with respect to the Acquired Assets or that any Taxing Authority intends to 

conduct such an audit, and no action, suit, investigation, claim or assessment is pending or, to the 

knowledge of Seller, proposed with respect to any alleged deficiency in Taxes with respect to the 

Acquired Assets. Except as and to the extent shown on Schedule 4.11 of the Disclosure Schedule, 

Seller has not been audited, investigated, received a claim from, assessed by or sued by any Taxing 

Authority with respect to the Acquired Assets. Except as and to the extent shown on Schedule 

4.11 of the Disclosure Schedule, all deficiencies asserted or assessments made as a result of any 

examinations by any Taxing Authority with respect to the Acquired Assets have been fully paid, 

and there are no other unpaid deficiencies asserted or assessments made by any Taxing Authority 

against Seller with respect to the Acquired Assets. 

(f) Seller has not (i) waived any statute of limitations in respect of any material 

Taxes with respect to the Acquired Assets or (ii) agreed to any extension of time with respect to 

any assessment or deficiency for material Taxes with respect to the Acquired Assets (other than 

pursuant to extensions of time to file Tax Returns obtained in the Ordinary Course of Business). 

(g) Seller has not entered into any listed, reportable or substantially similar 

transactions for purposes of Treasury Regulations Section 1.6011-4, or any transaction requiring 

disclosure under a corresponding or similar provision of Law except, in each case, to the extent 

that doing so would not adversely impact the Acquired Assets or Buyer’s ownership of the 

Acquired Assets. 

(h) Notwithstanding anything in this Agreement to the contrary, the 

representations and warranties in this Section 4.11 shall constitute the sole representations and 

warranties with respect to Taxes and Tax Returns of the Seller and with respect to the Acquired 

Assets. No representation or warranty is made with respect to the validity of any Tax position or 

the availability of any Tax attribute for any Tax period (or any portion thereof) following the 

Closing. 

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4.12 Compliance with Laws. 

(a) Except as set forth on Schedule 4.12(a) of the Disclosure Schedule, and 

as subject to the applicable Conditions, Seller has complied in all material respects, with all 

applicable federal, state and local statutes, laws and regulations (including, without limitation, any 

applicable building, zoning, health, employment, environmental protection or other law, ordinance 

or regulation) affecting the Acquired Assets and the operation of the Restaurants and has not been 

cited for any violation of any such law or regulation, except, in each case, as would not constitute 

a Material Adverse Change. Seller has in full force and effect all material licenses, permits and 

other authorizations required for the operation of the Restaurants and in a manner consistent with 

Seller’s Ordinary Course of Business for the Restaurants, except where the failure to hold the same 

would not reasonably be expected to have a Material Adverse Change on one or more Restaurants 

or the Acquired Assets and Seller has not received notice of any material default or violation in 

respect of or under any of the foregoing which could have a Material Adverse Change on one or 

more Restaurants or the Acquired Assets. Seller has not received any non-compliance orders, 

warning letters, notices of violation, claims, suits, actions, proceedings, judgments, penalties, fines 

or judicial or administrative investigations of any nature pending or threatened against or involving 

the Restaurants or the business, operations, properties of the Restaurants or the Acquired Assets, 

in each case, which would have a Material Adverse Change on one or more Restaurants or the 

Acquired Assets. Notwithstanding the foregoing, the Parties acknowledge and agree that (i) this 

Section 4.12(a) shall not apply with respect to any matters involving a liquor license to the extent 

Seller or its Affiliates have received any non-compliance order, warning letter, notice of violation, 

claim, suit, action, proceeding, plea, settlement, consent, penalty, fine or Judgment relating to any 

such liquor license utilized at the Restaurants and (ii) Section 4.12(b) below shall be the sole and 

exclusive representation or warranty with respect to such matters. 

(b) Schedule 4.12(b) of the Disclosure Schedule lists in all material respects 

all material non-compliance orders, warning letters, notices of violation, claims, suits, actions, 

proceedings, pleas, settlements, consents, penalties, fines or Judgments received by Seller during 

the past two (2) years that specifically relate to the liquor licenses utilized at the Restaurants. 

4.13 Litigation, Etc. Except as set forth on Schedule 4.13 of the Disclosure Schedule, 

there is no pending, or, to the Knowledge of Seller, any threatened suit, action, arbitration or legal, 

administrative or other proceeding, or governmental investigation or claim against or affecting the 

Acquired Assets or the Restaurants which, if determined adversely to Seller, would be material 

with respect to the Acquired Assets or the Restaurants. To the Knowledge of Seller, there is no 

basis for any action, arbitration, or legal, administrative or other proceeding, or governmental 

investigation or claim against Seller which could have a Material Adverse Change on the Acquired 

Assets or the Restaurants. 

4.14 Employees. 

(a) Schedule 4.14(a) of the Disclosure Schedule contains: (i) a list of all 

Restaurant Employees as of the date of this Agreement; and (ii) each such Restaurant Employee’s 

(A) job title, (B) date of hire, (C) rate of base compensation (hourly wage or annual salary, as 

applicable) as of the date hereof (D) status as active or in active, and if applicable and known to 

Seller, the reason for leave status, (E) work location (by store number), (F) accrued vacation or 

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paid time off as of the date of this Agreement (including the portion of which that would be 

required to be paid upon the cessation of such individual’s employment), (G) exempt or nonexempt status under the Fair Labor Standards Act or similar Applicable Law, and (H) years of 

service credit. Not less than fifteen (15) days prior to Closing, Seller will deliver to the Buyer an 

updated Schedule 4.14(a) of the Disclosure Schedule, containing the foregoing information 

relating to Persons who become Restaurant Employees or who are no longer employed by Seller, 

in each case, following the date of this Agreement. 

(b) (i) Seller is not a party to or bound by any collective bargaining agreement, 

work rules or other practices or any other labor-related Contract with a labor union, trade union or 

labor organization (“Collective Bargaining Agreement”) in respect of the Restaurants or covering 

any Restaurant Employees; (ii) there are, and have been in the past three (3) years, no pending, or 

to the knowledge of Seller, threatened activities or proceedings of any labor union or similar 

employee or labor organization to organize any Restaurant Employees; and (iii) there are, and have 

been in the past three (3) years, no unfair labor practice charges, grievances or complaints pending 

before the National Labor Relations Board or any similar Governmental Authority or, to the 

knowledge of Seller, threatened by or on behalf of any Restaurant Employees; and (iv) there is, 

and in the past three (3) years there has been, no material strike, slowdown, work stoppage, lockout 

or other material labor dispute pending or, to the knowledge of Seller, threatened in respect of the 

Restaurants, and Seller does not contemplate a lockout of any Restaurant Employees as of the date 

of this Agreement. 

(c) Except as set forth on Schedule 4.14(c) of the Disclosure Schedule, in the 

past six (6) months, Seller has not triggered any notice requirements under the WARN Act with 

respect to any Restaurant Employees. 

(d) Seller is not a party to any employment Contract, consulting Contract or 

other commitment for the employment or retention of any Restaurant Employees, and no 

Restaurant Employees are otherwise employed by Seller in connection with the business 

conducted by the Restaurants, other than any such Contract or commitment that can be terminated 

at will. Except as set forth on Schedule 4.14(d) of the Disclosure Schedule, Seller is not 

delinquent to, and has not failed to pay, any due wages, bonuses, commissions and other benefits 

and sums due (and all required taxes, insurance, social security and withholding thereon), 

including all accrued vacation, sick leave, benefits and payments and pro rata accruals for a portion 

of the year of this Agreement to the Restaurant Employees pursuant to all Applicable Laws and 

Seller’s current material policies and procedures. 

4.15 Employee Benefits. 

(a) Seller is not required to make any contributions to any defined benefit 

pension for the benefit of Restaurant Employees. Subject to the foregoing, Seller has, as of the 

date hereof, made all required payments, contributions and filings under or in respect of any such 

plans or arrangements, and, to the knowledge of Seller, there has not occurred any act, omission, 

event or condition such as would reasonably be expected to give rise to any material liability of 

Seller thereunder other than the obligations to make normal payments and contributions 

thereunder. Each Employee Benefit Plan that is intended to qualify under Section 401(a) of the 

Code has received a favorable determination or opinion letter from the IRS regarding its 

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qualification thereunder and, to the knowledge of Seller, nothing has occurred since the date of the 

most recent such determination or opinion letter that could reasonably be expected to adversely 

affect the qualified status of any of such Employee Benefit Plans. 

(b) Except as set forth in Schedule 4.15(b) of the Disclosure Schedule, neither 

Seller nor any of its ERISA Affiliates within the six-year period preceding the date of this 

Agreement has sponsored, maintained or contributed to (or has been obligated to contribute to), or 

has any current or contingent liability or obligation under or with respect to: (i) any “employee 

pension plan,” as defined in Section 3(2) of ERISA, that is or was subject to Title IV of ERISA or 

Section 412, 430 or 436 of the Code; or (ii) any Multiemployer Plan. No Employee Benefit Plan 

is a “multiple employer plan” within the meaning of Section 413(c) of the Code or Section 210 of 

ERISA, or a “multiple employer welfare arrangement” as defined in Section 3(40) of ERISA. 

(c) Neither the execution and delivery of this Agreement, nor the 

consummation of the transactions contemplated hereby, either alone or in combination with 

another event, will: (i) entitle any current or former Restaurant Employee, consultant, director or 

other service provider of the Restaurants (or any dependent or beneficiary thereof) to any payment 

of compensation; (ii) increase the amount of compensation or benefits due to any such person; (iii) 

accelerate the vesting, funding or time of payment of any compensation, equity award or other 

benefit to any Restaurant Employee; (iv) require a contribution to any Employee Benefit Plan in 

respect of any Restaurant Employee; or (v) result in any payments or benefits under any agreement 

with the Seller that, individually or in combination with any other payment or benefit, would 

constitute the payment of any “excess parachute payment” within the meaning of Section 280G of 

the Code or in the imposition of an excise Tax under Section 4999 of the Code. 

4.16 Finder’s or Broker’s Fees. Other than Hilco Corporate Finance, LLC, who has been 

engaged as Seller’s investment banker, neither Seller nor any of its directors, officers, managers, 

employees, agents, consultants, advisors, accountants, legal counselors or other representatives 

(each, a “Representative”) have engaged a broker or finder in connection with any transaction 

contemplated by this Agreement and no broker or other person is entitled to any commission or 

finder’s fee in connection with any of these transactions as a result of any actions by Seller. 

4.17 Environmental Matters. Except as would not, individually or in the aggregate, 

reasonably be expected to have a Material Adverse Change with respect to the Acquired Assets: 

(a) Except as set forth on Schedule 4.17(a) of the Disclosure Schedule, Seller 

has not received written notice of any material violation by Seller of Environmental Laws relating 

to the operation of the Restaurants. 

(b) Seller is not a party to, nor to the Knowledge of Seller, is it subject to any 

pending or threatened Environmental Claim, and, to the Knowledge of Seller, there are no 

conditions or occurrences at the Leased Properties or otherwise related to the Restaurants that 

reasonably could be expected to form the basis for an Environmental Claim against Seller that 

would have a Material Adverse Change. 

(c) To the Knowledge of Seller, Seller has not caused or permitted Hazardous 

Substances to be disposed of on or under the land occupied by the Restaurants as (i) a disposal site 

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or permanent storage site for any Hazardous Substance or (ii) a temporary storage site for any 

Hazardous Substance. Further, there have been no Releases of Hazardous Substances at, from, or 

to the land occupied by the Restaurants during Seller’s lease. To the Knowledge of Seller, Seller 

has operated the Restaurants in compliance with all applicable Environmental Laws. 

(d) To the Knowledge of Seller, Seller is in compliance with all permits, 

certificates, licenses, approvals and other authorizations relating to environmental matters and 

necessary for its business and its leasing of the property occupied by the Restaurants. 

(e) To the Knowledge of Seller, all Hazardous Substances used or generated by 

Seller have been generated, accumulated, stored, transported, treated, recycled and disposed of in 

compliance with all Applicable Laws and regulations. To the Knowledge of Seller, no claim or 

complaint concerning Hazardous Substances has been filed against Seller. To the Knowledge of 

Seller, Seller has no liabilities with respect to violations of Applicable Law in respect of Hazardous 

Substances, and, to the Knowledge of Seller, no facts or circumstances exist which could give rise 

to any such liabilities, claims or complaints with respect to Hazardous Substances. 

4.18 No Other Representations or Warranties. Except for the Express Representations, 

no Seller nor any other Person on behalf of Seller makes any express or implied representation or 

warranty with respect to Seller, the Acquired Assets, the Restaurants, the employees or the 

Assumed Liabilities or with respect to any information, statements, disclosures, documents, 

projections, forecasts or other material of any nature made available or provided by any Person 

(including in any presentations or other materials prepared by Seller or its Representatives) or in 

that certain datasite administered by CapLinked (the “Dataroom”) or elsewhere to Buyer or any of 

its Affiliates or Representatives on behalf of Seller or any of its Affiliates or Representatives. 

Without limiting the foregoing, no Seller nor any other Person will have or be subject to any 

Liability whatsoever to Buyer, or any other Person, resulting from the distribution to Buyer or any 

of its Affiliates or Representatives, or Buyer’s or any of its Affiliates’ or Representatives’ use of 

or reliance on, any such information, including the Projections, any information, statements, 

disclosures, documents, projections, forecasts or other material made available to Buyer or any of 

its Affiliates or Representatives in the Dataroom or otherwise in expectation of the transactions 

contemplated by this Agreement or any discussions with respect to any of the foregoing 

information. 

ARTICLE V 

REPRESENTATIONS AND WARRANTIES OF BUYER 

Buyer hereby represents and warrants that the following to Seller as of the date hereof and 

as of the Closing: 

5.1 Organization. Buyer is a Delaware limited liability company duly organized, validly 

existing, and in good standing under the laws of the jurisdiction in which it was incorporated or 

otherwise organized. 

5.2 Power and Authority; Authorization. Buyer has the requisite power and authority 

to enter into, and perform its obligations under, this Agreement and related agreements. The 

execution and delivery of this Agreement and the other agreements contemplated hereby to which 

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Buyer is a party, the performance by Buyer of its obligations hereunder and thereunder and the 

consummation by Buyer of the transactions contemplated hereby and thereby have been duly 

authorized by all necessary action on the part of Buyer and neither the execution, delivery nor 

performance of this Agreement or related agreements or the consummation of the transactions 

contemplated by this Agreement will result in or constitute a conflict or breach under Buyer’s 

organizational documents. 

5.3 Enforceability. This Agreement constitutes a valid and legally binding obligation 

of Buyer enforceable in accordance with the terms hereof, except as may be limited by the 

Enforceability Exceptions. 

5.4 No Consents or Approvals. Except as set forth on Schedule 5.4 of the Buyer 

Disclosure Schedule, no consent, approval, or authorization of, or declaration, filing, or 

registration with, any Governmental Authority, or any other Person is required to be made or 

obtained by Buyer in connection with the execution, delivery, and performance of this Agreement 

and related agreements and the consummation of the transactions contemplated by this Agreement. 

5.5 Non-contravention. Neither the execution and delivery of this Agreement, nor the 

consummation of the transactions contemplated hereby, shall (i) violate any constitution, statute, 

regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any 

Governmental Authority to which Buyer is subject, or (ii) conflict with, result in a breach of, 

constitute a default under, result in the acceleration of, create in any party the right to accelerate, 

terminate, modify, or cancel, or require any notice under any agreement, contract, lease, license, 

instrument, or other arrangement to which Buyer is a party or by which it is bound or to which any 

of its assets are subject. Except as set forth on Schedule 5.5 of the Buyer Disclosure Schedule, 

Buyer does not need to give any notice to, make any filing with, or obtain any authorization, 

consent, or approval of any Governmental Authority in order for the parties to consummate the 

transactions contemplated by this Agreement. 

5.6 Finder’s or Broker’s Fees. Buyer has not engaged a broker or finder in connection 

with any transaction contemplated by this Agreement and no broker or other person is entitled to 

any commission or finder’s fee in connection with any of these transactions as a result of any 

actions by Buyer. 

5.7 No Litigation. There are no Actions pending or, to Buyer’s knowledge, threatened 

against or affecting Buyer that will adversely affect Buyer’s performance of its obligations under 

this Agreement or the consummation of the transactions contemplated by this Agreement. 

5.8 Financing. Buyer has delivered to Seller true, complete and correct copies of an 

executed debt commitment letter, dated as of the date hereof (including all exhibits, annexes, 

schedules and term sheets attached thereto), and, if applicable, an executed fee letter, dated as of 

the date hereof (which may be redacted as to fee amounts and other economic and commercial 

terms so long as none of the redacted terms, either individually or in the aggregate, would (or 

would be reasonably expected to) materially adversely affect the amount or availability of funds 

pursuant to the terms of the debt commitment letter) (the “Fee Letter”), from the financing sources 

party thereto (collectively, the “Debt Commitment Letter”), pursuant to which the lenders and 

other parties thereto have agreed, on the terms and subject to the conditions set forth or referenced 

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therein, to provide debt financing to Buyer in the amounts set forth therein (collectively, the “Debt 

Financing”). The Debt Commitment Letter is a legal, valid and binding obligation of Buyer and 

(with respect to the Debt Commitment Letter and the Fee Letter), to the knowledge of Buyer, each 

other party thereto, and enforceable against Buyer and, to the knowledge of Buyer, each other 

party thereto in accordance with its terms, in each case, except as enforceability may be limited by 

bankruptcy laws, other similar laws affecting creditors’ rights and general principles of equity 

affecting the availability of specific performance and other equitable remedies. The Debt 

Commitment Letter has not been amended or modified in any respect prior to or as of the date of 

this Agreement and, as of the date of this Agreement, (a) no such amendment or modification is 

contemplated (other than modifications to assign or reassign or reallocate commitments and/or 

roles to lenders, agents, co-agents, arrangers, bookrunners, managers or other roles under the Debt 

Commitment Letter) and (b) the respective commitments contained in the Debt Commitment 

Letter have not been withdrawn, rescinded or terminated. As of the date hereof, assuming the 

accuracy in all material respects of the representations and warranties in Articles IV and V of this 

Agreement, no event or circumstance has occurred which, with or without notice, lapse of time or 

both, would constitute a default on the part of Buyer or, to the knowledge of Buyer, any of the 

other applicable parties thereto, under the Debt Commitment Letter. Assuming the accuracy in all 

material respects of the representations and warranties in Articles IV and V of this Agreement and 

the satisfaction of the conditions set forth in Articles VIII and IX, as of the date hereof, Buyer has 

no reason to believe that the Debt Financing contemplated by the Debt Commitment Letter will 

not be available as of the Closing. There are (i) no conditions precedent related to the funding of 

the full amounts of the Debt Financing other than as set forth in the Debt Commitment Letter and 

(ii) no other agreements that could limit, affect or impair the availability of the Debt Financing 

necessary to consummate the Closing on the Closing Date, other than as set forth in the Debt 

Commitment Letter. The aggregate proceeds of the Debt Financing will be sufficient to 

consummate the transactions contemplated by this Agreement. Buyer has fully paid or caused to 

be paid any and all commitment fees and any other amounts required by the Debt Commitment 

Letter and the Fee Letter, in each case, to be paid on or before the date of this Agreement. The 

obligations of Buyer under this Agreement are not subject to any conditions regarding Buyer’s, its 

Affiliates’, or any other Person’s ability to obtain financing for the consummation of the 

Transactions. 

5.9 Solvency. Buyer is, and immediately after giving effect to the transactions 

contemplated by this Agreement shall be, solvent and at all times shall: (a) be able to pay its debts 

as they become due, (b) own property that has a fair saleable value greater than the amounts 

required to pay its debt (including a reasonable estimate of the amount of all contingent Liabilities), 

and (c) have adequate capital to carry on its business. No transfer of property is being made and 

no obligation is being incurred in connection with the transactions contemplated hereby with the 

intent to hinder, delay or defraud either present or future creditors of Buyer or Seller. In connection 

with the transactions contemplated hereby, Buyer has not incurred, nor plans to incur, debts beyond 

its ability to pay as they become absolute and matured. 

5.10 Certain Arrangements. Except as stated in this Agreement, there are no Contracts, 

undertakings, commitments, agreements or obligations, whether written or oral, between any 

member of the Buyer Group, on the one hand, and any member of the management of Seller or its 

respective governing body (or applicable governing body of any Affiliate of Seller), any holder of 

equity or debt securities of Seller or any of its Affiliates, or any lender or creditor of Seller or any 

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Affiliate of Seller, on the other hand, (a) relating in any way to the acquisition of the Acquired 

Assets or the transactions contemplated by this Agreement or (b) that would be reasonably likely 

to prevent, restrict, impede or adversely affect the ability of Seller or any of its Affiliates to 

entertain, negotiate or participate in any such transactions. 

5.11 Investment; Buyer’s Investigation. Buyer is acquiring the Equity Interests of the 

Acquired Companies for its own account with the present intention of holding such securities for 

investment purposes and not with a view to, or for sale in connection with, any distribution of such 

securities in violation of any federal or state securities laws. Buyer is an “accredited investor” 

within the meaning of Regulation D promulgated pursuant to the Securities Act. Buyer is 

knowledgeable about the industries in which the Acquired Companies operate and is capable of 

evaluating the merits and risks of the transactions contemplated by this Agreement and is able to 

bear the substantial economic risk of such investment for an indefinite period of time. 

ARTICLE VI 

SELLER’S COVENANTS AND AGREEMENTS 

6.1 Buyer’s Access to Premises and Information. From the date hereof until the earlier 

of the termination of this Agreement and the Closing Date, upon reasonable advance written 

request by Buyer which shall be directed to Hilco or such other Persons as Seller may designate 

from time to time, Seller will permit Buyer and its counsel, accountants and other Representatives 

to have reasonable access during normal business hours and in a manner so as not to interfere 

unreasonably with the regular business operation of Seller, to all properties, accounts, Records, 

contracts, and employees of Seller relating to the Restaurants, in each case, for the sole purpose of 

consummating the transactions contemplated hereby and will be governed by all the terms and 

conditions of the Confidentiality Agreement provided that (a) a Representative of Seller to be 

designated by Seller shall be present during such access, (b) Buyer and its Representatives shall 

fully cooperate with Seller to maintain confidentiality regarding the transactions contemplated by 

this Agreement during such access and (c) could reasonably be expected to cause competitive harm 

to any Seller if the transactions contemplated by this Agreement are not consummated; provided, 

however, that, for avoidance of doubt, the foregoing shall not require any Party to waive, or take 

any action with the effect of waiving, its attorney-client privilege or any confidentiality obligation 

to which it is bound with respect thereto or take any action in violation of applicable Law. Seller 

shall furnish or cause to be furnished to Buyer and its Representatives all data and information 

concerning the business, finances and properties of Seller relating to the Restaurants that may 

reasonably be requested. Buyer will not, and will not permit any member of the Buyer Group to, 

contact any officer, manager, director, employee, customer, supplier, lessee, lessor, lender, 

licensee, licensor, distributor, landlord, franchisor, creditor, noteholder or other material business 

relation of any Seller or its Affiliates prior to the Closing with respect to any Seller, its business or 

the transactions contemplated by this Agreement without the prior written consent of Seller (which 

consent shall not be unreasonably delayed, conditioned or withheld) for each such contact. 

6.2 Conduct of Business in Ordinary Course. Seller shall, subject to the applicable 

Conditions, and except (i) as required to comply with any Applicable Laws (including by Order 

or directive of the Bankruptcy Court or fiduciary duty of boards of managers (or similar governing 

bodies) of the Seller and its Affiliates) or any requirements or limitations resulting from the 

Bankruptcy Cases, or (ii) as contemplated by this Agreement (including as restricted pursuant to 

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Section 6.2), as set Schedule 6.2 of the Disclosure Schedule or with the prior written consent 

(email to suffice) of Buyer which such consent shall not be unreasonably withheld, conditioned or 

delayed, from and after the date of this Agreement and through the Closing Date (or earlier 

termination of this Agreement), with respect to the Restaurants, (a) use commercially reasonable 

efforts to carry on its business solely in the Ordinary Course of Business; (b) use commercially 

reasonable efforts to preserve and maintain its business organization intact and to maintain its 

relationships with suppliers, customers and others so that such relationships will be preserved on 

and after the Closing Date; (c) use commercially reasonable efforts to repair and maintain all 

tangible properties and assets with respect to the Restaurants in accordance with its usual and 

ordinary repair and maintenance standards and maintain the Fixed Assets through the Closing Date 

in substantially the same condition as they were at the time of the Inspections, normal wear and 

tear excepted (for the avoidance of doubt, subject to the applicable Conditions, including requisite 

approvals by the Bankruptcy Court and under the DIP Facility or the DIP Credit Agreement on the 

use of cash); (d) except as otherwise set forth on Schedule 2.6(c) of the Disclosure Schedule, not 

end, terminate or change in any material respect, as related to the Acquired Assets, any lease, 

contract, undertaking or other commitment, and shall not knowingly do any act or omit to do any 

act, or permit an act or omission to act, which will cause a material breach of any such lease, 

contract, undertaking or other commitment unless such modification relates to splitting up any 

Acquired Assets in connection with Seller separating or duplicating necessary parts of the business 

to be able to sell non-Transaction related assets to other bidders; (e) except as required by 

applicable Law or pursuant to the terms of any Employee Benefit Plan, not grant any general 

increase in the rates of pay of any of its hourly-paid Restaurant Employees, grant any increase in 

the salaries or other compensation to any Restaurant Employees, or grant any increase in the 

pension, retirement or other employment benefits of any character of, or grant any new benefits 

to, such Restaurant Employees; and (f) not make, incur or authorize any dividends or distributions, 

repurchases or redemptions of Equity Interests, capital expenditures or any indebtedness for 

borrowed money, other in the Ordinary Course of Business and consistent with past practice; 

provided, that nothing herein shall limit Seller’s right to remove the Excluded Assets from the 

Restaurants prior to Closing, including any cash other than Restaurant Cash. 

6.3 Financing Cooperation. 

(a) Prior to the Closing Date (or the earlier termination of this Agreement), 

Seller, subject to the applicable Conditions, shall, and shall use its reasonable best efforts to cause 

its controlled Affiliates and Representatives to, at Buyer’s sole cost and expense, provide all 

customary cooperation as reasonably requested by Buyer and its Affiliates, subsidiaries and 

Representatives to assist Buyer in the arrangement of the Debt Financing including by (i) assisting 

with the preparation of the schedules and exhibits to the definitive financing documentation as 

may be reasonably requested by Buyer, (ii) assisting with the pledging of collateral for the Debt 

Financing, (iii) cooperating in satisfying the conditions precedent set forth in the Debt 

Commitment Letter or any definitive document relating to the Debt Financing to the extent the 

satisfaction of such condition requires the cooperation of, or is within the control of, Seller, (iv) 

taking corporate actions reasonably necessary to permit the consummation of the Debt Financing, 

and (v) providing to Buyer and its Financing Sources at least four (4) Business Days prior to the 

Closing Date all documentation and other information required by regulatory authorities under 

applicable “know your customer” and anti-money laundering rules and regulations, including the 

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PATRIOT Act and the Beneficial Ownership Regulation (31 C.F.R. § 1010.230) to the extent 

requested at least nine (9) days prior to the Closing. 

(b) Notwithstanding anything in this Agreement to the contrary, (i) neither 

Seller nor its directors, officers, employees or agents shall be required to execute or enter into any 

certificate, instrument, agreement or other document in connection with the Debt Financing which 

will be effective prior to the Closing, (ii) nothing herein shall require cooperation or other actions 

or efforts on the part of Seller or any of its directors, officers, employees or agents in connection 

with the Debt Financing to the extent it would interfere unreasonably with the business or 

operations of Seller, (iii) neither Seller nor its directors, officers, employees or agents will be 

required to pay any commitment or other similar fee that is not reimbursed by Buyer or to enter 

into any agreement effective in connection with the Debt Financing prior to the Closing, (iv) 

nothing herein shall require the boards of directors of Seller, prior to the Closing, to adopt 

resolutions approving or otherwise approve the agreements, documents or instruments pursuant to 

which the Debt Financing is made and (v) the cooperation required pursuant to this Section 6.3 

will not violate this Agreement, any other contractual or analogous obligation of Seller or 

Applicable Law. 

(c) Buyer shall indemnify and hold harmless Seller and its Affiliates, officers, 

directors, employees or agents from and against any and all losses, damages or liabilities suffered 

or incurred by any of them in connection with any of their cooperation or assistance with respect 

to the Debt Financing except, in each case, to the extent arising from the willful misconduct, gross 

negligence, intentional fraud or intentional misrepresentation of Seller or its Affiliates, officers, 

directors, employees or agents in connection with the Debt Financing. Buyer shall from time to 

time, promptly upon request by Seller, reimburse Seller for any and all out of pocket expenses 

incurred in connection with its cooperation or assistance with respect to the Debt Financing. 

(d) Notwithstanding anything to the contrary, Seller shall be deemed to have 

complied with this Section 6.3 for all purposes of this Agreement (including Article VIII) unless 

the Debt Financing has not been obtained as a result of Seller’s breach of its obligations under this 

Section 6.3. For the avoidance of doubt, the Parties acknowledge and agree that the provisions 

contained in this Section 6.3 represent the sole obligation of Seller and its Affiliates and 

Representatives with respect to cooperation in connection with the arrangement of the Debt 

Financing and no other provision of this Agreement (including the Exhibits and Schedules hereto) 

shall be deemed to expand or modify such obligations. 

6.4 Closing Conditions; Reasonable Efforts. From the date hereof until the Closing (or 

earlier termination of this Agreement), Seller shall, subject to the applicable Conditions, use 

reasonable best efforts (a) to take all such actions as are reasonably necessary to expeditiously 

satisfy the closing conditions set forth herein and to cause the transactions contemplated herein to 

be effected as soon as practicable, but in any event on or prior to the Outside Date, and (b) to 

cooperate with Buyer and its Affiliates and Representatives in connection with any step required 

to be taken as a part of its obligations hereunder. The “reasonable best efforts” of Seller will not 

require Seller or any of its Affiliates or Representatives to expend any money to remedy any breach 

of any representation or warranty, to commence any Action, to waive or surrender any right, to 

modify any Contract or to waive or forego any right, remedy or condition hereunder. 

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6.5 Supplements to Disclosure Schedule. On or before three (3) Business Days prior 

to the Bid Deadline, Seller will cause a copy of the final Disclosure Schedule to be delivered to 

Buyer; provided, however, the Parties acknowledge that Schedules 2.1, 2.2 and 2.6(d) of the 

Disclosure Schedule may be updated after such date but no later than the applicable dates set forth 

herein, in each case subject to the express terms of this Agreement. From the date hereof until the 

Closing, Seller shall use commercially reasonable efforts promptly notify Buyer upon Seller 

becoming aware (to the Knowledge of Seller) of any material breach by Seller of any 

representation, warranty, or covenant made by Seller hereunder or occurrence of any event or 

circumstance which will reasonably result in such a breach. At any time after the Bid Deadline but 

prior to the Closing, Seller may supplement or amend the Disclosure Schedule to this Agreement 

to the extent that Seller becomes aware of any matter previously existing or hereafter arising which, 

if existing, occurring or known as of the date of this Agreement, would have been required to be 

set forth or described in such Disclosure Schedule or that is otherwise necessary to correct any 

information in such Disclosure Schedule that has been rendered inaccurate thereby (collectively, 

the “Schedule Updates”). On or before the day prior to the Closing Date, Seller may deliver an 

updated set of Disclosure Schedule containing all Schedule Updates through such date in form and 

substance reasonably agreeable to Buyer. The Schedule Updates may describe facts, 

circumstances, events or conditions that: (a) did not exist on, or have changed since, the date hereof 

(“New Information”); or (b) existed on the date hereof (“Correcting Information”). No New 

Information or Correcting Information set forth in a Schedule Update shall affect the 

representations or warranties of Seller or Buyer’s right to rely thereon, or the conditions to the 

obligations of the Buyer. Neither the giving of notice nor the delivery of the Schedule Updates 

shall be deemed to prevent or cure any misrepresentation, breach of representation or warranty, or 

breach of covenant by Seller, nor shall they affect any right or remedy of Buyer existing or arising 

by reason of the inaccuracy of any representation or warranty or breach of any covenant. 

6.6 Bankruptcy Matters. 

(a) Bankruptcy Filings. Seller shall (A) cooperate with Buyer concerning the 

Bidding Procedures Order, the Sale Order and any other orders of the Bankruptcy Court relating 

to the transactions contemplated by this Agreement, and (B) use commercially reasonable efforts 

to provide Buyer with copies of all applications, pleadings, notices, proposed orders and other 

documents relating to this Agreement or the Transactions, at least three (3) Business Days in 

advance of the proposed filing date so as to permit Buyer sufficient time to review and comment 

on such drafts and, with respect to all provisions that materially impact Buyer, such pleadings and 

proposed orders shall be reasonably acceptable to Buyer and consistent with this Agreement. The 

Seller shall give Buyer reasonably advance notice of any hearings regarding the motions required 

to obtain the issuance of the Bidding Procedures Order and the Sale Order. 

(b) Bankruptcy Notices. Notice of the hearing on the Sale and Bid Procedures 

Motion, and request for entry of the Sale Order and the objection deadline shall be served by Seller 

in accordance with the Bankruptcy Code and the applicable Federal Rules of Bankruptcy 

Procedure, including Bankruptcy Rules 2002, 6004, 6006 and 9014, any applicable local rules or 

procedures of the Bankruptcy Court, and any orders of the Bankruptcy Court on all persons 

required to receive notice, including, but not limited to (i) the Office of the United States Trustee 

for the Northern District of Texas; (ii) counsel to any official committee appointed in the 

Bankruptcy Case; (iii) all entities known to have expressed an interest in a transaction with respect 

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to the Acquired Assets during the past twelve (12) months; (iv) all counterparties to any contracts 

or leases, whether executory or not; (v) all parties with Liens, claims or encumbrances on or against 

any of the Seller’s assets; (vi) all affected federal, state and local governmental regulatory and 

taxing authorities, including the Internal Revenue Service and State Attorney General in each State 

in which the Seller conducts business; (vii) all known holders of claims against and equity interests 

in the Seller, (viii) all of the Seller’s insurers; (ix) all parties that have filed and not withdrawn 

requests for notices pursuant to Bankruptcy Rule 2002, and (x) to the extent not already included 

above, all parties in interest listed on the Seller’s creditor matrix (collectively, the “Notice 

Parties”). Seller shall provide notice to the Notice Parties that all responses or objections to the 

Sale and Bid Procedures Motion shall be served on, among others, counsel to Buyer. 

6.7 Seller Receipt of Misdirected Assets; Liabilities. From and after the Closing, if 

Seller or any of its respective Affiliates receives any right, property or asset that is an Acquired 

Asset, the Seller shall promptly transfer or cause such of its Affiliates to transfer such right, 

property or asset (and shall promptly endorse and deliver any such asset that is received in the 

form of cash, checks or other documents) to Buyer without the payment of any further 

consideration therefor, and such asset will be deemed the property of Buyer held in trust by such 

Seller for Buyer until so transferred. From and after the Closing, if Seller or any of its respective 

Affiliates is subject to a Liability that should belong to Buyer pursuant to the terms of this 

Agreement, Seller shall promptly transfer or cause such of its Affiliates to transfer such Liability 

to Buyer, and Buyer shall assume and accept such Liability without the payment of any further 

consideration therefor. 

ARTICLE VII 

BUYER’S COVENANTS AND AGREEMENTS 

7.1 Cooperation in Securing Consents of Third Parties. Buyer shall use reasonable best 

efforts to obtain or, as applicable, to assist Seller in obtaining consents, if any, of all necessary 

persons and agencies to the assignment and transfer to Buyer of any and all properties, assets and 

agreements, to be assigned and transferred under the terms of this Agreement, and shall promptly 

execute all documents reasonably requested by Seller in connection therewith, but Buyer shall not, 

in order to obtain such consents or otherwise, except as provided for in Section 2.6, Section 7.2 or 

Section 7.10 (including, for the avoidance of doubt, Schedule 7.2 of the Disclosure Schedule and 

payment of the Cure Costs), be required to give consideration or guarantee any obligations of 

Seller arising prior to the Closing Date, whether relating to Seller’s operation of the Restaurants, 

ownership of the Acquired Assets or otherwise. In furtherance of, and in no way limiting the 

foregoing, within ten (10) days following the execution of this Agreement, Buyer will furnish to 

Seller (or Seller’s designee, including to any Landlord) all information reasonably requested by 

Seller or its designee in connection with obtaining the consents contemplated by this Agreement. 

Such information to be provided by Buyer to Seller or its designee may include, but shall not be 

limited to, (i) current and historical financial statements, (ii) company profiles (including in respect 

of any proposed assignee of a Real Property Lease), (iii) quantitative and qualitative information 

regarding the principals and/or owners of Buyer and its parent entities (including any assignee of 

a Real Property Lease), and (iv) such other information requested by Seller or its designee. 

7.2 Required Licenses. To the extent Applications may be made prior to Closing, except 

as set forth on Schedule 7.2 of the Disclosure Schedule, within a reasonable period of time, but 

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no later than fifteen (15) Business Days following the Effective Date, Buyer shall have completed 

and filed with the applicable Governmental Authorities all Applications for Conditional Liquor 

Licenses or a Liquor Licenses reasonably necessary for the operation of the Restaurants to the 

extent such licenses or permits do not constitute Transferable Permits. To the extent requested by 

the applicable Governmental Authority, Buyer shall promptly respond and provide such additional 

information or documentation as may be requested. Buyer shall keep Seller informed regarding 

the status of such Applications and provide such information as Seller may reasonably request in 

connection therewith. Buyer and Seller covenant and agree to comply with the obligations set forth 

on Schedule 7.2 of the Disclosure Schedule with respect to liquor licenses and the other matters 

set forth therein. 

7.3 Duplication of Records. Prior to the Closing, Seller and its Affiliates may make, 

and retain following the Closing, duplicate copies of any Records to the extent such Records are 

within Seller’s and its Affiliates’ possession; provided that Seller shall, and shall cause its 

controlled Affiliates to, only use duplicated copies of Records solely (i) to comply with reporting, 

disclosure, filing or other requirements imposed on Seller or its Affiliates by a Governmental 

Authority (including if so required under the Bankruptcy Code, Bankruptcy Court local rules or 

requested by the Bankruptcy Court), (ii) to prepare financial statements or tax returns, or in order 

to satisfy audit, accounting or other similar requirements of Seller or its Affiliates, (iii) to defend 

any Action or (iv) in connection with or related to any wind-down, dissolution, liquidation, 

reorganization or plan of reorganization of Seller or its Affiliates. In the event any Records are 

used both by the Restaurants and the Retained Business, each Party agrees to use its commercially 

reasonable efforts to enter into mutually acceptable arrangements to share such Records with both 

Seller and its Affiliates and any buyer(s) of, or successor(s) to, the Retained Business, including 

any trustee. 

7.4 Closing Conditions; Reasonable Efforts. From the date hereof until the Closing (or 

earlier termination of this Agreement), Buyer shall use reasonable best efforts (a) to take all such 

actions as are reasonably necessary to expeditiously satisfy the closing conditions set forth herein 

and to cause the transactions contemplated herein to be effected as soon as practicable, but in any 

event on or prior to the Outside Date, and (b) to cooperate with Seller and its Affiliates and 

Representatives in connection with any step required to be taken as a part of its obligations 

hereunder. 

7.5 Notice of Breach. From the date hereof until the Closing, Buyer shall promptly 

notify Seller of any material breach by Buyer of any representation, warranty or covenant made 

by Buyer hereunder or occurrence of any event or circumstance which will reasonably result in 

such a breach. 

7.6 Back-up Bidder. If an Auction is conducted, and Seller does not choose Buyer as 

the Winning Bidder, but instead choose Buyer as the Back-up Bidder in accordance with the 

Bidding Procedures Order, Buyer will serve as the Back-up Bidder. If Buyer is chosen as the 

Back-up Bidder, Buyer will be required to keep its bid to consummate the transactions 

contemplated by this Agreement on the terms and conditions set forth in this Agreement (as the 

same may be improved upon by Buyer prior to or at the Auction) open and irrevocable until the 

closing of the sale of the Acquired Assets to the Winning Bidder, subject to the Outside Date. If 

the Alternative Transaction with the Winning Bidder is terminated prior to the termination of this 

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Agreement, Buyer will be deemed to be the Winning Bidder and will forthwith consummate the 

transactions contemplated by this Agreement on the terms and conditions set forth in this 

Agreement (as the same may be improved upon by Buyer prior to or at the Auction). 

7.7 Wind-Down. 

(a) Notwithstanding anything to the contrary herein, from and after the Closing 

Date until the later of the conclusion of the Bankruptcy Case and the wind-down and final 

distribution of all assets of Seller and its Affiliates, Buyer shall give Seller and its Representatives 

reasonable access during normal business hours upon reasonable advance notice of not less than 

forty-eight (48) hours before the requested date of access to any books, records and information 

pertaining to the Acquired Assets and Assumed Liabilities and certain key employees for the 

purposes of (i) the preparation or amendment of Tax Returns, (ii) the determination of any matter 

relating to the rights or obligations of Seller under this Agreement, or (iii) as is necessary to 

administer, or satisfy their obligations in connection with, the Bankruptcy Case and the wind-down 

of Seller and its assets, in each case of clauses (i)-(iii), in such a manner as not to unreasonably 

interfere with the conduct of the Business. Notwithstanding anything to the contrary in this 

Agreement, Buyer and its controlled Affiliates (including the Acquired Companies) shall not be 

required to disclose any information to Seller if such disclosure would (x) jeopardize any attorneyclient or other legal privilege or (y) contravene any applicable Law or fiduciary duty; provided, 

however, Buyer shall use its commercially reasonable efforts to provide a summary of such 

privileged information to the extent it would not violate any such privilege, applicable Law or 

fiduciary duty. Buyer shall, and shall cause each of its controlled Affiliates (including the Acquired 

Companies) and its Representatives to, cooperate with Seller and its Representatives as may 

reasonably be requested by Seller for such purposes. 

(b) Notwithstanding anything to the contrary herein, unless otherwise 

consented to in writing by Seller, Buyer will not, for a period of three (3) years following the 

Closing Date, destroy, alter, or otherwise dispose of any of the Records without first offering to 

surrender to Seller such Records or any portion thereof that Buyer may intend to destroy, alter, or 

dispose of. From and after the Closing, Buyer will, and will cause its employees to, provide Seller 

and its Affiliates with reasonable assistance, support, and cooperation with Seller’s and its 

Affiliates’ wind-down and related activities (e.g., helping to locate documents or information 

related to preparation of Tax Returns, providing former officers, to the extent employed by or 

under Buyer’s or its Affiliate’s control, to sign pre-Closing Tax Returns or prosecution or 

processing of insurance/benefit claims). Without limiting the generality of the foregoing, Buyer 

acknowledges and agrees that Seller and its Affiliates may reasonably require (i) ongoing services 

from one or more former Business employees (and may request, upon the written consent of Buyer 

(not to be unreasonably withheld, conditioned or delayed) that such Business employee enter into 

consulting services or similar arrangements) and (ii) reasonable access to or use of certain 

transferred IT assets solely to the extent required to facilitate Seller’s wind-down and related 

activities, subject in each case to the parameters regarding access in Section 7.7(a). 

(c) Seller and its Affiliates shall be permitted to keep copies of any Contracts, 

documents, Records, and other information to the extent reasonably necessary or required by the 

Bankruptcy Courts or in connection with the Bankruptcy Case or to facilitate any subsequent winddown proceedings or liquidating plan of Seller or its Affiliates. For the avoidance of doubt, the 

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obligations in this Section 7.7 shall be in addition to, and not limited by, any services to be provided 

pursuant to any Transition Services Agreement. 

7.8 Buyer Receipt of Misdirected Assets; Liabilities. From and after the Closing, if 

Buyer or any of its Affiliates receives any right, property or asset that is an Excluded Asset, Buyer 

shall promptly transfer or cause such of its Affiliates to transfer such asset (and shall promptly 

endorse and deliver any such right, property or asset that is received in the form of cash, checks, 

or other documents) to Seller, and such asset will be deemed the property of Seller held in trust by 

Buyer for Seller until so transferred without the payment of any further consideration therefor. 

From and after the Closing, if Buyer or any of its Affiliates is subject to a Liability that should 

belong to Seller pursuant to the terms of this Agreement, Buyer shall promptly transfer or cause 

such of its Affiliates to transfer such Liability to Seller, and Seller shall accept such Liability 

without the payment of any further consideration therefor. 

7.9 Efforts to Obtain Financing. 

(a) Buyer shall use its reasonable best efforts to consummate and obtain the 

Debt Financing contemplated by the Debt Commitment Letter on the terms set forth therein, 

including using Buyer’s reasonable best efforts to (i) maintain in full force and effect the Debt 

Commitment Letter (and any definitive agreements entered into in connection therewith) in 

accordance with the terms thereof, (ii) negotiate and enter into definitive agreements with respect 

to the Debt Financing on terms and conditions not less favorable to Buyer (as determined by Buyer 

in good faith) than the terms and conditions contained in the Debt Commitment Letter, (iii) satisfy 

on a timely basis at or prior to Closing all conditions to obtaining the Debt Financing set forth in 

the Debt Commitment Letter that are applicable to Buyer and within Buyer’s control, (iv) upon 

satisfaction of the conditions set forth in the Debt Commitment Letter (other than those to be 

satisfied at the Closing, but subject to the satisfaction or waiver of those conditions at Closing), to 

consummate the Debt Financing at the Closing; provided, that all of the conditions set forth in 

Articles VIII and IX (other than those to be satisfied at the Closing, but subject to the satisfaction 

or waiver of those conditions at Closing) have been satisfied and (v) enforce its rights under the 

Debt Commitment Letter in a timely and diligent matter (as determined by Buyer). 

(b) Buyer shall give Seller prompt notice upon (A) becoming aware of any 

material breach or default by any party to the Debt Commitment Letter or any definitive 

agreements relating thereto or (B) its receipt of any written notice or other written communication 

from any party to the Debt Commitment Letter with respect to (i) any failure to comply with the 

terms of the Debt Commitment Letter or any definitive agreements related thereto by any party 

thereto or (ii) any actual or threatened termination or repudiation (whether in whole or in part) of 

the Debt Commitment Letter or any definitive agreements related thereto by any party thereto. 

Upon the request of Seller, Buyer shall inform Seller in reasonable detail of the status of Buyer’s 

efforts to arrange the Debt Financing; provided, however, that nothing in this sentence or the 

immediately preceding sentence shall require Buyer to disclose any information that is subject to 

the attorney-client or work product privilege. 

(c) If the Debt Financing contemplated by the Debt Commitment Letter 

becomes unavailable on the terms and conditions contemplated therein, in whole or in part, for any 

reason, Buyer shall (i) promptly notify Seller thereof and (ii) use reasonable best efforts to arrange 

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for and obtain alternative debt financing from other sources on terms and conditions that are not 

less favorable to Buyer (as determined by Buyer in good faith) than those in the Debt Commitment 

Letter in respect of the Debt Financing which has become unavailable in an amount sufficient to 

consummate the transactions contemplated by this Agreement in the timeframe contemplated by 

this Agreement (the “Alternative Financing”) to replace such unavailable Debt Financing and to 

obtain a new financing commitment letter with respect to such Alternative Financing (an 

“Alternative Commitment Letter”); provided that if the Debt Financing contemplated by the Debt 

Commitment Letter becomes unavailable on the terms and conditions contemplated therein, in 

whole or in part, for any reason, Seller shall have the right, in its sole discretion, to terminate this 

Agreement under Section 11.1(e) (with such failure being considered a Buyer breach and a Buyer 

Default Termination pursuant to Section 3.2(b)) at any time following receipt of notice that the 

Debt Financing contemplated by the Debt Commitment Letter has become unavailable on the 

terms and conditions contemplated therein, in whole or in part, for any reason. In the event any 

Alternative Commitment Letter is obtained, (x) any reference in this Agreement to any “Debt 

Financing” shall include the financing contemplated by such Alternative Commitment Letter and 

(y) any reference in this Agreement to any “Debt Commitment Letter” shall be deemed to include 

the Debt Commitment Letter to the extent not superseded by an Alternative Commitment Letter at 

the time in question and any Alternative Commitment Letter to the extent then in effect, in each 

case other than with respect to Buyer’s representations set forth in Section 5.8 with respect to the 

Debt Commitment Letter and Debt Financing. 

(d) Without the prior written consent of Seller (which shall not be unreasonably 

withheld, delayed or conditioned), Buyer shall not permit any amendment or modification to be 

made to, or any waiver of any provision or remedy under, the Debt Commitment Letter, or release 

or consent to the termination of the obligations of the sources of the Debt Financing under the Debt 

Commitment Letter if such amendment, modification, waiver, consent or termination or release (i) 

reduces the aggregate amount of the Debt Financing, (ii) imposes additional conditions precedent 

to the availability of the Debt Financing or amends or modifies any of the existing conditions to 

the funding of the Debt Financing in a manner that would prevent or materially impede or delay 

the funding of the Debt Financing on the Closing Date or (iii) adversely impacts the ability of 

Buyer to enforce its rights against the Financing Sources party to the Debt Commitment Letter (it 

being understood and agreed that, in any event, Buyer may amend the Debt Commitment Letter to 

add lenders, arrangers, bookrunners, agents, managers or similar entities that have not executed 

the Debt Commitment Letter as of the date of this Agreement). 

7.10 Guaranty. Intentionally deleted. 

7.11 Guarantees and Bonding Requirements. On or prior to the Closing Date, Buyer or 

its Affiliates shall provide replacement guarantees, sureties, standby letters of credit or other 

assurances of payment with respect to all Bonding Requirements, in form and substance 

reasonably satisfactory to Seller and any banks or other counterparty thereto, and, both prior to 

and following the Closing, Buyer shall cooperate with Seller to obtain a release in form and 

substance reasonably satisfactory to Buyer and Seller with respect to all Bonding Requirements. 

“Bonding Requirements” means standby letters of credit, guarantees, sureties indemnity bonds and 

other financial commitment credit support instruments issued by third parties on behalf of Seller 

or any of their respective subsidiaries or Affiliates regarding any of the Acquired Assets. 

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7.12 Directors’ and Officers’ Indemnification. Following the Closing until the sixth (6th) 

anniversary thereof, Buyer shall (a) cause the Acquired Companies and their Subsidiaries not to 

amend, repeal or otherwise modify the Acquired Companies’ and their Subsidiaries’ respective 

constitutive documents as in effect at the Closing, in any manner that would adversely affect the 

rights thereunder of individuals who are or were directors or officers of the Acquired Companies 

and their Subsidiaries (the “Indemnified Persons”) and (b) cause the Acquired Companies and 

their Subsidiaries to honor and pay the indemnification, advancement of expenses and exculpation 

provisions of each of the Acquired Companies’ and their Subsidiaries’ constitutive documents as 

in effect at the Closing, in any manner; provided, that all rights to indemnification in respect of 

any Action pending or asserted or any claim made within such period shall continue until the 

disposition of such Action or resolution of such claim. Buyer shall not cancel or otherwise reduce 

coverage under any “tail” insurance policies purchased by the Acquired Companies prior to the 

Closing; provided, that no payments shall be required of the Acquired Companies or the Buyer 

Group with respect to such policies after the Closing. Each Indemnified Person is and shall be an 

intended third party beneficiary of this Section 7.12 and shall have the right to enforce such 

provisions to the same extent as if it was a party. The obligations of the Parties under this Section 

7.12 will not be terminated or modified in such a manner as to adversely affect any Person to 

whom this Section 7.12 applies without the consent of such affected Person. 

ARTICLE VIII 

CONDITIONS PRECEDENT TO BUYER’S PERFORMANCE 

8.1 Buyer’s Closing Conditions. The obligations of Buyer to consummate the 

transactions contemplated by this Agreement are subject to the satisfaction, at or before the 

Closing, of all the conditions set out below. Buyer may, in its sole discretion, waive any or all of 

these conditions in whole or in part by giving written notice to Seller; provided, however, that the 

condition described in Section 8.1(f) shall be deemed automatically and irrevocably waived by 

Buyer as of 11:59 pm Eastern Time on the day prior to the Bid Deadline regardless of whether or 

not such condition was satisfied at or prior to such time. 

(a) No Order shall have been issued by any court of competent jurisdiction 

which enjoins or prohibits the Closing or the consummation of the transactions contemplated by 

this Agreement that is still in effect. 

(b) The representations and warranties made by Seller in Article IV shall be 

true and correct in all respects (disregarding all qualifications or limitations as to “materiality” or 

“Material Adverse Change” and words of similar import set forth therein) as though such 

representations and warranties had been made on and as of the Closing Date (except that 

representations and warranties that are made as of a specified date need be true and correct only 

as of such date), except where the failure of such representations and warranties to be true and 

correct has not had a Material Adverse Change; provided that the representations and warranties 

set forth in Sections 4.1, 4.2, and 4.16 shall be true and correct in all material respects on and as 

of the Closing Date with the same effect as though made at and as of the Closing Date (except for 

such representations and warranties that are made as of a specified date need be true and correct 

in all material respects only as of such date). 

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(c) Seller shall have performed and complied in all material respects with all of 

the covenants and agreements required by this Agreement to be performed or complied with by 

Seller on or before the Closing. For the avoidance of doubt, in the event that Seller has covenanted 

or agreed to use any degree of effort to achieve an outcome, the failure of such outcome to be 

achieved does not per se mean that Seller has failed to perform or comply in all material respects 

with such covenant or agreement. 

(d) The Parties shall have received any approvals or consents required from the 

Dallas/Fort Worth International Airport Board with respect to the Concession Lease Agreements 

relating to the sale of the Transferred Interests. 

(e) The Bankruptcy Court shall have entered the Sale Order. 

(f) Buyer and Franchisor shall have signed a mutually agreeable franchise 

agreement in substantially the form attached hereto as Exhibit 3.3 for each of the Restaurants, or 

such other form on which Buyer and Franchisor may agree. 

8.2 Wavier of Conditions. Upon the occurrence of the Closing, any condition set forth 

in this Article VIII that was not satisfied as of the Closing will be deemed to have been waived for 

all purposes by the Party having the benefit of such condition as of and after the Closing. None of 

Buyer or Seller may rely on the failure of any condition set forth in this Article VIII, as applicable, 

to be satisfied if such failure was caused by such Party’s failure to perform any of its obligations 

under this Agreement, including its obligation to use its reasonable best efforts to consummate the 

transactions contemplated hereby as required under this Agreement.

ARTICLE IX 

CONDITIONS PRECEDENT TO SELLER’S PERFORMANCE 

9.1 Seller’s Conditions. The obligations of Seller to consummate the transactions 

contemplated by this Agreement are subject to the satisfaction, at or before the Closing, of all the 

conditions set out below. Seller may, in its sole discretion, waive any or all of these conditions in 

whole or in part by giving written notice to Buyer. 

(a) No Order shall have been issued by any court of competent jurisdiction 

which enjoins or prohibits the Closing or the consummation of the transactions contemplated by 

this Agreement that is still in effect. 

(b) The representations and warranties made by Buyer in Article V shall be true 

and correct in all material respects (disregarding all qualifications or limitations as to “materiality” 

or “Material Adverse Change” and words of similar import set forth therein) as though such 

representations and warranties had been made on and as of the Closing Date (except that 

representations and warranties that are made as of a specified date need be true and correct in all 

material respects only as of such date). 

(c) Buyer shall have performed and complied in all material respects with all 

of the covenants and agreements required by this Agreement to be performed or complied with by 

Buyer on or before the Closing. For the avoidance of doubt, in the event that Buyer has covenanted 

or agreed to use any degree of effort to achieve an outcome, the failure of such outcome to be 

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achieved does not per se mean that Buyer has failed to perform or comply in all material respects 

with such covenant or agreement. 

(d) Seller shall have had an opportunity to remove its property and proprietary 

information from the Restaurants. Seller shall bear the costs of all such removals. 

(e) The Bankruptcy Court shall have entered the Sale Order. 

(f) The Parties shall have received any approvals or consents required from the 

Dallas/Fort Worth International Airport Board with respect to the Concession Lease Agreements 

relating to the sale of the Transferred Interests. 

9.2 Waiver of Conditions. Upon the occurrence of the Closing, any condition set forth 

in this Article IX that was not satisfied as of the Closing will be deemed to have been waived for 

all purposes by the Party having the benefit of such condition as of and after the Closing. None of 

Buyer or Seller may rely on the failure of any condition set forth in this Article IX, as applicable, 

to be satisfied if such failure was caused by such Party’s failure to perform any of its obligations 

under this Agreement, including its obligation to use its reasonable best efforts to consummate the 

transactions contemplated hereby as required under this Agreement. 

ARTICLE X 

THE CLOSING 

10.1 Time and Place. The Closing shall take place by telephone conference and 

electronic exchange of documents at 9:00 a.m. Central Time on the second (2nd) Business Day 

following full satisfaction or due waiver (by the Party entitled to the benefit of such condition) of 

the closing conditions set forth in Article VIII and Article IX (other than those conditions that by 

their terms or nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of 

those conditions at the Closing), or at such other place and time as the Parties may agree in writing. 

That date on which the Closing actually occurs is referred to herein as the “Closing Date”. 

10.2 Seller’s Obligations at Closing. At the Closing, Seller shall deliver or cause to be 

delivered to Buyer:

(a) A certificate from a duly authorized officer of Seller dated as of the Closing 

Date certifying the satisfaction of the conditions set forth in Sections 8.1(b) and 8.1(c); 

(b) Assignment and Assumption Agreement in respect of the Assigned 

Contracts, substantially in the form set forth on Exhibit 10.2(b) hereof, duly executed by Seller; 

(c) Instruments of assignment and transfer of all the Acquired Assets, 

substantially in the form set forth on Exhibit 10.2(c) hereof, duly executed by Seller; 

(d) The Interim Management Agreements, substantially in the form set forth on 

Exhibit 10.2(d) hereof, executed by Seller; 

(e) A Transition Services Agreement, if any, duly executed by Seller; 

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(f) A duly executed IRS Form W-9 of Seller; 

(g) All other documents, certificates and agreements reasonably necessary to 

evidence and effect the sale, assignment transfer and delivery of the Acquired Assets (other than 

the Non-Assignable Assets) to Buyer and assumption of the Assumed Liabilities by Buyer, keys 

for each of the Restaurants and alarm codes for all security systems at each of the Restaurants, in 

each case, other than those related to the Non-Assignable Assets (which shall be subject to Section 

2.6(d)); and 

(h) A copy of the Sale Order which has become final and non-appealable. 

10.3 Buyer’s Obligations at Closing. At the Closing, Buyer shall deliver or cause to be 

delivered to Seller: 

(a) The Cash Payment; 

(b) A certificate from a duly authorized officer of Buyer dated as of the Closing 

Date certifying the satisfaction of the conditions set forth in Sections 9.1(b) and 9.1(c). 

(c) Assignment and Assumption Agreement in respect of the Assigned 

Contracts, substantially in the form set forth on Exhibit 10.2(b) hereof, duly executed by Buyer; 

(d) Instruments of assignment and transfer of all the Acquired Assets, 

substantially in the form set forth on Exhibit 10.2(c) hereof, duly executed by Buyer; 

(e) The Interim Management Agreements, substantially in the form set forth on 

Exhibit 10.2(d) hereof, executed by Buyer; 

(f) A certificate from a duly authorized officer of Buyer dated as of the Closing 

Date (1) attaching a certificate of good standing for Buyer (certified by the appropriate Secretary 

of State as of a date within ten (10) Business Days of the Closing Date); and (2) certifying the 

incumbency of the officer(s) of Buyer executing any documents delivered by Buyer in connection 

with the Closing, and certifying that attached thereto is a true, correct and complete copy of the 

approval of Buyer’s execution, delivery, and performance under this Agreement and the other 

agreements, certificates, instruments and documents to be entered into by Buyer in connection 

with the Closing; and 

(g) A Transition Services Agreement, if any, duly executed by Buyer; and 

(h) All other documents, certificates and agreements reasonably necessary to 

evidence and effect the sale, assignment transfer and delivery of the Acquired Assets to Buyer and 

assumption of the Assumed Liabilities by Buyer, in each case, other than those related to the NonAssignable Assets (which shall be subject to Section 2.6(d)). 

10.4 Transfer Taxes. Notwithstanding anything herein to the contrary, Buyer 

acknowledges and agrees that Buyer shall be solely responsible for all real estate recording fees, 

title insurance premiums or fees, a prorated share of any prepaid expenses, fees relating to the 

transfer or issuance of a liquor license or other permits or licenses, and any other similar fees in 

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connection with the transactions contemplated by this Agreement. Buyer shall timely file and pay 

all stamp, documentary, registration, value-added, transfer, sales, use, reporting, recording, filing 

and other similar fees, Taxes and charges including any interest and penalties with respect thereto 

(“Transfer Taxes”) resulting from the transfer of the Acquired Assets effected pursuant to this 

Agreement to the extent determined to not be exempt in accordance with Section 1146 of the 

Bankruptcy Code. 

ARTICLE XI 

TERMINATION 

11.1 Termination of Agreement. This Agreement may be terminated only in accordance 

with this Section 11.1. This Agreement may be terminated at any time prior to the Closing: 

(a) by mutual written consent of Buyer and Seller; 

(b) by written notice of either Buyer or Seller, upon the issuance of an Order 

by a court of competent jurisdiction restraining, enjoining, or otherwise prohibiting the 

consummation of the Transaction or declaring unlawful the Transaction, and such Order having 

become final, binding and non-appealable; provided that no termination may be made by a Party 

under this Section 11.1(b) if the issuance of such Order was caused by such Party’s breach of, or 

failure to perform any of its obligations under, this Agreement; 

(c) by written notice of either Buyer or Seller, if the Closing shall not have 

occurred on or before February 14, 2025 (the “Outside Date”) (or such later date as provided in 

the Bidding Procedures Order); provided, that a Party shall not be permitted to terminate this 

Agreement pursuant to this Section 11.1(c) if the failure of the Closing to have occurred by the 

Outside Date was caused by such Party’s breach of, or failure to perform any of its obligations 

under, this Agreement; 

(d) by written notice from Buyer to Seller, if Seller has breached, or failed to 

perform, any of its representations, warranties, covenants or agreements set forth in this 

Agreement, in each case, such that the conditions set forth in Section 8.1(b) or 8.1(c) would not be 

satisfied; provided, that (i) if such breach or failure is curable by Seller then Buyer may not 

terminate this Agreement under this Section 11.1(d) unless such breach or failure has not been 

cured by the date that is the earlier to occur of (A) 30 days after written notice thereof is given to 

Seller and (B) two (2) Business Days prior to the Outside Date and (ii) the right to terminate this 

Agreement pursuant to this Section 11.1(d) shall not be available to Buyer at any time that Buyer 

is in material breach of any representation, warranty, covenant or agreement hereunder; 

(e) by written notice from Seller to Buyer, if Buyer has breached, or failed to 

perform, any of its representations, warranties, covenants or agreements, set forth in this 

Agreement, in each case, such that the conditions set forth in Section 9.1(b) or 9.1(c) would not be 

satisfied, including a breach of Buyer’s obligation to consummate the Closing; provided, that (i) 

if such breach or failure is curable by Buyer, then Seller may not terminate this Agreement under 

this Section 11.1(e) unless such breach or failure has not been cured by the date that is the earlier 

to occur of (A) 30 days after written notice thereof is given to Buyer and (B) two (2) Business 

Days prior to the Outside Date and (ii) the right to terminate this Agreement pursuant to this 

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Section 11.1(e) will not be available to Seller at any time that Seller is in material breach of any 

representation, warranty, covenant or agreement hereunder; 

(f) by written notice from Seller to Buyer, if (i) all of the conditions set forth 

in Section 8.1 have been satisfied (other than conditions that by their nature are to be satisfied at 

the Closing, but subject to the satisfaction or waiver of such conditions at the Closing) or waived 

and (ii) Buyer fails to complete the Closing at the time required by Section 10.1; 

(g) by written notice from Seller to Buyer, if the board of directors or similar 

governing body of Seller determines that proceeding with the transactions contemplated by this 

Agreement or failing to terminate this Agreement would be inconsistent with such Person’s or 

body’s fiduciary duties; 

(h) automatically, if the Bankruptcy Court enters an Order approving an 

Alternative Transaction and Seller closes and consummates such Alternative Transaction; 

(i) by written notice of either Buyer or Seller, in the event the Bankruptcy Case 

is dismissed or converted to cases under Chapter 7 of the Bankruptcy Code; or 

(j) by written notice of either Buyer or Seller, if Buyer is not the Winning 

Bidder or the Backup Bidder at the Auction; provided, that Buyer shall not be permitted to 

terminate this Agreement pursuant to this Section 11.1(j) until after the 25th day following entry 

by the Bankruptcy Court of an Order authorizing and approving an Alternative Transaction with 

the Winning Bidder at the Auction (and, notwithstanding Buyer not having been the Winning 

Bidder or the Backup Bidder at the Auction, until such time (if any) as Buyer terminates this 

Agreement pursuant to this Section 11.1(j), the obligations of Buyer to consummate the 

transactions contemplated by this Agreement shall remain unaffected by Buyer’s right to terminate 

this Agreement pursuant to this Section 11.1(j)). 

11.2 Effect of Termination. In the event of termination of this Agreement pursuant to 

Section 11.1, this Agreement shall forthwith become void and there shall be no liability on the part 

of any Party or any of its partners, officers, directors, managers, equityholders or shareholders; 

provided that Section 2.10(b), Section 3.2, this Section 11.2 and Article XIII and the definitions 

referenced in such Sections and Articles, even if not included in such Sections and Articles, shall 

survive any such termination; provided, further, that no termination will relieve Buyer from any 

Liability for damages, losses, costs or expenses (which the Parties acknowledge and agree shall 

not be limited to reimbursement of expenses or out-of-pocket costs, and would include the benefits 

of the transactions contemplated by this Agreement lost by Seller (taking into consideration all 

relevant matters, including other combination opportunities and the time value of money), which 

shall be deemed in such event to be damages of Seller) resulting from any Willful Breach of this 

Agreement prior to the date of such termination (which, for the avoidance of doubt, will be deemed 

to include any failure by Buyer to consummate the Closing if and when it is obligated to do so 

pursuant to this Agreement). Subject to Section 13.17, nothing in this Section 11.2 will be deemed 

to impair the right of any Party to be entitled to specific performance or other equitable remedies 

to enforce specifically the terms and provisions of this Agreement. 

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11.3 Break-Up Fee; Expense Reimbursement; Overbid. In consideration of Buyer 

having expended considerable time and expense in connection with this Agreement and 

negotiation thereof and Buyer’s willingness to act as the “stalking horse” bidder with respect to 

the Auction, Seller believes that Buyer is entitled to the Bid Protections. 

(a) If this Agreement is terminated pursuant to Section 11.1(d) (Seller Breach), 

or Section 11.1(h) (Alternative Transaction), then Seller shall pay the Break-Up Fee and Expense 

Reimbursement to Buyer in immediately available funds, without need for further order of or from 

the Bankruptcy Court; provided, however, that the Break-up Fee and Expense Reimbursement 

shall be paid (i) no earlier than upon consummation of an Alternative Transaction and (ii) out of 

the proceeds received by Seller from an Alternative Transaction; provided, further, that in the event 

Seller would otherwise be required to pay the Expense Reimbursement pursuant to both this 

Section 11.3(a) and Section 11.3(b), Seller shall only be required to pay the Expense 

Reimbursement pursuant to Section 11.3(b) (and, in any event, Seller shall not be required to pay 

the Break-Up Fee or Expense Reimbursement more than one time). 

(b) If this Agreement is terminated pursuant to Section 11.1(c) (Outside Date) 

at a time when Buyer would have been permitted to terminate pursuant to Section 11.1(d) (Seller 

Breach), Section 11.1(g) (Fiduciary Out), Section 11.1(i) (Chapter 7) or Section 11.1(j) (Buyer 

Not Winning Bidder), then Seller shall pay the Expense Reimbursement to Buyer in immediately 

available funds, without need for further order of or from the Bankruptcy Court, and such Expense 

Reimbursement shall be due and payable simultaneously with any such termination of this 

Agreement. 

(c) To the extent that Seller consummates an Alternative Transaction and the 

Break-Up Fee and Expense Reimbursement are due and owing to Buyer pursuant to this Section 

11.3, the Break-Up Fee and Expense Reimbursement shall be paid from the proceeds of a 

replacement debtor-in-possession financing or from the sale proceeds from such Alternative 

Transaction whereby the assets contemplated to be sold to Buyer are, instead, sold to a third party. 

To the extent that Seller does not consummate an Alternative Transaction and the Break-Up Fee 

or Expense Reimbursement are due and owing to Buyer pursuant to this Section 11.3, the BreakUp Fee and Expense Reimbursement shall be deemed an allowed administrative expense claim in 

accordance with Sections 503(b) and 507(b) of the Bankruptcy Code. 

(d) Seller acknowledges and agrees that Buyer’s due diligence, efforts, 

negotiation and execution of this Agreement have involved substantial investment of management 

time and have required significant commitment of financial, legal, and other resources by Buyer 

and its Affiliates, and that such due diligence, efforts, negotiation, and execution have provided 

value to Seller and, in Seller’s reasonable business judgment, is necessary for the preservation of 

the value of Seller’s estate. Seller further agrees and acknowledges that the Break-Up Fee and 

Expense Reimbursement are reasonable in relation to Buyer’s efforts, Buyer’s lost opportunities 

from pursuing this Transaction, and the magnitude of the Transaction. The provision of the BreakUp Fee and the Expense Reimbursement is an integral part of this Agreement, without which Buyer 

would not have entered into this Agreement. 

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Up Fee or the Expense Reimbursement and, in order to obtain such Break-Up Fee or the Expense 

Reimbursement, Buyer commences an Action which results in a judgment in favor of Buyer, Seller 

shall pay to Buyer, in addition to the Break-Up Fee or the Expense Reimbursement, an amount of 

cash equal to the costs and expenses (including attorneys’ fees) incurred by Buyer in connection 

with such Action. 

(f) Seller hereby acknowledges and agrees that the obligation to pay the BreakUp Fee and the Expense Reimbursement (to the extent due hereunder) shall survive the termination 

of this Agreement. 

ARTICLE XII 

SURVIVAL; POST CLOSING MATTERS 

12.1 Non-Survival of Representations and Warranties and Certain Covenants; Certain 

Waivers. Each of the representations and warranties and the covenants and agreements (to the 

extent such covenant or agreement contemplates or requires performance by such Party prior to 

the Closing) of the Parties set forth in this Agreement or in any other document contemplated 

hereby, or in any certificate delivered hereunder or thereunder, and excluding Sections 2.10(b) 

(Inspection and Due Diligence) and 5.11 (Investment; Buyer’s Investigation), will terminate 

effective immediately as of the Closing such that no claim for breach of any such representation, 

warranty, covenant or agreement, detrimental reliance or other right or remedy (whether in 

contract, in tort or at law or in equity) may be brought with respect thereto after the Closing. Each 

covenant and agreement that explicitly contemplates performance after the Closing, will, in each 

case and to such extent, expressly survive the Closing in accordance with its terms, and if no term 

is specified, then for five (5) years following the Closing Date, and nothing in this Section 12.1 

will be deemed to limit any rights or remedies of any Person for breach of any such surviving 

covenant or agreement. Buyer and Seller acknowledge and agree, on their own behalf and on 

behalf of the Buyer Group or the Seller Parties, as the case may be, that the agreements contained 

in this Section 12.1 (a) require performance after the Closing to the maximum extent permitted by 

Applicable Law and will survive the Closing for five (5) years and (b) are an integral part of the 

transactions contemplated hereby and that, without the agreements set forth in this Section 12.1, 

none of the Parties would enter into this Agreement. The Buyer Group hereby waives all rights 

and remedies with respect to any environmental, health or safety matters, including those arising 

under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, or 

any other Environmental Laws, relating to this Agreement or the transactions contemplated 

hereby. 

12.2 Post-Closing Access. To the extent Seller has not completed the removal of its 

property or proprietary information permitted pursuant to Section 9.1(d) by the Closing Date, 

Buyer will provide access to the Restaurants during normal business hours, upon reasonable prior 

notice from Seller, after the Closing for Seller to complete such removal; provided, however, that 

Seller agrees its removal of its property or proprietary information shall not unreasonably interfere 

with Buyer’s operation of the Restaurants. 

12.3 Cooperation Regarding Employment Matters. Buyer will, and will cause its 

Affiliates and subsidiaries to: (a) at no cost to Buyer, cooperate with Seller and provide to Seller 

all assistance reasonably requested in connection with the administration, defense or resolution of 

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any Pre-Closing Employment Claim that has not been fully and finally resolved as of the Closing; 

(b) at no cost to Buyer, make available to Seller (or its designee) as reasonably requested the 

Transferred Employees (including, without limitation, for interviews, depositions and witness 

statements) and all information, records and documents relating to any Pre-Closing Employment 

Claim, in each case, in connection with any mediation, arbitration, investigation, court, 

administrative or other proceeding (including any proceeding with a Governmental Authority) 

which may remain in Buyer’s possession; (c) retain any books and records in Buyer’s possession 

as of the applicable Closing Date that Buyer reasonably believes could be necessary or useful in 

connection with the resolution of any Pre-Closing Employment Claim and, upon written request 

of Seller or its designee, promptly (but in no event later than five (5) days following such written 

request) make all such books and records available for inspection, copying or e-discovery 

(provided that Buyer’s failure to maintain such books and records shall not be a breach by Buyer 

under this Agreement, unless (i) such failure was caused by Buyer’s gross negligence or willful 

misconduct or (ii) such failure relates to any matter set forth or referenced on the Disclosure 

Schedule or is the subject of a written notice provided by Seller to Buyer regarding a request to 

retain any information or other documentation relating to a particular matter or Pre-Closing 

Employment Claim); and (d) promptly notify Seller of any communications received from any 

person, entity or Governmental Authority with respect to any Pre-Closing Employment Claim. 

Notwithstanding the foregoing, Seller acknowledges that it will remove from the Restaurants all 

information, records and documents relating to employment of its employees prior to the Effective 

Time, including, but not limited to, personnel, human resources, and/or health files for all 

employees. Once there is clarity that Buyer will be the prevailing Buyer of the Acquired Assets, 

the Seller and Buyer will reasonably cooperate with one another to initiate the hiring process prior 

to Closing in accordance with Section 3.5. 

ARTICLE XIII 

MISCELLANEOUS 

13.1 Notices. Except as otherwise provided herein, and subject to any requirements as to 

timing or sequencing set forth herein (e.g., advance or prior notice requirements), all notices, 

requests, claims, demands, waivers and other communications concerning this Agreement or the 

transactions contemplated hereby must be in writing and must be personally delivered or sent by 

overnight courier service or by email as set forth below: 

Notices to Buyer: 

Sugarloaf Concessions, LLC 

15995 N. Barkers Landing Road 

Houston, TX 77079 

Attention: Ray Blanchette 

Email: RayB@sugarloafhospitality.com 

with a copy to (which shall not constitute notice): 

Hoover Slovacek LLP 

5051 Westheimer, Suite 1200 

Houston, TX 77056 

Attention: Edward W. Engel 

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Email: engel@hooverslovacek.com 

Notices to Seller: 

TGI Friday’s Inc. 

500 E State Highway 114, Suite 200 

Southlake, TX 76092 

Attention: Kyle Richter 

Email: krichter@thinkbrg.com 

with a copy to (which shall not constitute notice): 

Ropes & Gray LLP 

191 North Wacker Drive, 32nd Floor 

Chicago, IL 60606 

Attention: Chris L. Dickerson; Ellen Wheeler 

Email: chris.dickerson@ropesgray.com; ellen.wheeler@ropesgray.com 

and 

Foley & Lardner LLP 

2021 McKinney Avenue, Suite 1600 

Dallas, TX 75201 

Attention: Holland N. O’Neil 

Mark C. Moore 

Zachary C. Zahn 

Email: honeil@foley.com 

mmoore@foley.com 

zzahn@foley.com 

Any Party may specify by written notice in accordance with this Section 13.1 to each of 

the other Parties a different email or physical address at any time. Written notice shall be effective 

and deemed to have been given: (a) on the day such notice is sent by email (provided that the Party 

delivering such notice does not promptly receive notice of unsuccessful transmission and such sent 

email is kept on file (whether electronically or otherwise) by the sending party); (b) on the next 

Business Day when sent by reputable overnight courier service (charges prepaid); or (c) on the day 

such notice is personally delivered. A copy of the e-mail transmission containing the time, date, 

and recipient e-mail address shall be rebuttable evidence of receipt by e-mail in accordance with 

clause (a) above. Written confirmation of receipt provided by an overnight courier service shall be 

rebuttable evidence of delivery by an overnight courier service in accordance with clause (b) 

above. 

13.2 Effect of Headings; Negotiated Agreement. The subject headings of this Agreement 

are included for convenience only and shall not affect the construction or interpretation of any of 

its provisions. This Agreement is the result of negotiations between, and has been reviewed by, 

the Parties and their respective legal counsel and shall be construed without regard to any 

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presumption or rule requiring construction or interpretation against the party drafting an instrument 

or causing any instrument to be drafted. 

13.3 Entire Agreement; Modification; Waiver. This Agreement and the Disclosure 

Schedule, as may be amended and updated, together with all Exhibits and schedules hereto or 

thereto and agreements or instruments executed in connection herewith or therewith, together with 

the Confidentiality Agreement, constitutes the entire agreement between the Parties pertaining to 

the subject matter contained in it and supersedes all prior and contemporaneous agreements, 

representations and understandings of the Parties. No supplement, modification or amendment of 

this Agreement shall be binding unless executed in writing by all the Parties; provided that this 

Section 13.3 and Section 13.18 shall not be amended, supplemented, waived or otherwise modified 

in a manner adverse to any Financing Source without the prior written consent of each such 

Financing Source. No waiver of any of the provisions of this Agreement shall be deemed, or shall 

constitute, a waiver of any other provision, whether or not similar, and no waiver shall constitute 

a continuing waiver. No waiver shall be binding unless executed in writing by the party making 

the waiver. No course of dealing, nor any failure or delay in exercising any right, shall be 

construed as a waiver, and no single or partial exercise of a right shall preclude any other or further 

exercise of that or any other right. 

13.4 Parties in Interest. Except as otherwise expressly provided herein, including in 

Sections 7.12 (Directors’ and Officers’ Indemnification), 13.18 (Non-Recourse) and Section 13.22 

(Legal Representation), nothing in this Agreement, whether express or implied, is intended to 

confer any rights or remedies under or by reason of this Agreement on any persons other than the 

Parties to it and its respective permitted successors and assigns. 

13.5 Binding Effect; Assignment. This Agreement and the rights, interests, and 

obligations hereunder shall be binding upon Buyer, and, subject to the Bidding Procedures Order 

(with respect to the matters covered thereby) and the entry and terms of the Sale Order, Seller, and 

shall inure to the benefit of and be so binding on the Parties and their respective successors and 

permitted assigns, including any trustee or estate representative appointed in the Bankruptcy Cases 

or any successor Chapter 7 cases; provided that neither this Agreement nor any of the rights, 

interests, or obligations hereunder shall be assigned or delegated without the prior written consent 

of Buyer and Seller, and any attempted assignment or delegation without such prior written consent 

shall be null and void. 

13.6 Signatures. The signatures of the Parties to this Agreement, or to any related 

document, may be delivered by facsimile or other electronic transmission (such as electronic mail). 

This Agreement may be executed simultaneously in one or more counterparts, each of which shall 

be deemed an original, but all of which together shall constitute one and the same instrument. 

13.7 Governing Law; Jurisdiction. 

(a) Except to the extent the mandatory provisions of the Bankruptcy Code 

apply, this Agreement, and any Action that may be based upon, arising out of or related to this 

Agreement or the negotiation, execution or performance of this Agreement or the transactions 

contemplated hereby will be governed by and construed in accordance with the internal Laws of 

the State of Texas applicable to agreements executed and performed entirely within such State 

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without regards to conflicts of law principles of the State of Texas or any other jurisdiction that 

would cause the Laws of any jurisdiction other than the State of Texas to apply. 

(b) Each of the Parties irrevocably agrees that any Action that may be based 

upon, arising out of, or related to this Agreement or the negotiation, execution or performance of 

this Agreement and the transactions contemplated hereby brought by any other Party or its 

successors or assigns will be brought and determined only in (i) the Bankruptcy Court and any 

federal court to which an appeal from the Bankruptcy Court may be validly taken or (ii) in the 

event the Bankruptcy Case is closed, or if the Bankruptcy Court is unwilling or unable to hear such 

Action, any state or federal court within Dallas, Texas ((i) and (ii), the “Chosen Courts”), and each 

of the Parties hereby irrevocably submits to the exclusive jurisdiction of the Chosen Courts for 

itself and with respect to its property, generally and unconditionally, with regard to any such 

Action arising out of or relating to this Agreement and the transactions contemplated hereby. Each 

of the Parties agrees not to commence any Action relating thereto except in the Chosen Courts, 

other than Actions in any court of competent jurisdiction to enforce any judgment, decree or award 

rendered by any Chosen Court, and no Party will file a motion to dismiss any Action filed in a 

Chosen Court on any jurisdictional or venue-related grounds, including the doctrine of forum nonconveniens. The Parties irrevocably agree that venue would be proper in any of the Chosen Courts, 

and hereby irrevocably waive any objection that any such court is an improper or inconvenient 

forum for the resolution of such Action. Each of the Parties further irrevocably and 

unconditionally consents to service of process in the manner provided for notices in Section 13.1. 

Nothing in this Agreement will affect the right of any Party to this Agreement to serve process in 

any other manner permitted by Law.

13.8 [Reserved.] 

13.9 Severability. If any provision of this Agreement is held invalid or unenforceable by 

any arbitrator or court of final jurisdiction, it is the intent of the Parties that all other provisions of 

this Agreement be construed to remain fully valid, enforceable and binding on the Parties and such 

provision will be ineffective only to the extent of such prohibition or invalidity in such jurisdiction, 

without invalidating the remainder of such provision or the remaining provisions of this Agreement 

or in any other jurisdiction. 

13.10 Expenses. Whether or not Closing takes place, except as otherwise provided herein, 

each Party shall pay all costs and expenses incurred or to be incurred by it in negotiating and 

preparing this Agreement and in closing and carrying out the transactions contemplated by this 

Agreement. 

13.11 Bulk Sales. The Parties intend that pursuant to section 363(f) of the Bankruptcy 

Code, the transfer of the Acquired Assets shall be free and clear of any Liens in the Acquired 

Assets including any liens or claims arising out of the bulk transfer laws except Permitted Liens, 

and the Parties shall take such steps as may be necessary or appropriate to so provide in the Sale 

Order. In furtherance of the foregoing, each Party hereby waives compliance by the Parties with 

the “bulk sales,” “bulk transfers” or similar laws and all other similar laws in all applicable 

jurisdictions in respect of the transactions contemplated by this Agreement. 

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13.12 Disclosure. Seller and its parent organization shall have the right to disclose this 

Agreement and related agreements in connection with any filings or other disclosures required in 

connection with compliance with federal and state securities and franchise laws, the rules and 

regulations of any applicable securities trading organization, or the Bankruptcy Court. Subject to 

the other provisions of this Agreement, press releases and other publicity materials relating to the 

transactions contemplated by this Agreement shall be released by the Parties only after review and 

with the consent of the other Parties. Except as permitted pursuant to this Section 13.12, Seller 

shall not disclose to anyone, except its Representatives, Affiliates, advisors or agents, without 

Buyer’s prior written consent, the existence or nature of the transactions contemplated by this 

Agreement. This Section 13.12 does not alter or amend any confidentiality obligations that Buyer 

may have or will have under the Franchise Agreements. Seller acknowledges and agrees that 

Buyer’s remedy at law for any breach of Seller’s obligations hereunder could be inadequate, and 

that Buyer shall have the right to seek temporary and permanent injunctive relief in any court 

proceeding to enforce this covenant regarding confidentiality. However, nothing contained herein 

shall in any way affect Buyer’s rights and remedies afforded by law and/or in equity, and Buyer 

shall retain the right to recover such damages as it may have sustained by reason of any breach 

hereof, as limited by any cap on Buyer’s damages in this Agreement. Notwithstanding the 

foregoing, Buyer or Seller may disclose to any of its lenders any of the provisions of this 

Agreement and the documents entered into or to be entered into in connection herewith. 

13.13 Further Assurances. Each Party, as requested by the other, shall use commercially 

reasonable efforts to execute, acknowledge and deliver any further deeds, assignments, 

conveyances and other assurances, documents and instruments of transfer, reasonably requested 

by the other, and shall take any other action consistent with the terms of this Agreement that may 

reasonably be requested by the other, for the purpose of assigning, transferring, granting, 

conveying and confirming to such Party, or reducing to possession, any or all property to be 

conveyed and transferred under this Agreement. 

13.14 Limitation of Liability. Except as otherwise provided herein (including as set forth 

in Section 11.2), in no event will any Party or any of its Affiliates be liable for any special, 

incidental, indirect, exemplary, punitive or consequential damages (including lost profits, loss of 

revenue or lost sales) in connection with any claims, losses, damages or injuries arising out of 

related to this Agreement or the transactions contemplated hereby. 

13.15 Casualty and Condemnation. At all times prior to the Closing, the risk of loss for 

all Acquired Assets and Restaurants will be retained by the Seller. If, prior to the Closing, any 

Restaurant is a C&C Restaurant, Seller shall notify Buyer reasonably promptly of such fact and 

Buyer’s exclusive remedy hereunder shall be as follows: (a) in the case of condemnation or taking, 

Seller shall assign or pay, as the case may be, any condemnation or taking proceeds thereof (of 

which are payable to or actually received by Seller) to Buyer at the Closing, and (b) in the case of 

fire, flood or other casualty to the Restaurant, Seller shall, at Buyer’s option and subject to any 

applicable lease or Contract with the applicable landlord, either use insurance proceeds to restore 

such damage, or to the extent such proceeds were not previously applied, assign the insurance 

proceeds therefrom to Buyer at Closing. For the avoidance of doubt, any casualty or 

condemnation, including any Restaurant becoming a C&C Restaurant, is not a per se breach of 

any representation, warrant, covenant or agreement and Buyer shall not have the right to terminate 

this Agreement or assert that any condition to Closing was not satisfied as a result thereof. 

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13.16 Waiver of Jury Trial. EACH OF THE PARTIES KNOWINGLY, VOLUNTARILY 

AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL 

RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM 

(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR 

RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY 

THIS AGREEMENT OR THE ANCILLARY DOCUMENTS OR THE ACTIONS OF EITHER 

PARTY TO THIS AGREEMENT IN NEGOTIATION, EXECUTION AND DELIVERY, 

PERFORMANCE OR ENFORCEMENT OF THIS AGREEMENT OR THE ANCILLARY 

DOCUMENTS. 

13.17 Specific Performance. The Parties agree that irreparable damage, for which 

monetary relief, even if available, would not be an adequate remedy, would occur in the event that 

any provision of this Agreement is not performed in accordance with its specific terms or is 

otherwise breached, including if any of the Parties fails to take any action required of it hereunder 

to consummate the transactions contemplated by this Agreement. It is accordingly agreed that (a) 

Seller and Buyer will be entitled to an injunction or injunctions, specific performance or other 

equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and 

provisions hereof in the courts described in Section 13.7 without proof of damages or otherwise, 

this being in addition to any other remedy to which they are entitled under this Agreement, and (b) 

the right of specific performance and other equitable relief is an integral part of the transactions 

contemplated by this Agreement and without that right, neither Seller nor Buyer would have 

entered into this Agreement. The Parties acknowledge and agree that either Seller or Buyer 

pursuing an injunction or injunctions or other Order to prevent breaches of this Agreement and to 

enforce specifically the terms and provisions of this Agreement in accordance with this Section 

13.17 will not be required to provide any bond or other security in connection with any such Order. 

The remedies available to Seller pursuant to this Section 13.17 will be in addition to any other 

remedy to which they were entitled at law or in equity, and the election to pursue an injunction or 

specific performance will not restrict, impair or otherwise limit Seller from seeking to collect or 

collecting damages. If, prior to the Outside Date, either Buyer or Seller bring any action, in each 

case in accordance with this Section 13.17, to enforce specifically the performance of the terms 

and provisions hereof by the other, the Outside Date will automatically be extended (i) for the 

period during which such action is pending, plus ten (10) Business Days or (ii) by such other time 

period established by the court presiding over such action, as the case may be. In no event will this 

Section 13.17 be used, alone or together with any other provision of this Agreement, to require 

Seller to remedy any breach of any representation or warranty made by Seller herein. 

13.18 Non-Recourse. Notwithstanding anything herein to the contrary: 

(a) this Agreement may only be enforced against, and any Action based upon, 

arising out of or related to this Agreement may only be brought against, the Persons that are 

expressly named as parties to this Agreement; 

(b) except to the extent named as a party to this Agreement, and then only to 

the extent of the specific obligations of such parties set forth in this Agreement, no past, present 

or future shareholder, member, partner, manager, director, officer, employee, Affiliate or 

subsidiary, agent, or Representative of any Party (each, a “Non-Recourse Party”) shall have any 

Liability (whether in contract, tort, equity or otherwise) for any of the representations, warranties, 

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covenants, agreements or other obligations or Liabilities of any of the parties to this Agreement or 

for any claims, causes of action, obligations or liabilities arising under, out of, in connection with 

or related in any manner to this Agreement or the Ancillary Documents or based on, in respect of, 

or by reason of this Agreement or the Ancillary Documents or their negotiation, execution, 

performance or breach; 

(c) the Parties acknowledge and agree not to commence any Action against any 

Financing Source in connection with such Debt Financing whether under law or equity (whether 

in tort, contract or otherwise); provided, that nothing in this Section 13.18(c) shall limit the liability 

or obligations of the Financing Sources under the Debt Commitment Letter or the Fee Letter; 

provided further, that Buyer (including its permitted successors and assigns under any Debt 

Financing) at its own direction shall be permitted to bring any claim against a Financing Source 

for failing to satisfy any obligation to fund the Debt Financing pursuant to the terms thereof; 

(d) each Non-Recourse Party is and shall be an intended third party beneficiary 

of this Section 13.18 and shall have the right to enforce such provisions to the same extent as if it 

was a party; and 

(e) this Section 13.18 may not be terminated or modified in any manner that 

adversely affects any Non-Recourse Party, without the prior written consent of such affected NonRecourse Party. 

13.19 No Right of Set-Off. Buyer, on its own behalf and on behalf of the Buyer Group 

and its and their respective successors and permitted assigns, hereby waives any rights of set-off, 

netting, offset, recoupment or similar rights that Buyer, any member of the Buyer Group or any of 

its or their respective successors and permitted assigns has or may have with respect to the payment 

of the Purchase Price or any other payments to be made by Buyer pursuant to this Agreement or 

any other document or instrument delivered by Buyer in connection herewith. 

13.20 Fiduciary Obligations. Nothing in this Agreement, or any document related to the 

transactions contemplated hereby, will require Seller or any of their respective directors, managers, 

officers or members, in each case, in their capacity as such, to take any action, or to refrain from 

taking any action, to the extent inconsistent with their fiduciary obligations or applicable Law. 

Seller retains the right to pursue any transaction or restructuring strategy that, in Seller’s business 

judgment, will maximize the value of their estates. For the avoidance of doubt, the Seller’s ability 

to conduct the sale process (including the Auction) and to consider or advance alternative 

proposals in a manner consistent with the foregoing and the Bidding Procedures Order shall not 

be impaired in any respect by this Agreement. 

13.21 Seller Representative. Each Party agrees that TGI Friday’s Inc. has the power and 

authority to unilaterally act on behalf of all or any of Seller for the purposes specified under this 

Agreement. Such power will include the power to make all decisions, actions, consents and 

determinations on behalf of Seller, including to make any waiver of any Closing condition or agree 

to any amendment to this Agreement. No Seller shall have any right to object, dissent, protest or 

otherwise contest the same. Buyer shall be entitled to rely on any action or omission taken by TGI 

Friday’s Inc. on behalf of Seller. 

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13.22 Legal Representation. 

(a) Buyer agrees, on its own behalf and on behalf of each of its Affiliates (for 

the avoidance of doubt, including, following the Closing, the Acquired Companies) and its and 

their respective successors and assigns (collectively, the “Waiving Parties”), that, following the 

Closing, Ropes & Gray LLP and Foley & Lardner LLP (collectively, “Seller Counsel”) may serve 

as counsel to Seller and its Affiliates in connection with any matters related to this Agreement or 

the Transactions contemplated hereby, including any litigation, claim or obligation arising out of 

or relating to this Agreement or such transactions, notwithstanding any representation by Seller 

Counsel prior to the Closing Date of the Acquired Companies. Buyer, on its own behalf and on 

behalf of the other Waiving Parties (including, following the Closing, the Acquired Companies) 

hereby (i) waives any claim they have or may have that Seller Counsel has a conflict of interest or 

is otherwise prohibited from engaging in such representation and (ii) agrees that, in the event that 

a dispute arises after the Closing between any of the Waiving Parties, on the one hand, and any 

Seller or any of their Affiliates, on the other hand, Seller Counsel may represent Seller and/or any 

of its Affiliates in such dispute even though the interests of such Person(s) may be directly adverse 

to the Waiving Parties and even though Seller Counsel may have represented any Acquired 

Company in a matter substantially related to such dispute. The Waiving Parties also further agree 

that, as to all communications among Seller Counsel and the Acquired Companies, Seller or its 

Affiliates, subsidiaries or Representatives, that relate in any way to this Agreement, the negotiation 

thereof, or the transactions contemplated hereby, the attorney-client privilege and the expectation 

of client confidence belongs to Seller and may be controlled by TGI Friday’s Inc. on behalf of 

Seller (collectively, “Pre-Closing Privileges”) and shall not pass to or be claimed by the Buyer or 

any other Waiving Party. Notwithstanding the foregoing, in the event that a dispute arises after 

the Closing between a Waiving Party, on the one hand, and a third party other than a party to this 

Agreement, on the other hand, an Acquired Company may assert a Pre-Closing Privilege to prevent 

disclosure of confidential communications by Seller Counsel to such third party; provided, 

however, that such Acquired Company may not waive such privilege without the prior written 

consent of TGI Friday’s Inc. on behalf of Seller. 

(b) All such Pre-Closing Privileges, and the portion of any books and records 

and other documents of the Acquired Companies containing any advice or communication that is 

subject to any Pre-Closing Privilege (“Pre-Closing Privileged Materials”), shall be excluded from 

the transactions contemplated by this Agreement, and shall be distributed to TGI Friday’s Inc. on 

behalf of Seller immediately prior to the Closing with (in the case of the portion of any such books 

and records) no copies retained by the Acquired Companies. Absent the prior written consent of 

TGI Friday’s Inc. on behalf of Seller (not to be unreasonably withheld, conditioned or delayed), 

neither Buyer nor any other Waiving Party (including, for the avoidance of doubt, following the 

Closing, the Acquired Companies) shall have a right of access to Pre-Closing Privileged Materials. 

The Parties further agree and acknowledge that Seller has taken reasonable efforts to segregate 

and retain Pre-Closing Privileged Materials, that the existence of any remaining Pre-Closing 

Privileged Materials found in the custody of the Acquired Companies after Closing will not be 

deemed a waiver of any Pre-Closing Privileges, and that the same will be returned to TGI Friday’s 

Inc. on behalf of Seller promptly after any discovery thereof. 

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(c) The Buyer acknowledges that it has consulted with independent counsel of 

its own choosing with respect to the meaning and effect of this Section 13.22, and understands 

such meaning and effect. 

[Signature Page Follows] 

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[SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT]

IN WITNESS WHEREOF, the Parties to this Agreement have duly executed it on the day 

and year first above written.

BUYER

SUGARLOAF CONCESSIONS, LLC

a Delaware limited liability company

By:

Name: Raymond A. Blanchette

Its: Manager

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[SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT] 

SELLER:

TGIF HOLDINGS, LLC 

TGIF MIDCO, INC. 

TGIF PARENT, INC. 

TGI FRIDAY’S INC. 

BURLINGTON TOWNE CROSSING, INC. 

T.G.I. FRIDAY’S OF CHARLES COUNTY, INC. 

T.G.I. FRIDAY’S OF FREDERICK COUNTY, INC. 

TGI FRIDAY’S OF ANNAPOLIS, INC. 

TGI FRIDAY’S OF GREENBELT, INC. 

TGI FRIDAY’S OF HOWARD COUNTY, INC. 

TGI FRIDAY’S OF TOWSON, INC. 

TGI FRIDAY’S NY, LLC 

WEBCO PRODUCTS INCORPORATED 

T.G.I. FRIDAY’S OF HARFORD COUNTY, INC. 

T.G.I. FRIDAY’S OF WASHINGTON COUNTY, INC. 

TGI FRIDAY’S OF WISCONSIN, INC. 

TGI FRIDAY’S OF ROCKVILLE, INC. 

TGI FRIDAY’S OF TEXAS LLC 

TGI FRIDAY’S OF THE ROCKIES, INC. 

TGIF/DFW MANAGER, LLC 

TGIF/DFW PARTNER, LLC 

By: 

Name: Kyle Richter 

Its: Chief Restructuring Officer 

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Exhibit 1.0 - 1 

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148483277_14 

EXHIBIT 1.0 

RESTAURANTS 

Current Store Number City/State 

Site: 60339 US MD Hanover Anne Arundel Mills 

Site: 60122 US MD Owing Mills 

Site: 60788 US MD White Marsh 

Site: 60374 US MD Waldorf 

60843 US TX DFW Term A* 

60851 US TX DFW Airport E-17* 

60852 US TX DFW Airport B-10* 

60856 US TX DFW Airport C-8* 

60857 US TX DFW Airport C-30* 

* Indicates the DFW Stores; asset to be purchased is membership interest in TGIF/DFW 

Partner, LLC 

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Exhibit 1.1 - 1 

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EXHIBIT 1.1 

DEFINED TERMS 

“Accounts Receivable” means all accounts receivable, rights to payment, notes receivable 

and other receivables (including all Credit Card Receivables), but excluding income tax 

receivables, of the Restaurants, and any security interest, claim, remedy or other right related to 

any of the foregoing. 

“Acquired Assets” means (i) the Transferred Interests and (ii) substantially all of the assets 

owned by Seller located at and/or exclusively used in the operation of the business of the 

Restaurants, other than Excluded Assets, whether real, personal, tangible, or intangible (including 

goodwill), accrued, contingent or otherwise, including, without limitation, the following: 

(a) Fixed Assets;

(b) Assigned Contracts; 

(c) Transferable Permits; 

(d) subject to Section 2.8, all of Seller’s leasehold interest in the Real Property 

Leases that are Assigned Contracts, in each case together with Seller’s interest in all buildings, 

fixtures, plant, equipment and improvements thereon or attached thereto; 

(e) the Intellectual Property owned by the Seller that is used exclusively in the 

Restaurants; 

(f) all goodwill associated with the Restaurants, goodwill as a going concern 

and goodwill associated with all other intangible property owned by the Seller (for clarity, 

excluding trademark goodwill); 

(g) all transferable telephone numbers, facsimile numbers and related directory 

listings used exclusively in connection with each of the Restaurants; 

(h) subject to Section 7.3, all past and present customer, supplier, vendor 

records, files, documents, instruments, and all other books, records, instruments, policies, 

procedures and documents exclusively pertaining to the operation of the Restaurants or the use of 

the other Acquired Assets (“Records”), to the extent said Records are within Seller’s possession, 

in each case, other than any Tax Returns of Seller or Tax Returns and other books and records 

relating to the Restaurants, the Acquired Assets, the Business or the Retained Business (i) that are 

otherwise reasonably necessary for Seller, its Affiliates or the Securitization Entities for Tax filing 

or reporting purposes, (ii) that pertain to the Retained Business, which Buyer acknowledges and 

agrees may be transferred to or used by one or more buyers of the Retained Business or (iii) 

otherwise reasonably necessary to the wind-down or liquidating plan of any Seller or Affiliate or 

businesses of Seller or its Affiliates after the Closing; 

(i) all of Seller’s Claims, including, without limitation, warranties and 

indemnification rights; 

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(j) cash on hand in each of the Restaurants as of the Effective Time 

(“Restaurant Cash”) which cash amount shall not exceed $2,500 in the case of each Restaurant; 

(k) all prepayments and prepaid expenses (other than prepaid insurance) and 

security and other deposits, including deposits in connection with any Real Property Lease 

assigned to Buyer, credits, deferred charges, advance payments and rebates (in each case, other 

than in respect of Taxes), in each case, to the extent such assets exclusively relate to the Acquired 

Assets; 

(l) all insurance benefits, including rights and proceeds, exclusively arising 

from or exclusively relating to the Acquired Assets or the Assumed Liabilities before the Effective 

Time (but only to the extent that such benefits relate to claims or potential claims arising from 

facts or circumstances existing or arising on or prior to the Closing Date which claims or potential 

claims have not been paid or resolved by Seller on or prior to the Closing Date); and 

(m) Avoidance Actions that exclusively relate to the Acquired Assets. 

For the avoidance of doubt, no assets of any Acquired Company or DFW Entity shall be “Acquired 

Assets” and Buyer shall acquire such assets only indirectly, as a result of acquiring the Equity 

Interests of the Acquired Companies. 

“Action” means a claim, action, cause of action, demand, lawsuit, arbitration, inquiry, 

audit, notice of violation, proceeding, litigation, citation, summons, subpoena or investigation of 

any nature, civil, criminal, administrative, regulatory or otherwise, whether at law or in equity. 

“Actual Financials” has the meaning given to it in Section 4.7. 

“Agreement” has the meaning given to it in the Caption. 

“Affiliate” means, with respect to any Person, any other Person that, directly or indirectly 

through one or more intermediaries, controls, or is controlled by, or is under common control with, 

such Person, and the term “control” (including the terms “controlled by” and “under common 

control with”) means the possession, directly or indirectly, of the power to direct or cause the 

direction of the management and policies of such Person, whether through ownership of voting 

securities, by Contract or otherwise. Neither TGI SPV Guarantor, LLC nor any of its subsidiaries, 

including TGI Funding, LLC and TGI Fridays Franchisor, LLC (collectively, the “Securitization 

Entities”) shall be “Affiliates” of Seller. 

“Alternative Transaction” means any transaction (or series of transactions), whether direct 

or indirect, whereby any Person or group of Persons (other than Seller and their Affiliates or Buyer 

and its Affiliates) acquires (i) beneficial ownership of a majority of the equity interests of Seller 

or (ii) a material portion of the Acquired Assets (but does not mean the sale of assets to customers 

conducted in the Ordinary Course of Business), in each case, whether by merger, sale of assets or 

equity, recapitalization, plan of reorganization or otherwise. Notwithstanding the foregoing, a 

liquidation or wind-down of Seller’s estates shall not be an Alternative Transaction. 

“Ancillary Documents” means the Assignments and Assumption Agreement, Assignment 

and Assumption of Leases, the bill of sale, the Interim Management Agreement, Transition 

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Services Agreement, and the other agreements, instruments and documents required to be 

delivered pursuant to this Agreement or in connection with the transactions contemplated 

hereunder or at the Closing. 

“Applicable Law” means and includes applicable Law, common law and all applicable 

statutes, laws, rules, regulations, ordinances, policies and procedures established by any 

Governmental Authority, including, without limitation, those governing the development, 

construction and/or operation of a TGI FridaysTM Restaurant, including, without limitation, all 

labor, disability, food and drug laws and regulations, as in effect on the Effective Time hereof, and 

as may be enacted, modified or amended from time to time thereafter. 

“Application” means an application for Buyer’s acquisition of a Conditional Liquor 

License or a Liquor License in the applicable jurisdiction where a Restaurant is located. 

“Assigned Contracts” means all of Seller’s right, title and interest in and to the executory 

Contracts and unexpired leases exclusively related to the Restaurants listed on Exhibit 1.0 as of 

the date hereof listed on Schedule 2.1 of the Disclosure Schedule to be assumed and assigned to 

Buyer in connection with the Closing of the Transaction (or following the Closing in accordance 

with the terms of this Agreement to the extent permitted by law and/or court order). 

“Assumed Liabilities” means the following Liabilities, in each case, only to the extent not 

paid prior to the Closing: 

(a) all Liabilities and obligations of Seller for payment and performance under 

the Assigned Contracts that become due from and after the Closing; 

(b) all accounts payable and trade payables existing on the Closing that relate 

to post-Closing periods (including, for the avoidance of doubt, (i) invoiced accounts payable and 

(ii) accrued but uninvoiced accounts payable), of Seller to the extent related to the Acquired Assets; 

(c) all Liabilities and obligations of Seller under the Transferable Permits, but 

only to the extent such obligations do not arise from or relate to any actual or alleged breach of 

such Transferable Permit or violation of law, in each case, arising as of, or related to the period 

prior to, Closing; 

(d) to Transferred Employees; 

(e) any Cure Costs; provided, however, that such Cure Costs shall not exceed 

an amount equal to $500,000 in the aggregate (the “Cure Cost Cap”) except with respect to any 

Disputed Contract as set forth in Section 2.6(c)(ii); 

(f) any liability for (i) Taxes of Buyer (or any Affiliate of Buyer), (ii) Taxes 

attributable to the ownership or operation of the Acquired Assets or the Business by Buyer (or any 

of its Affiliates) for any Post-Closing Tax Period other than any Taxes of (or allocated to) the 

Seller under applicable Tax Law or pursuant to Section 3.5(c) and (iii) any Transfer Taxes pursuant 

to Section 10.4; 

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(g) all Liabilities of Seller with respect to utilities for the Restaurants, whether 

arising prior to, on or after the Closing Date; 

(h) all Liabilities related to, resulting from or arising out of, on or after the 

Closing, any (i) unredeemed refund amounts or similar items, (ii) customer deposits or (iii) 

customer promotions and related programs (including customer loyalty programs and gift cards); 

(i) all Liabilities with respect to Restaurant Employees that arise on or after the 

date of Effective Time; 

(j) all Accrued PTO; 

(k) all Post-Closing COBRA Liabilities; 

(l) all Liabilities or obligations owing from Seller or its Affiliates to any 

Acquired Company, any DFW Entity or any of their respective Subsidiaries; 

(m) all Liabilities related to the claims incurred as of the Closing Date but not 

reported in respect of the Seller’s self-insured medical and dental plans (“IBNR Claims”); and 

(n) all Liabilities (including all government charges or fees) arising out of the 

conduct of the business or the ownership or operation of the Acquired Assets, in each case, by 

Buyer from and after the Closing. 

For the avoidance of doubt, no liabilities of any Acquired Company or DFW Entity shall be 

“Assumed Liabilities” and Buyer shall acquire such liabilities only indirectly, as a result of 

acquiring the equity interests of the Acquired Companies. 

“Auction” has the meaning given to it in the Bidding Procedures Order. 

“Avoidance Actions” means any and all actual or potential causes of action to avoid a 

transfer of property or an obligation incurred by the Seller pursuant to Chapter 5 of the Bankruptcy 

Code, including Sections 502(d), 510, 541, 542, 543, 544, 545, 547, 548, 549, 550, 551, and 553 

or under analogous state or federal statutes and common law. 

“Back-up Bidder” has the meaning given to it in the Bidding Procedures Order. 

“Bankruptcy Code” means title 11 of the United States Code, 11 U.S.C. §§ 101 et seq, as 

amended. 

“Bid Protections” means the Break-Up Fee and Expense Reimbursement. 

“Bidding Procedures Order” means that certain Order Approving (I) Bidding Procedures, the 

Sale Timeline and the Form and Manner or Notice Thereof; (II) Assumption and Assignment 

Procedures; and (III) Granting Related Relief, entered by the Bankruptcy Court on November 20, 

2024 at Docket No. 197 (as may be amended, modified or updated from time to time). 

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“Break-Up Fee” means the amount of $640,000.00, which the Parties agree represents fair 

consideration of the significant costs, efforts to be expended and risks assumed by Buyer in 

negotiating the transaction described herein. 

“Business” has the meaning given to it in the Recitals. 

“Business Day” means any day other than a Saturday, Sunday or other day on which banks 

in Dallas, Texas or New York, New York are authorized or required by Law to be closed. 

“Buyer” has the meaning given to it in the Caption. 

“Buyer Group” means Buyer, any Affiliate of Buyer (including, following transfer of the 

Transferred Interests, the Acquired Companies) and each of their respective former, current or 

future Affiliates, officers, directors, employees, partners, members, managers, financing sources, 

agents, advisors and other Representatives, successors or permitted assigns. 

“C&C Restaurant” means any Restaurant which has suffered any fire or other casualty with 

respect to a material portion of the Acquired Assets relating to the particular Restaurant, or a 

condemnation or other taking of any material portion of the Acquired Assets relating to the 

particular Restaurant by any Governmental Authority. For purposes of this definition, “material 

portion” shall be deemed to mean an amount equal to or greater than seventy-five percent (75%) 

of the Acquired Assets with respect to a particular Restaurant (with the casualty or condemnation 

of such material portion of the Acquired Assets resulting in an inability of Seller to operate such 

Restaurant). 

“Cash Payment” has the meaning given to it in Section 3.1(a). 

“Claim(s)” means all of Seller’s claims or causes action against third parties exclusively 

arising out of or exclusively arising in connection with the Acquired Assets or the Restaurants, all 

warranties, rights and claims of Seller under all existing third party warranties exclusively relating 

to any and all of the Acquired Assets or the Restaurants, including without limitation third party 

warranties and indemnification rights. 

“Closing” means transfer of the Acquired Assets by Seller to Buyer, the assumption of the 

Assumed Liabilities by Buyer, the delivery of the Purchase Price and the consummation of the 

Transaction. 

“Code” means the United States Internal Revenue Code of 1986, as amended. 

“Collective Bargaining Agreement” has the meaning given to it in Section 4.14(b). 

“Conditional Liquor License” means a temporary, provisional or conditional alcoholic 

beverage and liquor license that permits Buyer to serve and sell alcoholic beverages pending the 

issuance of a Liquor License. 

“Conditions” has the meaning given to it in Section 2.6(d). 

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Exhibit 1.1 - 6 

4903-2558-8736, v. 1 

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“Confidentiality Agreement” means that certain confidentiality agreement, dated as of 

November 9, 2024, by and between TGI Friday’s Inc. and Sugarloaf Concessions, LLC, as 

amended. 

“Contract(s)” means all contracts, agreements, leases, license agreements, arrangements 

and/or commitments of any kind, and, in each case, other than a purchase order, service order, or 

sales order. 

“COBRA” means the continuation coverage provisions of the Consolidated Omnibus 

Budget Reconciliation Act of 1985, as codified in Code Section 4980B and ERISA Sections 601 

et seq., as amended from time to time, and the regulations and other guidance promulgated 

thereunder and any other similar provisions of state or local Law. 

“Correcting Information” has the meaning given to it in Section 6.5. 

“Credit Card Receivables” means all accounts receivable and other amounts owed to any 

Seller (whether current or non-current) in connection with any customer purchases that are made 

with credit cards or any other related amounts owing (including deposits or holdbacks to secure 

chargebacks, offsets or otherwise) from credit card processors to Seller. 

“Cure Costs” means cure costs required to be paid pursuant to Section 365 of the 

Bankruptcy Code in connection with the assumption and assignment of Assigned Contracts. 

“DFW Entities” has the meaning given to it in Section 4.3(b). 

“DFW Stores” means the five (5) T.G.I. Friday’s restaurants operated by the DFW Entities 

in the Dallas/Fort Worth International Airport as set forth on Exhibit 1.0. 

“DIP Facility” means the debtor-in-possession financing facility provided to Seller under 

that certain Senior Secured Superpriority Debtor-in-Possession Credit Agreement, dated as of 

November 11, 2024, by and among TGI Friday’s, Inc., as the borrower representative, the 

borrower parties thereto, and Texas Partners Bank, as lender (as amended from time to time, the 

“DIP Credit Agreement”) 

“DIP Loan” means any amount funded to Seller and/or its Affiliates pursuant to a debtorin-possession financing loan that has been made pursuant to an Order of the Bankruptcy Court. 

“Disclosure Schedule” has the meaning given to it in Article IV. 

“Effective Date” has the meaning given to it in the Caption. 

“Effective Time” means the time that all of the Restaurants have closed for business on the 

day preceding the Closing Date or, if any Restaurant closes after midnight on such day, then as of 

the closing time of such Restaurant on the Closing Date. 

“Employee Benefit Plan” means each “employee benefit plan,” as defined in Section 3(3) 

of ERISA (whether or not subject to ERISA), including all other employee benefit and 

compensation plans or arrangements, including bonus or incentive plans, deferred compensation 

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148483277_14 

arrangements, equity or equity-based compensation, severance pay, salary continuation, sick leave, 

vacation pay, disability, hospitalization, medical, accident, disability and life insurance, worker’s 

compensation, retiree healthcare, retiree life insurance, pension, retirement, scholarship, cafeteria, 

dependent care, or other insurance or employee benefit or compensation programs, plans, policies, 

agreements or arrangements, whether written or oral, which are for the benefit of current or former 

Restaurant Employees or to which Seller contributes or has any material Liability, including due 

to an ERISA Affiliate, in respect of such Restaurant Employees, other than (i) any Multiemployer 

Plan and (ii) any plans, programs, agreements or arrangements maintained or sponsored by, or to 

which contributions are mandated by, a Governmental Authority. 

“Entity” means any joint venture, general partnership, limited partnership, limited liability 

company, corporation, trust, business trust, cooperative, association or other incorporated or 

unincorporated entity. 

“Environmental Claim(s)” means, solely in respect of the Leased Properties, any currently 

pending investigation, claim, notice of violation, information request, allegation, demand, 

summons, suit, action, injunction, proceeding, penalty, fine, restriction, lien, encumbrance, 

judgment, decree, order or agreement from, by or with any Governmental Authority or private 

party concerning any Environmental Law or any Release of any Hazardous Substance into the 

environment. 

“Environmental Law(s)” means any current Applicable Law concerning (a) the treatment, 

disposal, emission, discharge, Release or threatened Release of Hazardous Substance or (b) the 

protection of the environment (including natural resources, air and surface or subsurface land or 

waters). 

“Equipment” means any and all equipment (including the point of sale equipment), 

computers, computer peripherals, hardware, accessories, furniture, furnishings, fixtures, office 

supplies, vehicles and all other fixed assets. 

“Equity Interests” means (a) with respect to a company or corporation, any and all classes 

or series of shares, (b) with respect to a partnership, limited liability company trust or similar 

Person, any and all classes or series of units, interests or other partnership or limited liability 

company equity securities, and (c) with respect to any other Entity, any other security representing 

an ownership interest or participation in such Entity. 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended. 

“ERISA Affiliate” means any Affiliate of Seller and any other entity that, together with 

Seller, would be treated as a single employer under Section 4001 of ERISA or Section 414 of the 

Code. 

“Excluded Assets” means the following assets, properties and rights of Seller: 

(a) any asset, document, permit or Contract not exclusively used by the 

Restaurants; 

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(b) any Claims, causes of action or other rights not exclusively for the benefit 

of the Restaurants; 

(c) cash and cash equivalents of the Business (other than Restaurant Cash); 

(d) all bank accounts, and all deposits (including maintenance deposits and 

security deposits for rent, electricity, telephone or otherwise) or prepaid or deferred charges and 

expenses, including all lease and rental payments, that have been prepaid by any Seller, and any 

retainers or similar amounts paid to Representatives or other professional service providers; 

(e) income tax receivables; 

(f) deferred tax assets; 

(g) employee advances; 

(h) all current and prior insurance policies of Seller, including, for the 

avoidance of doubt, all director and officer insurance policies, and all rights and benefits of any 

nature of Seller with respect thereto, including all insurance recoveries thereunder and rights to 

assert claims with respect to any such insurance recoveries; 

(i) Contracts and leases that are not Assigned Contracts, including those listed 

on Schedule 2.2 of the Disclosure Schedule (the “Excluded Contracts”); 

(j) the Purchase Price and all rights, claims and causes of action of Seller 

under this Agreement or any agreement, certificate, instrument or other document executed and 

delivered between any Seller and Buyer in connection with the transactions contemplated hereby, 

or any other agreement between any Seller and Buyer entered into on or after the date hereof; 

(k) any personnel records and other books, records, and files that Seller is 

required by law to retain in their possession; 

(l) any claim, right, or interest of Seller in or to any refund, rebate, abatement, 

or other recovery for taxes, together with any interest due thereon or penalty rebate arising

therefrom; 

(m) all demands, credits, statements, allowances, refunds, rebates (including 

any vendor or supplier rebates), rights (including under or with respect to express or implied 

guarantees, warranties, representations, covenants and indemnities), claims, counterclaims, 

defenses, credits, causes of action, rights of set off, rights of recovery or rights of recoupment 

relating to or arising against suppliers, vendors, merchants, manufacturers and counterparties to 

leases, licenses or any Contract, arising out of or relating to events occurring on or prior to the 

Closing; 

(n) every asset of Seller that would otherwise constitute an Acquired Asset (if 

owned immediately prior to the Closing) if conveyed or otherwise disposed of during the period 

from the date hereof until the Closing (i) in the Ordinary Course of Business, (ii) as authorized by 

the Bankruptcy Court, or (iii) as otherwise permitted by the terms of this Agreement; 

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(o) any other prepaid assets or properties set forth on Schedule 1.1(o) of the 

Disclosure Schedule; 

(p) applicable federal, state, and local taxes (including any amounts collected 

in respect thereof); 

(q) all Intellectual Property owned by a third party and used by Seller under a 

license or other Contract (other than rights granted to Seller pursuant to an Assigned Contract), 

including all Intellectual Property held or owned by TGI SPV Guarantor, TGI Funding LLC and 

TGI Fridays Franchisor, LLC; 

(r) all Intellectual Property owned by the Seller that is not used exclusively in 

the Restaurants, including the Intellectual Property listed on Schedule 2.2 of the Disclosure 

Schedule; 

(s) all documents prepared or received by Seller or any of its Affiliates or other 

subsidiaries or their Representatives or on their behalf in connection with the sale of the Acquired 

Assets, this Agreement or the other Ancillary Documents, the transactions contemplated hereby or 

thereby or the Bankruptcy Case, including (i) all records and reports prepared or received by Seller 

or any of their respective Affiliates, subsidiaries or Representatives in connection with the sale of 

the Acquired Assets and the transactions contemplated hereby, (ii) all bids and expressions of 

interest received from third parties with respect to the acquisition of any of Seller’s businesses or 

assets, (iii) all privileged materials, documents and records (including any work product) of any 

Seller or any of its Affiliates or other subsidiaries or Representatives, including any privileged 

materials, documents and records (including any work product) that are in the possession of any 

Acquired Company or DFW Entity, (iv) copies of the documents, materials and data related to the 

Acquired Assets or Assumed Liabilities prior to the Closing Date, (v) confidentiality agreements 

with prospective purchasers of the Acquired Assets or the Assumed Liabilities or any portion 

thereof, and (vi) any other files or records to the extent relating exclusively to any Excluded Assets, 

Excluded Liabilities, the Retained Business or the Bankruptcy Case; 

(t) all documents (including information stored on the computer systems, data 

networks or servers of any Seller) (i) to the extent they relate to any of the Excluded Assets, the 

Excluded Liabilities or the Retained Business, (ii) that are Seller’s financial accounting documents, 

all minute books, organizational documents, stock certificates, stock registers and such other books 

and records of any Seller as pertaining to ownership, organization or existence of such Seller, Tax 

Returns (and any related work papers), corporate seal, checkbooks and canceled checks, or (iii) 

that any Seller is required by Law to retain; 

(u) (i) all other Claims, rights, claims, causes of action, rights of recovery, rights 

of set-off and rights of recoupment of any Seller, in each case, arising out of or relating to events 

occurring prior to the Closing Date, and (ii) all claims that any Seller may have against any Person 

with respect to any other Excluded Assets or any Excluded Liabilities; 

(v) any Equity Interests in or assets, properties and rights of any non-Debtor 

Affiliate of any Seller, including the Securitization Entities; 

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(w) all Liabilities or other amounts owing from any Seller or any of its Affiliates 

or subsidiaries, the Acquired Companies, the DFW Entities or any of their Subsidiaries; 

(x) all Accounts Receivable whether current or non-current, and the right to bill 

and receive payment for products delivered and/or services performed but unbilled or unpaid as of 

the Closing; and 

(y) any books and records relating to any of the foregoing. 

“Excluded Liabilities” has the meaning given to it in Section 2.4 and shall include, but not 

be limited to, the following: 

(a) any Liability (i) for Taxes of Seller (or any member or Affiliate of Seller 

(other than the Acquired Companies or the DFW Entities)); (ii) for Taxes relating to or arising 

from the Business, the Acquired Assets, or the Assumed Liabilities for any Pre-Closing Tax Period 

(or portion thereof as determined pursuant to Section 3.5(c)); (iii) of Seller for the Taxes of any 

other Person under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local 

or foreign law), as a transferee or successor, by contract or otherwise; and (iv) for sales, use, 

payroll, and withholding (or other deposits) with respect to the Acquired Assets or the Business 

for any Pre-Closing Tax Periods; 

(b) all Liabilities arising under Section 503(b)(9) of the Bankruptcy Code; 

(c) all Liabilities of Seller arising or incurred in connection with the 

negotiation, preparation, investigation and performance of this Agreement, the Ancillary 

Documents and the transactions contemplated hereby and thereby, including fees and expenses of 

counsel, accountants, consultants, advisers, and any other Person; 

(d) all Liabilities relating to or arising out of the Excluded Assets; 

(e) all Liabilities in respect of any pending or threatened Action arising out of, 

relating to, or otherwise in respect of the operation of the Business or the Acquired Assets to the 

extent such Action relates to such operation on or prior to the Closing Date; 

(f) all Liability or claim for injury or sickness to a Person or property that arises 

out of or is based upon any express or implied representation, warranty, agreement, or guaranty 

made by Seller, or by reason of the improper cooking or performance of a service by Seller, 

including with respect to any drink, food or any other item or sold or any service performed by 

Seller; 

(g) all Liabilities of Seller arising under or in connection with any employee 

benefit plan providing benefits to any present or former employee of Seller and all Liabilities of 

Seller for any present or former employees, officers, directors, retirees, independent contractors, 

or consultants of Seller, including any Liabilities associated with any claims for wages or other 

benefits, bonuses, accrued vacation, workers’ compensation, or employee deferred compensation, 

including stock option plans, grants, and agreements, severance, retention, termination, or other 

payments, in each case, to the extent arising prior to the Effective Time, except as otherwise 

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provided in this Agreement and other than, for the avoidance of doubt, and the Post-Closing 

COBRA Liabilities, Accrued PTO, IBNR Claim; 

(h) all Liabilities for injury to a Person that arises out of or related to the 

Business prior to the Closing, including any loss, damage, or injury sustained by any present or 

former employee or independent contractor of Seller or any other Person while engaging in 

activities in connection with any Acquired Asset prior to the Closing; 

(i) all Liabilities to indemnify, reimburse, or advance amounts to any present 

or former officer, director, employee, agent or other Person of Seller (including with respect to 

any breach of fiduciary obligations by same), except as set forth in this Agreement with respect to 

the Acquired Companies; 

(j) all Liabilities under any Contracts that are not validly and effectively 

assigned to Buyer pursuant to this Agreement or the Sale Order; 

(n) all Liabilities associated with debt, loans, or credit facilities of Seller; and 

(p) all Liabilities arising out of, in respect of, or in connection with the failure 

by Seller or any of its Affiliates to comply with any Law or Order prior to the Closing, other than 

express Assumed Liabilities (including Cure Costs). 

Notwithstanding the foregoing, any Excluded Liability with respect to Taxes shall be exclusively 

governed by clause (a) of this definition and any Liability or other amounts described in clauses 

(b) – (p) of this definition shall not include any Liability for Taxes. 

“Expense Reimbursement” means all documented and reasonable out-of-pocket expenses 

incurred in connection with Buyer’s efforts to negotiate and consummate the transaction described 

herein, not to exceed $50,000.00. 

“FDD” means Franchisor’s Franchise Disclosure Document dated April 28, 2023. 

“Financing Sources” means the entities that have committed to provide the Debt Financing 

or any Alternative Financing in replacement thereof (including the parties to any joinder 

agreements, credit agreements or other definitive agreements relating thereto) and their respective 

Affiliates and such entities’ (and their respective Affiliates’), officers, directors, employees, 

attorneys, advisors, agents and representatives involved in the Debt Financing and their successors 

and permitted assigns. 

“Fixed Assets” means all machinery, Equipment, tools, signs, marketing material, tenant 

improvements, inventories, and other items of tangible personal property located at the 

Restaurants. 

“Franchise Agreement(s)” is defined in the Recitals. 

“Governmental Authority” means any (a) foreign, federal, state, local, municipal or other 

government; (b) department, agency or instrumentality of a foreign or other government; (c) 

governmental or quasi-governmental authority of any nature; (d) any court or other tribunal; or (e) 

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body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, 

regulatory or taxing authority or power of any nature. 

“Hazardous Substance” means any and all substances, materials and wastes which are 

regulated as hazardous or toxic under applicable local, state or federal law or which are classified 

as hazardous or toxic under local, state or federal laws or regulations, including, without limitation, 

(i) those substances included within the definitions of “hazardous substances,” “hazardous 

materials,” “toxic substances,” “solid waste,” “pollutant” or “contaminant” as such terms are 

defined by or listed in the Comprehensive Environmental Response Compensation and Liability 

Act of 1980 (42 U.S.C. § 9601 et seq.), as amended by Superfund Amendments and 

Reauthorization Act of 1986 (Pub. L. 99-499 100 Stat. 1613), the Hazardous Materials 

Transportation Act (49 U.S.C. § 1801 et seq.), the Resource Conservation and Recovery Act of 

1976 (42 U.S.C. § 6901 et seq.), the Toxic Substance Control Act (15 U.S.C. § 2601 et seq.), the 

Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. § 136 et seq.), the Occupational 

Safety and Health Act of 1970 (29 U.S.C. § 651 et seq.), the Emergency Planning and Community 

Right to Know Act of 1986 (42 U.S.C. § 11001 et seq.), the Hazardous and Solid Waste 

Amendments of 1984 (Public Law 86-616 Nov. 9, 1984), the Federal Clean Air Act (42 U.S.C. 

§ 7401 et seq.), and in the regulations promulgated pursuant to such laws, all as amended, (ii) those 

substances listed as hazardous substances in the United States Department of Transportation Table 

(49 CFR 172.101) or 40 CFR Part 302, both as amended, and (iii) any material, waste or substance 

which is (A) petroleum or refined petroleum by-product, (B) asbestos, in any form, 

(C) polychlorinated biphenyls, (D) designated as a “hazardous substance” pursuant to Section 311 

of the Clean Water Act (33 U.S.C. § 1251 et seq.), as amended, (E) flammable explosives, or 

(F) radioactive materials. Notwithstanding the foregoing, Hazardous Substances do not include 

any of the foregoing in naturally occurring or de minimis amounts or concentrations. 

“Inspections” means Buyer’s right to reasonably inspect the Restaurants and Acquired Assets 

to determine if the Fixed Assets are in satisfactory working condition. 

“Intellectual Property” means all of the following in any jurisdiction throughout the world: 

(a) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all 

improvements thereto, and all patents, patent applications, and patent disclosures, together with all 

reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations 

thereof, (b) all trademarks, service marks, trade dress, logos, designs, shapes, configurations, 

slogans, trade names, corporate names, Internet domain names, and rights in telephone numbers, 

together with all translations, adaptations, derivations, and combinations thereof and including all 

goodwill associated therewith (c) all copyrightable works, all copyrights, moral rights and other 

rights in any work of authorship, compilation or derivative work and all applications, registrations, 

and renewals in connection therewith, (d) all mask works and all applications, registrations, and 

renewals in connection therewith, (e) all trade secrets and confidential business information 

(including ideas, research and development, know-how, methods, recipes, formulas, compositions, 

manufacturing and production processes and techniques, technical and other data, designs, 

drawings, specifications, customer and supplier lists, pricing and cost information, and business 

and marketing plans and proposals), (f) proprietary rights in software (including source code, 

executable code, data, databases, and related documentation) and computer programs, (g) Internet 

domain names and social media accounts, and (h) all other intellectual property rights in the 

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foregoing, including the right to sue and recover for past, present or future infringements, 

misappropriations or other conflict with any of the foregoing. 

“Interim Management Agreement” means an interim management agreement and/or other 

interim agreement mutually acceptable the Parties contemplated by Schedule 7.2 of the 

Disclosure Schedule with respect to each applicable Restaurant location relating to the offer and 

sale of liquor and other alcoholic beverages. 

“Judgment” means any order, injunction, judgment, decree, ruling, assessment or 

arbitration award of any Governmental Authority or arbitrator. 

“Knowledge of Seller” or words of like import means the actual knowledge without 

independent verification (and in no event encompass constructive, imputed or similar concepts of 

knowledge) of Chip Bundick, Michael Taylor, Jamie Murrieta and Ashley Kirkley, none of whom, 

for the sake of clarity and avoidance of doubt, shall have any personal Liability or obligations 

regarding such knowledge. 

“Law” means any federal, state, provincial, local, municipal, foreign or international, 

multinational or other law, statute, legislation, constitution, principle of common law, resolution, 

ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, ruling, directive, 

pronouncement, determination, decision, opinion or requirement issued, enacted, adopted, 

promulgated, implemented or otherwise put into effect by or under the authority of any 

Governmental Authority. 

“Landlord” means a lessor described in the related Real Property Lease. 

“Leased Property(ies)” means the parcel(s) of real property identified on Schedule 4.9 of 

the Disclosure Schedule. 

“Liability(ies)” means, as to any Person, any debt, adverse claim, liability, duty, 

responsibility, obligation, commitment, assessment, cost, expense, loss, expenditure, charge, fee, 

penalty, fine or contribution obligation of any kind or nature whatsoever, whether known or 

unknown, asserted or unasserted, absolute or contingent, direct or indirect, accrued or unaccrued, 

liquidated or unliquidated, or due or to become due, and regardless of when sustained, incurred or 

asserted or when the relevant events occurred or circumstances existed. 

“Lien(s)” means any lien (as defined in Section 101(37) of the Bankruptcy Code), charge, 

easement, adverse claim, encumbrance, mortgage, security interest, option, pledge, or any other 

title defect or restriction on transfer or use. 

“Liquor License” means an alcoholic beverage and liquor license required by Applicable 

Law that permits Buyer to serve and sell alcoholic beverages at the applicable Restaurant. 

“Marks” means certain proprietary and other property rights and interests in and to the 

“TGI Friday’sTM” name and service mark, and such other trademarks, service marks, logo types, 

and commercial symbols as Seller and Franchisor may from time to time authorize for use by either 

its licensees or franchisees. 

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Exhibit 1.1 - 14 

4903-2558-8736, v. 1 

148483277_14 

“Material Adverse Change” means any effect or change that, individually or in the 

aggregate, is or would reasonably expected to be materially adverse to the business of the 

Restaurants; provided that none of the following shall be deemed to constitute, and none of the 

following shall be taken into account in determining whether there has been a Material Adverse 

Change: any adverse change, event, development, occurrence or effect (each, an “Effect”) in, 

arising from or relating to (i) general business or economic conditions, including such conditions 

related to the business of the Restaurants and Effects affecting the industry in which Seller and its 

Affiliates operate, including Effects arising from or relating to competition or ordinary course 

matters and other Effects within such industry, new entrants into such industry, new products from 

other participants in such industry, changes in product pricing due to such competition, changes in 

market share or financial results due to such competition and other related changes resulting from 

such competition; (ii) Effects in, arising from or relating to national or international political or 

social conditions, including tariffs, riots, protests, the engagement by the United States or any other 

country in hostilities or the escalation thereof, whether or not pursuant to the declaration of a 

national emergency or war, or the occurrence or the escalation of any military, cyber or terrorist 

(whether or not state-sponsored) attack upon the United States or any other country, or any of its 

territories, possessions, or diplomatic or consular offices or upon any military installation, asset, 

Equipment or personnel of the United States or of any other country; (iii) Effects in, arising from 

or relating to any fire, flood, hurricane, earthquake, tornado, windstorm, other calamity or act of 

God, global or national health concern, epidemic, pandemic (whether or not declared as such by 

any Governmental Authority), viral outbreak (including the worsening thereof) or any quarantine 

or trade restrictions related thereto or any other force majeure; (iv) Effects in, arising from or 

relating to the decline or rise in price of any currency or any Equipment or supplies necessary to 

or used in the provision of services by Seller (including any resulting inability to meet customer 

demands or fulfill purchase orders and any resulting breaches of Contracts); (v) Effects in, arising 

from, or relating to financial, banking, or securities markets (including (A) any disruption of any 

of the foregoing markets, (B) any change in currency exchange rates, (C) any decline or rise in the 

price of any security, commodity, Contract or index, and (D) any increased cost, or decreased 

availability, of capital or pricing or terms related to any financing for the transactions contemplated 

by this Agreement); (vi) Effects in, arising from or relating to changes in GAAP or the 

interpretation thereof; (vii) Effects in, arising from or relating to changes in Laws or other binding 

directives or determinations issued or made by or agreements with or consents of any 

Governmental Authority and any increase (or decrease) in the terms or enforcement of (or 

negotiations or disputes with respect to) any of the foregoing; (viii) Effects in, arising from or 

relating to (A) any act or omission by any Seller or any of their respective Affiliates required to be 

taken pursuant to the terms of the DIP Facility or the DIP Credit Agreement or any Order of the 

Bankruptcy Court or taken at the request of Buyer or actions or omissions of the Seller or any 

Acquired Company expressly required to be taken (or not taken) in accordance with this 

Agreement or (B) the negotiation, announcement or pendency of this Agreement or the 

transactions contemplated hereby, the identity, nature or ownership of Buyer or Buyer’s plans with 

respect to the Acquired Assets and Assumed Liabilities, including the impact thereof on the 

relationships, contractual or otherwise, of the business of Seller with employees, customers, 

lessors, suppliers, vendors or other commercial partners or litigation arising from or relating to this 

Agreement or the transactions contemplated hereby; (ix) Effects in, arising from, or relating to any 

existing event, occurrence or circumstance that is publicly known or disclosed or with respect to 

which Buyer has knowledge as of the date hereof; (x) Effects in, arising from or relating to any 

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Exhibit 1.1 - 15 

4903-2558-8736, v. 1 

148483277_14 

action required to be taken under any existing Contract to which Seller (or any of its assets or 

properties) is bound; (xi) Effects that arise from any seasonal fluctuations in the business; (xii) any 

failure, in and of itself, to achieve any budgets, projections, forecasts, estimates, plans, predictions, 

performance metrics or operating statistics or the inputs into such items (whether or not shared 

with Buyer or its Affiliates or Representatives) and any other failure to win or maintain customers 

or business; (xiii) Effects of any action taken by Buyer or its Affiliates with respect to the 

transactions contemplated by this Agreement or the financing thereof or any breach by Buyer of 

this Agreement; or (xiv) Effects in, arising from, or relating to (A) the commencement or pendency 

of the Bankruptcy Case, including any reasonably anticipated effects of the commencement or 

prosecution of the Bankruptcy Cases or the financial condition of Seller or any Acquired Company 

or their Affiliates or subsidiaries (including any Action brought against a Seller or any Acquired 

Company or any of their Affiliates or subsidiaries for breach of Contract in connection with the 

collection of payment due thereunder (whether alone or with other claims) or any modification of 

credit, cash on delivery or similar terms of a Contract); (B) any objections in the Bankruptcy Court 

to (1) this Agreement or any of the transactions contemplated hereby or thereby, (2) the Sale Order 

or the reorganization or liquidation of Seller or (3) the assumption or rejection of any Assigned 

Contract; or (C) any Order of the Bankruptcy Court or any actions or omissions of Seller in 

compliance therewith. 

“Multiemployer Plan” means a multiemployer plan as defined in Section 3(37) of ERISA 

or Section 4001(a)(3) of ERISA. 

“New Information” has the meaning given to it in Section 6.5. 

“Order” means any order, injunction, judgment, decree, ruling, writ, assessment or 

arbitration award of a Governmental Authority, including any Order entered by the Bankruptcy 

Court in the Bankruptcy Case. 

“Ordinary Course of Business” means the ordinary and usual course of operations of the 

business of Seller taken as a whole consistent with past practice, taking into account the 

contemplation, commencement and pendency of the Bankruptcy Cases and the business and 

operating practices of Seller in light of its financial condition, financial distress and the Bankruptcy 

Cases. 

“Permitted Liens” means (a) statutory liens of carriers, warehousemen, mechanics, 

materialmen and other similar common law liens incurred in the Ordinary Course of Business for 

sums not yet due and payable and that do not impair the conduct of Seller’s business or the present 

or proposed use of the affected property or asset; (b) Liens for real or personal property Taxes not 

yet due and payable, being contested in good faith, or the nonpayment of which is permitted or 

required by the Bankruptcy Code, (c) Liens that are immaterial in character, amount and extent 

and which do not detract from the value of, or interfere with the present or proposed use of, the 

properties or assets they affect; (d) any Liens imposed pursuant to the terms of the Real Property 

Leases, (e) licenses granted on a non-exclusive basis, (f) Liens for utilities and Taxes not yet due 

and payable, being contested in good faith, or the nonpayment of which is permitted or required 

by the Bankruptcy Code, (g) easements, rights of way, restrictive covenants, encroachments and 

similar non-monetary encumbrances or non-monetary impediments against any of the Acquired 

Assets which do not, individually or in the aggregate, materially and adversely affect the operation 

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Exhibit 1.1 - 16 

4903-2558-8736, v. 1 

148483277_14 

of the Acquired Assets and, in the case of the Leased Property, which do not, individually or in 

the aggregate, materially and adversely affect the use or occupancy of such Leased Property as it 

relates to the operation of the Acquired Assets, (h) applicable zoning Laws, building codes, land 

use restrictions and other similar restrictions imposed by Law which are not materially violated by 

the current use or occupancy of such Leased Property, as applicable, (i) Liens imposed under 

Seller’s certificate of incorporation, certificate of formation, bylaws, operating agreement or 

similar organizational documents, or under federal or state securities Laws, (j) Liens arising by, 

through or under Buyer’s financing for the transactions contemplated hereby and (k) Liens that 

will be released by, or that are specifically permitted by, the Sale Order (including any Assumed 

Liabilities). 

“Person” means an individual, firm, Entity, group or organization of any kind, including a 

Governmental Authority. 

“Post-Closing Tax Period” means any Tax period beginning after the Closing Date and that 

portion of a Straddle Period beginning after the Closing Date. 

“Pre-Closing Employment Claim” means any Claim against Buyer or its Affiliates related 

to the employment or engagement by Buyer or its Affiliates of any Person as an employee, 

independent contractor or other service provider, or the termination of any such employment or 

engagement, in each case, to the extent arising prior to the Closing Date. 

“Pre-Closing Tax Amount” means an amount equal to any sales and use taxes, together 

with any penalties, fees or similar for amounts past due, payable by Seller which are past due and 

outstanding as of the Closing in respect of the Restaurants listed on listed on Exhibit 1.0 as of the 

date hereof, but (x) without duplication of any amounts included in Cure Costs, (y) excluding any 

sales and use taxes for periods of time following the Petition Date that have been collected, but 

not yet remitted, in the Ordinary Course of Business, and (z) solely to the extent that such amounts 

are required be paid under Applicable Law as a mandatory pre-condition to the transfer of any 

Liquor License which is a Transferable Permit to Buyer (and are actually so paid). 

“Pre-Closing Tax Period” means any Tax period ending on or before the Closing Date and 

that portion of any Straddle Period ending on the Closing Date. 

“Purchase Price” has the meaning given to it in Section 3.1. 

“Real Property Leases” means all of the unexpired leases of real property relating to the 

Restaurants. 

“Release” means, solely in respect of the Leased Properties, the release, spill, emission, 

leaking, pumping, pouring, emptying, escaping, dumping, injection, deposit, disposal, discharge, 

dispersal, leaching or migrating of any Hazardous Substance into the environment in violation of 

Environmental Law. 

“Representatives” means, with respect to any Person, any directors, officers, employees, 

investment bankers, financial advisors, accountants, agents, attorneys, consultants, or other 

representatives of such Person. 

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Exhibit 1.1 - 17 

4903-2558-8736, v. 1 

148483277_14 

“Restaurant(s)” means the TGI FridaysTM restaurant(s) which are owned by Seller and 

being transferred to Buyer pursuant to this Agreement and that are listed on Exhibit 1.0 attached 

hereto and the DFW Stores listed on Exhibit 1.0. 

“Restaurant Employees” means (a) all individuals who are employees of Restaurants, (b) 

all individuals who are employees of Seller and devote all or substantially all of their working time 

to the business of the Restaurants, the Acquired Companies or the DFW Entities, and (c) all other 

employees of Seller or its Affiliates who are listed by employee number and job title on Schedule 

1.1(a) of the Disclosure Schedule. 

“Seller” has the meaning given to it in the Caption. 

“Seller Parties” means Seller and each of its former, current, or future Affiliates or other 

subsidiaries, officers, directors, employees, partners, members, equityholders, controlling or 

controlled Persons, managers, agents, advisors and other Representatives, successors or permitted 

assigns. 

“Shared Contracts” means Contracts that relate to or are used by both, on the one hand, the 

Restaurants acquired pursuant to this Agreement and, on the other hand, other restaurants and 

business of Seller or its Affiliates that is not being acquired pursuant to this Agreement. 

“Straddle Period” means any taxable period that includes but does not end on the Closing 

Date. 

“Subsidiary” or “Subsidiaries” means, with respect to any Person, any corporation, limited 

liability company or other entity of which a majority of the total voting power of shares of stock 

or other equity interests entitled (without regard to the occurrence of any contingency) to vote in 

the election of directors, managers or trustees or other governing body or Person thereof is at the 

time owned or controlled, directly or indirectly, by such Person or one or more of the other 

Subsidiaries of such Person or a combination thereof or any partnership, association or other 

business entity of which a majority of the partnership or other similar ownership interest is at the 

time owned or controlled, directly or indirectly, by such Person or one or more Subsidiaries of 

such Person or a combination thereof. 

“Tax” or “Taxes” means any federal, state, local, or foreign income, gross receipts, license, 

payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, 

environmental, customs duties, capital stock, franchise, profits, withholding, social security (or 

similar), unemployment, disability, real property, personal property, sales, use, privilege, transfer, 

registration, value-added, alternative or add-on minimum, or estimated, tax, including any interest, 

penalty, or addition thereto, whether disputed or not. 

“Tax Return(s)” means any return, declaration, report, claim for refund, or information 

return or statement filed required to be filed with any Taxing Authority, including any supplement 

or attachment thereto and including any amendment of any of the foregoing. 

“Taxing Authority” means any governmental authority, domestic or foreign, having 

jurisdiction over the assessment, determination, collection, or other imposition of any Taxes. 

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Exhibit 1.1 - 18 

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148483277_14 

“Transaction Consents” means the approval of the Bankruptcy Court and the matters 

contemplated by Schedule 7.2 of the Disclosure Schedule. 

“Transferable Permits” means, to the extent transferable pursuant to Applicable Law, 

Seller’s interest in certain licenses and permits (including Seller’s interest in Liquor Licenses to 

the extent transferable) granted by Governmental Authorities and held by Seller exclusively in 

connection with the operation of the Restaurants as listed on Schedule 2.1 of the Disclosure 

Schedule. 

“Transferred Employees” means Restaurant Employees who accept an offer of 

employment from Buyer or its Affiliates. 

“Transferred Interests” has the meaning given to it in the Recitals. 

“WARN” means the federal Worker Adjustment and Retraining Notification Act of 1988 

and any similar applicable foreign, state or local law. 

“Willful Breach” shall mean a deliberate act or a deliberate failure to act regardless of 

whether breaching was the conscious object of the act or failure to act. 

“Winning Bidder” means the bidder with the highest or otherwise best bid for the Acquired 

Assets, as determined in accordance with the Bidding Procedures Order. 

In this Agreement, unless expressly stated otherwise: 

(i) the singular includes the plural and vice versa; 

(ii) reference to any person includes such person’s successors and assigns, if applicable, 

but only if such successors and assigns are permitted by this Agreement, and reference to a person 

in a particular capacity excludes such person in any other capacity; 

(iii) reference to a gender includes the other gender; 

(iv) reference to any agreement, document, or instrument means such agreement, 

document, or instrument as amended or modified and in effect from time to time in accordance 

with its terms; 

(v) reference to any law or regulation means that law or regulation as from time to time 

in effect, including any amendment, modification, codification, replacement, or reenactment of 

such law or regulation; 

(vi) reference to any section or other provision of any law or regulation means that 

provision of such law or regulation as from time to time in effect, including any amendment, 

modification, codification, replacement, or reenactment of such section or other provision; 

(vii) “hereunder,” “hereof,” “hereto,” and words of similar import refer to this 

Agreement as a whole and not to any particular Section, Subsection, or other provision of this 

Agreement; 

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Exhibit 1.1 - 19 

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148483277_14 

(viii) “including” (and with correlative meaning “include”) means including without 

limiting the generality of any description preceding such term; 

(ix) where context permits, “or” is used in the inclusive sense of “and/or”; 

(x) “any” means “any and all”; 

(xi) with respect to the determination of any period of time, “from” means “from and 

including” and “to” means “to but excluding”; 

(xii) a reference to a document, instrument, or agreement also refers to all addenda, 

exhibits, or schedules thereto; 

(xiii) a reference to a “copy” or “copies” of any document, instrument, or agreement 

means a copy or copies that are, to the Knowledge of Seller (where applicable), complete and 

correct; and 

(xiv) “Sections,” “Subsections,” “Schedules,” “Exhibits,” “Annexes,” and “Articles,” 

refer to the corresponding Sections, Subsections, Schedules, Exhibits, Annexes and Articles of and 

to this Agreement unless otherwise stated; 

(xv) the word “will” will be construed to have the same meaning and effect as the word 

“shall”. The words “shall,” “will,” or “agree(s)” are mandatory, and “may” is permissive; 

(xvi) any document or item will be deemed “delivered,” “provided” or “made available” 

by Seller, within the meaning of this Agreement if such document or item is (A) included in the 

Dataroom, (B) actually delivered or provided to Buyer or any of Buyer’s Representatives 

(including by email) or (C) made available upon request, including at Seller’s offices; 

(xvii) all references to “$” and dollars will be deemed to refer to United States currency 

unless otherwise specifically provided; 

(xviii) All references to a day or days will be deemed to refer to a calendar day or calendar 

days, as applicable, unless otherwise specifically provided; 

(xix) The words “to the extent” shall mean “the degree by which” and not simply “if”; 

and 

(xx) With regard to all dates and time periods set forth or referred to in this Agreement, 

time is of the essence. 

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EXHIBIT 3.3 

FRANCHISE AGREEMENT 

[Attached] 

Exhibit 3.3 

4903-2558-8736, v. 1 

148483277_14

Exhibit 3.3 

4903-2558-8736, v. 1 

148483277_14 

EXHIBIT 3.3 

FRANCHISE AGREEMENT 

[Attached] 

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4931-8848-6658.1 

TGI FRIDAYSTM RESTAURANT 

FRANCHISE AGREEMENT 

STORE NAME – STORE # 

Dated: , 

[Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

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i [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

ACTIVE 684889259v1 

4931-8848-6658.1 

TABLE OF CONTENTS 

SECTION PAGE 

1. GRANT OF FRANCHISE ........................................................................................................................ 2 

2. TERM ........................................................................................................................................................ 3 

3. SITE DEVELOPMENT PROCEDURES .................................................................................................. 5 

4. CONSTRUCTION OF THE RESTAURANT .......................................................................................... 8 

5. OPENING OF THE RESTAURANT ...................................................................................................... 11 

6. FEES ........................................................................................................................................................ 12 

7. RECORDKEEPING AND REPORTS .................................................................................................... 16 

8. ADVERTISING AND PROMOTION .................................................................................................... 18 

9. MANUALS ............................................................................................................................................. 25 

10. MODIFICATIONS OF THE SYSTEM .................................................................................................. 26 

11. TRAINING .............................................................................................................................................. 26 

12. ADDITIONAL SERVICES BY FRANCHISOR .................................................................................... 30 

13. PERFORMANCE STANDARDS AND UNIFORMITY OF OPERATION .......................................... 30 

14. PROPRIETARY MARKS ....................................................................................................................... 44 

15. INSURANCE .......................................................................................................................................... 46 

16. ORGANIZATION OF FRANCHISEE ................................................................................................... 48 

17. TRANSFERS BY FRANCHISOR .......................................................................................................... 51 

18. TRANSFERS BY FRANCHISEE ........................................................................................................... 52 

19. GENERAL RELEASE ............................................................................................................................ 57 

20. COVENANTS ......................................................................................................................................... 57 

21. DEFAULT AND REMEDIES ................................................................................................................ 60 

22. OBLIGATIONS ON TERMINATION OR EXPIRATION .................................................................... 64 

23. OPTION TO PURCHASE ...................................................................................................................... 66 

24. RELATIONSHIP OF THE PARTIES AND INDEMNIFICATION ....................................................... 69 

25. CONSENTS, APPROVALS AND WAIVERS ....................................................................................... 71 

26. NOTICES ................................................................................................................................................ 72 

27. ENTIRE AGREEMENT ......................................................................................................................... 72 

28. SEVERABILITY AND CONSTRUCTION ........................................................................................... 72 

29. GOVERNING LAW, FORUM AND LIMITATIONS ........................................................................... 73 

30. MISCELLANEOUS ................................................................................................................................ 75 

31. REPRESENTATIONS ............................................................................................................................ 76 

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[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

ACTIVE 684889259v1 

4931-8848-6658.1 

TABLE OF CONTENTS 

(continued) 

EXHIBIT A: FRANCHISE INFORMATION 

EXHIBIT B: FRANCHISEES ADVERTISING AND PROMOTION OBLIGATIONS 

EXHIBIT C: LOCAL STORE MARKETING GUIDELINES 

EXHIBIT D: OWNERSHIP INTERESTS 

EXHIBIT E: ACH AUTHORIZATION FORM 

EXHIBIT F: GUARANTY AND ASSUMPTION OF FRANCHISEES OBLIGATIONS 

EXHIBIT G: NON-DISCLOSURE AND NON-COMPETITION AGREEMENT 

EXHIBIT H: TGI FRIDAYS LOYALTY PROGRAM AGREEMENT 

RIDER 1: FRANCHISE AGREEMENT EXPIRATION DATE 

RIDER 2: ADA CERTIFICATION 

RIDER 3: OCCUPANCY CONTRACT PROVISIONS 

ii [Store Name # ] 

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1 [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

THIS FRANCHISE AGREEMENT (“Agreement”) is made as of 

(“Effective Date”), by and between TGI Fridays Franchisor, LLC, a Delaware limited liability company 

(“Franchisor”), with its principal place of business located at 500 East State Highway 114, Suite 200, 

Southlake, Texas 76082, and , a formed in 

(“Franchisee”), with its principal place of business located at . 

RECITALS: 

As a result of the expenditure of time, skill, effort, and money, Franchisor has developed and 

owns a distinctive system (“System”) relating to the development, establishment, and operation of fullservice casual theme restaurants featuring a specialized menu and full bar service operating in buildings that 

bear Franchisor’s interior and exterior trade dress under the name Fridays or related tradenames 

(collectively, “Fridays Restaurants”). 

The distinguishing characteristics of the System include, without limitation, distinctive exterior 

and interior design and layout, including specially designed décor, décor, furnishings and color schemes; 

special recipes, menu items and full service bar; menu formats; uniform standards; procedures and 

techniques for food and beverage preparation and service; automated management information and 

control systems for inventory controls, cash controls and sales analysis; technical assistance and training 

through course instruction and manuals; and advertising and promotional programs. The System and its 

components may be changed, improved, and further developed by Franchisor from time to time. 

Franchisor identifies the System by means of certain names and marks (including “TGI Fridays,” 

“Fridays,” and other names, marks, logos, insignias, slogans, emblems, symbols, and designs 

(collectively, “Proprietary Marks”), which Franchisor has designated, or may in the future designate, 

for use with the System. The Proprietary Marks used to identify the System, including the principal 

Proprietary Marks, may be modified by Franchisor and/or its affiliates from time to time. 

Franchisor has the exclusive right to use, and permit its franchisees to use, the Proprietary Marks. 

Franchisor continues to develop, use, and control the use of these Proprietary Marks in order to identify to 

the public the source of services and products marketed under the Proprietary Marks and the System and 

to represent the Systems high standards of quality, appearance, and service. 

Franchisee desires to obtain a license to use the System and to operate continuously one 

franchised Fridays Restaurant at a site accepted by Franchisor subject to the terms and conditions of this 

Agreement and in strict compliance with the standards and specifications established by Franchisor 

(“System Standards”). 

Franchisee understands and acknowledges the importance of Franchisor’s high standards of 

quality, cleanliness, appearance, operations, and service and the necessity of developing and operating the 

franchised Fridays Restaurant in strict conformity with this Agreement, the System Standards, and the 

Fridays Manuals (as defined in Section 9). 

Franchisor is willing to grant Franchisee a license to operate a franchised Fridays Restaurant 

subject to the terms and conditions of this Agreement. 

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[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

NOW THEREFORE, in consideration of the mutual covenants, agreements and obligations set 

forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which 

are hereby acknowledged, the parties agree as follows: 

1. GRANT OF FRANCHISE 

A. Grant. 

(1) Subject to the provisions of this Agreement, Franchisor hereby grants to 

Franchisee the right and Franchisee accepts the obligation (“Franchise”) to (a) continuously operate a 

franchised Fridays Restaurant under the System (“Restaurant”); (b) use, only in connection with the 

Restaurant, the Proprietary Marks and the System, as they may be modified, improved, or further 

developed from time to time by Franchisor; and (c) do so only at the site accepted by Franchisor and 

specified in Exhibit A (“Premises”). Franchisee may not operate the Restaurant at any site other than the 

Premises and may not relocate the Restaurant without Franchisor’s prior written consent, which may be 

withheld by Franchisor in its sole discretion. Franchisee may be required to participate in Franchisor’s 

delivery and/or takeout programs, in which case Franchisee must make accommodations for delivery 

and/or takeout programs in compliance with Franchisor’s standards and procedures set forth in the 

Manuals or otherwise in writing. Should Franchisor require Franchisee to participate in a delivery 

program, Franchisee will not be guaranteed a particular or exclusive delivery territory, and, should 

Franchisor designate a territory, it may only be on a non-exclusive basis. 

(2) Unless otherwise permitted by Franchisor, Franchisee shall offer and sell only 

products and services previously authorized by Franchisor, and only from the Restaurant, only in 

accordance with the requirements of this Agreement and the procedures set forth in the Manuals, and only 

to retail customers for consumption on the Premises or for personal, carry-out consumption. Franchisee 

shall not offer or sell products or services authorized under this Agreement through any other means, 

including without limitation, through satellite locations, temporary locations, carts or kiosks, the Internet, 

or through any form of Digital Media, without the prior written approval of Franchisor, and only in 

accordance with Franchisor’s policies as they may be developed and/or modified from time to time. As 

used in this Agreement, the term “Digital Media” means one or more related documents, applications, 

designs, or other communications or forms of media that can be accessed through electronic means, 

including, but not limited to, the Internet, the World Wide Web, the Fridays Websites (as defined in 

Section 8.I) or other websites, social networking sites like Facebook, Twitter, TikTok, LinkedIn, 

Instagram, Snapchat, YouTube, blogs, vlogs, and other applications, and any online equivalent 

(collectively, “Social Media”). 

(3) Franchisee may request approval from Franchisor to participate in any catering 

program permitted by Franchisor and provide the catering services designated by Franchisor from the 

Restaurant subject to Franchisee’s obligation to comply with Franchisor’s procedures and menu 

requirements, purchase all supplies, products and ingredients through Franchisor’s approved and 

designated suppliers and otherwise follow the Manuals with respect to the catering services, which may, 

among other requirements, limit Franchisee to a specified geographical area for catering. 

(4) Franchisee agrees that it will at all times faithfully, honestly and diligently 

perform its obligations under this Agreement, that it will continuously exert reasonable efforts to promote 

and enhance the business of the Restaurant and that it will not engage in any other business or activity 

that may conflict with its obligations under this Agreement, except the operation of other Fridays 

Restaurants or other restaurants operated by Franchisee that are franchised by Franchisor or its affiliates. 

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FRANCHISE AGREEMENT 

4931-8848-6658.1 

B. No Exclusivity. 

This Agreement does not give Franchisee any exclusive rights to use the System or the 

Proprietary Marks in any geographic area. Nothing in this Agreement prohibits Franchisor from, among 

other things: (1) operating or licensing others to operate at any location, during or after the Initial Term 

(as defined in Section 2), any delivery or mobile kitchen or any type of restaurant other than Fridays 

Restaurants; (2) operating or licensing others to operate, during the Initial Term, Fridays Restaurants at 

any location other than the Premises; (3) operating or licensing others to operate, after this Agreement 

terminates or expires, Fridays Restaurants at any location, including the Premises; (4) merchandising and 

distributing goods and services identified by some or all of the Proprietary Marks through any other 

method or channel of distribution; and (5) purchasing, being purchased by, merging with or combining 

with businesses that directly or indirectly compete with Fridays Restaurants. Franchisor reserves to itself 

and its affiliates all rights to use and license the System and the Proprietary Marks other than those 

expressly granted under this Agreement. 

C. Principal Owners. 

Franchisee acknowledges and agrees that certain provisions of this Agreement apply to those 

individuals and entities who directly or indirectly hold an equity ownership interest in Franchisee of 20% 

or more (“Principal Owners”). Franchisee shall be solely and completely responsible to ensure (and 

cause) each Principal Owner to comply with the terms of this Agreement. Franchisee agrees that any 

violation of the terms of this Agreement by Franchisee’s Principal Owners shall constitute a default of the 

terms of this Agreement. In addition, each of Franchisee’s Principal Owners must personally guarantee 

Franchisee’s obligations under this Agreement as set forth in Section 16.F. 

2. TERM 

A. Initial Term. 

The initial term of this Agreement (“Initial Term”) and the Franchise granted by this Agreement 

shall begin on the Effective Date and expire at midnight on the day preceding the 10th anniversary of the 

date the Restaurant first opened for business, unless this Agreement is terminated at an earlier date 

pursuant to Section 21. Within 30 days after the Restaurant opens, Franchisor shall complete and forward 

to Franchisee a notice, in a form substantially similar to attached Rider 1, to memorialize the opening 

date. Franchisee acknowledges that it does not have the unilateral right to cease operating the Restaurant 

before the expiration of the Initial Term. 

B. Successor Terms. 

(1) This Agreement and the Franchise shall not automatically renew upon the 

expiration of the Initial Term. Franchisee shall have an option to remain a franchisee and upon 

qualification for each successor grant, sign a new Franchise Agreement for each of two successor terms of 

five years each (each, a “Successor Term”). Franchisee shall give Franchisor written notice of whether 

or not it intends to exercise each option not less than 12 months, nor more than 24 months, before the end 

of each expiring term. Franchisee’s failure to provide Franchisor the required notice in a timely manner 

constitutes a waiver by Franchisee of its option to remain a franchisee beyond the expiration of the 

expiring term. 

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(2) If Franchisee desires to continue as a franchisee for a Successor Term, 

Franchisee must comply with all of the following conditions before and at the end of each expiring initial 

and successor term to the satisfaction of Franchisor: 

(a) Franchisee shall have timely satisfied all monetary obligations owed to 

Franchisor and its affiliates; Franchisee shall have operated the Restaurant and all of its other franchised 

Fridays Restaurants substantially in accordance with the terms of this Agreement and the standards, 

specifications and procedures of the System as set forth in the Manuals; Franchisee shall not be in default 

under this Agreement or any other agreements between Franchisee and Franchisor or its affiliates; 

Franchisee shall not be in default beyond the applicable cure period under any real estate lease, equipment 

lease or financing instrument relating to the Restaurant; Franchisee shall not be in default beyond the 

applicable cure period with any vendor or supplier to the Restaurant; and, for the 24 months before the 

date of Franchisee’s notice, Franchisee shall not have been in default beyond the applicable cure period 

under this Agreement or any other agreements between Franchisee and Franchisor or its affiliates. 

(b) Franchisee must satisfy all of Franchisor’s then-current financial 

requirements (including the analysis of net worth, debt-to-equity ratios and capitalization) for approval of 

a new franchisee to the System. Franchisee must submit certified financial statements for at least the 

preceding fiscal year prepared by a certified public accountant, supported by income tax returns and such 

other documentation as is reasonably requested by Franchisor. If the individual net worth of any of 

Franchisee’s Principal Owners is used to satisfy all or a portion of the financial requirements, the Principal 

Owner must submit a current certified financial statement. 

(c) Franchisee shall make the capital expenditures required to renovate and 

modernize the Restaurant to conform to the interior and exterior designs, décor, color schemes, 

furnishings, equipment, signage, Computer Systems (as defined in Section 13.J), and presentation of the 

Proprietary Marks consistent with the image of the System for new Fridays Restaurants at the time 

Franchisee provides Franchisor the notice under Section 2.B(1), including such structural changes, 

remodeling, redecoration and modifications to existing improvements as may be necessary to do so. 

(d) Franchisee and its employees at the Restaurant shall be in compliance 

with Franchisor’s then-current training requirements. 

(e) Franchisee acknowledges and agrees that the Premises may not meet 

Franchisor’s then-current site selection standards and that Franchisee may need to relocate the Restaurant 

for the Successor Term(s). Franchisee must submit a site application to Franchisor for the Premises or a 

new site for the Restaurant and Franchisor will review that application in accordance with its then-current 

site selection standards and policies. 

(f) Franchisee is able to maintain all licenses and permits, including but not 

limited to a liquor license, necessary to continue to operate the Restaurant at the Premises for the 

Successor Term. 

(g) Franchisee, all individuals who executed this Agreement, all guarantors 

of Franchisee’s obligations and any other individual or entity required by Franchisor shall have executed a 

general release and a covenant not to sue, in a form satisfactory to Franchisor, of any and all claims 

against Franchisor and its affiliates and their respective past and present officers, directors, shareholders, 

agents and employees, in their corporate and individual capacities. 

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(h) Franchisee must submit to Franchisor all standard form information and 

documentation reasonably requested by Franchisor as a basis for the issuance and consummation of a 

franchise. 

(3) Within 4 months after Franchisor’s receipt of Franchisee’s written notice of its 

desire to exercise the successor option, Franchisor shall advise Franchisee whether or not Franchisor will 

permit Franchisee to remain a franchisee for the Restaurant for the Successor Term. If Franchisor intends 

to permit Franchisee to remain a franchisee for the Successor Term, Franchisor’s notice will contain 

preliminary information regarding the actions Franchisee must take to satisfy Franchisor’s site selection, 

remodeling, training, management and other criteria for entering into the Successor Term. If Franchisor 

chooses not to permit Franchisee to remain a franchisee for the Successor Term, Franchisor’s notice shall 

specify the reasons for that decision and Franchisor shall have the right to unilaterally extend the expiring 

term of this Agreement as necessary to comply with any applicable laws. 

(4) If Franchisee will remain a franchisee for a Successor Term, Franchisor shall 

forward to Franchisee a new franchise agreement for that Successor Term for Franchisee’s signature. The 

form of successor franchise agreement for each Successor Term shall be the form then in general use by 

Franchisor for Fridays Restaurants (or, if Franchisor is not then granting franchises for Fridays 

Restaurants, that form of agreement as specified by Franchisor). Franchisee acknowledges that the terms, 

conditions, and provisions of the successor franchise agreement, and the obligations of the parties under 

that agreement, may differ substantially from the terms, conditions, provisions and obligations in this 

Agreement, including, without limitation, higher fees and advertising contributions. FRANCHISEE 

AND FRANCHISOR AGREE THAT THE ROYALTY FEE WILL BE INCREASED TO 4.5% OF 

GROSS SALES FOR THE FIRST SUCCESSOR TERM AND 4.75% OF GROSS SALES FOR THE 

SECOND SUCCESSOR TERM. 

(5) Franchisee shall execute the successor franchise agreement for the Successor 

Term and return the signed agreement to Franchisor before the expiration of the expiring term, along with 

a successor fee. The successor fee for the first Successor Term shall be 50% of Franchisor’s then- current 

initial franchise fee for the first Fridays Restaurant to be developed by a new franchisee. The successor 

fee for the second Successor Term shall be 30% of Franchisor’s then current initial franchise fee for the 

first Fridays Restaurant to be developed by a new franchisee. The successor fee shall be in addition to, 

among other things, the costs and expenses that Franchisee is required to make for any capital 

expenditures pursuant to Section 2.B(2)(c). Failure by Franchisee to timely sign the successor franchise 

agreement and return it to Franchisor (along with the successor fee) shall be deemed an election by 

Franchisee not to remain a franchisee and shall result in expiration of this Agreement and the Franchise at 

the expiration of the expiring term. Provided Franchisee has timely complied with all of the conditions 

set forth in this Section 2.B, Franchisor shall execute the successor franchise agreement and promptly 

return a fully-executed copy to Franchisee. Franchisee shall be solely responsible for meeting the 

requirements for each Successor Term. Franchisor shall have no liability, obligations, or responsibility 

for any reliance or expectation damages in the event Franchisee complies with some, but not all of the 

foregoing requirements, or otherwise fails to meet all of the requirements set forth in this Agreement 

within the required timeframes. 

3. SITE DEVELOPMENT PROCEDURES 

Except with respect to a relocation contemplated by Section 3.E, Sections 3.A through 3.C shall 

not be applicable if Franchisor has accepted the Premises in writing as of the Effective Date or to the 

extent a Development Agreement with Franchisor and Franchisee or its affiliates is controlling. 

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A. Site Selection. 

If the Premises have not been designated as of the Effective Date, then Franchisee must obtain 

Franchisor’s acceptance of the site for the Restaurant from a designated market area agreed to by the 

parties and set forth on Exhibit A (“Site Selection Search Area”) within 90 days after the Effective Date 

(“Site Acceptance Period”). Franchisor will provide Franchisee with the following site selection 

assistance: (1) Franchisor’s site selection guidelines including two sets of Franchisor’s standard plans and 

specifications for the construction of a prototypical Fridays Restaurant and, as Franchisee may request, a 

reasonable amount of consultation with respect thereto; and (2) such on-site evaluation as Franchisor may 

deem advisable as part of its evaluation of Franchisee’s request for site acceptance. The parties 

acknowledge and agree that Franchisor providing its standard plans and specifications or any other 

activities or services to Franchisee before the proposed site being accepted by Franchisor shall not create 

any reliance or expectation damages or liability for Franchisor nor shall any such activities create any 

expectations or representations to Franchisee that any proposed site will be accepted by Franchisor. 

B. Real Estate Site Application. 

Within 45 days after the Effective Date, Franchisee shall submit to Franchisor a site application 

for one or more proposed sites for the Restaurant including a description of the site, a feasibility study 

(including, without limitation, demographic data, photographs, maps, artists renderings, site plans, a copy 

of the Occupancy Contract (as defined in Section 3.D) and documentation indicating Franchisee’s 

prospects to acquire a possessory interest in the site) and such other information related to the 

development of the site as Franchisor reasonably requests (“Real Estate Site Application”). After 

Franchisor receives the Real Estate Site Application, if a site meets Franchisor’s site acceptance criteria, 

Franchisor or its designee, in Franchisor’s sole discretion, may conduct an on-site evaluation of the 

proposed site. 

C. Site Acceptance. 

(1) Within 45 days after Franchisor’s receipt of the Real Estate Site Application and 

any additional information that Franchisor may reasonably require, Franchisor shall review that 

information, evaluate the proposed site and advise Franchisee in writing whether it has accepted a 

particular site. If Franchisor does not respond within that time period, Franchisor shall be deemed to have 

rejected the site. It is within Franchisor’s sole discretion whether to accept or reject a site. Franchisor 

may revoke its acceptance of a site at any time if Franchisee commits a default of this Agreement or any 

agreement with Franchisor or its affiliates (including any development or franchise agreement) and fails 

to cure that default within the applicable cure period, if any. 

(2) Franchisee acknowledges that, in order to preserve and enhance the reputation 

and goodwill of all restaurants franchised by Franchisor and the goodwill of the Proprietary Marks, all 

Restaurants must be properly developed, operated and maintained in accordance with Franchisor’s System 

Standards and specifically that Franchisor may, in its sole discretion, refuse to review or accept any site 

submitted by Franchisee if Franchisee has failed to meet any of the following requirements: 

(a) All Fridays Restaurants operated by Franchisee and/or any of its 

affiliates are in good standing with all of Franchisor’s operational standards at the time the Real Estate 

Site Application is submitted; 

(b) Franchisee and any of its affiliates that operate Fridays Restaurants shall 

have timely paid all sums due to Franchisor under any Franchise Agreement(s) or other agreements(s) 

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between Franchisee and/or any of its affiliates and Franchisor and/or its affiliates for the six-month period 

immediately before submission of the Real Estate Site Application; and 

(c) Franchisee and Franchisee’s Principal Owners shall have submitted the 

Real Estate Site Application, Franchisee’s proposed investment and financing plans, financial statements 

and any additional information required by Franchisor to demonstrate that Franchisee meets Franchisor’s 

then current standards to develop a Restaurant, including, but not limited to, Franchisor’s then-current 

financial and operational requirements. 

D. Occupancy Contract Provisions. 

(1) Franchisee shall provide to Franchisor, for its review and approval, a copy of the 

proposed agreement or document (including, without limitation, any lease, deed, contract for sale, 

contract for deed, land contract, management contract, license, or other agreement purporting to grant any 

right, title, or interest in or to the site) pursuant to which Franchisee shall occupy or acquire rights in the 

Premises (“Draft Occupancy Contract”; the final execution [or executed] version of the Draft 

Occupancy Contract, together with all amendments, consents, waivers, or other modifications made from 

time to time, the “Occupancy Contract”) within 60 days after Franchisor accepts the site for the 

Premises. The Occupancy Contract shall not contain any covenants or other obligations that would 

prevent, limit or adversely affect Franchisee from performing its obligations under the Franchise 

Agreement. The Occupancy Contract shall be executed by all necessary parties within 30 days following 

Franchisor’s approval. Franchisee shall furnish Franchisor a complete copy of the executed Occupancy 

Contract within 10 days after execution and within 30 days after written request by Franchisor. 

(2) Unless waived in writing by Franchisor or unless it conveys to Franchisee fee 

simple title to the Premises, the Occupancy Contract shall include during the entire term thereof, 

including any renewal terms, the provisions set forth in Rider 3 attached hereto and incorporated herein 

by this reference. 

(3) Notwithstanding the terms of Rider 3, Franchisee shall: (a) deliver to 

Franchisor, immediately after delivery to or by Franchisee, any notice of default under the Occupancy 

Contract which threatens or purports to terminate the Occupancy Contract or result in a foreclosure 

thereof; (b) permit Franchisor to enter the Premises to protect the Proprietary Marks or the System or to 

cure any default under the Occupancy Contract or this Agreement, all at Franchisee’s expense; and (c) not 

amend the Occupancy Contract in any way which is inconsistent with the provisions of Rider 3. 

E. Relocation. 

Franchisee (1) may, if Franchisee loses the right to occupy the Premises during the Initial Term 

(other than as a result of default by Franchisee); and (2) shall (but not until Franchisor accepts a Real 

Estate Site Application regarding a given relocation site), in the event of a casualty or condemnation 

pursuant to which Franchisee cannot or does not rebuild or restore the Restaurant, apply to Franchisor for 

the right to relocate the Restaurant to another location within a three-mile radius of the Premises. 

Franchisee shall notify Franchisor of the termination or non-renewal of its Occupancy Contract at least 30 

days in advance of Franchisee’s projected last day of possession. In order for Franchisee to obtain 

Franchisor’s approval of a relocation, at the time of the request, Franchisee must: (1) be in compliance 

with the terms of this Agreement and the terms of any related or successor agreement; (2) meet all of 

Franchisor’s then-current financial, operational and other requirements and qualifications for the right to 

develop within the System; (3) open the Restaurant at a location selected by Franchisee and accepted by 

Franchisor in accordance with site selection criteria specified by Franchisor within 270 days from the 

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approval of the relocation; (4) pay Franchisor a non-refundable relocation review fee in the amount of 

$5,000, which fee shall be due and payable when Franchisee submits the relocation request; and (5) pay 

to Franchisor a monthly royalty fee (“Closure Royalty”) during the period when the Restaurant is closed 

equal to the average monthly royalty fee owed during the 12 months preceding the closure. If Franchisee 

receives business interruption insurance proceeds during the relocation process (or during any period of 

closure contemplated by Section 13.R(5), Franchisee shall use the same to pay the Closure Royalty. 

Franchisor’s decision as to whether to consent to Franchisee’s relocation request may be based, among 

other things, upon Franchisor’s conclusion of the effect relocation may have on other Fridays Restaurants 

(whether in operation, under construction or in negotiations) in the general area of the proposed new site. 

Failure to relocate the Restaurant as provided in this Section after Franchisor has approved the relocation 

request shall constitute a default under this Agreement subject to the remedies set forth in Section 21. 

The Initial Term shall not be extended as a consequence of such relocation. For the avoidance of doubt, 

any relocation of the Restaurant shall be subject to the requirements of Sections 4 and 5. 

4. CONSTRUCTION OF THE RESTAURANT 

A. Restaurant Construction. 

(1) Franchisee assumes all cost, liability and expense for constructing the 

Restaurant. As used in this Agreement, “construction,” “constructing,” and “construct” refer to 

development, construction, equipping, renovation, reimage, remodeling, refurbishment, conversion, 

relocating, and maintenance of the Restaurant, whether initially, as part of a Facilities Remodeling (as 

hereinafter defined), or in connection with a reconstruction following casualty or condemnation, as 

applicable. Franchisee shall ensure that (a) only materials satisfying the System Standards are utilized in 

construction; and (b) such materials are purchased from approved suppliers (as described in 

Section 13.B). 

(2) Franchisor will furnish to Franchisee prototypical plans and specifications for 

the applicable construction, including general requirements for dimensions, design, image, interior layout, 

décor, fixtures, equipment, signs, furnishings, storefront and color scheme. It shall be Franchisee’s 

responsibility to have prepared all required construction plans and specifications to suit the shape and 

dimensions of the Premises, and Franchisee must ensure that these plans and specifications comply with 

applicable ordinances, building codes and permit requirements and with lease requirements and 

restrictions. Upon request by Franchisee, Franchisor may make available to Franchisee, at Franchisee’s 

expense: (a) architectural consultation and advice; (b) preparation of construction plans, specifications 

and drawings for the relevant construction of the Restaurant (whether made available by Franchisor or 

obtained solely by Franchisee, “Plans”); and (c) consultation and advice on the purchase, display and 

installation of typical décor. 

(3) Franchisee shall employ (subject to Franchisor’s consent) only registered 

architects, registered engineers, and professional and licensed contractors in the construction of the 

Restaurant. Before submission of proposed Plans to Franchisor, Franchisee, if requested by Franchisor, 

shall furnish Franchisor with resumes of the registered architects, registered engineers and professional 

and licensed contractors whom Franchisee desires to retain to prepare the Plans and construct the 

Restaurant, along with additional information and detail concerning their training, experience and 

financial responsibility as Franchisor may direct. Franchisor need not consent to Franchisee’s use of the 

Plans, and Franchisee shall not commence construction of the Restaurant before Franchisor has consented 

to Franchisee’s use of the registered architects, registered engineers and professional and licensed 

contractors who will prepare the Plans and construct the Restaurant. Upon written request from 

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Franchisor, Franchisee shall submit to Franchisor copies of all contracts with the architects, engineers and 

contractors. 

(4) Franchisee shall submit the Plans to Franchisor and shall, upon Franchisor’s 

request, submit all revised or “as-built” Plans during the course of such construction. Franchisor will 

approve or refuse to approve the Plans and notify Franchisee within 30 days after Franchisor receives the 

Plans. (Franchisor’s approval shall not be unreasonably withheld.) As a condition to Franchisor’s 

approval of the Plans, Franchisee shall deliver to Franchisor, in the form of Rider 2, a certification by a 

design professional of ADA compliance of the design of the Restaurant. Once Franchisor has approved 

the Plans, no substantial change shall be made to the Plans without the prior approval of Franchisor, 

which shall not be unreasonably withheld. If, in the course of construction, any such change in the Plans 

is contemplated, Franchisor’s approval must first be obtained before proceeding. Franchisor shall approve 

or reject Plan changes within 10 business days after receipt. 

(5) Franchisee shall not begin site preparation or any other construction before 

receiving written notification from Franchisor that Franchisor has approved the Plans. All construction 

must be in accordance with Plans approved by Franchisor and must comply in all respects with applicable 

laws, ordinances, local rules, regulations and lease requirements. The Restaurant may not open (or reopen, as applicable) if construction has not been performed in substantial compliance with Plans approved 

by Franchisor, and this Agreement may be terminated if such non-compliance is not cured within a 

commercially reasonable amount of time (not to exceed 30 days). Franchisor may, in its sole discretion, 

furnish guidance to Franchisee in constructing the Restaurant and may periodically inspect the Premises 

during its construction. 

(6) During the course of construction, Franchisee shall, at all times, have a project 

manager to oversee construction (“Project Manager”). Not less than 60 days before the commencement 

of construction, Franchisee shall designate a Project Manager and, before construction commences, the 

Project Manager shall attend any training required by Franchisor. Any replacement Project Manager shall 

be designated within 10 days after the prior Project Managers resignation or termination. 

(7) Franchisee shall obtain all zoning classifications, clearances, consents, permits 

and licenses required in connection with the construction and operation of the Restaurant. Upon request, 

copies of such permits and licenses shall be provided to Franchisor. 

B. Construction. 

(1) For the initial construction of the Restaurant, Franchisee shall commence 

construction within six months from the date of Franchisor’s site acceptance for the Premises and shall 

complete construction and open the Restaurant no later than 11 months thereafter (“Opening Deadline”). 

After the Opening Date, any construction at the Restaurant shall be conducted in accordance with System 

Standards and pursuant to any timeline required by Franchisor (including the date for closing [if 

applicable], substantial and final completion dates and the re-opening date). 

(2) Before the commencement of construction, Franchisee shall have provided 

Franchisor a copy of the fully executed Occupancy Contract for the Premises. Construction shall be 

deemed to have been commenced upon the commencement of construction-related work. Franchisee 

shall, within 10 days after commencement of construction, advise Franchisor of such commencement 

date. 

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(3) Once construction has commenced, it shall continue uninterrupted except for 

interruption by reason of events constituting Force Majeure (as defined in Section 30.G) until completed. 

Notwithstanding the occurrence of any events, except events constituting Force Majeure, initial 

construction of the Restaurant as a TGI FridaysTM restaurant (if applicable) shall be completed, and the 

Restaurant shall be furnished, equipped and shall otherwise be ready to open for business in accordance 

with this Agreement not later than Opening Deadline. If events constituting Force Majeure cause a delay 

in the commencement of initial construction of the Restaurant, Franchisor shall proportionately extend the 

Opening Deadline for the Restaurant. 

(4) Franchisee agrees, at its sole expense, to do, or cause to be done, the following 

(which shall occur by the Opening Deadline, if applicable): 

(a) Secure all financing required to construct and operate the Restaurant; 

(b) Obtain and maintain all required building, utility, sign, health, sanitation, 

business, liquor and other permits and licenses applicable to the Restaurant. Upon Franchisor’s request, 

Franchisee must promptly provide a copy of any such licenses and permits to Franchisor; 

(c) Construct all required improvements to the Premises and decorate the 

exterior and interior of the Restaurant in compliance with the Plans approved by Franchisor; 

(d) Purchase or lease and install all specified and required fixtures, 

equipment, furnishings and interior and exterior signs required for the Restaurant; and 

(e) Purchase an opening inventory for the Restaurant of only authorized and 

approved products and other materials and supplies. 

C. Acquisition of Necessary Furnishings, Fixtures and Equipment. 

(1) Franchisee agrees to use in the development and operation of the Restaurant 

only the fixtures, furnishings (including décor), equipment and signs that Franchisor has approved for 

Fridays Restaurants as meeting its specifications and standards for quality, design, appearance, function 

and performance. Franchisee further agrees to place or display at the Restaurant (interior and exterior) 

only those signs, emblems, lettering, logos and display materials that Franchisor approves in writing from 

time to time. 

(2) Franchisee shall purchase or lease approved brands, types or models of fixtures, 

furnishings, equipment and signs only from suppliers designated or approved by Franchisor, which may 

include Franchisor. Franchisee acknowledges that Franchisor may (a) profit from its sale of such items to 

Franchisee or (b) receive consideration from the third party supplier with respect to Franchisee’s 

purchases of such items. If Franchisee proposes to purchase, lease or otherwise use any fixtures, 

furnishings, equipment or signs which have not been approved by Franchisor, Franchisee shall first notify 

Franchisor in writing and shall, at Franchisee’s sole expense, submit to Franchisor upon Franchisor’s 

request sufficient specifications, photographs, drawings and/or other information or samples for 

Franchisor to determine whether those fixtures, furnishings, equipment and/or signs comply with 

Franchisor’s specifications and standards. Franchisor will, in its sole discretion, approve or disapprove 

the items and notify Franchisee within 30 days after Franchisor receives the request. 

(3) If Franchisee constructs any portion of the Restaurant outside of Franchisor’s 

specifications without receiving Franchisor’s prior written consent, Franchisor shall have the right to 

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delay the opening (or re-opening, as applicable) of the Restaurant until Franchisee, at its sole expense, 

brings the Restaurant’s construction within full compliance of Franchisor’s specifications. 

D. Inspection, Cooperation. 

During the course of construction, Franchisee shall (and shall cause Franchisee’s architect, 

engineer, contractors, and subcontractors to) cooperate fully with Franchisor and its designees for the 

purpose of permitting Franchisor and its designees to inspect the Premises and the course of construction 

of the Restaurant in order to determine whether construction is proceeding according to the Plans. 

Without limiting the generality of the foregoing, Franchisee and Franchisee’s architect, engineer, 

contractors and subcontractors shall: (1) supply Franchisor or its designees with samples of construction 

materials, test borings, corings, due diligence environmental studies, supplies, equipment and other 

material and reports, if any such tests, studies or reports indicate there may be material problems or as 

Franchisor or its designees may request; and (2) afford Franchisor representatives and its designees access 

to the Premises and to the construction work in order to permit Franchisor and its designees to carry out 

their inspections. 

E. Reports. 

If requested by Franchisor, Franchisee shall submit to Franchisor, on or before the first day of 

each month (or more frequently if Franchisor requests), a report with photographs showing progress made 

in connection with the construction of the Restaurant. 

5. OPENING OF THE RESTAURANT 

A. Final Inspection and Opening. 

Franchisee shall notify Franchisor in writing at least 30 days before the date Franchisee expects 

construction to be completed and a certificate of occupancy to be issued. If requested by Franchisor, 

Franchisee shall submit a copy of the certificate of occupancy to Franchisor. Franchisor reserves the 

right, after receiving Franchisee’s notice, to conduct a final inspection of the Restaurant to determine if 

Franchisee has complied with this Agreement. Franchisor shall not be liable for delays or loss occasioned 

by its inability to complete its investigation and to make a determination within this period. Franchisee 

shall not open the Restaurant for business without Franchisor’s express written authorization, which will 

not be granted unless Franchisee has satisfied the conditions contained in Section 5.B. 

B. Right to Open (or Re-Open) the Restaurant. 

For initial construction, Franchisee must open the Restaurant by the Opening Deadline. Except 

for a conditional opening pursuant to Section 5.C, Franchisor will not authorize the opening or re-opening 

(as applicable) of the Restaurant unless all the following conditions have been met: 

(1) Franchisee is not in material default under this Agreement or any other 

agreements with Franchisor; Franchisee is not in default beyond the applicable cure period under any real 

estate lease, equipment lease or financing instrument relating to the Restaurant; Franchisee is not in 

default beyond the applicable cure period with any vendor or supplier to the Restaurant; and for the 

previous six months, Franchisee has not been in default beyond the applicable cure period under any 

agreement with Franchisor; 

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(2) Franchisee is current on all obligations due Franchisor and its affiliates and 

Franchisee has signed all documents required by Franchisor including those necessary to participate in 

Franchisor electronic funds transfer program; 

(3) Franchisor is satisfied that the Restaurant was constructed substantially in 

accordance with the Plans approved by Franchisor, this Agreement and state and local codes. Franchisee 

must deliver to Franchisor, in the form of attached Rider 2, a certification by the construction contractor 

of ADA compliance of the actual construction of the Restaurant; 

(4) Franchisor has received a copy of the fully executed Occupancy Contract; 

(5) Franchisee has obtained a liquor license authorizing the sale of alcoholic 

beverages at the Restaurant; 

(6) Franchisee has obtained a certificate of occupancy and any other required 

health, safety or fire department certificates; 

(7) Franchisee has certified to Franchisor in writing that the installation of all items 

of furnishings, fixtures, equipment, signs, the Computer System and related equipment, supplies and other 

items has been accomplished in accordance with the System Standards; 

(8) An adequate number of Franchisee’s managers as determined by Franchisor in 

its sole discretion have attended, successfully completed and become “validated” in the Management 

Training Program; and 

(9) Franchisor has been furnished with copies of all insurance policies required by 

Section 15 or such other evidence of insurance coverage and payment of premiums as Franchisor 

reasonably may request. 

C. Conditional Opening or Re-Opening. 

Franchisor may conditionally authorize Franchisee to open or re-open and operate the Premises as 

a Fridays Restaurant, even though Franchisee has not fully complied with the terms of this Agreement, if 

Franchisee agrees to fulfill all remaining terms of this Agreement on or before a date specified by 

Franchisor. Franchisor’s determination as to whether to authorize a conditional opening or re-opening 

shall be final and binding and shall be made in its sole discretion based upon those factors that Franchisor 

deems relevant, including its determination that a conditional opening or re-opening will not be injurious 

to the reputation of the System or the public health and safety. If Franchisee fails to timely fulfill all 

remaining terms of this Agreement, Franchisor may terminate this Agreement by providing written notice 

to Franchisee without opportunity to cure. 

6. FEES 

A. Initial Franchise Fee. 

By no later than the execution of this Agreement, Franchisee shall pay to Franchisor an Initial 

Franchise Fee in the amount specified in Exhibit A. Franchisee acknowledges and agrees that the Initial 

Franchise Fee is fully earned by Franchisor when paid and is not refundable. 

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B. Royalty Fee. 

In addition to all other amounts to be paid by Franchisee to Franchisor, Franchisee shall pay 

Franchisor a nonrefundable and continuing Royalty Fee in an amount equal to 4% of the Gross Sales (as 

defined below) of the Restaurant, for the right to use the System and the Proprietary Marks at the 

Premises (“Royalty Fee”). If, due to federal, state or local laws, Franchisor is prohibited from receiving a 

percentage royalty based on alcoholic beverage sales, gambling device revenues or other similar 

percentage payouts, Franchisee shall pay Franchisor a Royalty Fee on all Gross Sales except these 

alcoholic beverage sales, gambling device and/or other revenues in the same dollar amount as would have 

been paid if Franchisee paid the specified Royalty Fee percentage on all Gross Sales. If any taxes, fees or 

assessments are imposed on Franchisor by reason of its acting as franchisor or licensing the Proprietary 

Marks under this Agreement, Franchisee shall reimburse Franchisor for the amount of those taxes, fees or 

assessments within 30 days after receipt of an invoice from Franchisor. 

C. Gross Sales. 

(1) “Gross Sales” shall include the entire amount of the actual sales price, whether 

for cash, credit, check or other consideration, of all sales of food, beverages, merchandise, promotional 

items and services at or from the Restaurant, including, but not limited to, the following: (a) revenues 

from dine-in, carry-out, delivery, banquets, catering or otherwise; (b) electronic, mail, facsimile or 

telephone orders received or filled from the Restaurant; (c) commissions on telephone, video, game 

machine and vending machine revenues; (d) commissions on lotteries or legal games of chance (except to 

the extent prohibited by applicable law); (e) cover charges and entertainment fees; (f) stored value gift 

cards and gift certificates (when redeemed, but not when purchased, however, Franchisor reserves the 

right to change the method of accounting and collection for stored value gift cards and gift certificates 

sales upon six (6) months’ prior written notice to Franchisee); (g) all deposits not refunded to purchasers; 

(h) payments to Franchisee by any manufacturer, vendor, distributor or concessionaire, franchisee or 

person other than bona fide rebates and volume discounts; and (i) promotional allowances to customers 

whether negative or positive in an amount equal to Franchisee’s retail price for food and/or beverages 

prepared and served by Franchisee to the extent of the discount (in whole or in part) provided to the 

customers, but only to the extent that said amount for promotional allowances exceeds 1.5% of Gross 

Sales as calculated without inclusion of said amount. Such promotional allowances shall include the 

retail price of food and beverages covered by appetizer and dinner cards and the customer comp cards to 

which Franchisor gives consent. Promotional allowances provided in exchange for goods or services 

shall be includable in Gross Sales without benefit of the 1.5% discount. Funds expended by Franchisee to 

comply with its Local Store Marketing requirement pursuant to Section 8.G shall not be included as 

promotional allowances under this section. 

(2) Gross Sales shall not include: (a) the amount of returns to shippers or 

manufacturers; (b) the amount of any cash or credit refunds made upon any sale where the food, 

beverages, merchandise or service sold or some part thereof is thereafter returned by the customer and 

accepted by Franchisee; (c) receipts from sales of furniture, trade fixtures or other extraordinary sales 

(unless bearing any Proprietary Mark) not made in the ordinary course of business; (d) any sales or value 

added tax required by any duly constituted taxing authority to be separately accounted for and collected 

on its behalf by Franchisee directly from Franchisee’s customers and paid by Franchisee to the taxing 

authority; and (e) meals served to an employee at no cost while the employee is on duty, or the discounted 

portion of meals served to an employee. 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 made, irrespective of 

whether, or of the time when, Franchisee shall receive payment (whether full or partial) thereof. 

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D. Advertising Contributions and Expenditures. Franchisee also shall spend and/or 

contribute for advertising. The exact amount to be spent and/or contributed by Franchisee for advertising 

and promotional activities, and the allocation of the advertising contributions and expenditures, as of the 

Effective Date, is set forth in Section 8 and Exhibit B as such may change from time to time in 

accordance with Section 8. 

E. Gross Sales Remittance Reports and Payment of Fees. 

(1) Within seven days after the end of each fiscal period (which for purposes of this 

Agreement, may be a month, a week, or other accounting period as defined and prescribed by Franchisor 

from time to time in the Manuals), Franchisee shall: (a) report to Franchisor the amount of Gross Sales 

from the Restaurant and showing itemized deductions and exclusions from Gross Sales for the Restaurant 

during the preceding fiscal period, provide such other information as Franchisor may require and; (b) pay 

Franchisor (by check, electronic funds transfer or such other form or method as Franchisor may 

designate) the Royalty Fee and advertising contributions applicable to the Gross Sales. The Gross Sales 

remittance reports shall be in writing or such other form or method as Franchisor may designate including 

transmittal by direct Internet connection with Franchisor, polling by Franchisor of Franchisee’s Computer 

System, facsimile transmission, telephone, electronic data communications, or any other method that 

Franchisor may reasonably direct. Franchisee also shall submit an annual accounting of Gross Sales to 

Franchisor within 30 days after the end of each accounting year. 

(2) Upon receipt of written notice from Franchisor, Franchisee must pay the 

Royalty Fees, advertising contributions and all amounts owed to Franchisor under this Agreement, 

including interest charges, by electronic funds transfer. In connection with payment of these fees by 

electronic funds transfer, Franchisor may designate a day for payment (“Due Date”) different than that 

provided in Section 6.E(1) above. On each Due Date, Franchisor will transfer from the Restaurant’s 

commercial bank operating account (“Account”) the amount reported to Franchisor in Franchisee’s 

remittance report or determined by Franchisor based on the records contained in Franchisee’s Computer 

System. If Franchisee has not reported Gross Sales to Franchisor for any fiscal period, Franchisor will 

transfer from the Account an amount calculated in accordance with its estimate of the Gross Sales during 

the fiscal period. If, at any time, Franchisor determines that Franchisee has underreported the Gross Sales 

of the Restaurant, or underpaid the Royalty Fees, advertising contributions or other amounts due to 

Franchisor under this Agreement or any other agreement, Franchisor shall initiate an immediate transfer 

from the Account in the appropriate amount in accordance with the foregoing procedure, including 

interest as provided in this Agreement. Any overpayment will be credited to the Account effective as of 

the first reporting date after Franchisor and Franchisee determine that such credit is due. 

(3) In connection with payment of amounts owed by electronic funds transfer, 

Franchisee shall: (a) comply with procedures specified by Franchisor in the Manuals or otherwise in 

writing; (b) perform those acts and sign and deliver those documents (including the ACH Authorization 

form as such form may change from time to time attached as Exhibit E) as may be necessary to 

accomplish payment by electronic funds transfer; (c) designate the Account and furnish to Franchisor an 

authorization in the form designated by Franchisor to initiate debit entries and/or credit correction entries 

to the Account for payments of the Royalty Fees, advertising contributions and other amounts payable 

under this Agreement, including any interest charges; and (d) make sufficient funds available in the 

Account for withdrawal by electronic funds transfer no later than the Due Date for payment thereof. 

Failure by Franchisee to have sufficient funds in the Account shall constitute a default of this Agreement 

pursuant to Section 21.C(2). 

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(4) Notwithstanding the provisions of this Section 6.E, Franchisor reserves the right 

to modify, at its option, the method by which Franchisee pays the Royalty Fees, advertising contributions 

and other amounts owed under this Agreement, including interest charges, upon Franchisee’s receipt of 

written notice from Franchisor. 

F. Late Charges and Interest. 

Any payment or report not actually received by Franchisor on or before the date due shall be 

deemed as late. To compensate Franchisor for the increased administrative expense of handling late 

payments and reports, Franchisee shall pay a $500 late fee to Franchisor for each delinquent payment or 

report, due upon making the delinquent payment or submitting the delinquent report. In addition to 

paying the late charge, Franchisee shall pay Franchisor interest on the amount owed from the date due 

until paid at the maximum rate permitted for indebtedness of this nature in the state in which the 

Restaurant is located, not to exceed 1.5% per month or a portion of a month. Payment of interest by 

Franchisee on past due obligations is in addition to all other remedies and rights available to Franchisor 

pursuant to this Agreement or under applicable law. 

G. Partial Payments. 

No payment by Franchisee or acceptance by Franchisor of any monies under this Agreement for a 

lesser amount than due shall be treated as anything other than a partial payment on account. Franchisee’s 

payment of a lesser amount than due with an endorsement, statement or accompanying letter to the effect 

that payment of the lesser amount constitutes full payment shall be given no effect, and Franchisor may 

accept the partial payment without prejudice to any rights or remedies it may have against Franchisee. 

Acceptance of payments by Franchisor other than as set forth in this Agreement shall not constitute a 

waiver of Franchisor’s right to demand payment in accordance with the requirements of this Agreement or 

a waiver by Franchisor of any other remedies or rights available to it pursuant to this Agreement or under 

applicable law. Notwithstanding any designation by Franchisee, Franchisor shall have sole discretion to 

apply any payments by Franchisee to any of its past due indebtedness for Royalty Fees, advertising 

contributions, purchases from Franchisor or its affiliates, interest or any other indebtedness. Franchisor 

has the right to accept payment from any other entity as payment by Franchisee. Acceptance of that 

payment by Franchisor will not result in that other entity being substituted for Franchisee. 

H. Collection Costs and Expenses. 

Franchisee agrees to pay to Franchisor on demand any and all costs and expenses incurred by 

Franchisor in enforcing the terms of this Agreement, including, without limitation, collecting any monies 

owed by Franchisee to Franchisor. These costs and expenses include, but are not limited to, costs and 

commissions due a collection agency, reasonable attorneys’ fees (including attorneys’ fees for in-house 

counsel employed by Franchisor or its affiliates and any attorneys’ fees incurred by Franchisor in 

bankruptcy proceedings), costs incurred in creating or replicating reports demonstrating Gross Sales of 

the Restaurant, court costs, expert witness fees, discovery costs and reasonable attorneys’ fees and costs 

on appeal, together with interest charges on all of the foregoing. 

I. No Offset. 

Franchisee shall not withhold or off-set any portion of any payment due to Franchisor’s alleged 

non-performance under this Agreement or any other agreement by and between Franchisor and 

Franchisee or their respective parent corporations, subsidiaries or affiliates. 

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7. RECORDKEEPING AND REPORTS 

A. Recordkeeping. 

Franchisee agrees to use computerized cash and data capture and retrieval systems that meet 

Franchisor’s specifications and to record sales of the Restaurant electronically or on tape for all sales at or 

from the Premises. Franchisee shall keep and maintain, in accordance with any procedures set forth in the 

Manuals, complete and accurate books and records pertaining to the Restaurant sufficient to fully report 

to Franchisor. Franchisee’s books and records shall be kept and maintained using generally accepted 

accounting principles (“GAAP”), if Franchisee uses GAAP in any of its other operations, or using other 

recognized accounting principles applied on a consistent basis which accurately and completely reflect 

the financial condition of Franchisee. Franchisee shall preserve all of its books, records and state and 

federal tax returns for at least five years after the later of preparation or filing (or such longer period as 

may be required by any governmental entity) and make them available and provide duplicate copies to 

Franchisor within five days after Franchisor’s written request. Franchisee shall adopt such accounting 

periods as Franchisor prescribes in writing. 

B. Quarterly Reports. 

Within 30 days after the end of each fiscal quarter (as defined by Franchisor from time to time) 

during each fiscal year (as defined by Franchisor from time to time), Franchisee shall, at Franchisee’s 

expense, submit to Franchisor, in the form prescribed by Franchisor (all of which may be unaudited), on 

both a Restaurant unit level as well as a separate consolidated basis with any other Fridays Restaurants 

owned by Franchisee or Franchisee’s affiliates, the following: (1) a quarterly and year-to-date profit and 

loss statement; and, (2) a quarterly and year-to-date balance sheet; and, (3) a quarterly and year-to-date 

cash flow statement; and (4) financial statements, including profit and loss statements, a balance sheet and 

cash flow statement for all related entities, affiliates, or organizations that have any shared or commingled 

debt, assets, or other dependent financial interests with Franchisee. It is acknowledged by Franchisee that 

as part of Franchisee’s disclosures, Franchisor is entitled to the information, details and specific data 

related to Franchisee’s financing structure, debt schedule, real estate interests and related assets, 

distributions, dividends, capital expenditures, sales slips, coupons, purchase orders, invoices, payroll 

records, check stubs, bank statements, sales tax records and returns, cash receipts and disbursements, 

journals and ledgers, periodic guest counts, affiliates and such other information as Franchisor may 

require. Franchisor shall have the right, to be exercised in its sole discretion, to require that Franchisee 

provide Franchisor with profit and loss statements, balance sheets, and cash flow statements or other 

financial information listed above at other times requested by Franchisor. Each statement and balance 

sheet shall be signed by Franchisee or by Franchisee’s treasurer or chief financial officer attesting that it is 

true, correct and complete and uses accounting principles applied on a consistent basis which accurately 

and completely reflect Franchisee’s financial condition. 

C. Annual Reports. 

At Franchisor’s request, Franchisee shall, at its expense, provide to Franchisor: (1) either a 

reviewed or audited profit and loss statement and balance sheet for the Restaurant within 60 days after the 

end of each fiscal year to be signed by Franchisee or by Franchisee’s treasurer or chief financial officer 

attesting that the financial statements present fairly the financial position of Franchisee and the results of 

operations of the Restaurant during the period covered; (2) financial statements, including profit and loss 

statements, a balance sheet and cash flow statement for all related entities, affiliates, or organizations that 

have any shared or commingled debt, assets, or other dependent financial interests with Franchisee; and 

(3) income tax statements of every Principal Owner. Franchisor shall have the right, in its reasonable 

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discretion, to require that Franchisee, at Franchisee’s expense, submit audited financial statements 

prepared by a certified public accounting firm acceptable to Franchisor for any fiscal year or any period 

or periods of a fiscal year. 

D. Other Reports. 

Franchisee shall submit to Franchisor, for review or auditing, such additional reports, records, 

data, information and financial statements as Franchisor may reasonably designate, in the form and at the 

times and places reasonably required by Franchisor, upon request and as specified from time to time in 

the Manuals or otherwise in writing. 

E. Data. 

All data provided by Franchisee in any form, and whether required by this Section 7 or any other 

requirement under the System or in the Manuals, including data uploaded to Franchisor computer system 

from the Franchisee’s Computer System and/or downloaded from Franchisor computer system to the 

Franchisee’s Computer System, is and will be owned exclusively by Franchisor, including without 

limitation, Customer Data (described in Section 13.L), customer lists, any and all loyalty program data 

and customer lists and e-mail lists, and Franchisor will have the right to use such data in any manner that 

Franchisor deems appropriate without compensation to Franchisee. In addition, all other data created or 

collected by Franchisee in connection with the System, or in connection with Franchisee’s operation of 

the Restaurant (including but not limited to consumer and transaction data), is and will be owned 

exclusively by Franchisor during the Initial Term and following termination or expiration of this 

Agreement. Copies and/or originals of such data must be provided to Franchisor upon Franchisor’s 

request. Franchisor hereby licenses use of such data back to Franchisee, at no additional cost, solely for 

the Initial Term and solely for Franchisee to use in connection with the operation of the Restaurant. 

Franchisor may use all such information, data, and reports in any manner, including, without limitation, 

providing financial and operating reports to Franchisee’s and operators operating under the System. 

F. Public Filings. 

If Franchisee is or becomes a publicly-held entity in accordance with other provisions of this 

Agreement, Franchisee shall send to Franchisor copies of all reports (including responses to comment 

letters) or schedules that Franchisee may file with the U.S. Securities and Exchange Commission 

(certified by Franchisee’s chief executive officer to be true, correct, complete and accurate) and copies of 

any press releases it may issue, within 3 days of the filing of those reports or schedules or the issuance of 

those releases. 

G. Audit Rights. 

(1) Franchisor or its designee shall have the right at all reasonable times, both 

during and after the Initial Term, to inspect, copy and audit Franchisee’s books, records, and federal, state 

and local tax returns, and such other forms, reports, information and data as Franchisor reasonably may 

designate, applicable to the operation of the Restaurant. If an inspection or audit discloses an 

understatement of Gross Sales, Franchisee shall pay Franchisor, within 10 days after receipt of the 

inspection or audit report, the deficiency in the Royalty Fees, advertising contributions and other amounts 

owed plus interest (at the rate and on the terms provided in Section 6.F) from the date originally due until 

the date of payment. 

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(2) If an inspection or audit is made necessary by Franchisee’s failure to furnish 

reports or supporting records as required under this Agreement, or to furnish such reports, records or 

information on a timely basis, or if an understatement of Gross Sales for the period of any audit is 

determined by any audit or inspection to be greater than 1% or an underpayment of the Royalty Fee of 5% 

or more, Franchisee also shall reimburse Franchisor for the reasonable cost of the audit or inspection 

including, without limitation, the charges of attorneys and independent accountants, and the travel 

expenses, room, board and compensation of Franchisor employees or designees involved in the audit or 

inspection. 

(3) If an inspection or audit discloses an understatement of the Gross Sales of the 

Restaurant for any period by 1% or more three or more times during any 18 month period, or by more 

than 3% on any one occasion, then in addition to Franchisee’s obligations in Sections 7.G(1) and (2) 

above, Franchisor may immediately terminate this Agreement. 

(4) If Franchisee fails to provide Franchisor on a timely basis with the records, 

reports and other information required by this Agreement or, upon request of Franchisor, with copies of 

the same, Franchisor or its designee shall have access at all reasonable times (and as often as necessary) 

to Franchisee’s books and records for the purpose, among other things, of preparing the required records, 

reports and other information. Franchisee promptly shall reimburse Franchisor or its designee for all 

costs and expenses associated with Franchisor obtaining such records, reports or other information. 

(5) The foregoing remedies shall be in addition to all other remedies and rights 

available to Franchisor under this Agreement or applicable law. 

8. ADVERTISING AND PROMOTION 

A. Marketing Contributions and Expenditures. 

(1) This Section 8 describes Franchisor’s marketing, public relations and advertising 

programs; however, Franchisor reserves the right to modify these programs and the manner in which the 

marketing and advertising funds are used for such purposes from time to time, in whole or in part, as 

Franchisor deems necessary. Franchisee acknowledges and recognizes the importance of the 

standardization of advertising programs to the furtherance of the goodwill and public image of the System 

and the Proprietary Marks. During the Initial Term of this Agreement, Franchisee shall pay an 

advertising and promotion obligation (“APO”) in an amount of up to 5% of the Gross Sales of the 

Restaurant as set forth in this Section 8 and Exhibit B. Franchisee shall pay that portion of the APO as 

directed by Franchisor to the National Advertising Fund in accordance with Section 8.C and to a Regional 

Advertising Fund or a Regional Co-op in accordance with Section 8.D or 8.E at the time and in manner as 

directed by Franchisor. The remainder of Franchisee’s APO shall be spent for Local Store Marketing in 

accordance with Section 8.G. 

(2) Franchisor has the right, following written notice to Franchisee, to reallocate the 

APO and to increase the APO; however Franchisor may not increase the APO above 5% of Gross Sales. 

This limitation on Franchisor does not prevent the Restaurant’s Regional Co-op from requiring a 

contribution, that when added to Franchisee’s National Advertising Fund contribution, results in a total 

APO in excess of 5% of Gross Sales. 

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B. Grand Opening Required Spending. 

Franchisee shall, during the period beginning 30 days before the scheduled opening of the 

Restaurant and continuing for 90 days after the Restaurant first opens for business (“Grand Opening 

Period”), spend at least $15,000 to conduct grand opening advertising in accordance with Franchisor 

Local Store Marketing Guidelines (as defined in Section 8.G and Exhibit C). At least 90 days before the 

opening of the Restaurant, Franchisee must submit to Franchisor a proposal for grand opening advertising 

(“Grand Opening Plan”). Franchisee shall not implement the Grand Opening Plan unless and until 

Franchisor has consented to the Grand Opening Plan in writing. Franchisee agrees to modify the Grand 

Opening Plan as requested by Franchisor and, thereafter, no substantial changes shall be made to the 

Grand Opening Plan without the advance written consent of Franchisor. Within 10 days after the end of 

the Grand Opening Period, Franchisee shall submit to Franchisor proof of such grand opening advertising 

expenditures to Franchisor. During the Grand Opening Period, Franchisee must contribute to the 

National Advertising Fund and a Regional Advertising Fund or Regional Co-op (if established in the area 

where the Restaurant is located); however, Franchisee’s obligation to make Local Store Marketing 

expenditures pursuant to Section 8.G below will not commence until after the expiration of the Grand 

Opening Period. 

C. National Advertising Fund. 

(1) Franchisor formed a non-profit corporation, Fridays Marketing Advisory 

Council (“FMAC”) to administer a national advertising fund for Fridays Restaurants (“National 

Advertising Fund”). At the same time and in the same manner as Franchisee pays its Royalty Fees to 

Franchisor, Franchisee shall contribute to the National Advertising Fund in the amount set forth in 

Exhibit B, as such may be subsequently modified by Franchisor pursuant to Section 8.A(2). Fridays 

Restaurants operated by Franchisor and its affiliates shall contribute to the National Advertising Fund on 

the same basis as comparable franchisees. 

(2) FMAC or its successor shall direct all advertising, marketing, and public 

relations programs and activities financed by the National Advertising Fund, with sole discretion over the 

creative concepts, materials and endorsements used in those programs and activities, and the geographic, 

market and media placement and allocation of advertising and marketing materials. Franchisee agrees 

that the National Advertising Fund may be used among other things to pay the costs of preparing and 

producing such associated materials and programs as Franchisor or its designee may determine, including, 

but not limited to, the following: (a) creative development and production of print ads, commercials, radio 

spots, electronic ads, point of purchase materials, direct mail pieces, door hangers, and other advertising 

and marketing materials; (b) creative development, preparation, production and placement of video, 

audio, and written materials and electronic media; (c) media placement and buying, including all 

associated expenses and fees; (d) administering local, regional and/or multi-regional marketing and 

advertising programs including the hiring of personnel or services; (e) market research, new product 

testing and marketing, and customer satisfaction surveys, including the use of secret shoppers; (f) the 

creative development of, and actual production associated with, premium items, giveaways, promotions, 

contests, public relation events, and charitable or nonprofit events; (g) creative development of menus, 

signage, posters, and individual Fridays Restaurant décor items including wall graphics and signage; 

(h) Digital Media, Extranet and/or Intranet development and maintenance as well as mobile creative, 

technology and other emerging digital initiatives; (i) development, implementation, and maintenance of 

an electronic commerce website and/or related strategies; (j) development and implementation of search 

engine optimization strategies; (k) development and administration of consumer surveys, interviews and 

other customer satisfaction and retention policies; (l) retention and payment of advertising and marketing 

agencies and other outside advisors including retainer and management fees; (m) co-branding or licensing 

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programs; (n) public relations and community involvement activities and programs; and (o) gift card and 

loyalty programs. From time to time, Franchisor or its designee may furnish Franchisee with marketing, 

advertising and promotional materials at the cost of producing them, plus any related shipping, handling 

and storage charges. Franchisee shall not modify any of these materials without Franchisor’s prior written 

consent. 

D. Regional Advertising Funds. 

(1) Franchisor shall have the right, in its sole discretion, to establish one or more 

regional advertising funds for Fridays Restaurants (“Regional Advertising Funds”). If a Regional 

Advertising Fund is established for a geographical area that includes the Premises, at the same time and in 

the same manner as Franchisee pays its Royalty Fees to Franchisor, Franchisee shall contribute to that 

Regional Advertising Fund in the amount set forth in Exhibit B, as subsequently modified by Franchisor. 

Fridays Restaurants operated by Franchisor and its affiliates in an area covered by a Regional Advertising 

Fund shall contribute to the Regional Advertising Fund on the same basis as comparable franchisees. 

(2) Franchisor or its designee shall direct all advertising, marketing, and public 

relations programs and activities financed by the Regional Advertising Fund, with sole discretion over the 

creative concepts, materials and endorsements used in those programs and activities, and the geographic, 

market and media placement and allocation of advertising and marketing materials. Franchisee agrees 

that the Regional Advertising Fund may be used to pay the costs of preparing and producing such 

associated materials and programs as Franchisor or its designee may determine, including video, audio 

and written advertising materials; employing advertising agencies; sponsorship of sporting, charitable or 

similar events; administering regional and multi-regional advertising programs, including, without 

limitation, purchasing direct mail and other media advertising and employing advertising agencies to 

assist with these efforts; and supporting public relations, market research and other advertising, 

promotional and marketing activities. Franchisee agrees to participate in all advertising, marketing, 

promotions, research and public relations programs instituted by the Regional Advertising Fund. 

E. Regional Co-op. 

(1) In lieu of a Regional Advertising Fund for the area that includes the Premises, 

Franchisor, in its sole discretion, may establish (or permit the franchisees in the relevant geographic area 

to establish) a Regional Co-op. Franchisee shall contribute to the Regional Co-op in the amount and at 

the times set by the Regional Co-op, which will be reflected in Franchisee’s APO on Exhibit B. 

Franchisor, if it so elects, may prepare bylaws to be used by the Regional Co-op and may require the 

Regional Co-op to incorporate. 

(2) Monies in the Regional Co-op may be spent for the purposes determined by the 

Regional Co-op Bylaws or other applicable guidelines, which will be made available to Franchisee up on 

request. Unless otherwise consented to in writing by Franchisor, the Regional Co-op Fund shall only 

conduct advertising that conforms with those advertising and sales promotions specified by Franchisor 

from time to time (including the media in which conducted). All advertising shall be submitted to 

Franchisor before first use as provided in Section 8.G, and all advertising shall adhere to the standards set 

forth in Section 8.G. Each franchisee who is a member of the Regional Co-op shall be entitled to vote on 

Regional Co-op matters; however, a franchisee shall not be entitled to vote if it is in default under its 

franchise agreement or any other agreement with Franchisor or its affiliates. Franchisor always shall be a 

member of the Regional Co-op and be entitled to attend and fully participate in Regional Co-op meetings, 

but Franchisor shall not have a vote unless it or its affiliates operates Fridays Restaurants in the area 

covered by the Regional Co-op. Franchisor shall be given at least 3 days prior written notice of Regional 

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Co-op meetings. If the members of the Regional Co-op are unable or fail to determine the manner in 

which Regional Co-op monies should be spent, Franchisor may assume this decision making authority 

following 10 days advance written notice to the members of the Regional Co-op. 

(3) Franchisor or its designee shall have the right to terminate (and subsequently 

restart) the Regional Co-op or convert the Regional Co-op to a Regional Advertising Fund. Upon 

termination, all monies in the Regional Co-op shall be spent for advertising and/or promotional purposes. 

(4) Franchisor or its designee may grant to any franchisee an exemption for any 

length of time from the requirement of membership in the Regional Co-op, upon written request of such a 

franchisee stating reasons supporting an exemption. Decisions regarding a request for exemption shall be 

final. Franchisor shall have the sole right to enforce the obligations of franchisees who are members of 

the Regional Co-op to contribute to the Regional Co-op, and neither Franchisee nor any other franchisees 

who contribute to the Regional Co-op shall be deemed a third party beneficiary with respect to the 

Regional Co-op obligations of other franchisees or have any right to enforce the obligation of any 

franchisee to contribute to the Regional Co-op. 

F. Treatment of Payments to Franchisor. 

(1) Franchisor shall separately account for the National Advertising Fund and any 

Regional Advertising Funds, but Franchisor shall not be required to segregate any of the funds from 

Franchisor’s other monies. None of the funds shall be used to defray any of Franchisor’s general 

operating expenses (except reasonable administrative costs and overhead related to the administration or 

direction of such funds). Each fund may hire employees, either full-time or part-time, for its 

administration. Franchisor, its affiliates, and designees may be reimbursed by each fund for administrative 

expenses directly related to the fund’s marketing programs, including, without limitation, conducting 

market research, preparing advertising and marketing materials and collecting and accounting for 

contributions to each fund. Franchisor or its designee may spend in any fiscal year an amount greater or 

less than the aggregate contribution of all Fridays Restaurants to each fund during that year or cause each 

fund to invest any surplus for future use by the fund. An unaudited statement of monies collected and 

costs incurred by each fund shall be prepared annually and shall be furnished to Franchisee within a 

reasonable period of time following a written request. Franchisor or its designee will have the right to 

cause each fund to be incorporated or operated through an entity separate from Franchisor at such time as 

Franchisor or its designee deems appropriate, and such successor entity shall have all rights and duties of 

Franchisor pursuant to this Section 8. 

(2) Franchisee understands and acknowledges that each fund is intended to enhance 

recognition of the Proprietary Marks and patronage of Fridays Restaurants. Franchisor will endeavor to 

utilize each fund to develop advertising and marketing materials and programs and to place advertising 

that will benefit the System and all Fridays Restaurants contributing to the fund. Franchisee agrees, 

however, that Franchisor is not liable to Franchisee, and Franchisee forever covenants not to sue and 

holds Franchisor harmless of any liability or obligation to ensure that expenditures by each fund in or 

affecting any geographic area (including the Premises) are proportionate or equivalent to the contributions 

to the fund by Fridays Restaurants operating in that geographic area, or that any Fridays Restaurant will 

benefit directly or in proportion to its contribution to each fund from the development of advertising and 

marketing materials or the placement of advertising. Except as expressly provided in this Section 8, 

neither Franchisor nor its designee assumes any direct or indirect liability to Franchisee with respect to 

the maintenance, direction or administration of each fund. 

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(3) Franchisor reserves the right, in its sole discretion, to: (a) suspend contributions 

to and operations of each fund for one or more periods that Franchisor determines to be appropriate; 

(b) terminate any fund upon 30 days written notice to Franchisee and establish, if Franchisor so elects, 

one or more new advertising funds; and (c) defer or waive, in whole or in part, upon the written request of 

any franchised or company restaurants, any advertising contributions required by this Section if, in 

Franchisor’s sole judgment, there has been demonstrated unique, objective circumstances justifying any 

such waiver or deferral. On termination of a fund, all monies in the fund shall be spent for advertising 

and/or promotional purposes. Franchisor has the right to reinstate any fund upon the same terms and 

conditions set forth in this Agreement upon 30 days prior written notice to Franchisee. Franchisor, in its 

sole discretion as it deems appropriate in order to maximize media effectiveness, may transfer monies 

from the National Advertising Fund to any Regional Advertising Fund or from all Regional Advertising 

Funds to the National Advertising Fund. 

G. Local Store Marketing. 

(1) Franchisee shall spend, on a monthly basis, the difference between (a) the APO 

and (b) the amount Franchisee is required to contribute to the National Advertising Fund and the Regional 

Advertising Fund or Regional Co-Op (if any), as set forth in Exhibit B (and as such may be subsequently 

modified by Franchisor), on authorized advertising media and for authorized advertising expenditures to 

promote the Restaurant (“Local Store Marketing”). Franchisor or its designee periodically shall advise 

Franchisee of the advertising and sales promotions approved by Franchisor including: direct mail, 

newspapers, magazines and other periodicals; radio and television spots; outdoor advertising (e.g., 

billboards, highway or transit signs); geo-targeted digital advertising and local Social Media. If requested 

by Franchisor, Franchisee shall submit annually for Franchisor’s prior consent its marketing plan and 

budget with respect to kinds and amounts of advertising and media intended to be used in accordance 

with Fridays Local Store Marketing guidelines as set forth in Exhibit C and the Manuals as such 

guidelines may be modified by Franchisor from time to time. Franchisee shall obtain Franchisor’s 

consent to the marketing plan and budget and any changes to the marketing plan and budget before it may 

be implemented. 

(2) Within 30 days after the end of each fiscal quarter, Franchisee shall provide 

Franchisor or its designee copies of all documentation demonstrating the amount and types of Local Store 

Marketing expenditures made by Franchisee in the prior fiscal quarter. If Franchisee fails to expend the 

required amount annually, then Franchisee must contribute to the National Advertising Fund within 30 

days after the close of Franchisor’s fiscal year any amounts that Franchisee should have expended to reach 

the Local Store Marketing requirement. Franchisor reserves the right to require Franchisee to remit to 

Franchisor 100% of the Local Store Marketing obligation upon 10 days notice and, upon receipt, 

Franchisor will have the right to use the funds for advertising and promotion in the Restaurant’s local 

area. 

(3) Franchisee may purchase local advertising and promotion materials from any 

Franchisor-approved third party. If purchased from a source other than Franchisor or its affiliates, these 

materials shall comply with federal and local laws and regulations and with the guidelines for advertising 

and promotions promulgated from time to time by Franchisor or its designee and shall be submitted to 

Franchisor or its designee at least 30 days before first use for its approval, which Franchisor may grant or 

withhold in its sole discretion. Franchisee’s local advertising and marketing materials must follow 

Franchisor’s guidelines, which may include, among other things, requirements for, or restrictions 

regarding, the use of the Proprietary Marks and notices of the Fridays Websites domain name(s) in the 

manner Franchisor designates. In no event shall Franchisee’s advertising contain any statement or 

material which, in the sole discretion of Franchisor, may be considered: (a) in bad taste or offensive to the 

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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 the System. 

H. Promotional Programs. 

In addition to the national and regional advertising described in this Section 8, Franchisor may 

from time to time develop and administer advertising, marketing and sales promotion programs in which 

Franchisee shall participate upon such terms and conditions as established by Franchisor. Such programs 

are in addition to Franchisee’s APO and may include, but not be limited to, liquor menu and marketing 

promotions, specialized menu offerings and similar programs. All phases of such advertising and 

promotion, including, without limitation, type, quantity, timing, placement, and choice of media 

(including Digital Media), market areas, promotional programs and advertising agencies, shall be 

determined by Franchisor. 

I. Fridays Websites. 

(1) Franchisor may establish and maintain one or more websites and/or mobile 

applications (collectively referred to herein as the “Fridays Websites”) that provide information about 

the System and the products and services offered and sold by Fridays Restaurants. The Fridays Websites 

may also offer reservations, online and mobile ordering, mobile payments or similar services or sales of 

items bearing the Proprietary Marks, including, but not limited to, Franchisor’s memorabilia, clothing and 

pre-packaged food and beverage products. Franchisor may require Franchisee to pay Franchisor and/or 

one or more third party vendors their then-current costs and fees applicable to online and mobile orders 

placed from Franchisee’s Restaurant through the Fridays Websites, or Franchisor may use part of the 

National Advertising Fund contributions that Franchisor collects under this Section 8 to pay a portion or 

all of those costs and fees. Franchisor has absolute control over the Fridays Websites design and content. 

Franchisor will attempt to configure the Fridays Websites to accommodate individual Fridays Restaurant 

pages described in Section 8.I(2). Franchisor will have no obligation to maintain the Fridays Websites 

indefinitely, but may discontinue them at any time without liability to Franchisee. Furthermore, as 

Franchisor has no control over the stability or maintenance of the Internet generally, Franchisor is not 

responsible for damage or loss caused by errors of the Internet. Franchisor is not liable for any direct, 

indirect, special, incidental, exemplary or consequential damages arising out of the use of the Internet or 

the inability to use the Internet including loss of profits, goodwill or savings, downtime, damage to or 

replacement of programs and data, whether based in contract or tort, product liability or otherwise. 

(2) The Fridays Websites may include a series of interior pages developed by 

Franchisor (and, at Franchisor’s sole discretion, using content provided by Franchisee as requested by 

Franchisor) that identify participating Fridays Restaurants by address, telephone number, and e-mail 

address. At Franchisee’s request, Franchisor will endeavor (technology permitting) to include on the 

Fridays Websites one or a series of interior pages devoted to information about the Restaurant. 

Franchisee will not have the capability to modify such page(s) except in coordination with Franchisor and 

in compliance with Franchisor’s policies and procedures as such may change from time to time. 

(3) Franchisor may require Franchisee to contribute an amount, as determined by 

Franchisor in its sole discretion (the “Digital Marketing Fee”), toward the cost of the development and 

maintenance of Digital Media (including, but not limited to, the Fridays Websites) to be used for 

advertising, marketing, promotional, technology, or other purposes in Franchisor’s sole discretion. 

Franchisor will collect the Digital Marketing Fee monthly and will notify Franchisee in or before January 

of each year the amount of the Digital Marketing Fee for that calendar year, provided that the Digital 

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Marketing Fee will remain the same for that calendar year if Franchisor does not notify Franchisee before 

January 31 of each year of a change in the amount of the Digital Marketing Fee. In addition or 

alternatively, Franchisor may use part of the National Advertising Fund contributions that Franchisor 

collects under this Section 8 to maintain and further develop the Digital Media and may elect in 

conjunction therewith to establish a separate fund for the Digital Marketing Fee and such contribution 

amounts apart from the National Advertising Fund. 

(4) If Franchisee fails to pay when due any fees or other amounts payable to 

Franchisor under this Agreement or otherwise fails to comply with any policy or procedure governing the 

Digital Media, in addition to other remedies, Franchisor may, at its option, temporarily disable 

Franchisee’s interior page(s) on the Fridays Websites (or other Digital Media) or Franchisee’s ability to 

accept online or mobile orders and/or mobile payments for the Restaurant, until Franchisee pays its 

outstanding obligations in full and/or Franchisee fully cures the breach. Franchisee will not have any 

claim against Franchisor or any affiliate arising from Franchisor’s actions pursuant to this Section 8.I and 

Franchisee hereby waives any such claim it may at any time have, and releases Franchisor and its 

affiliates from any liability arising therefrom. 

J. E-Mail, Internet, Social Media and Other Media. 

Franchisee must comply with Franchisor’s requirements and policies (as described in the Manuals 

or otherwise in writing) with respect to all Digital Media in connection with the Restaurant and the 

business, and in connection with discussing, advertising, or disseminating any information, or otherwise 

having a presence, on the Internet, in Social Media or in any other media, regarding the Restaurant and 

the business. Such activities include, without limitation, participation in any Internet “blogs” or Social 

Media sites. Any such activities which are not expressly permitted in the Manuals or otherwise in 

writing, or for which Franchisee has not previously received approval from Franchisor, shall be subject to 

Franchisor’s approval as Local Store Marketing. 

(1) Franchisee may advertise and promote the Restaurant via Social Media, which 

shall be comprised of pages, communications, and content located on third party platforms using the 

Proprietary Marks as specified by Franchisor (collectively, “Franchisee’s Social Media”). All uses of 

Franchisee’s Social Media pages and communication channels and uses must be established in 

accordance, and at all time be in compliance, with the Manuals and System Standards. 

(2) Franchisee agrees not to transmit or cause any other party to transmit consumer 

advertisements or solicitations by e-mail or other Digital Media without Franchisor’s prior written consent 

as to: (a) the content of such advertisements or solicitations; and (b) Franchisee’s plan for transmitting 

such advertisements. In addition to any other provision of this Agreement, Franchisee agrees that it will 

be solely responsible for complying with any laws pertaining to sending e-mails, including but not limited 

to the Controlling the Assault of Non-Solicited Pornography and Proprietary Marketing Act of 2003 

(known as the “CAN-SPAM Act of 2003”). 

(3) Franchisee shall promptly discontinue any advertising or promotion using Social 

Media, whether or not previously agreed to by Franchisor, upon notice from Franchisor that it reasonably 

considers that such use of Social Media does not conform to the System Standards. Upon the expiration 

or termination of this Agreement, Franchisee will assign ownership (to the extent Franchisor does not 

already own them) of all domain names, account names, handles and user names used by Franchisee in its 

business under this Agreement and Franchisee will take all such actions as Franchisor reasonably requires 

to disassociate Franchisee from any such names and Social Media pages. 

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K. Copyrights. 

Copyright to all advertising and promotional materials that contain any of the Proprietary Marks 

or that otherwise relate to Fridays Restaurants will belong solely to Franchisor regardless of the party that 

created those materials. For purposes of this provision on ownership of advertising and promotional 

material, Fridays Websites and all material on Fridays Websites or Social Media including, without 

limitation, all informational text, photographs, illustrations, artwork, software, music, sound, photographs, 

graphics, audio, video, messages, files, documents, images or other materials, as well as all derivative 

works will be considered advertising and promotional material, and will therefore be owned solely by 

Franchisor. Franchisee will (and will cause its employees and agents to) execute all documents required 

by Franchisor to confirm this ownership. 

9. MANUALS 

A. Manuals and System Standards. 

(1) At the time of Franchisee’s initial training, Franchisor shall deliver to 

Franchisee, on loan, one set of Fridays Manuals. The Manuals may be published in an electronic format. 

As used in this Agreement, the term “Manuals” includes publications, materials, drawings, memoranda, 

compact disks, digital video disks and electronic media that Franchisor from time to time may provide to 

Franchisee. The Manuals contain the System Standards for Fridays Restaurants, which include 

mandatory and suggested specifications, standards, operating procedures, reporting requirements and 

rules that Franchisor periodically prescribes for operating a Fridays Restaurant. Franchisee acknowledges 

that the Manuals and System Standards are designed to protect the System and the Proprietary Marks, 

goodwill and reputation associated with the System and to maintain the uniform quality of operation 

through the System, and not to control the day-to-day operation of the Restaurant. Franchisee at all times 

remains responsible for the operation of the Restaurant and all activities occurring in the Restaurant, 

including but not limited to the hiring, training, discipline, and staffing of the Restaurant’s employees. 

Franchisee agrees to comply fully with all mandatory standards, specifications, operating procedures, and 

other obligations contained in the Manuals, as amended from time to time. 

(2) Franchisor has the right to amend and supplement the Manuals periodically by 

letter, electronic mail, bulletin, DVDs, audio tapes, compact disks, software or other communications 

concerning the System to reflect changes in the image, specifications and standards relating to 

developing, equipping, furnishing and operating a Fridays Restaurant. Franchisee shall keep its copy of 

the Manuals current and up-to-date with all additions and deletions provided by or on behalf of Franchisor 

and shall purchase whatever equipment and related services (including, without limitation, the computer, 

Internet service, dedicated phone line, facsimile machine, etc.) as may be necessary to receive these 

communications. If a dispute relating to the contents of the Manuals develops, the master copy 

maintained by Franchisor at its principal offices shall control. If Franchisee’s copy of the Manuals are 

lost, destroyed, or significantly damaged, Franchisee will immediately notify Franchisor and Franchisee 

will be obligated to obtain from Franchisor, at the then-current charge, a replacement copy of the 

Manuals. 

B. Confidentiality of the Manuals. 

Franchisee acknowledges that the contents of the Manuals are confidential and that the Manuals 

contain Franchisor’s trade secrets and copyrighted material. Any passwords or other digital 

identifications necessary to access the Manuals on the applicable website, intranet or extranet also are 

deemed to be confidential and proprietary to Franchisor. Accordingly, Franchisee agrees that Franchisee 

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will not disclose the Manuals, passwords or other digital identifications to any person other than 

employees of the Restaurant who need to know its contents. Franchisee’s employees with access to the 

Manuals will sign a confidentiality agreement before accessing the Manuals. Franchisee may not at any 

time copy, duplicate, record, or otherwise reproduce any part of the Manuals. 

10. MODIFICATIONS OF THE SYSTEM 

A. System Modifications. 

Franchisor, in its sole discretion, shall be entitled from time to time to change or modify the 

System, including modifications to the Manuals, the System Standards, the menu and menu formats, the 

required equipment, the signage, the building and premises of the Restaurant (including the trade dress, 

décor and color schemes), the presentation of the Proprietary Marks, the adoption of new administrative 

forms and methods of reporting and of payment of any monies owed to Franchisor (including electronic 

means of reporting and payment) and the adoption and use of new or modified Proprietary Marks or 

copyrighted materials. Franchisee shall accept and use or display in the Restaurant any such changes or 

modifications to the System as if they were a part of the System at the time this Agreement was executed, 

and Franchisee will make such expenditures as the changes or modifications in the System may require. 

B. Variations from System Standards. 

Franchisor has the right, in its sole discretion, to waive, defer or permit variations from the 

System Standards or the applicable agreement to any franchisee or prospective franchisee based on the 

peculiarities of a particular site, existing building configuration or circumstance, density of population, 

business potential, trade area population or any other condition or circumstance. Franchisor shall have 

the right, in its sole discretion, to deny any such request. 

C. Franchisee’s Development of System Improvements. 

If Franchisee develops any new concepts, processes or improvements relating to the System, 

whether or not pursuant to a Franchisor’s authorized test, Franchisee promptly shall notify Franchisor and 

provide Franchisor with all information regarding the new concept, process or improvement, all of which 

shall, at Franchisor’s option, automatically become the property of Franchisor and its affiliates and which 

may be incorporated into the System without any payment to Franchisee. If Franchisor so elects, 

Franchisee, at its expense, promptly shall take all actions deemed necessary or desirable by Franchisor to 

vest in Franchisor’s ownership of such concepts, processes or improvements. 

11. TRAINING 

A. Owner’s Orientation Program. 

Franchisee’s Principal Owner(s) and its Representative (as described in Section 16.E) must attend 

Franchisor’s then current owner’s orientation program (“Owner’s Orientation Program”) at 

Franchisor’s then current corporate headquarters, which are currently located in Southlake, Texas. The 

Owner’s Orientation Program is an expedited program consisting of training related to the overall 

operation and management philosophy of a Fridays Restaurant. Franchisee’s Principal Owners may also 

participate in all or any part of the Management Training Program (defined in Section 11.B) that the 

Operating Principal (as described in Section 16.G) and Restaurant managers are required to attend. 

Franchisor does not charge a fee for the Owner’s Orientation Program; however, Franchisee is 

responsible for any travel expenses, living expenses, wages, and other incidental expenses incurred by 

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the Representative and the Principal Owner(s) while attending the Owner’s Orientation Program. 

Franchisor may in its sole discretion modify the Owner’s Orientation Program. 

B. Management Training Program. 

(1) At least 90 days before the Restaurant opens for business, and during the Initial 

Term of this Agreement, Franchisee’s Operating Principal, the Restaurant’s general manager, kitchen 

manager and at least two other salaried Restaurant managers must attend, and successfully complete 

Franchisor’s then-current restaurant management training course including without limitation, all course 

materials, activities, methods, processes, prerequisites and testing, as such may change from time to time 

at Franchisor’s sole discretion (collectively, “Management Training Program”). Franchisor shall 

identify any management employee of Franchisee who successfully completes the Management Training 

Program as a “Validated Manager.” As part of the Management Training Program, attendees must 

successfully complete a Certified Professional Food Manager training and certification program as 

specified by Franchisor. The eight-week Management Training Program includes classroom and online 

instruction, and on-the-job training and is held at a Fridays Restaurant that has received Franchisor’s 

certification to conduct training programs (“Center of Excellence Restaurant”) or at Franchisor’s 

designated training facilities. Franchisor may offer all or portions of the Management Training Program 

over the Internet, Franchisor’s company intranet or by webinar. Franchisor may, in its sole discretion, 

modify the Management Training Program for any trainee based on that trainees prior restaurant 

operating and management experience. 

(2) Franchisor will not authorize the Restaurant to open until an adequate number of 

Franchisee’s managers, as determined by Franchisor in its sole discretion, have attended, successfully 

completed and been “validated” in the Management Training Program. Subsequent to the opening of the 

Restaurant, any employee of Franchisee who assumes any management position must, within 60 days 

after assuming such position, attend the Management Training Program and become validated for that 

position after completing such training. The Management Training Program will be provided by 

Franchisor, unless a restaurant operated by Franchisee has been certified by Franchisor as a Center of 

Excellence Restaurant in accordance with Section 11.D(4). In the event that Franchisee’s manager(s) 

must be trained at another restaurant not operated by Franchisee, whether it is owned by Franchisor or 

another franchisee, Franchisee must pay a fee of $500 per trainee to the owner of the restaurant in which 

the training takes place. 

(3) Franchisee will be required to pay Franchisor’s then-current tuition or other fees 

as well as all travel expenses, living expenses, wages, and other incidental expenses incurred by 

Franchisee and Franchisee’s employees while attending the training. 

(4) In order to facilitate all online training and testing and make it available to all 

managers and team members, Franchisee will be required to purchase mobile devices, the type and 

number of which as Franchisor may specify, and provide sufficient, reliable WiFi access within the 

Restaurant. 

C. New Store Opening (“NSO”) Team and Franchisee Responsibility for All Costs and 

Expenses. 

(1) Franchisor will authorize Franchisee to open the Restaurant only after an 

adequate number of Franchisee’s employees, as determined by Franchisor in its sole discretion as 

necessary to protect the goodwill associated with the Proprietary Marks, have attended and been validated 

by Franchisor. The NSO Team shall assist in the opening of the Restaurant. The NSO Team typically 

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consists of a combined total of approximately 12 employees of Franchisor or its designee and Franchisee’s 

Validated Managers (the actual number of members shall be determined by Franchisor, depending upon 

the number of Fridays Restaurants already being operated by Franchisee or its affiliate and such other 

criteria as Franchisor deems reasonable). The members of the NSO Team shall be subject to Franchisor’s 

consent. The number of Franchisor’s or its designees’ employees selected to serve on the NSO Team for 

the Restaurant is determined according to the following schedule, provided however, Franchisor may 

elect to modify this schedule in the event the total number of people on the NSO Team is greater or less 

than 12: 

No. of Fridays Restaurants Operated by 

Franchisee (or its affiliate) 

No. of Franchisor’s 

Validated Trainers On the 

NSO Team 

1 & 2 12 

3 & 4 9 

5 & 6 6 

7 or more 2 

(2) In the event Franchisor determines that more than 12 NSO team members are 

necessary for the opening of the Restaurant, Franchisee shall be responsible for the costs associated with 

the team members in excess of 12. If Franchisee fails or is unable to timely provide the number of 

employees noted above, Franchisor may, but shall not be obligated to, staff the NSO Team with 

Franchisor’s or its designees’ employees. 

(3) Franchisee shall be solely responsible for all costs, expenses, and liabilities 

incurred by the NSO team members provided by Franchisor (or its designee). Franchisor reserves the 

right to require Franchisee to prepay an estimated amount of these expenses in advance. Franchisor will 

submit a final invoice to Franchisee within 30 days after the Restaurant opens and Franchisee and 

Franchisor shall reconcile and reimburse the other as necessary based on the initial estimate. 

D. Training by Franchisee. 

(1) Franchisee’s Validated Managers are responsible for training the Restaurant’s 

staff (“Team Member Training Program”). Periodically, Franchisee must conduct such Team Member 

Training Programs as Franchisor may require, including those training programs required for Franchisee’s 

employees to become validated for the position(s) for which each employee was hired. Franchisee may 

offer the Management Training Program to Franchisee’s managerial employees if Franchisee operates a 

Center of Excellence Restaurant. Franchisee will be responsible for all costs that Franchisee incurs in 

training Franchisee’s employees. 

(2) Franchisor or its designee may periodically visit the Restaurant to ensure that 

Franchisee’s Validated Managers continue to meet Franchisor’s standards. Franchisor has the right to devalidate any of Franchisee’s Validated Managers who consistently fails to maintain System Standards as 

set forth in the Manuals. If Franchisee’s Validated Managers are no longer qualified to train Franchisee’s 

employees, then Franchisor may, among other things, require the Validated Managers attend and 

successfully complete the Management Training Program and be re-validated or designate replacement 

personnel to complete the Management Training Program to be validated as Franchisee’s Validated 

Managers. Franchisor may charge a reasonable training fee to re-validate Franchisee’s managers. 

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(3) If Franchisee does not operate a Center of Excellence Restaurant, then 

Franchisee must send Franchisee’s managerial employees to the Management Training Program offered 

by Franchisor and Franchisee must pay Franchisor’s then current tuition fee for Franchisee’s managers 

who attend the Management Training Program, in addition to paying all salaries, benefits, travel, food, 

lodging and other expenses incurred by Franchisee’s managerial employees while attending the 

Management Training Program. If Franchisee does not have Validated Managers to train Franchisee’s 

staff, Franchisor or its designee will send a trainer to the Restaurant to train Franchisee’s hourly 

employees on the System Standards and related topics necessary to protect the goodwill associated with 

the System and Proprietary Marks, and Franchisee must reimburse Franchisor for all salary, travel, food, 

lodging and other expenses incurred by Franchisor’s or its designees’ trainers. Franchisor reserves the 

right to require Franchisee to pay an estimated amount of these wages and expenses in advance. 

Franchisor will submit a final invoice to Franchisee within 30 days after the training and shall reimburse 

Franchisee for any expenses in excess of the estimate. 

(4) If Franchisee operates three or more franchised Fridays Restaurants, within 90 

days after Franchisee opens its third franchised Fridays Restaurant, Franchisee may request permission 

from Franchisor to establish one of Franchisee’s Fridays Restaurants as a Center of Excellence Restaurant 

at which Franchisee’s employees will offer Team Training Program to Franchisee’s employees and the 

Management Training Program to Franchisee’s managers. Franchisor must certify the Restaurant as a 

Center of Excellence Restaurant before Franchisee may begin training there and Franchisee shall be 

responsible for reimbursing Franchisor for all costs and expenses in certifying the Restaurant. Franchisor 

may periodically visit Franchisee’s Center of Excellence Restaurant to ensure that it continues to meet 

Franchisor’s standards. 

(5) Franchisee is strongly encouraged to train its team members in responsible 

alcohol service. Franchisor’s corporate program – “S.U.R.F.” (Serving Up Responsible Fun) – is 

available for Franchisee’s use; however, Franchisor assumes no liabilities, duties or obligations by simply 

disclosing to others how to handle responsible alcohol service. Other alcohol awareness programs are 

available through the National Restaurant Association, state restaurant associations, state beverage 

commissions and from hospitality industry consultants. 

E. Additional Training, Conferences and Meetings. 

(1) Franchisor shall have the right (which may be exercised at any time and in 

Franchisor’s sole discretion) to require that Franchisee, the Operating Principal, and Franchisee’s 

restaurant managers take and successfully complete other training courses in addition to the initial 

training program. Franchisor reserves the right to require Franchisee to pay a tuition fee as established by 

Franchisor from time to time for these additional training programs within 30 days of receipt of an 

invoice from Franchisor. 

(2) In addition to training programs, Franchisee’s Operating Principal must attend 

the Franchisor’s annual meeting, convention or conference of franchisees and all meetings relating to new 

products or product preparation procedures, new operational procedures or programs, restaurant 

management, sales or sales promotion, or similar topics, at Franchisee’s expense. Franchisor reserves the 

right to require that the Operating Principal attend any additional meetings that Franchisor deems 

appropriate under special circumstances, provided, however, that Franchisor will not require more than 

one additional meeting every year and Franchisor will provide written notice of any such meeting at least 

10 days before the meeting. 

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F. Training Materials and Methods. 

All training materials that Franchisor provides to Franchisee remain Franchisor’s property. 

Except for the on-the-job training portions of the Management Training Program, Franchisor reserves the 

right to provide training programs in person, on tape, via the Internet, webinar, in printed or electronic 

format or by other means. 

G. Expenses. 

Franchisee is responsible for any travel expenses, living expenses, wages, and other incidental 

expenses incurred by Franchisee and Franchisee’s trainees while attending Franchisor’s training programs. 

12. ADDITIONAL SERVICES BY FRANCHISOR 

A. Pre-Opening Assistance. 

Franchisor may provide, at times and in a manner determined solely by Franchisor, consultation 

and advice to Franchisee, as Franchisor deems appropriate, with regard to the development and operation 

of the Restaurant, building layout, furnishings, fixtures and equipment plans and specifications, 

purchasing and inventory control, and such other matters as Franchisor deems appropriate. 

B. General Guidance. 

Franchisor will advise Franchisee from time to time regarding the operation of the Restaurant 

based on Franchisee’s reports to Franchisor and/or Franchisor’s direct or indirect observations, and 

Franchisor will provide guidance to Franchisee with respect to: (1) the System Standards and operating 

procedures used by Fridays Restaurants; (2) advertising and marketing materials and programs; and 

(3) administrative, bookkeeping, accounting, and inventory control procedures. Franchisor will provide 

ongoing advice and consultation to Franchisee through the Manuals, bulletins or other written materials, 

electronic media, telephone, national or regional meetings and/or in person at Franchisor’s corporate 

offices or the Restaurant. If Franchisee requests, and Franchisor agrees to provide, additional or special 

guidance, assistance, or training, then Franchisee must pay Franchisor’s then applicable charges, including 

Franchisor’s fees for its personnel and their related travel and living expenses. 

C. Periodic Inspections. At periodic intervals and at times designated by Franchisor in its 

sole discretion with or without notice to Franchisee, Franchisor shall inspect the Restaurant and its 

operations to assist Franchisee’s operations and ensure compliance with the System. 

D. Delegation. Franchisor has the right, from time to time, to delegate the performance of 

any portion or all of its obligations and duties under this Agreement to designees, whether affiliates or 

agents of Franchisor or independent contractors with which Franchisor has contracted to provide this 

service. 

13. PERFORMANCE STANDARDS AND UNIFORMITY OF OPERATION 

Products sold and services performed under the Proprietary Marks have a reputation for quality. 

This reputation has been developed and maintained by Franchisor, and it is of the utmost importance to 

Franchisor, Franchisee and all other franchisees of Franchisor that this reputation be maintained. In 

recognition of the mutual benefits that come from maintaining the reputation for quality enjoyed by the 

System, Franchisee covenants and agrees, with respect to the operation of the Restaurant, that Franchisee 

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and its employees shall comply with all of the requirements of the System as set forth in the Manuals or 

otherwise, and Franchisee additionally shall comply with the following: 

A. Standards and Specifications. 

To ensure that the highest degree of quality and service is maintained, Franchisee shall operate the 

Restaurant in strict conformity with such methods, standards, and specifications as Franchisor may from 

time to time prescribe in the Manuals or otherwise in writing. Franchisee agrees: 

(1) To maintain in sufficient supply, and to use and/or sell at all times only such 

products, ingredients, materials, supplies, merchandise and paper goods as conform to Franchisor’s 

written standards and specifications, and to refrain from deviating therefrom by the use or offer of any 

non-conforming items without Franchisor’s specific prior written consent. 

(2) To sell or offer for sale only such products as have been expressly approved for 

sale in writing by Franchisor; to sell or offer for sale all such products, utilizing the ingredients and 

employing the preparation standards and techniques, as specified by Franchisor; to refrain from any 

deviation from Franchisor’s standards and specifications, including the manner of preparation of products, 

without Franchisor’s prior written consent; and to discontinue selling and offering for sale any products 

which Franchisor shall have the right to disapprove, in writing, at any time. If Franchisee deviates or 

proposes to deviate from Franchisor’s standards and specifications, whether or not such deviation is 

approved by Franchisor, such deviation shall become the property of Franchisor. 

(3) To permit Franchisor or its agents, at any reasonable time, to remove samples of 

products, without payment therefor, in amounts reasonably necessary for testing by Franchisor or an 

independent laboratory to determine whether said samples meet Franchisor’s then-current standards and 

specifications. In addition to any other remedies it may have under this Agreement, Franchisor may 

require Franchisee to bear the cost of such testing if the supplier of the item has not previously been 

approved by Franchisor or if the sample fails to conform to Franchisor’s specifications. 

(4) To purchase and install, at Franchisee’s expense, all fixtures, furnishings, 

equipment, décor, and signs as Franchisor shall specify; and to refrain from installing or permitting to be 

installed on or about the Restaurant premises, without Franchisor’s prior written consent, any fixtures, 

furnishings, equipment, décor, signs, or other items not previously approved as meeting Franchisor’s 

standards and specifications. 

(5) To fully and faithfully comply with all applicable governing authorities, laws 

and regulations. Franchisee shall immediately close the Restaurant and terminate operations in the event 

that: (a) any products sold at the Restaurant evidence adulteration or deviation from the standards set for 

products by Franchisor; (b) any products sold at the Restaurant fail to comply with applicable laws or 

regulations; or (c) Franchisee fails to maintain the products, Restaurant premises, equipment, personnel, 

or operation of the Restaurant in accordance with any applicable law or regulations. In the event of such 

closing, Franchisee shall immediately notify Franchisor in writing and Franchisee shall destroy 

immediately in accordance with procedures set forth in the Manual, or otherwise in writing by Franchisor, 

all products which it knows, or should know through the exercise of reasonable care, to be adulterated, 

tainted, contaminated, spoiled, unsafe, or otherwise unfit for human consumption and eliminate the source 

thereof, and remedy any unsanitary, unsafe, or other condition or other violation of the applicable law or 

regulation. Franchisee shall not reopen the Restaurant until after Franchisor has inspected the Restaurant 

premises, and Franchisor has determined that Franchisee has corrected the condition and that all products 

sold at the Restaurant comply with Franchisor’s standards. 

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B. Suppliers. 

(1) Franchisee shall purchase all products, ingredients, supplies, materials, 

furnishings (including décor), fixtures and equipment, merchandise and other products used in the 

construction and development of the Restaurant and/or offered for sale at the Restaurant solely from 

suppliers that Franchisor has approved in writing, which may be Franchisor or its affiliates or a buying 

cooperative that Franchisor organizes. In determining whether it will approve any particular supplier, 

Franchisor shall consider various factors, including a supplier who can demonstrate, to Franchisor’s 

continuing reasonable satisfaction, the ability to meet Franchisor’s then-current standards and 

specifications for such items; who possesses adequate quality controls and capacity to supply Franchisee’s 

needs promptly and reliably; who would enable the System, in Franchisor’s sole opinion, to take 

advantage of marketplace efficiencies; and who has been approved in writing by Franchisor before any 

purchases by Franchisee from any such supplier, and has not thereafter been disapproved. For the 

purpose of this Agreement, the term “supplier” shall include, but not be limited to, manufacturers, 

distributors, resellers, and other vendors. Franchisee recognizes that Franchisor shall have the right to 

appoint only one manufacturer, distributor, reseller, and/or other vendor for any particular item, and that 

Franchisor may so designate itself or its affiliate. Franchisee acknowledges that Franchisor may profit 

from its sale of such items to Franchisee or receive rebates or other consideration from the third party 

supplier with respect to Franchisee’s purchases of such items. 

(2) If Franchisee wishes to purchase any products or any items from an unapproved 

supplier, Franchisee shall first submit to Franchisor a written request for such approval. Franchisee shall 

not purchase any products or services from any supplier until, and unless, such supplier has been 

approved in writing by Franchisor. Franchisor shall have the right to require that its representatives be 

permitted to inspect the supplier’s facilities, and that samples from the supplier be delivered, either to 

Franchisor or to an independent laboratory designated by Franchisor for testing. A charge not to exceed 

the reasonable cost of the inspection and the actual cost of the test shall be paid by Franchisee or the 

supplier. Franchisor may also require that the supplier comply with such other requirements as 

Franchisor may deem appropriate, including payment of reasonable continuing inspection fees and 

administrative costs, or other payment to Franchisor by the supplier on account of their dealings with 

Franchisee or other franchisees, for use, without restriction (unless otherwise instructed by the supplier) 

and for services that Franchisor may render to such suppliers. Franchisor reserves the right, at its option, 

to reinspect from time to time the facilities and products of any such approved supplier and to revoke its 

approval upon the supplier’s failure to continue to meet any of Franchisor’s then-current criteria. Nothing 

in the foregoing shall be construed to require Franchisor to approve any particular supplier, nor to require 

Franchisor to make available to prospective suppliers, standards and specifications for formulas, which 

Franchisor shall have the right to deem confidential. 

(3) Notwithstanding anything to the contrary contained in this Agreement, 

Franchisee acknowledges and agrees that, at Franchisor’s sole option, Franchisor may establish one or 

more strategic alliances, purchasing and/or distribution cooperatives or preferred vendor programs with 

one or more nationally or regionally-known suppliers who are willing to supply all or some Restaurants 

with some or all of the products and/or services that Franchisor requires for use and/or sale in the 

development and/or operation of Restaurants. In this event, Franchisor may limit the number of approved 

suppliers with whom Franchisee may deal, designate sources that Franchisee must use for some or all 

products and other products and services, and/or refuse any of Franchisee’s requests if Franchisor believes 

that this action is in the best interests of the System or the franchised network of Restaurants. Franchisor 

shall have unlimited discretion to approve or disapprove of the suppliers who may be permitted to sell 

products to Franchisee. Franchisor may charge a surcharge to Franchisee on any items purchased from 

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approved suppliers for Franchisor’s role in managing the purchasing and distribution contracts for the 

System. 

(4) Franchisee acknowledges and agrees that Franchisor shall have the right to 

collect and retain all manufacturing allowances, marketing allowances, rebates, credits, monies, payments 

or benefits (collectively, “Allowances”) offered by suppliers to Franchisee or to Franchisor or its affiliates 

based upon Franchisee’s purchases of products and other goods and services. These Allowances are 

based on System-wide purchases of food, beverages, alcohol, paper goods, merchandise and other items. 

Franchisee assigns to Franchisor or its designee all of Franchisee’s right, title and interest in and to any 

and all such Allowances and authorizes Franchisor or its designee to collect and retain any or all such 

Allowances without restriction (unless otherwise instructed by the supplier); provided, however, that 

Franchisor’s current policy is to utilize such funds for purposes that Franchisor believes, in its sole 

discretion, may enhance the “Fridays” System and the Proprietary Marks and/or public awareness of 

Fridays Restaurants. 

(5) Franchisee shall comply with all terms, conditions, and obligations of all 

contracts and arrangements with suppliers, including contracts and arrangements negotiated by Franchisor 

or third parties as part of a network or multiple-franchise or multiple-restaurant supply and distribution 

arrangement, and Franchisee’s contracts with and obligations to suppliers. Franchisee shall promptly pay 

all suppliers in accordance with the agreed-upon terms. In the event Franchisee fails to promptly pay one 

or more suppliers as required, Franchisor may, but is not required to, pay such supplier(s) on behalf of 

Franchisee, and Franchisee shall promptly reimburse Franchisor for such payment following notice from 

Franchisor, or Franchisor may obtain payment through the electronic process described in Section 6 

above and the Manuals. 

C. Authorized Menu Items and Merchandise. 

(1) Within 14 days after receipt of written notice from Franchisor, Franchisee shall 

begin selling any newly authorized menu items and cease selling any menu items that are no longer 

authorized. Within 30 days after receipt of written notice from Franchisor, Franchisee shall begin selling 

any and all newly authorized merchandise and cease selling any merchandise that is no longer authorized. 

However, if any discontinued menu item or merchandise could pose a hazard to the public or prove 

detrimental to the system, Franchisee must cease selling or using that item or ingredient immediately. 

Franchisee shall purchase any additional equipment and smallwares as Franchisor deems reasonably 

necessary in connection with new menu items. If Franchisor requires Franchisee to begin offering a new 

menu item which requires the purchase of additional equipment, a reasonable period of time, as 

determined in the sole discretion of Franchisor, shall be provided for the financing, purchase and 

installation of any such equipment before such new menu items must be offered for sale at the Restaurant. 

(2) All food, beverage and merchandise items authorized for sale at the Restaurant 

shall be offered for sale under the specific name designated by Franchisor. Franchisor, in its sole 

discretion, may restrict sales of menu items to certain time periods during the day. 

(3) If Franchisee has a suggestion for a new menu item or for a change to an 

authorized menu item or Franchisee desires to participate in a test market program, Franchisee shall 

provide Franchisor’s written notice before implementation. Franchisee shall not add or modify any menu 

item or participate in a test market program without first having obtained Franchisor’s prior written 

approval, which may be withheld or denied in Franchisor’s sole discretion. If Franchisor grants its 

approval, Franchisee agrees to sign Franchisor’s then-current test agreement before commencing the test. 

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(4) Franchisee may not use the Restaurant for the sale of any items that promote 

illegal activity or for any purpose for which Franchisor determines, in its sole discretion, that may offend 

an appreciable segment of the public or may adversely affect the acceptance, favorable reputation or 

goodwill associated with the Franchisor brand. 

D. Menu Formats. 

Franchisor shall have the right to prescribe, and subsequently vary, one or more menu formats to 

be utilized in the Restaurant including, but not limited to, any and all bar or alcoholic beverage menus. 

The menu formats may include requirements concerning organization, graphics, product descriptions, 

calorie counts, illustrations and other matters related to the menu. Prescribed menu formats may vary 

depending on region, market size or other factors deemed relevant by Franchisor. If any menu format 

utilized by Franchisee ceases to be an authorized menu format, Franchisee shall have a reasonable period 

of time (not to exceed 30 days) to discontinue use of the old menu format and begin using an authorized 

menu format. 

E. Promotional Materials. 

Franchisee shall require all advertising and promotional materials, signs, decorations, paper goods 

(including without limitation disposable food and beverage containers, bags, napkins, menus, and all 

forms and stationery used in the Restaurant), any and all replacement trade dress products, and other 

items which may be designated by Franchisor to bear the Franchisor’s then-current Proprietary Marks and 

logos in the form, color, location, and manner then-prescribed by Franchisor. 

F. Signs and Logos. 

Subject to local ordinances, Franchisee shall prominently display in and upon the Premises and 

buildings of the Restaurant interior and exterior signs and logos using the name “Fridays,” without any 

prefix or suffix, and those other names, marks, advertising signs and logos, of such nature, form, color, 

number, location and size, and containing that material as Franchisor may from time to time direct. 

Franchisee shall not display in or upon the Premises any sign, logo or advertising media of any kind to 

which Franchisor objects. 

G. Entertainment. 

Franchisee shall refrain from: (1) offering for sale any tickets, subscriptions or chances; 

(2) conducting any pools, raffles or related activities; (3) installing or using any juke box, vending or 

game machine, gum machine, game, ride, gambling or lottery device, coin or token operated machine, or 

any other music, film or video device; (4) using or allowing any gaming, dancing or live entertainment; or 

(5) using or providing any form of delivery or catering service at, from or on the Premises without 

Franchisor’s prior written consent. 

H. Incentive and Guest Membership Programs. 

Franchisee shall promote, participate, offer for sale, and will honor for purchases by customers, 

any incentive, guest membership, loyalty or similar programs that Franchisor may institute from time to 

time. Franchisee shall pay any fees and purchase any equipment required by Franchisor to participate in 

such programs and shall do so in compliance with Franchisor’s standards and procedures for such 

programs. Concurrent with the execution of this Agreement, Franchisee shall sign and deliver to 

Franchisor the TGI Fridays Loyalty Program Agreement attached to this Agreement as Exhibit H. 

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I. Prices. 

With respect to the sale of all menu items, products, merchandise or services, Franchisee shall be 

solely responsible for determining the prices of products offered at the Restaurant; however, Franchisee is 

required to comply with any maximum or minimum resale pricing restrictions Franchisor may implement 

so long as such pricing does not violate applicable law. 

J. Technology and Computer System. 

Franchisor has the right to specify or require that certain brands, types, makes, and/or models of 

communications, computer systems, and hardware be used by, between, or among Fridays Restaurants, 

including without limitation: (1) back office and point of sale systems, mobile devices, data, audio, video, 

and voice storage, retrieval, and transmission systems for use at Fridays Restaurants, between or among 

Fridays Restaurants, and between and among Franchisee’s Restaurant and Franchisor, our designee and/or 

Franchisee; (2) physical, electronic, and other security systems; (3) printers and other peripheral devices; 

(4) archival back-up systems; and (5) internet access mode (e.g., form of telecommunications connection) 

and speed (collectively, the “Computer System”). Franchisee shall purchase or lease, and thereafter 

maintain, the Computer System, and comply with Franchisor’s requirements, specifications and policies 

concerning the use of technology, as they may be specified in this Agreement, or specified or modified in 

the Manuals or otherwise in writing. 

(1) Franchisor shall have the right at any time to retrieve and use such data and 

information from Franchisee’s Computer System that Franchisor deems necessary or desirable, including, 

without limitation, the uses identified in Section 7.E above. In view of the contemplated interconnection 

of computer systems and the necessity that such systems be compatible with each other, Franchisee 

expressly agrees that it shall strictly comply with Franchisor’s standards and specifications for all item(s) 

associated with Franchisee’s Computer System, and will otherwise operate its Computer System in 

accordance with Franchisor’s standards and specifications. To ensure full operational efficiency and 

optimum communication capability between and among equipment and computer systems installed by 

Franchisee, Franchisor, and other franchisees, Franchisee agrees, at its expense, that Franchisee shall keep 

its Computer System in good maintenance and repair, and, at its expense, and following the determination 

that Franchisor shall have the right to make, to the effect that same will prove economically or otherwise 

beneficial to all System franchisees, that Franchisee shall promptly install such additions, changes, 

modifications, substitutions and/or replacement to Franchisee’s computer hardware, software, telephone 

and power lines, and other related facilities, as Franchisor directs periodically in writing. Franchisee shall 

provide to Franchisor, upon Franchisor’s request, all e-mail lists and customer lists used or maintained by 

Franchisee on the Computer System or elsewhere. 

(2) Franchisor has the right, but not the obligation, to develop or have developed for 

it, or to designate, any or all of the following: (a) computer software programs and accounting system 

software that Franchisee must use in connection with the Computer System (“Required Software”), 

which Franchisee must install; (b) updates, supplements, modifications, or enhancements to the Required 

Software, which Franchisee must install; (c) the tangible media upon which such Franchisee must record 

or receive data; (d) the database file structure of Franchisee’s Computer System; (e) an Extranet for 

informational assistance, which may include, without limitation, the Manuals, training, other assistance 

materials, and management reporting solutions; and (f) answering service requirements and/or systemwide phone, online or mobile order processing of all delivery orders, and/or to designate vendors that will 

provide such order processing. 

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(3) Franchisee agrees to install and use the Computer System and Required 

Software in the manner that Franchisor requires. Franchisor may charge a reasonable software license fee 

for any Required Software. Franchisee agrees to implement and periodically upgrade and make other 

changes to the Computer System and Required Software as Franchisor requests in writing, which shall 

not be more often than one upgrade per year (collectively, “Computer Upgrades”). Franchisee agrees to 

comply with Franchisor’s written specifications (whether in the Manuals or otherwise) with respect to the 

Computer System and the Required Software, and with respect to Computer Upgrades, at Franchisee’s 

own expense. 

(4) Franchisee agrees to afford Franchisor unimpeded access to its Computer 

System and Required Software in the manner, form, and at the times that Franchisor requests. Franchisee 

shall provide Franchisor with user identifications and passwords required to access files and other 

information contained on the Computer System. 

(5) Because changes to technology are dynamic and not predictable within the 

Initial Term, and in order to provide for inevitable but unpredictable changes to technological needs and 

opportunities, Franchisee agrees: (a) that Franchisor will have the right to establish, in writing, reasonable 

new standards to address new technologies and data security, whether published in the Manuals or 

otherwise in writing, and that Franchisor has the right to implement those changes in technology into the 

System; and (b) to abide by Franchisor’s new standards (and with Restaurant audits conducted by 

Franchisor or its designee to confirm Franchisee’s compliance) as if this Section 13.J, and other 

technology provisions in this Agreement, were periodically revised for that purpose. 

K. Extranet. 

(1) Franchisee shall comply with Franchisor’s requirements (as set forth in the 

Manuals or otherwise in writing) with respect to establishing and maintaining telecommunications 

connections between Franchisee’s Computer System and Fridays Extranet and/or such other computer 

systems as Franchisor may reasonably require. The term “Extranet” means a private network based upon 

Internet protocols that will allow users inside and outside of Franchisor’s headquarters to access certain 

parts of Franchisor’s computer network via the Internet. Franchisor may establish an Extranet (but is not 

required to do so or to maintain an Extranet). Franchisee shall comply with Franchisor’s requirements (as 

set forth in the Manuals or otherwise in writing) with respect to connecting to the Extranet, and utilizing 

the Extranet in connection with the operation of Franchisee’s Restaurant. The Extranet may include, 

without limitation, the Manuals, training and other assistance materials, and management reporting 

solutions (both upstream and downstream, as Franchisor may direct). 

(2) Franchisee shall purchase and maintain such computer software and hardware 

(including but not limited to telecommunications capacity) as may be required to connect to and utilize 

the Extranet. Franchisor reserves the right to require Franchisee to contribute a reasonable amount toward 

the cost of the Extranet’s maintenance and further development. If Franchisee fails to comply with any 

policy or procedure governing the Extranet, Franchisor may temporarily suspend Franchisee’s access to 

all or any aspect of the Extranet (such as a chat room, bulletin board, list serve, or similar feature) until 

Franchisee fully cures the breach. Franchisee will not have any claim against Franchisor or any affiliate 

arising from such suspension from the Extranet pursuant to this Section 13.K and Franchisee hereby 

waives any such claim it may at any time have, and releases Franchisor and its affiliates from any liability 

arising therefrom. 

(3) Franchisee and Franchisor shall each be responsible for protecting their own 

interests in relation to electronic communications. Franchisor shall have no liability to Franchisee on any 

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basis, whether in contract, tort (including negligence) or otherwise, in respect of any error, damage, loss 

or omission arising from or in connection with electronic communication of information. 

L. Customer Data. 

Franchisee agrees that all data and personally identifiable information (including, but not limited 

to, name, birth date, mailing address, phone number and email address) that it collects from customers 

and potential customers in connection with the Restaurant (“Customer Data”) is deemed to be owned 

exclusively by Franchisor, and Franchisee also agrees to provide the Customer Data to Franchisor at any 

time that Franchisor requests. Franchisee has the right to use Customer Data during the Initial Term, but 

only as authorized by Franchisor in connection with operating the Restaurant and only in accordance with 

the policies that Franchisor establishes from time to time. Franchisee may not sell, transfer, or use 

Customer Data for any purpose other than operating the Restaurant and marketing Franchisor’s products 

and services. However, if Franchisee Transfers the Restaurant (as provided in Section 18 below), as part 

of the Transfer, Franchisee must also Transfer use of the Customer Data to the buyer as part of the total 

purchase price paid for the Restaurant. 

M. Privacy Laws. 

Franchisee agrees to abide by all applicable laws pertaining to the privacy of consumer, 

employee, and transactional information (“Privacy Laws”). Franchisee agrees to comply with 

Franchisor’s standards and policies pertaining to Privacy Laws. If there is a conflict between Franchisor’s 

standards and policies pertaining to Privacy Laws and applicable law, Franchisee shall: (1) comply with 

the requirements of applicable law; (2) immediately give Franchisor’s written notice of said conflict; and 

(3) promptly and fully cooperate with Franchisor and its counsel in determining the most effective way, if 

possible, to meet its standards and policies pertaining to Privacy Laws within the bounds of applicable 

law. Franchisee agrees not to publish, disseminate, implement, revise, or rescind a data privacy policy 

without Franchisor’s prior written consent as to said policy. 

N. POS or Cash Register Systems and Reservation and Table Management System. 

(1) Franchisee agrees to record all sales on computer-based point of sale systems or 

such other types of cash register systems that Franchisor has the right to designate or approve in the 

Manuals or otherwise in writing (“POS System”). The POS System is deemed to be part of Franchisee’s 

Computer System. Franchisee agrees that only trained and qualified personnel will be assigned the 

responsibility for conducting transactions on the POS System. 

(2) Franchisor may require Franchisee to use a reservation system Franchisor 

designates that is designed to manage reservations, guest seating and waitlists, including communication 

with guests who are waiting for a table. The National Advertising Fund may pay for this service, or 

Franchisor may require Franchisee to pay this fee and the cost of any associated hardware directly. 

O. Non-Cash Payment Systems. 

(1) Franchisee shall accept debit cards, credit cards, stored value gift cards or other 

non-cash systems specified by Franchisor to enable customers to purchase authorized products and shall 

obtain all necessary hardware and/or software used in connection with these non-cash systems. At all 

times, Franchisee must maintain credit-card relationships with the credit- and debit-card issuers or 

sponsors, check or credit verification services, financial-center services, and electronic-fund-transfer 

systems that Franchisor designates as mandatory, and Franchisee must not use any such services or 

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providers that Franchisor has not approved in writing or for which Franchisor has revoked its approval. 

Franchisor has the right to modify its requirements and designate additional approved or required methods 

of payment and vendors for processing such payments, and to revoke its approval of any service provider. 

Franchisee must comply with Franchisor’s credit-card policies, including minimum purchase requirements 

for a customer’s use of a credit card as prescribed in the Manuals. Franchisee must comply with the 

Payment Card Industry Data Security Standards (“PCI DSS”) as these standards may be revised and 

modified by the Payment Card Industry Security Standards Council (“PCISSC”) or such successor or 

replacement organization, and/or in accordance with other standards as Franchisor may specify. In 

addition, Franchisee must submit annually to Franchisor a fully completed copy of Franchisee’s PCI 

Attestation of Compliance on the then current PCISSC form via email at 

informationsecurity@fridays.com or such successor or replacement form(s) and/or processes. 

(2) Franchisee agrees to participate in any gift card program(s) that Franchisor 

specifies. For this purpose, Franchisee must purchase the software, hardware, blank cards, and other 

items needed to sell and process gift cards or stored value cards, which Franchisor may specify in writing 

in the Manuals or otherwise. Franchisee also agrees to pay such monthly and per-swipe transaction fees 

as may be required by the vendor of the gift card system. Franchisee must sell or honor gift cards only in 

accordance with Franchisor’s written standards. Franchisee must account for all gift card sales, gift card 

redemptions, and other gift card transactions in the manner Franchisor specifies in the Manuals. 

Franchisee must maintain sufficient cash reserves to pay Franchisor or other franchisees as part of any 

network-wide periodic reconciliation of the gift card program. Franchisee shall pay Franchisor or make 

payments as specified by Franchisor, in such amounts and at such times as directed by Franchisor, in 

accordance with Franchisor’s gift card rules, programs and policies. Franchisee agrees not to sell, issue, 

or redeem gift certificates other than gift cards that Franchisor has approved in writing. Concurrent with 

the execution of this Agreement, Franchisee shall sign and deliver to Franchisor the then-current form of 

Gift Card Participation Agreement. 

P. E-Mail and Fax Communications. 

(1) Franchisee agrees that exchanging information with Franchisor by e-mail and 

fax is an important way to enable quick, effective, and efficient communication, and that Franchisor is 

entitled to rely upon each other’s use of e-mail and faxes for communicating as part of the economic 

bargain underlying this Agreement. To facilitate the use of e-mail and fax to exchange information, 

Franchisee authorizes the transmission of e-mail by Franchisor and Franchisor’s employees, vendors, and 

affiliates (on matters pertaining to the business contemplated hereunder) (together, “Official Senders”) to 

Franchisee and Franchisee’s employees during the Initial Term. Franchisor’s list of Official Senders shall 

be the master and official list of Official Senders. 

(2) Franchisee agrees that: (a) Official Senders are authorized to send e-mails and 

faxes to Franchisee and its employees; (b) Franchisee will cause its officers, directors, and employees (as 

a condition of their employment or position with Franchisee) to give their consent (in an e-mail, 

electronically, or in a pen-and-paper writing, as Franchisor may reasonably require) to Official Senders 

transmission of e-mails and faxes to those persons, and that such persons shall not opt-out, or otherwise 

ask to no longer receive e-mails, from Official Senders during the time that such person works for or is 

affiliated with Franchisee; and (c) Franchisee will not opt-out, or otherwise ask to no longer receive emails and/or faxes, from Official Senders during the Initial Term. 

(3) The consent given above in will not apply to the provision of formal notices 

under this Agreement by either party using e-mail unless and until the parties have otherwise agreed, in a 

pen-and-paper writing that both parties have signed. 

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Q. Health Standards. 

Franchisee shall meet and maintain the highest health standards and ratings applicable to the 

operation of the Restaurant. Franchisee must participate in any food safety and brand standard audit 

program specified by Franchisor and the Restaurant must undergo the then current number of audits per 

year as required by Franchisor, which shall all be at Franchisee’s expense. Franchisee shall furnish to 

Franchisor, within five days after receipt thereof, a copy of all inspection reports, warnings, citations, 

certificates, and/or ratings resulting from inspections conducted by any federal, state or municipal agency 

with jurisdiction over the Restaurant. Without limiting the foregoing, Franchisee and all required 

personnel shall obtain and maintain all necessary and required licenses and certificates for food service 

and food handling as may be required by applicable local rules and regulations and/or the Manuals. 

R. Upkeep of the Restaurant. 

(1) Franchisee shall constantly maintain and continuously operate the Restaurant 

and all furniture, fixtures, equipment, furnishings, floor coverings, interior and exterior signage, the 

building interior and exterior, interior and exterior lighting, landscaping and parking lot surfaces in firstclass condition and repair in accordance with the requirements of the System, including all ongoing 

necessary remodeling, redecorating, refurbishing and repairs. In addition, Franchisee shall promptly and 

diligently perform all necessary maintenance, repairs and replacements to the Restaurant as Franchisor 

may prescribe from time to time, including periodic interior and exterior painting; resurfacing of the 

parking lot; roof repairs; and replacement of obsolete or worn out signage, floor coverings, furnishings, 

equipment and decor. Franchisee shall not make any material alterations to the Restaurant that affect 

operations or the image of the System without Franchisor’s prior written approval. Franchisee 

acknowledges and agrees that the requirements of this Section are both reasonable and necessary to 

ensure continued public acceptance and patronage of Fridays Restaurants, to assist the Restaurant to 

compete effectively in the marketplace and to avoid deterioration or obsolescence of the operation of the 

Restaurant. 

(2) Franchisee shall cause to be completed extensive structural changes, major 

construction, and substantial modifications to existing furniture, fixtures, equipment and improvements to 

modernize and conform the Restaurant to the existing or a new image of the System for new franchised 

and company restaurants (“Facilities Remodeling”) at Franchisor’s request (which may not be made 

sooner than seven years after the later of (a) the date that Franchisee commenced construction-related 

work for the initial construction of the Restaurant; and (b) the date that Franchisor required the most 

recent Facilities Remodeling to be completed at the Restaurant, provided that, if Franchisor did not set 

such a date or if Franchisee completed the Facilities Remodeling before the date set by Franchisor, the 

date that Franchisee commenced work at the Restaurant to complete that Facilities Remodeling, as 

applicable. For the avoidance of doubt, (i) Sections 4 and 5 of this Agreement shall apply to all Facilities 

Remodeling; (ii) there shall be no cap on the cost of the Facilities Remodeling; and (iii) capital expenses 

necessary for the repair and maintenance of the Premises are not subject to the time limitations described 

in the preceding sentence. Within 60 days after receipt of Franchisor’s written notice regarding the 

required Facilities Remodeling, Franchisee shall prepare and complete the corresponding Plans. These 

Plans must be submitted to, and their use approved by, Franchisor before the commencement of 

construction. Franchisee shall complete the required Facilities Remodeling within six months after 

receipt of Franchisor’s written notice, or such other time reasonably specified by Franchisor in its written 

notice. 

If Franchisee fails to complete a Facilities Remodeling in accordance with the preceding 

paragraph, and such failure continues for sixty (60) days (“Remodel Cure Period”) following notice 

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thereof from Franchisor (“Remodel Default”), Franchisee shall be in a default hereunder. 

Notwithstanding anything to the contrary herein, no (x) grace or cure period; or (y) doctrine of force 

majeure, impossibility, frustration of purpose, or other legal or equitable remedy shall toll or extend 

beyond the Remodel Cure Period Franchisee’s obligation to timely complete the Facilities Remodeling. 

Franchisee may elect to cure a Remodel Default (“Royalty Increase Alternative”) by (i) paying a 2.5% 

increase in the Royalty Fee from the expiration of the Remodel Cure Period until Franchisee completes 

such Facilities Remodeling and (ii) satisfying Franchisor’s then-current requirements for the Royalty 

Increase Alternative. Upon the earlier to occur of (i) the seventh anniversary of the expiration of the 

Remodel Cure Period; and (ii) Franchisee’s failure to timely pay the increased Royalty Fee, Franchisee’s 

right to cure a Remodel Default by virtue of the Royalty Increase Alternative shall automatically 

terminate without any notice or grace or cure period. 

(3) The limitation on the frequency or scope of Facilities Remodeling shall not 

include repair to, or the normal upkeep of, the Restaurant, nor shall it include Equipment Upgrades (as 

defined below). 

(4) In addition to Facilities Remodeling, Franchisee shall make, from time to time, 

such upgrades and other changes to the equipment utilized in the Restaurant (other than the Computer 

System) as Franchisor may request in writing (collectively, “Equipment Upgrades”). Franchisor shall 

have the right to require any Equipment Upgrades it deems necessary for the Restaurant. 

(5) During any period following a casualty when the Restaurant is closed (or has 

not fully re-opened), Franchisee shall pay to Franchisor the Closure Royalty. Failure to rebuild or restore 

the Restaurant, or relocate the Premises as provided in Section 3.E, following a casualty or condemnation 

shall constitute a default under this Agreement subject to the remedies set forth in Section 21. The Initial 

Term shall not be extended as a consequence of such taking or destruction. 

S. Maximum Operation of the Restaurant. 

(1) During the Initial Term, Franchisee shall use the Premises solely for the 

operation of the Restaurant and shall maintain sufficient inventories, and continuously operate the 

Restaurant at its maximum capacity and efficiency for the minimum number of days and hours set forth in 

the Manuals or as Franchisor otherwise prescribes in writing (subject to the requirements of local laws 

and licensing requirements). 

(2) Franchisee must obtain all necessary equipment, including hardware and 

software components and associated products, for an integrated music system. Franchisee shall play all 

recorded music required by Franchisor at the Restaurant and shall obtain all copyright licenses in 

connection with the use of such music. 

(3) Except as otherwise specified by Franchisor in the Manuals or otherwise, 

Franchisee shall immediately resolve any customer complaints regarding the quality of food or beverages, 

service and/or cleanliness of the Restaurant or any similar complaints. When any customer complaints 

cannot be immediately resolved, Franchisee shall use reasonable efforts to resolve the customer 

complaints as soon as practical and shall, whenever feasible, give the customer the benefit of the doubt.

If Franchisor, in its sole discretion, determines that its intervention is necessary or desirable to protect the 

System or the goodwill associated with the System, or if Franchisor, in its sole discretion, believes that 

Franchisee has failed adequately to address or resolve any customer complaints, Franchisor may, without 

Franchisee’s consent, resolve any complaints and charge Franchisee an amount sufficient to cover 

Franchisor’s reasonable costs and expenses in resolving the customer complaints, which amount 

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Franchisee shall pay Franchisor immediately on demand. Franchisee must participate in, and pay all 

charges associated with, all customer relations programs initiated by Franchisor, which programs may 

include, without limitation, visibly posting any 800 numbers, email or other contact information for 

customers to contact Franchisor’s customer relations providers and customer surveys and mystery shopper 

programs. Franchisee agrees to pay for all costs associated with Franchisor’s customer relations providers 

relating to customer complaints or issues arising from its operation of the Restaurant, including but not 

limited to the costs of gift cards or other remuneration given to customers needed to resolve the 

complaint. 

(4) In order to (among other things) maintain and enhance the goodwill associated 

with the Proprietary Marks, the System and each Fridays Restaurant, Franchisee agrees to participate and 

request its customers to participate, at Franchisee’s expense, in programs initiated by Franchisor to verify 

customer satisfaction and/or Franchisee’s compliance with all operational and other aspects of the System, 

including (but not limited to) an 800 number, Franchisor’s customer feedback and satisfaction programs, 

secret shoppers or other programs as Franchisor may require. Franchisor will share the results of these 

programs, as they pertain to the Restaurant, with Franchisee. 

T. Inspections of the Restaurant. 

(1) To determine whether Franchisee and the Restaurant are in compliance with this 

Agreement and with all System Standards, Franchisor or its designees shall have the right at any 

reasonable time and without prior notice to Franchisee to: (a) inspect the Premises; (b) observe, 

photograph and videotape the operations of the Restaurant for such consecutive or intermittent periods as 

Franchisor deems necessary; (c) remove samples of any food and beverage products, material or other 

inventory items for testing to determine if such samples meet the System Standards (without paying for 

the samples) and Franchisor may require Franchisee to bear the cost of such testing if Franchisor has not 

given consent to the supplier or if the sample fails to conform to Franchisor’s specifications; (d) interview 

personnel and customers of the Restaurant; and (e) inspect and copy any books, records and documents 

relating to the operation of the Restaurant or, upon the request of Franchisor or its designee, require 

Franchisee to send copies thereof to Franchisor or its designee. 

(2) Franchisee agrees to cooperate fully with Franchisor or its designee in 

connection with any such inspections, observations, videotaping, product removal and interviews. 

Following each inspection, Franchisor will provide Franchisee an inspection report listing Franchisee’s 

score on the inspection and those conditions at the Restaurant that must be rectified. Franchisee shall take 

all necessary steps to immediately correct any deficiencies detected during these inspections, including, 

without limitation, ceasing further sale of unauthorized menu items (regardless of Franchisee’s inventory) 

and ceasing further use of any equipment, advertising materials or supplies that do not conform with the 

standards and requirements promulgated by Franchisor from time to time. 

(3) Recognizing that the failure of Franchisee to meet the System Standards may 

endanger the reputation and operations of other Fridays Restaurants and/or potentially endanger the 

general public, Franchisee and Franchisor agree that in the event that operations at the Restaurant fall 

below the System Standards, Franchisor may, in its sole discretion, in addition to and not in lieu of its 

right to terminate this Agreement pursuant to Section 21.B(11), require that Franchisee discontinue all 

operations at the Restaurant and close the Restaurant to the public until Franchisee is able to establish to 

Franchisor’s reasonable satisfaction that operations at the Restaurant meet or exceed the System 

Standards. 

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(4) If Franchisee fails to achieve a passing score on an inspection, Franchisor may, 

in its sole discretion, require that Franchisee, the Operating Principal and/or one or more managerial 

employees of the Restaurant attend and successfully complete an additional Management Training 

Program to be held at a location designated by Franchisor. Franchisee shall pay a tuition charge as 

established by Franchisor from time to time for this training program and the travel, living, food and other 

incidental expenses incurred by Franchisee’s employees while attending this training program. 

(5) In addition, if Franchisee fails to achieve a passing score on an inspection, the 

inspection report shall constitute a notice of default. If Franchisee fails to achieve a passing score on the 

next inspection (which shall be conducted at least 30 days after Franchisee’s receipt of the inspection 

report for the prior inspection), Franchisor may terminate this Agreement, without opportunity to cure, by 

providing Franchisee written notice of termination along with a copy of the inspection report. 

U. Restaurant Management and Personnel. 

(1) The Restaurant shall at all times be under the on-site supervision of the 

Operating Principal or a Validated Manager who must meet, to the satisfaction of Franchisor, Franchisor’s 

applicable training qualifications for their designated position. Franchisee must, at all times, employ at 

least four Validated Managers for the Restaurant. Franchisor may require Franchisee to hire and train 

additional Validated Managers at any time based on the sales performance of the Restaurant. If, at any 

time, Franchisee ceases to employ at least four Validated Managers, Franchisee has 30 days (from the 

date on which Franchisee has less than four Validated Managers) to hire and enroll replacement managers 

in the Management Training Program. At Franchisee’s option, the Operating Principal can be one of the 

Validated Managers. 

(2) Franchisee (or, if applicable, the Operating Principal) shall remain active in 

overseeing the operations of the Restaurant, including, without limitation, regular, periodic visits to the 

Restaurant and sufficient communications with Franchisor to ensure that the Restaurant’s operations 

comply with the System Standards as promulgated by Franchisor from time to time in the Manuals or 

otherwise in written or oral communications. 

(3) Franchisee will have the sole authority and control over the day-to-day 

operations of the Restaurant and its employees. Franchisee shall hire all employees of the Restaurant and 

be exclusively responsible for the terms of their employment, including but not limited to their 

compensation, taxes, benefits, safety, work schedules, work conditions, assignments, discipline and 

termination, and for the proper training of such employees in the operation of the Restaurant. Franchisee 

shall establish at the Restaurant a Team Member Training Program for all employees that covers training 

for all System Standards as relevant to the employee’s positions. Franchisor shall have the right to 

interview and consent to each Operating Principal, each Multi-Unit Manager (as described in 

Section 16.H), each Project Manager and all managers of the Restaurant. Franchisor shall endeavor to 

conduct such interviews at the Restaurant, but may require that such interviews occur at Franchisor’s 

corporate headquarters. Franchisee shall bear all costs and expenses related to making these individuals 

available for such interviews. At no time will Franchisee or Franchisee’s employees be deemed to be 

employees of Franchisor. Franchisor has no right or obligation to direct Franchisee’s employees or to 

operate the Restaurant. 

V. Liquor License. 

The right to operate a Restaurant pursuant to this Agreement is conditioned upon the ability of 

Franchisee to obtain and maintain required state and/or local licenses permitting the sale of alcoholic 

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beverages at the Restaurant. Franchisee agrees to use its best efforts to obtain such licenses and maintain 

same in good standing during the Initial Term. In the event that Franchisee is prohibited by a 

governmental authority from offering alcoholic beverages at the Restaurant (other than routine occasions 

on which Franchisee is prohibited by applicable law from offering alcoholic beverages for sale from the 

Restaurant, such as a local prohibition on the sale of alcoholic beverages on Sunday), including, but not 

limited to, violations of federal, state or local liquor laws, then, at the option of Franchisor, this 

Agreement shall be immediately terminated upon receipt by Franchisee of written notice from Franchisor 

to such effect. 

W. Control During Crisis Situation. 

(1) Franchisee must comply at all times with Franchisor’s then-current Crisis 

Response Manual. If an event occurs at the Restaurant that has or reasonably may cause harm or injury to 

customers, guests or employees in the sole opinion of Franchisor (i.e., food spoilage/poisoning, food 

tampering/sabotage, slip and fall injuries, natural disasters, robberies, shootings, etc.) or may damage the 

Proprietary Marks, the System or the reputation of Franchisor (collectively “Crisis Situation”), 

Franchisee shall: (a) immediately contact appropriate emergency care providers to assist Franchisee in 

curing the harm or injury; and (b) immediately inform Franchisor by telephone of the Crisis Situation. 

Franchisee shall refrain from making any internal or external announcements (i.e., no communication 

with the news media) regarding the Crisis Situation (unless otherwise directed by Franchisor or public 

health officials). 

(2) To the extent Franchisor deems appropriate, in its sole and absolute discretion, 

Franchisor or its designee may control the manner in which the Crisis Situation is handled by the parties, 

including, without limitation, conducting all communication with the news media, providing care for 

injured persons and/or temporarily closing the Restaurant. The parties acknowledge that, in directing the 

management of any Crisis Situation, Franchisor or its designee may engage the services of attorneys, 

experts, doctors, testing laboratories, public relations firms and those other professionals as it deems 

appropriate. Franchisee and its employees shall cooperate fully with Franchisor or its designee in its 

efforts and activities in this regard and shall be bound by all further Crisis Situation procedures developed 

by Franchisor from time to time hereafter. The indemnification under Section 24 shall include all losses 

and expenses that may result from the exercise by Franchisor or its designee of the management rights 

granted in this Section 13.W. 

X. Compliance with Laws and Good Business Practices, Taxes. 

(1) Franchisee shall secure and maintain in force in its name all required licenses, 

permits and certificates relating to the operation of the Restaurant. Franchisee shall operate the 

Restaurant in full compliance with all applicable laws, ordinances and regulations including, without 

limitation, all laws or regulations governing or relating to the handling of food products, immigration and 

discrimination, occupational hazards and health insurance, employment and labor laws, including, 

without limitation, workers compensation insurance, unemployment insurance, and the withholding and 

payment of federal and state income taxes, social security taxes and sales taxes. All advertising and 

promotion by Franchisee shall be completely factual and shall conform to the highest standards of ethical 

advertising. Franchisee shall, in all dealings with Franchisee’s customers, suppliers and the public, adhere 

to the highest standards of honesty, integrity, fair dealing and ethical conduct. Franchisee agrees to 

refrain from any business or advertising practice that may be injurious to the goodwill associated with the 

Proprietary Marks or the business of Franchisor or its affiliates, the System or other restaurants operated 

or franchised by Franchisor or its affiliates. 

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(2) Franchisee shall promptly pay when due all taxes levied or assessed, including, 

without limitation, income, unemployment, and sales taxes, and all accounts and other indebtedness of 

every kind incurred by Franchisee in the conduct of the business franchised under this Agreement. 

Franchisee shall pay Franchisor an amount equal to any sales tax, gross receipts tax, or similar tax (other 

than income tax) imposed on Franchisor with respect to any payments to Franchisor required under this 

Agreement, unless the tax is credited against income tax otherwise payable by Franchisor. 

(3) In the event of any bona fide dispute as to Franchisee’s liability for taxes 

assessed or other indebtedness, Franchisee may contest the validity or the amount of the tax or 

indebtedness in accordance with procedures of the taxing authority or applicable law; however, in no 

event shall Franchisee permit a tax sale or seizure by levy of execution or similar writ or warrant, or 

attachment by a creditor, to occur against the premises of the Restaurant, or any improvements thereon. 

(4) Franchisee shall notify Franchisor in writing within five days after the 

commencement of: (a) any action, suit or proceeding, or the issuance of any order, writ, injunction, award 

or decree of any court, agency or other governmental instrumentality, which may adversely affect the 

operation or financial condition of Franchisee or the Restaurant; or (b) of any notice of violation of any 

law, ordinance or regulation relating to health or sanitation at the Restaurant. 

14. PROPRIETARY MARKS 

A. Scope. 

The term “Proprietary Marks” as used in this Agreement refers to all words, symbols, insignia, 

devices, designs, trade names, service marks or combinations thereof designated by Franchisor as 

identifying the System and the products sold and services provided in connection with the System. 

Franchisor shall, from time to time, advise Franchisee as to any additions or deletions to the Proprietary 

Marks, and Franchisee’s right to use the Proprietary Marks shall be deemed modified by those additions 

or deletions. 

B. Limited Right To Use Proprietary Marks. 

Franchisee’s right to use the Proprietary Marks is limited to its use of the Proprietary Marks in the 

operation of the Restaurant at the Premises and as expressly provided in this Agreement and the Manuals. 

Franchisee shall not use the Proprietary Marks on any vehicles without Franchisor’s prior written 

approval. Franchisee shall not modify the Proprietary Marks in any manner in connection with 

Franchisee’s display of, or creation or duplication of materials bearing, the Proprietary Marks. Franchisee 

shall not use the Proprietary Marks or any variations of the Proprietary Marks or marks or names 

confusingly similar to the Proprietary Marks in any manner not authorized by Franchisor or in any 

corporate, limited liability company, partnership, fictitious, DBA or other name and shall not use any 

other trade names, service marks or trademarks in conjunction with the Restaurant. If local laws or 

ordinances require that Franchisee file an affidavit of doing business under an assumed name or otherwise 

make a filing indicating that the Proprietary Marks are being used as a fictitious or assumed name, 

Franchisee shall include in such filing or application an indication that the filing is made “as a franchisee 

of TGI Fridays Franchisor, LLC.” Franchisee shall use the symbol ® with all registered marks and the 

symbol TM with all pending registrations or other marks. During the Initial Term, Franchisee shall identify 

itself as a franchisee of Franchisor (1) in conjunction with any use of the Proprietary Marks including, 

without limitation, invoices, order forms, receipts, contracts, stationary and business cards; (2) in a notice 

of such content and form and at conspicuous locations in the Restaurant as Franchisor may designate in 

writing; and (3) on any authorized delivery vehicles. 

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C. Use of the Proprietary Marks in Digital Media. 

Franchisee shall not use the Proprietary Marks or any variations of the Proprietary Marks or 

marks or names confusingly similar to the Proprietary Marks in any manner not authorized by Franchisor 

in writing as part of any Digital Media, including but limited to any URL, domain name, meta-tag, 

download, application, posting, directory listing, screen name, anonymous name, blog, vlog, e-mail 

account, instant messaging account, texting identity, user generated content, or any other identification of 

Franchisee or the Restaurant in any electronic medium (collectively, and individually, “Electronic 

Identifiers”). Franchisor may grant or withhold its consent in its sole discretion and may condition its 

consent on such requirements as Franchisor deems appropriate, including, among other things, that 

Franchisee obtain Franchisor’s prior written approval of: (a) any and all Electronic Identifiers related to 

the Restaurant; (b) the proposed form and content (including any visible and non-visible content such as 

meta-tags) of any Digital Media or Franchisee’s Social Media related to the Restaurant (including any 

modification thereof); (c) Franchisee’s use of any hyperlinks or other links; and (d) Franchisee’s use of 

any materials (including text, video clips, photographs, images and sound bites) in which any third party 

has an ownership interest. 

D. Modifications to Proprietary Marks. 

If Franchisor should elect to use a principal name other than “TGI Fridays” to identify the 

System, Franchisor may select another name and notify Franchisee to change all or some items bearing 

the Proprietary Marks to the new name within a reasonable period of time as determined by Franchisor 

without Franchisor incurring any liability to Franchisee, and Franchisee promptly shall adopt that name. 

Franchisee agrees that nothing in this Agreement gives it any right, title or interest in the Proprietary 

Marks (except the right to use the Proprietary Marks in accordance with the terms of this Agreement), that 

the Proprietary Marks are the sole property of Franchisor and its affiliates, that Franchisee shall not 

directly or indirectly contest the validity or ownership of the Proprietary Marks or Franchisor’s right to 

license the Proprietary Marks, and that any and all uses by Franchisee of the Proprietary Marks and the 

goodwill arising therefrom shall inure exclusively to the benefit of Franchisor and its affiliates. 

Franchisee will not seek to register, reregister, assert claim to ownership of, license or allow others to use, 

or otherwise appropriate to itself, any of the Proprietary Marks or any mark or name confusingly similar 

thereto, or the goodwill symbolized by any of the foregoing except to the extent this action inures to the 

benefit of, and has the prior written approval of, Franchisor. Any unauthorized use of the Proprietary 

Marks by Franchisee or attempt by Franchisee, directly or indirectly, to register the Proprietary Marks in 

any jurisdiction shall constitute a breach of this Agreement and an infringement of Franchisor’s rights in 

and to the Proprietary Marks. 

E. Notice of Infringement. 

Franchisee promptly shall inform Franchisor in writing as to any infringement of the Proprietary 

Marks of which Franchisee has knowledge. Franchisee shall not make any demand or serve any notice, 

orally or in writing, or institute any legal action or negotiate, compromise or settle any controversy with 

respect to any such infringement without first obtaining Franchisor’s written approval. Franchisor shall 

have the right, but not the obligation, to bring such action or take such steps as it may deem advisable to 

prevent any such infringement and to join Franchisee as a party to any action in which Franchisor is or 

may be a party and as to which Franchisee is or would be a necessary or proper party. Franchisee also 

shall promptly notify Franchisor of any litigation (including administrative or arbitration proceedings) of 

which Franchisee is aware instituted against Franchisor, its affiliates or Franchisee relating to the 

Proprietary Marks. Franchisee shall execute any and all instruments and documents, render such other 

assistance and do any acts and things as may, in the opinion of Franchisor’s counsel, be necessary or 

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advisable to protect and maintain Franchisor’s interests in the Proprietary Marks, including, without 

limitation, Franchisor’s interests in litigation or proceedings before the U.S. Patent and Trademark Office 

or other tribunal relating to the Proprietary Marks. 

15. INSURANCE 

A. Procurement of Insurance by Franchisee. 

Franchisee shall be responsible for all loss or damage arising from or related to Franchisee’s 

development and operation of the Restaurant, and for all demands or claims with respect to any loss, 

liability, personal injury, death, property damage, or expense whatsoever occurring upon the premises of, 

or in connection with the development or operation of, the Restaurant. When Franchisee commences 

construction of the Restaurant, Franchisee shall obtain and, throughout the Initial Term, shall maintain in 

full force and effect that insurance which is required by law or which Franchisee determines is necessary 

or appropriate for liabilities caused by or occurring in connection with the development or operation of 

the Restaurant which shall include, at a minimum, insurance policies of the kinds, and in the amounts, 

required by Section 15.B. Franchisor, TGI Friday’s Inc., a New York corporation, and any entity with an 

insurable interest designated by Franchisor, shall be named as an additional insured in such policies (with 

the exception of workers compensation insurance). 

B. Minimum Insurance Requirements. 

All insurance policies shall be written by an insurance company or companies satisfactory to 

Franchisor, in compliance with the standards, specifications, coverages and limits Franchisor prescribes at 

any time and from time to time in the Manuals or otherwise provided to Franchisee in writing. Franchisor 

may periodically increase the minimum required coverage and require different or additional kinds of 

insurance (including reasonable excess liability insurance, employment practices liability insurance and 

cyber security insurance) at any time to reflect inflation, identification of new risks, changes in law or 

standards of liability, higher damage awards or other relevant changes in circumstances. Franchisee shall 

receive written notice of such modifications and shall take prompt action to secure the additional 

coverage or higher policy limits. These policies shall include, at a minimum, the following: 

(1) Commercial General Liability Insurance providing coverage for bodily injury, 

personal injury, advertising injury, property damage, products liability, contractual liability, completed 

operations with a limit of not less than $10,000,000, auto liability insurance on owned, non-owned and 

hired automobiles with a limit of not less than $10,000,000 and liquor liability/dram shop insurance with 

a minimum limit of $10,000,000. This insurance shall be on an occurrence based policy form, and may 

be provided by a combination of primary and excess liability policies; 

(2) Workers’ Compensation Insurance in such amount as may be required by 

applicable statute or rule, Unemployment Insurance and State Disability Insurance (as required by 

governing law) for Franchisee’s employees, and employer’s liability insurance with a limit of not less 

than $1,000,000; 

(3) “All Risk” Property Insurance on the Premises with replacement costs coverage 

and business interruption insurance covering Franchisor’s fees, with Franchisor named as a loss payee on 

the policy with respect to those fees; 

(4) Builder’s All Risk Insurance in connection with initial construction, a Facilities 

Remodeling, relocation, or any other substantial construction of the Restaurant. Franchisee shall also 

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maintain performance and completion bonds in forms and amounts, and written by carrier(s), reasonably 

satisfactory to Franchisor; 

(5) Business Interruption Insurance to cover the rent of the Premises, previous 

profit margins, maintenance of competent personnel and other fixed expenses for the duration of the 

interruption to the Restaurant’s operation; 

(6) Employment Practices Liability Insurance to cover an employer against 

employment claims made by employees with a limit of not less than $1,000,000; 

(7) Cyber Liability Insurance to cover a business liability for a data breach with a 

limit of not less than $1,000,000; 

(8) Insurance coverage of such type, nature and scope sufficient to satisfy 

Franchisee’s indemnification obligations under Section 24.B below; and 

(9) Any additional insurance required by Franchisee’s landlord or master landlord 

under the Occupancy Contract. 

C. General Insurance Requirements. 

The following general requirements shall apply to each insurance policy that Franchisee is 

required to maintain under this Agreement: 

(1) Each liability insurance policy shall be specifically endorsed to provide that the 

coverages shall be primary and that any insurance carried by Franchisor shall be excess and noncontributory. No insurance policy shall contain a provision that in any way limits or reduces coverage for 

Franchisee in the event of a claim by Franchisor or its affiliates. Each liability insurance policy shall 

contain either a “cross-liability” or a “separation of insureds” provision. 

(2) Each insurance policy shall extend to, and provide indemnity for, all obligations 

and liabilities of Franchisee to third parties and all other items for which Franchisee is required to 

indemnify Franchisor under this Agreement. 

(3) Each insurance policy shall be written by an insurance company that has 

received and maintains an A.M. Best Rating of “(A) VII” or better (or comparable ratings from a 

reputable insurance rating service, in the event such A.M. Best ratings are discontinued or materially 

altered). 

(4) No insurance policy shall provide for a deductible amount that exceeds $5,000, 

unless otherwise approved in writing by Franchisor. Coinsurance shall not apply under any insurance 

policy. 

(5) Required coverage shall include insurers waiver of subrogation against 

Franchisor and Franchisee shall waive rights of recovery against Franchisor. 

D. Proof of Insurance. 

No later than 30 days after the earlier of the date that Franchisee commences construction or 

renovation of the Restaurant or opens the Restaurant, and on each policy renewal date thereafter, 

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Franchisee shall submit evidence of satisfactory insurance and proof of payment therefor to Franchisor. 

Upon request, Franchisee also shall provide to Franchisor copies of all or any policies, and policy 

amendments and riders. 

E. No Representations. 

Franchisee acknowledges that no requirement for insurance contained in this Agreement 

constitutes advice or a representation by Franchisor that only such policies, in such amounts, are 

necessary or adequate to protect Franchisee from losses in connection with its business under this 

Agreement. Maintenance of this insurance, and the performance by Franchisee of its obligations under 

this Section, shall not relieve Franchisee of liability under the indemnification provisions of this 

Agreement. 

F. Procurement of Insurance by Franchisor. 

Should Franchisee, for any reason, fail to procure or maintain at least the insurance required by 

this Section 15, as revised from time to time pursuant to the Manuals or otherwise in writing, Franchisor 

shall have the immediate right and authority, but not the obligation, to procure such insurance and charge 

its cost to Franchisee. Franchisee shall reimburse Franchisor for all out-of-pocket costs incurred by 

Franchisor in obtaining such insurance on behalf of Franchisee immediately upon Franchisee’s receipt of 

an invoice therefor. 

G. Blanket Insurance Policies. 

These insurance requirements may be satisfied by maintaining either individual policies covering 

only the Restaurant, or blanket insurance policies covering multiple properties, provided that with respect 

to any blanket insurance policies Franchisee agrees to either immediately reinstate any limits and 

coverages which are used, reduced or cancelled back up to the blanket policy limits approved by 

Franchisor, or to secure individual policy coverages for the Restaurant satisfying these insurance 

requirements. Franchisee will deliver to Franchisor a schedule of insured locations under any blanket 

insurance policy together with the related certificates of insurance. 

16. ORGANIZATION OF FRANCHISEE 

A. Representations. 

(1) If Franchisee is a corporation, a limited liability company or a partnership, 

Franchisee makes the following representations and warranties: (a) it is duly organized and validly 

existing under the laws of the state of its formation; (b) it is qualified to do business in the state in which 

the Restaurant is located; (c) execution of this Agreement and the development and operation of the 

Restaurant is permitted by its governing documents; and (d) unless waived in writing by Franchisor, 

Franchisee’s articles of incorporation, articles of organization or written partnership agreement shall at all 

times provide that: (i) the activities of Franchisee are limited exclusively to the development and 

operation of Fridays Restaurants and other restaurants operated by Franchisee that are franchised by 

Franchisor or its affiliates; and (ii) all transfers of ownership in Franchisee are subject to the terms of this 

Agreement. 

(2) If Franchisee is an individual, or a partnership comprised solely of individuals, 

Franchisee makes the following additional representations and warranties: (a) each individual has 

executed this Agreement; (b) each individual shall be jointly and severally bound by, and personally 

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liable for the timely and complete performance of, each and every provision of this Agreement; and (c) 

notwithstanding any Transfer for convenience of ownership, pursuant to Section 18.D, each individual 

shall continue to be jointly and severally bound by, and personally liable for the timely and complete 

performance of, each and every provision of this Agreement. 

B. Governing Documents. 

If Franchisee is a corporation, copies of Franchisee’s articles of incorporation, bylaws, other 

governing documents and any amendments, including the resolution of the Board of Directors and all 

stockholders authorizing entry into and performance of this Agreement, and all shareholder agreements, 

including buy/sell agreements, have been furnished to Franchisor. If Franchisee is a limited liability 

company, copies of Franchisee’s articles of organization, management agreement, other governing 

documents and any amendments, including the resolution of the managers authorizing entry into and 

performance of this Agreement, and all agreements, including buy/sell agreements, among the members 

have been furnished to Franchisor. If Franchisee is a partnership, copies of Franchisee’s written 

partnership agreement, other governing documents and any amendments, as well as all agreements among 

the partners, including buy/sell agreements, have been furnished to Franchisor, in addition to evidence of 

consent or approval of the entry into and performance of this Agreement by the requisite number or 

percentage of partners, if that approval or consent is required by Franchisee’s written partnership 

agreement. When any of these governing documents are modified or changed, Franchisee promptly shall 

provide copies to Franchisor. 

C. Ownership Interests. 

If Franchisee is a corporation, a limited liability company or a partnership, Franchisee must 

identify all of its owners in attached Exhibit D. In addition, if Franchisee is a corporation, Franchisee 

shall maintain a current list of all owners of record and all beneficial owners of any class of voting 

securities of the corporation (and the number of shares owned by each). If Franchisee is a limited liability 

company, Franchisee shall maintain a current list of all members (and the percentage membership interest 

of each member). If Franchisee is a partnership, Franchisee shall maintain a current list of all owners of 

an interest in the partnership (and the percentage ownership of each owner). Franchisee shall comply 

with Section 18 before any change in ownership interests and shall execute addenda to Exhibit D as 

changes occur in order to ensure the information contained in Exhibit D is true, accurate and complete at 

all times. 

D. Restrictive Legend. 

If Franchisee is an entity, the stock certificates, member certificates, or partnership agreement 

shall have the following statement: “Any assignment or transfer of any ownership interest in the entity is 

subject to the restrictions imposed on assignment by the TGI Fridays Restaurant Franchise Agreement(s) 

to which this entity is a party.” 

E. Representative. 

Franchisee shall designate a Principal Owner as Franchisee’s representative who is authorized to 

act on behalf of, and bind, Franchisee with respect to this Agreement (“Representative”). The 

Representative shall be identified in Exhibit D as it may be revised from time to time. Any replacement 

Representative shall be designated within 10 days of the prior Representatives resignation or termination. 

Each Representative shall attend and successfully complete Franchisor’s Owner’s Orientation Program. 

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F. Guaranties; Confidentiality and Non-Compete Covenants. 

(1) All of Franchisee’s officers, directors and Principal Owners (and their spouses) 

also shall jointly and severally guarantee Franchisee’s payment and performance under this Agreement 

and also shall bind themselves to the terms of this Agreement pursuant to the attached Guaranty and 

Assumption of Franchisee’s Obligations (“Guaranty”). Notwithstanding the foregoing, Franchisor 

reserves the right, in its sole discretion, to waive the requirement that some or all of the previously 

described individuals execute the attached Guaranty. Franchisor reserves the right to require any 

guarantor to provide personal financial statements to Franchisor from time to time. Franchisee 

acknowledges that, unless otherwise agreed to in writing by Franchisor, Franchisor requires individuals 

(and not solely corporations, limited liability companies or other entities) to execute the Guaranty. 

Accordingly, if any Principal Owner is not an individual, Franchisor shall have the right to have the 

Guaranty executed by individuals who have only an indirect ownership interest in Franchisee. 

(2) If Franchisee, any guarantor or any parent, subsidiary or affiliate of Franchisee 

holds any interest in other restaurants that are franchised by Franchisor or its affiliates, the party who 

owns that interest shall execute, concurrently with this Agreement, a form of cross-guaranty to Franchisor 

and its affiliates for the payment of all obligations for such restaurants, unless waived in writing by 

Franchisor in its sole discretion. For purposes of this Agreement, an affiliate of Franchisee is any 

company controlled, directly or indirectly, by Franchisee or Franchisee’s parent or subsidiary. 

(3) Any direct or indirect owner of Franchisee who is not a Principal Owner but 

who has access to Confidential Information or who has an active role in the operation or management of 

the Restaurant must execute a Non-Disclosure and Non-Competition Agreement in the form attached as 

Exhibit G. 

G. Operating Principal. 

(1) If Franchisee is owned by more than one individual, Franchisee shall designate 

and retain the individual identified in Exhibit D (as it may be revised from time to time) to serve as the 

“Operating Principal.” Unless waived in writing by Franchisor, the Operating Principal shall meet all 

of the following qualifications: 

(a) The Operating Principal, at all times, shall have at least a 5% equity 

ownership interest in Franchisee. This Section 16.G(1)(a) shall not apply if Franchisee was a publiclyheld entity or a wholly-owned subsidiary of a publicly-held entity as of the date of the first franchiserelated agreement between Franchisee and Franchisor. 

(b) The Operating Principal must sign the attached Guaranty. 

(c) The Operating Principal, at all times, shall have full control over the dayto-day activities, including operations, of the Restaurant, including control over the standards of operation 

and financial performance. 

(d) The Operating Principal shall devote full-time and reasonable efforts to 

supervising the operation of the Restaurant and shall not engage in any other business or activity, directly 

or indirectly, that requires substantial management responsibility. 

(e) The Operating Principal shall maintain a primary residence within a 

reasonable driving distance of the Restaurant. 

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(f) The Operating Principal shall successfully complete the Management 

Training Program (either the full Management Training Program or a modified version of the 

Management Training Program to meet the specific needs of the trainee, as deemed appropriate by 

Franchisor in its sole discretion) and any additional training required by Franchisor. 

(g) The Operating Principal shall have been approved by Franchisor in its 

sole discretion, with said approval not being later withdrawn. If the Operating Principal no longer 

qualifies as such, Franchisee shall designate another qualified person to act as Operating Principal within 

30 days after the date the prior Operating Principal ceases to be qualified. Franchisee’s designee to 

become the Operating Principal must successfully complete the Management Training Program. 

Following Franchisor’s approval of a new Operating Principal, that person shall execute the attached form 

of Guaranty and satisfy all other requirements stated in this Section 16.G. 

H. Multi-Unit Manager. 

(1) In the event this Agreement is for the third or any additional Fridays Restaurant 

to be operated by Franchisee and its affiliates, Franchisee shall designate a Multi-Unit Manager. The 

Multi-Unit Manager shall be identified in Exhibit D as it may be revised from time to time. Additional 

Multi-Unit Managers shall be designated from time to time as reasonably required by Franchisor. 

(a) The Multi-Unit Manager must sign the Non-Disclosure and NonCompetition Agreement attached as Exhibit G. 

(b) The Multi-Unit Manager shall devote full-time and reasonable efforts to 

supervising the operation of the Restaurant and those other restaurants (that are franchised by Franchisor 

or its affiliates) operated by Franchisee in the same geographic area as the Restaurant and shall not 

engage in any other business or activity, directly or indirectly, that requires substantial management 

responsibility. The Multi-Unit Manager shall maintain a primary residence within a reasonable driving 

distance of the Restaurants. 

(c) The Multi-Unit Manager shall successfully complete the Management 

Training Program (either the full Management Training Program or a modified version of the 

Management Training Program to meet the specific needs of the trainee, as deemed appropriate by 

Franchisor in its sole discretion) and any additional training required by Franchisor. Franchisor shall have 

approved the Multi-Unit Manager, and not have later withdrawn that approval. 

(2) If the Multi-Unit Manager no longer qualifies as such, Franchisee shall 

designate another qualified person to act as Multi-Unit Manager within 30 days after the date the prior 

Multi-Unit Manager ceases to be qualified. Franchisee’s designee to become the Multi-Unit Manager 

must successfully complete the Management Training Program. Following Franchisor’s approval of a 

new Multi-Unit Manager, that person shall execute the Non-Disclosure and Non-Competition Agreement 

attached as Exhibit G and satisfy all other requirements stated in this Section 16.H. 

17. TRANSFERS BY FRANCHISOR 

Franchisor has the absolute, unrestricted right, exercisable at any time, to change its ownership or 

form and/or transfer and assign all or any part of its rights and obligations under this Agreement to any 

person or legal entity without Franchisee’s consent. After Franchisor’s transfer or assignment of this 

Agreement to a third party who expressly assumes Franchisor’s obligations under this Agreement, 

Franchisor no longer will have any performance or other obligations under this Agreement. 

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18. TRANSFERS BY FRANCHISEE 

A. Franchisor’s Prior Written Approval Required. 

(1) Franchisee understands and acknowledges that the rights and duties set forth in 

this Agreement are personal to Franchisee and that Franchisor has entered into this Agreement in reliance 

on Franchisee’s business skill, financial capacity, personal character, experience and demonstrated or 

purported ability in developing and operating high quality foodservice operations. Accordingly, neither 

Franchisee nor any immediate or remote successor to any part of Franchisee’s interest in this Agreement, 

nor any individual, partnership, corporation or other legal entity which directly or indirectly controls 

Franchisee shall sell, assign, transfer, convey, give away, pledge, mortgage, or otherwise encumber any 

interest in Franchisee, this Agreement, the Franchise, the Restaurant, the assets of the Restaurant, the 

Premises or any other assets pertaining to Franchisee’s operations under this Agreement (collectively 

“Transfer”) without the prior written consent of Franchisor. 

(2) Except as otherwise provided in this Agreement, any purported Transfer, by 

operation of law or otherwise, not having the prior written consent of Franchisor shall be null and void 

and shall constitute a material breach of this Agreement, for which Franchisor may terminate this 

Agreement without providing Franchisee an opportunity to cure the breach. 

B. Transfer Considerations. 

Franchisee shall advise Franchisor in writing of any proposed Transfer, submit (or cause the 

proposed transferee to submit) (1) a franchise application for the proposed transferee; (2) a copy of all 

contracts and all other agreements or proposals; (3) a nonrefundable Transfer fee in the amount of $5,000 

in connection with Franchisor’s review of the Transfer application; (4) background investigation fees in 

the amount of $10,000 per transferee entity, and each individual equity holder in transferee, who are 

international candidates; and (5) all other information requested by Franchisor, relating to the proposed 

Transfer. If, in connection with the Transfer, Franchisor incurs out-of-pocket expenses in excess of the 

Transfer fee in Section 18.B(iii), Franchisee must reimburse Franchisor for those expenses upon receipt of 

written notice from Franchisor. If the cost for any background investigation conducted under 

Section 18.B(iv) is less than $10,000, Franchisor may refund that unused portion to transferee. If 

Franchisor does not exercise its right of first refusal under Section 18.K below, the decision as to whether 

or not to approve a proposed Transfer shall be made by Franchisor in its sole discretion and shall include 

numerous factors deemed relevant by Franchisor. These factors may include, but will not be limited to, 

the following: 

(1) The proposed transferee (and if the proposed transferee is other than an 

individual, such owners of an interest in the transferee as Franchisor may request) must demonstrate that 

it has extensive experience in high quality restaurant operations of a character and complexity similar to 

the restaurants franchised by Franchisor or its affiliates; meets the managerial, operational, experience, 

quality, character and business standards for a franchisee promulgated by Franchisor from time to time; 

possesses a good character, business reputation and credit rating; has an organization whose management 

culture is compatible with Franchisor’s management culture; has adequate infrastructure to operate the 

Restaurant; and has adequate financial resources and working capital to meet Franchisee’s obligations 

under this Agreement. 

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(2) The sales price shall not be so high, in Franchisor’s reasonable judgment, as to 

jeopardize the ability of the transferee to develop, maintain, operate and promote the Restaurant and meet 

financial obligations to Franchisor, third party suppliers and creditors. 

(3) All of Franchisee’s accrued monetary obligations to Franchisor and its affiliates 

(whether arising under this Agreement or otherwise) and all other outstanding obligations related to the 

Restaurant (including, but not limited to, bills from suppliers, taxes, judgments and any required 

governmental reports, returns, affidavits or bonds) have been satisfied or, in the reasonable judgment of 

Franchisor, adequately provided for. Franchisor reserves the right to require that a reasonable sum of 

money be placed in escrow to ensure that all of these obligations are satisfied. 

(4) Franchisee is not then in material default of any provision of this Agreement or 

any other agreement between Franchisee and Franchisor or its affiliates, is not in default beyond the 

applicable cure period under any real estate lease, equipment lease or financing instrument relating to the 

Restaurant and is not in default beyond the applicable cure period with any vendor or supplier to the 

Restaurant. 

(5) Franchisee, all individuals who executed this Agreement, all guarantors of 

Franchisee’s obligations, the proposed transferee and any other individuals or entities required by 

Franchisor must execute a general release and a covenant not to sue, in a form satisfactory to Franchisor. 

(6) Unless waived by Franchisor in its sole discretion, the transferee and those 

employees of the transferee designated by Franchisor shall complete the training provided in Section 11. 

(7) The transferee, at its expense, shall repair or replace any equipment, signs, 

interior and exterior décor items, fixtures and furnishings at the Restaurant as required by Franchisor, 

shall offer such products and services at the Restaurant as then required by Franchisor, and shall make 

any modifications or upgrades required for the Restaurant to comply with the current image of the 

System. 

(8) Franchisee, Franchisee’s Principal Owners, and the proposed transferee shall 

comply with any other conditions that Franchisor reasonably requires from time to time as part of 

Franchisor’s transfer policies including without limitation, evidence of third party consents to the Transfer 

(such as landlord, suppliers, vendors, etc.), subordination of the purchase price to monetary obligations 

owed by the transferee to Franchisor after the Transfer, execution of confidentiality, non-competition 

covenants as required by Franchisor, and disclosures, consents and releases for background investigations 

if the transferee or any of its equity holders are non-United States residents and/or non-United States 

citizens. 

C. Conditions of Transfer. 

If Franchisor approves a proposed Transfer, before the Transfer becoming effective: 

(1) Franchisee and the proposed transferee shall execute, at Franchisor’s election, 

either an assignment agreement and any amendments to this Agreement deemed necessary or desirable by 

Franchisor to reflect the Transfer or Franchisor’s then-current standard form of franchise agreement for an 

initial term ending on the expiration date of the Initial Term of this Agreement. In either event, a 

guaranty of the type required by Section 16.F shall be executed by those individuals identified in 

Section 16.F and a non-disclosure and non-competition agreement executed by any person as required by 

Franchisor. 

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(2) The transferor must remain liable to Franchisor for any obligations that arose 

before the Transfer and the transferor shall, at Franchisor’s request, execute a written guaranty pursuant to 

which the transferor shall remain liable for all obligations to Franchisor incurred before the date of the 

Transfer and for a period of two years following such Transfer. 

D. Transfers for Convenience of Ownership. 

If Franchisee is an individual or a partnership and desires to Transfer this Agreement to a 

corporation or limited liability company formed for the convenience of ownership, the requirements of 

Sections 18.B and 18.C shall apply to such a Transfer; however, Franchisee will not be required to pay a 

Transfer fee. Franchisor’s approval also will be conditioned on the following: (1) the corporation or 

limited liability company must be newly organized; (2) before the Transfer, Franchisor must receive a 

copy of the documents specified in Section 16.B and the transferee shall comply with the remaining 

provisions of Section 16; and (3) Franchisee must own all voting securities of the corporation or 

membership interests of the limited liability company or, if Franchisee is owned by more than one 

individual, each person shall have the same proportionate ownership interest in the corporation or the 

limited liability company as before the Transfer. 

E. Issuance or Exercise of Stock Options. 

Notwithstanding the provisions of Section 18.B, the issuance of options or the exercise of options 

pursuant to a qualified stock option plan or a qualified employee stock ownership plan shall not be 

considered a Transfer and shall not require the prior written approval of Franchisor; provided no more 

than a total of 49% of Franchisee’s outstanding voting securities are subject to the qualified stock option 

plan or qualified employee stock ownership plan. 

F. Changes in Ownership of Voting Securities. 

If Franchisee was a publicly-held entity as of the date of the first franchise-related agreement 

between Franchisee and Franchisor or its affiliates, Section 18.B shall be applicable to transfers of 

ownership interests in Franchisee only if the proposed Transfer would result in either: (1) 50% or more of 

Franchisee’s voting securities being held by different shareholders than as of the date of the first 

franchise-related agreement between Franchisee and Franchisor or its affiliates; or (2) any change in 

ownership of Franchisee’s voting securities whereby any existing shareholder of Franchisee acquires an 

additional 10% or more of Franchisee’s voting securities. 

G. Transfers Permitted Without Franchisor’s Prior Written Approval. 

Notwithstanding the provisions of Section 18.B, Franchisor’s prior written approval is not 

required if: (1) the Transfer is a Transfer of an ownership interest in Franchisee of less than 10% and, 

after that Transfer, the original owners of Franchisee own at least 51% of Franchisee; and (2) Franchisee 

provides Franchisor’s written notice of Franchisee’s intent to undertake the Transfer at least 30 days 

before the effective date of the Transfer, together with documents demonstrating that the Transfer meets 

the requirements of this Section; and (3) at the time of Franchisee’s notice to Franchisor, Franchisee is not 

be in default of this Agreement or any other agreements between Franchisee and Franchisor or its 

affiliates. 

H. Transfer on Death or Disability. 

Franchisor shall consent to a Transfer of an equity ownership interest in Franchisee following the 

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death or permanent disability of Franchisee or an equity owner of Franchisee provided that: 

(1) immediately before and after the Transfer, the transferee franchisee meets Franchisor’s then-current 

financial, operational and experience standards for new franchisees; and (2) such Transfer is completed 

within six months following the death or permanent disability. Failure to complete the Transfer as 

required by this Section 18.H within this period of time will constitute a breach of this Agreement. A 

person shall be deemed to have a “permanent disability” if he or she has any physical, emotional or 

mental injury, illness or incapacity which would prevent the afflicted person from performing his 

obligations under this Agreement for more than 90 consecutive days as determined by a licensed 

physician selected by Franchisor. Franchisee or any equity owner of Franchisee refusing to submit to 

examination with respect to a permanent disability shall be deemed permanently disabled. 

I. Grant of Security Interest. 

Franchisee shall not grant any security interest in its business, the Restaurant, the Premises or the 

assets used in the operation or development of the Restaurant without Franchisor’s prior written approval. 

Franchisor’s approval may be conditioned, in its sole discretion, on the written agreement by the secured 

party that, in the event of a default by Franchisee under any agreement related to the security interest, 

Franchisor shall have the right and option (but not the obligation) to purchase the rights of the secured 

party upon payment of all sums then due to the secured party. 

J. Offerings by Franchisee. 

Securities or partnership interests in Franchisee may be sold, by private or public offering, only 

with Franchisor’s prior written consent (whether or not Franchisor’s consent is required under any other 

provision of this Section). In addition to the requirements of Section 18.B, at least 30 days before any 

public offering or private placement of securities or partnership interests in Franchisee is made available 

to potential investors, Franchisee, at its expense, shall deliver to Franchisor a copy of the offering 

documents. Franchisee, at its expense, also shall deliver to Franchisor an opinion of Franchisee’s legal 

counsel and an opinion of one other legal counsel selected by Franchisor (both of which shall be 

addressed to Franchisor and in a form acceptable to Franchisor) that the offering documents properly use 

the Proprietary Marks and accurately describe Franchisee’s relationship with Franchisor and/or its 

affiliates. The indemnification provisions of Section 24.B shall also include any losses or expenses 

incurred by Franchisor and/or its affiliates in connection with any statements made by or on behalf of 

Franchisee in any public offering or private placement of Franchisee’s securities. For each proposed 

offering, Franchisee shall pay to Franchisor a non-refundable fee of $15,000 when Franchisee submits the 

offering documents to Franchisor. 

K. Friday’s Right of First Refusal. 

(1) If any party holding any interest in Franchisee, this Agreement, the Restaurant, 

or the Premises, receives a bona fide offer (as determined by Franchisor in its reasonable discretion) from 

a third party or otherwise desires to undertake any Transfer that would require Franchisor’s approval 

(other than a Transfer for convenience of ownership pursuant to Section 18.D or a sale of ownership 

interests in Franchisee to a spouse, parent, adult child or adult sibling), that party shall notify Franchisor 

in writing of the terms of the proposed Transfer, and shall provide such information and documentation 

relating to the proposed Transfer as Franchisor may reasonably require. Franchisor or its designee may 

elect to purchase the interest that the seller proposes to Transfer any time within 30 days after receipt of 

written notification, and all documents and other information required by Franchisor, by sending written 

notice to the seller that Franchisor or its designee intends to purchase the sellers interest on the same 

financial terms and conditions offered by the third party (except that Franchisor or its designee shall not 

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be obligated to pay any finder’s or broker’s fees). In purchasing the interest, Franchisor or its 

designee shall be entitled to set off any monies owed to Franchisor and/or its affiliates by Franchisee and 

Franchisor or its designee shall be entitled to all customary representations and warranties that the assets 

are free and clear (or, if not, accurate and complete disclosure) as to: (a) ownership, condition and title; 

(b) liens and encumbrances; (c) environmental and hazardous substances; and (d) validity of contracts 

inuring to the purchaser or affecting the assets, whether contingent or otherwise. 

(2) If the offer to Franchisee involves assets in addition to this Agreement, the 

Premises, the Restaurant and other restaurants operated by Franchisee that are franchised by Franchisor or 

its affiliates, Franchisee’s notice to Franchisor shall state the cash value of that portion of the offer 

received by Franchisee relating to this Agreement, the Premises, the Restaurant and those other 

restaurants. If the proposed Transfer provides for payment of consideration other than cash or it involves 

intangible benefits, Franchisor or its designee may elect to purchase the interest proposed to be sold for 

the reasonable equivalent in cash. If the parties are unable to agree within 30 days on the reasonable 

equivalent in cash of the non-cash part of the offer received by Franchisee or the cash value of that 

portion of the offer received by Franchisee relating to this Agreement, the Premises, the Restaurant and 

those other restaurants, the amount shall be determined by two professionally certified appraisers, 

Franchisee selecting one and Franchisor or its designee selecting one. If the amounts set by the two 

appraisers differ by more than 10%, the two appraisers shall select a third professionally certified 

appraiser who also shall determine the amount. The average value set by the appraisers (whether two or 

three appraisers as the case may be) shall be conclusive and Franchisor or its designee may exercise its 

right of first refusal within 30 days after being advised in writing of the decision of the appraisers. The 

cost of the appraisers shall be shared equally by the parties. 

(3) Franchisor’s failure to exercise its right of first refusal shall not constitute 

approval of the proposed Transfer nor a waiver of any other provision of this Section 18 with respect to a 

proposed Transfer. If Franchisor does not exercise its right of first refusal, Franchisee may not thereafter 

Transfer the interest at a lower price or on more favorable terms than those that have been offered to 

Franchisor. Franchisor shall again be given a right of first refusal if a transaction does not close within 

six months after Franchisor elected not to exercise its right of first refusal. Franchisee shall not, at any 

time, offer any interest for sale or transfer at public auction, nor make an offer to the public to sell, 

transfer or assign, through any advertisement, either in the newspapers or otherwise, without first having 

obtained the written approval of Franchisor to the auction or advertisement. 

L. No Waiver. 

Franchisor’s consent to any Transfer shall not constitute a waiver of any claims Franchisor may 

have against the transferring party or transferee, nor shall it be deemed a waiver of Franchisor’s right to 

demand exact compliance with any of the terms of this Agreement by the transferee, nor will it be deemed 

a waiver of Franchisor’s right to give or withhold approval to future Transfers. 

M. No Liability. 

Franchisor’s decision with respect to a proposed Transfer shall not create any liability on the part 

of Franchisor: (1) to the transferee, if Franchisor approves the Transfer and the transferee experiences 

financial difficulties; or (2) to Franchisee, the transferring party or the proposed transferee, if Franchisor 

disapproves the Transfer pursuant to this Section 18 or for other legitimate business purposes. 

Franchisor, without any liability to Franchisee, the transferring party or the proposed transferee, has the 

right, in its sole discretion, to communicate and counsel with Franchisee and the proposed transferee 

regarding any aspect of the proposed Transfer. 

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19. GENERAL RELEASE 

Franchisee (on behalf of itself and its parent, subsidiaries and affiliates and their respective past 

and present members, officers, directors, shareholders, agents and employees, in their corporate and 

individual capacities), all individuals who execute this Agreement and all guarantors of Franchisee’s 

obligations under this Agreement (collectively “Releasors”), freely and without any influence, forever 

release and covenant not to sue Franchisor, its parent, subsidiaries and affiliates, including without 

limitation, TGI Friday’s Inc., and their respective past and present officers, directors, shareholders, agents 

and employees, in their corporate and individual capacities (collectively “Releasees”) with respect to any 

and all claims, demands, liabilities and causes of action of whatever kind or nature, whether known or 

unknown, vested or contingent, suspected or unsuspected (collectively “claims”), that any Releasor now 

owns or holds, or may at any time have owned or held, up to and including the date of this Agreement, 

including, without limitation, claims arising under federal, state and local laws, rules and ordinances, 

claims for contribution, indemnity and/or subrogation, and claims arising out of, or relating to this 

Agreement and all other agreements between any Releasor and any Releasee, the sale of a franchise to 

any Releasor, the development and operation of the Restaurant and the development and operation of all 

other restaurants operated by any Releasor that are franchised by any Releasee. Notwithstanding any 

provision to the contrary in this Section 19, this General Release does not release any claims arising from 

representations made in Franchise Disclosure Document or its exhibits or otherwise impair or affect any 

claims arising after the date of this Agreement. TO THE EXTENT APPLICABLE, FRANCHISEE, 

EACH PRINCIPAL OWNER AND EACH GUARANTOR INTEND THIS SECTION TO COVER, 

ENCOMPASS, RELEASE AND EXTINGUISH ALL CLAIMS AND MATTERS THAT MIGHT 

OTHERWISE BE RESERVED BY CALIFORNIA CIVIL CODE SECTION 1542, WHICH 

PROVIDES: “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE 

CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF 

EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY 

AFFECTED THE SETTLEMENT WITH THE DEBTOR.” 

20. COVENANTS 

A. Best Efforts. 

During the Initial Term, Franchisee shall devote its best efforts to the development, management 

and operation of the Restaurant. 

B. Confidentiality. 

(1) As used in this Agreement, the term “Confidential Information” includes the 

System, the Manuals, the System Standards, written directives and all drawings, equipment, recipes, 

computer and point of sale programs (and output from such programs), and any other information, knowhow, techniques, trade secrets, material and data imparted or made available by Franchisor which is 

(a) designated as confidential; (b) known by Franchisee to be considered confidential by Franchisor; or 

(c) by its nature inherently or reasonably considered confidential. 

(2) Franchisee acknowledges and agrees that: (a) Franchisor owns all right, title 

and interest in and to the Confidential Information; (b) the Confidential Information gives Franchisor and 

its affiliates a competitive advantage; (c) Franchisor and its affiliates have taken all measures necessary to 

protect the Confidential Information; (d) all Confidential Information now or hereafter provided or 

disclosed to Franchisee is disclosed in confidence; (e) Franchisee has no right to disclose any part of the 

Confidential Information to anyone who is not an employee of Franchisee; (f) Franchisee will disclose to 

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its employees only those parts of the Confidential Information that an employee needs to know; 

(g) Franchisee will have a system in place to ensure its employees keep confidential Fridays Confidential 

Information; (h) Franchisee will not acquire any interest in the Confidential Information; and 

(i) Franchisee’s use or duplication of the Confidential Information or any part of the Confidential 

Information in any other business would constitute an unfair method of competition, for which Franchisor 

would be entitled to all legal and equitable remedies, including injunctive relief, without posting a bond. 

Franchisee shall not, during the Initial Term or at any time thereafter, communicate or disclose any 

Confidential Information to any unauthorized person, or do or perform, directly or indirectly, any other 

acts injurious or prejudicial to any of the Proprietary Marks or the System. 

C. Restrictions. 

(1) Franchisee acknowledges and agrees that: (a) pursuant to this Agreement, 

Franchisee will have access to valuable trade secrets, specialized training and other Confidential 

Information from Franchisor and its affiliates regarding the development, operation, purchasing, sales and 

marketing methods and techniques of Franchisor and its affiliates and the System; (b) the System and the 

opportunities, associations and experience established and acquired by Franchisee under this Agreement 

are of substantial and material value; (c) in developing the System, Franchisor and its affiliates have made 

and continue to make substantial investments of time, technical and commercial research, and money; 

(d) Franchisor would be unable to adequately protect the System and its trade secrets and other 

Confidential Information against unauthorized use or disclosure and would be unable to adequately 

encourage a free exchange of ideas and information among Fridays Restaurants if franchisees or 

developers were permitted to hold interests in competitive businesses; and (e) restrictions on Franchisee’s 

right to hold interests in, or perform services for, competitive businesses will not hinder its activities. 

(2) Accordingly, Franchisee covenants and agrees that during the Initial Term and 

for a continuous period of two years following its expiration, termination or Transfer, Franchisee shall 

not, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with, any person, 

firm, partnership, corporation, or other entity: 

(a) Divert or attempt to divert any business or customer, or potential 

business or customer, of any restaurant franchised or operated by Franchisor or its affiliates to any 

competitor, by direct or indirect inducement or otherwise; or 

(b) Own, maintain, operate, engage in, advise, help, make loans to, or have 

any interest in, either directly or indirectly, any restaurant business that offers the same or similar 

products and services as offered by Fridays Restaurants or restaurants in any other concept or system 

owned, operated, managed or franchised by Franchisor or an affiliate, including, without limitation, 

waiter/waitress service, sit-down dining and bar services. 

(3) During the Initial Term, there is no geographical limitation on the restrictions 

set forth in Section 20.C. For a continuous two-year period following the expiration, termination or 

Transfer of this Agreement, the restrictions set forth in Section 20.C shall apply within: (a) a three-mile 

radius of the Premises; and (b) within a three-mile radius of any then-existing Fridays Restaurant, except 

as otherwise approved in writing by Franchisor. These restrictions shall not apply to Franchisee’s existing 

restaurant or foodservice operations, if any, which are identified in Exhibit A, nor shall it apply to other 

restaurants operated by Franchisee that are franchised by Franchisor or its affiliates. 

(4) If any part of these restrictions is found to be unreasonable in time or distance, 

each month of time or mile of distance may be deemed a separate unit so that the time or distance may be 

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reduced by appropriate order of the court to that deemed reasonable. If, at any time during the two-year 

period following expiration, termination or Transfer of this Agreement, Franchisee fails to comply with 

its obligations under this Section, that period of noncompliance will not be credited toward Franchisee’s 

satisfaction of the two-year obligation. 

(5) Franchisee further covenants and agrees that, during the Initial Term and for a 

period of two continuous years following the expiration, termination or Transfer of this Agreement, 

Franchisee will not, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with 

any person, firm, partnership, corporation, or other entity, sell, assign, lease or transfer the Premises to 

any person, firm, partnership, corporation, or other entity which Franchisee knows, or has reason to know, 

intends to operate a restaurant business at the Premises that would violate Sections 20.C(2)(c) or 20.C(3). 

Franchisee, by the terms of any conveyance selling, assigning, leasing or transferring its interest in the 

Premises, shall include these restrictive covenants as are necessary to ensure that a restaurant business 

that would violate Sections 20.C(2)(c) or 20.C(3) is not operated at the Premises for this two-year period, 

and Franchisee shall take all steps necessary to ensure that these restrictive covenants become a matter of 

public record. 

D. Additional Remedies for Breach. 

In addition to any other remedies or damages permitted under this Agreement, if Franchisee 

breaches Sections 20.C(2)(c), 20.C(3) or 20.C(5) (“Covenants Against Competition”) during the Initial 

Term or during the continuous two-year period following the expiration, termination or Transfer of this 

Agreement, for each restaurant business that violates those Sections, Franchisee shall pay to Franchisor: 

(1) a fee equal to Franchisor’s then-current Initial Franchise Fee for franchised Fridays Restaurants; and 

(2) 8% of the Gross Sales of that restaurant business until the expiration of the continuous two-year 

period following the expiration, earlier termination, or Transfer of this Agreement. Franchisee 

acknowledges that a precise calculation of the full extent of Franchisor damages under these 

circumstances is difficult to determine and the method of calculation of such damages as set forth in this 

Section 20.D is reasonable. Franchisee’s payment to Franchisor under this Section shall be in addition to 

any attorneys’ fees and other costs and expenses to which Franchisor is entitled pursuant to the terms of 

this Agreement. Franchisee acknowledges that breach of the Covenants Against Competition by 

Franchisee shall cause irreparable harm to Franchisor in addition to monetary damages and nothing in this 

Section 20.D shall preclude Franchisor from obtaining appropriate injunctive relief to enforce the 

Covenants Against Competition and specific performance to enforce this Section 20.D. 

E. Modification. 

Franchisor shall have the right, in its sole discretion, to reduce the scope of any covenant in this 

Section 20 effective immediately upon Franchisee’s receipt of written notice, and Franchisee agrees that it 

shall comply forthwith with any covenant as so modified, which shall be fully enforceable 

notwithstanding the provisions of Section 27. 

F. Execution of Covenants by Third Parties. 

At Franchisor’s request, Franchisee shall require and obtain the execution of covenants similar to 

those set forth in this Section 20 (including covenants applicable upon the termination of an individual’s 

name with Franchisee) from certain third parties such as any officer, partner, member, manager, employee 

or Principal Owner of Franchisee and/or its affiliates. Every covenant required by this Section 20.F 

shall be in a form satisfactory to Franchisor, including, without limitation, specific identification of 

Franchisor as a third party beneficiary of such covenants with the independent right to 

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enforce them. Franchisor’s current form of Non-Disclosure and Non-Competition Agreement is attached 

as Exhibit G. Failure by Franchisee to obtain execution of a covenant required by this Section 20.F shall 

constitute a material breach of this Agreement. 

G. Applicability. 

The restrictions contained in this Section 20 shall apply to Franchisee, Franchisee’s Principal 

Owners, and all guarantors of Franchisee’s obligations. With respect to guarantors, these restrictions shall 

apply for a two-year period after any guarantor is released in writing from all obligations under the 

applicable guaranty agreement. The restrictions contained in this Section 20 shall not apply to ownership 

of less than a 5% legal or beneficial ownership in the outstanding equity securities of any publicly held 

corporation by Franchisee or any guarantor of Franchisee’s obligations. The existence of any claim 

Franchisee or any guarantor of Franchisee’s obligations may have against Franchisor or its affiliates, 

whether or not arising from this Agreement, shall not constitute a defense to the enforcement by 

Franchisor of the covenants in this Section 20. The preceding sentence, however, does not constitute a 

waiver of any such claim. 

21. DEFAULT AND REMEDIES 

A. Defaults Resulting in Automatic Termination – No Notice or Opportunity to Cure. 

Franchisee shall be deemed to be in default under this Agreement, and all rights granted herein 

shall automatically terminate without notice to Franchisee or an opportunity to cure, upon the occurrence 

of any of the following events: (1) Franchisee shall become insolvent or makes a general assignment for 

the benefit of creditors; (2) a petition in bankruptcy is filed by Franchisee or such a petition is filed 

against and not opposed by Franchisee; (3) Franchisee is adjudicated a bankrupt or insolvent; (4) a bill in 

equity or other proceeding for the appointment of a receiver of Franchisee or other custodian for 

Franchisee’s business or assets is filed and consented to by Franchisee; (5) a receiver or other custodian 

(permanent or temporary) of Franchisee’s assets or property, or any part thereof, is appointed by any court 

of competent jurisdiction; (6) proceedings for a composition with creditors under any state or federal law 

is instituted by or against Franchisee; (7) a final judgment remains unsatisfied or of record for 30 days or 

longer (unless on appeal or a supersedeas bond is filed); (8) Franchisee is dissolved; (9) execution is 

levied against Franchisee’s business or property; (10) suit to foreclose any lien or mortgage against the 

Premises or Restaurant equipment is instituted against Franchisee and not dismissed within 30 days; or 

(11) the real or personal property of the Restaurant shall be sold after levy thereupon by any sheriff, 

marshal, or constable. 

B. Defaults Resulting in Termination Upon Notice – No Opportunity to Cure. 

In addition to the grounds for termination that may be stated elsewhere in this Agreement, 

Franchisor may terminate this Agreement, and the rights granted by this Agreement, upon written notice 

to Franchisee without an opportunity to cure upon the occurrence of any of the following events: 

(1) Franchisee fails to obtain site acceptance during the Site Acceptance Period. 

(2) Franchisee fails to begin development, construction and equipping of the 

Restaurant within 6 months after Franchisor accepts the site for the Restaurant. 

(3) Franchisee fails to open the Restaurant for business on or before the Opening 

Deadline. 

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(4) Franchisee fails to obtain and maintain a liquor license or any permit or license 

necessary to operate the Restaurant. 

(5) Franchisee ceases to continuously operate the Restaurant for a period in excess 

of three consecutive days, unless the closing is due to Force Majeure, due to government order, or is 

required or otherwise approved in writing in advance by Franchisor. 

(6) Franchisee understates the Gross Sales of the Restaurant for any period by 1% 

or more, 3 or more times during any 18 month period, or by more than 3% on any one occasion. 

(7) Franchisee (or any other person subject to any confidentiality obligation or 

restrictive covenant under Section 20 or Exhibit G) materially breaches any confidentiality obligation or 

restrictive covenant under Section 20. 

(8) Any Transfer that requires Franchisor’s prior written approval occurs without 

Franchisee having obtained that prior written approval. 

(9) Franchisor discovers that Franchisee made a material misrepresentation or 

omitted a material fact in the information that was furnished to Franchisor in connection with its decision 

to enter into this Agreement. 

(10) Franchisee knowingly falsifies any report required to be furnished Franchisor or 

makes any material misrepresentation in its dealings with Franchisor or fails to disclose any material facts 

to Franchisor. 

(11) Franchisor determines, in its sole discretion, that continued operation of the 

Restaurant by Franchisee will endanger the reputation and operations of other Fridays Restaurants and/or 

potentially endanger the general public. 

(12) Franchisee loses possession of the Premises through its own fault or its failure to 

extend Occupancy Contract through the Initial Term. 

(13) Franchisee, any stockholder, member, partner, director or officer of Franchisee, 

or any Principal Owner is convicted of, or pleads no contest (regardless of status of any appeal) to, a 

felony charge, a crime involving moral turpitude or any other crime or offense that is reasonably likely, in 

the sole opinion of Franchisor, to adversely affect Franchisor, its affiliates or the System. 

(14) Franchisee fails to provide or refuses to have its employees attend the training 

programs described in Section 11. 

(15) Franchisee materially breaches any representation or warranty set forth in 

Section 31.I or 31.J. 

(16) Franchisee loses the right to transact business in the jurisdiction where the 

Restaurant is located. 

(17) Franchisee (or its affiliates) or any Principal Owner: (a) remains in default 

beyond any applicable cure period under any other agreement with Franchisor or its affiliates; (b) remains 

in default beyond the applicable cure period under any Occupancy Contract, equipment lease, or 

financing instrument relating to the Restaurant; (c) remains in default beyond the applicable cure period 

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under any contract with any vendor or supplier to the Restaurant; or (d) fails to pay when due any taxes or 

assessments relating to the Restaurant or its employees, unless Franchisee is actively prosecuting or 

defending the claim or suit in a court of competent jurisdiction or by appropriate government 

administrative procedure or by arbitration or mediation conducted by a recognized alternative dispute 

resolution organization. 

(18) Franchisee, in accordance with Section 13.R, (i) does not cure a Remodel 

Default by electing the Royalty Increase Alternative; (ii) does cure a Remodel Default by electing the 

Royalty Increase Alternative but stops paying the 2.5% increase in the Royalty Fee before Franchisee 

completes the required Facilities Remodeling; or, (iii) does cure a Remodel Default by electing the 

Royalty Increase Alternative and continues to pay the 2.5% increase in the Royalty Fee but seven years 

from the expiration of the Remodel Cure Period passes without Franchisee completing the required 

Facilities Remodeling. 

C. Defaults Resulting in Termination Following Expiration of Cure Period. 

(1) Except for those items listed in preceding Section 21.A and 21.B, Franchisee 

shall have 30 days after written notice of default from Franchisor within which to remedy the default and 

provide evidence of that remedy to Franchisor. If any such default is not cured within that time, this 

Agreement shall terminate without further notice to Franchisee effective immediately upon expiration of 

that time, unless Franchisor notifies Franchisee otherwise in writing. Franchisee will be in default under 

this Section 21.C(1) for any failure to materially comply with any of the requirements imposed by this 

Agreement, the Manuals or otherwise in writing, or to carry out the terms of this Agreement in good faith. 

(2) Notwithstanding the provisions of preceding Section 21.C(1), if Franchisee 

defaults in the payment of any monies owed to Franchisor when such monies become due and payable 

and Franchisee fails to pay such monies within 10 days after receiving written notice of default, then this 

Agreement will terminate effective immediately upon expiration of that time, unless Franchisor notifies 

Franchisee otherwise in writing. 

(3) If Franchisee has received two or more notices of default within the previous 12 

months, Franchisor shall be entitled to send Franchisee a notice of termination upon Franchisee’s next 

default within that 12-month period without providing Franchisee an opportunity to remedy the default. 

(4) In addition to the other provisions of this Section, if Franchisor reasonably 

determines that Franchisee becomes or will become unable to meet its obligations to Franchisor or its 

affiliates under this Agreement, Franchisor may provide Franchisee written notice to that effect and 

demand that Franchisee provide those assurances reasonably designated by Franchisor, which may 

include security or letters of credit for the payment of Franchisee’s obligations to Franchisor and its 

affiliates. If Franchisee fails to provide the assurances demanded by Franchisor within 30 days after its 

receipt of written notice from Franchisor, this Agreement shall terminate without further notice to 

Franchisee effective immediately upon expiration of that time, unless Franchisor notifies Franchisee 

otherwise in writing. 

D. Franchisor’s Alternate Remedies Upon Franchisee’s Default. 

In addition to, and without limiting, Franchisor’s other rights and remedies under this Agreement, 

any other agreement or applicable law, if Franchisee fails to comply with any provision of this Agreement 

or upon the occurrence of (i) any event of default giving rise to Franchisor’s right to terminate this 

Agreement under the preceding Section 21.B or (ii) any event of default under Section 21.C which, 

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following notice, is not timely cured, Franchisor may instead elect, in its sole discretion and upon written 

notice to Franchisee, to take any or all of the following actions without terminating this Agreement until 

such time as Franchisor confirms in writing that such default has been cured: 

(1) temporarily remove information concerning the Restaurant from any Digital 

Media operated for the network of Fridays Restaurants, and/or restrict Franchisee’s participation in other 

programs or benefits offered on or through any such Digital Media; 

(2) temporarily suspend Franchisee’s right to participate in any advertising, 

marketing, promotional, or public relations programs that Franchisor or the National Advertising Fund 

provides, authorizes, or administers; 

(3) withhold the provision of any services required to be performed by Franchisor 

under this Agreement for a period of time determined by Franchisor in its sole discretion; 

(4) assess a non-compliance fee in the amount of 1% of the Gross Sales of the 

Restaurant for each month in which that non-compliance has occurred or continued for one or more days, 

in order to compensate Franchisor for damage to the reputation of Fridays Restaurants, the Proprietary 

Marks and the entire System; and, 

(5) at Franchisee’s expense, require Franchisee, Franchisee’s Operating Principal, 

the Restaurant’s general manager, and/or the kitchen manager to attend and successfully complete the 

Management Training Program. 

E. Early Termination Damages. 

(1) If Franchisee defaults on its obligations and this Agreement terminates before 

the expiration of the Initial Term, it is hereby agreed by Franchisee and Franchisor that the amount of 

damages which Franchisor would incur for any such termination of this Agreement would be difficult, if 

not impossible, to accurately ascertain. Accordingly, within 30 days following such termination, 

Franchisee and its Principal Owners shall pay to Franchisor an amount equal to the average monthly 

Royalty Fees and advertising fund contributions that Franchisee owed for the past 36 months multiplied 

by the lesser of 36 months or the number of months remaining in the Initial Term (“Early Termination 

Damages”). If Franchisee has not operated the Restaurant for 36 months, the Early Termination 

Damages will be calculated by using the average monthly Royalty Fees and advertising contributions 

owed by Franchisee for the number of months that the Restaurant has been in operation. The Early 

Termination Damages shall also include the value of the Occupancy Contract and Permits (as hereinafter 

defined), if applicable, assigned to Franchisor or its designee pursuant to Section 23.A(2). These Early 

Termination Damages shall constitute liquidated damages and are not to be construed as a penalty and 

shall be the joint and several liability of Franchisee, its Principal Owners, and each Guarantor. 

(2) Franchisee and Franchisor acknowledge and agree that: (a) the Early 

Termination Damages are a reasonable estimation of the damages that would be incurred by Franchisor 

resulting from or arising out of the premature termination of this Agreement; and (b) Franchisee’s 

payment of such Early Termination Damages is intended to fully compensate Franchisor only for any and 

all damages related to or arising out of the premature termination of this Agreement by Franchisor, and 

shall not constitute an election of remedies, waiver of any default under this Agreement, nor waiver of 

Franchisor’s claim for other damages and/or equitable relief arising out of Franchisee’s breach of this 

Agreement. 

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(3) The imposition of Early Termination Damages shall be at Franchisor’s sole 

option. Franchisor is not required to impose Early Termination Damages and may, in addition or in lieu 

thereof, pursue other remedies available to Franchisor under the terms and conditions of this Agreement, 

in equity or at law in the event of Franchisee’s default under this Agreement, including, without 

limitation, actual damages incurred by Franchisor, if such can be ascertained. All such remedies shall be 

cumulative and non-exclusive. 

F. Statutory Limitations. 

If any valid, applicable law or regulation of a competent governmental authority with jurisdiction 

over this Agreement requires a notice or cure period before termination longer than set forth in this 

Section, this Agreement will be deemed amended to conform to the minimum notice or cure period 

required by the applicable law or regulation. 

22. OBLIGATIONS ON TERMINATION OR EXPIRATION 

A. Franchisee’s Obligations. 

Upon termination or expiration of this Agreement (or as directed by Franchisor if Franchisor 

intends to exercise the Purchase Option under Section 23): 

(1) Franchisee immediately shall cease operating a Fridays Restaurant at the 

Premises. All rights and licenses granted to Franchisee under this Agreement (including, without 

limitation, the right to use the System, the Manuals, and the Proprietary Marks) immediately shall 

terminate and all rights shall revert to Franchisor; 

(2) Franchisee immediately shall pay Franchisor and its affiliates all sums due and 

owing Franchisor or its affiliates pursuant to this Agreement. Until all amounts are paid and any 

damages, costs or expenses incurred or suffered by Franchisor have been paid, Franchisor shall have, and 

Franchisee shall be deemed to have granted, a lien against any and all of the Assets (as defined below) 

and Franchisee’s interest in the Premises; 

(3) Franchisee promptly shall cease use of and return to Franchisor the Manuals, 

any copies of the Manuals, all other Confidential Information, and all other materials and information 

furnished by Franchisor, and Franchisee promptly shall return to Franchisor, in good condition and repair 

excepting normal wear and tear, all computer software, disks, tapes and other magnetic storage media. 

Franchisee shall retain no copies of the returned materials; 

(4) Franchisee immediately shall discontinue all use of the Proprietary Marks and 

Franchisor’s trade secrets in connection with the Restaurant and of any and all items bearing the 

Proprietary Marks; unless acquired by Franchisor pursuant to Section 23 below, remove the Proprietary 

Marks from the Restaurant, and from clothing, signs, materials, motor vehicles and other items owned or 

used by Franchisee in the operation of the Restaurant; cease to use, in any manner whatsoever, any 

websites, Social Media, or other Electronic Identifiers associated with the Proprietary Marks or the 

System; cancel all advertising for the Restaurant that contains the Proprietary Marks (including telephone 

directory listings); and take such action as may be necessary to cancel any filings or registrations for the 

Restaurant that contain any Proprietary Marks (including any assumed name filings); 

(5) Franchisee shall, at the option of Franchisor, execute all documentation required 

by Franchisor to assign to Franchisor all rights to the telephone numbers of the Restaurant, any related 

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and other business listings, and any Electronic Identifiers related to the Restaurant. Franchisee is not 

entitled to any compensation from Franchisor if Franchisor exercises these rights or options. Franchisee 

hereby appoints Franchisor as its attorney-in-fact with full power and authority (which power and 

authority are coupled with an interest and irrevocable) for the purpose of assigning these rights to 

Franchisor and shall execute any forms or documents that Franchisor considers necessary for that 

appointment; 

(6) Franchisee and all persons and entities subject to the covenants contained in 

Section 20 shall continue to abide by those covenants and shall not, directly or indirectly, take any action 

that violates those covenants; 

(7) If Franchisor or its designee does not elect to assume the Occupancy Contract 

for the Premises and/or does not purchase the Restaurant assets in accordance with Section 23 below, then 

Franchisee promptly shall make such alterations and modifications to the Premises as may be necessary to 

clearly distinguish to the public the Premises from that of other Fridays Restaurants and also make those 

specific additional changes as Franchisor or its designee may request for that purpose including, but not 

be limited to: (1) removal of décor, including wall graphics, decorative glass elements and the racing 

scull; (2) removal of red and white striped outside awnings; (3) removal or painting of interior red and 

white ceiling elements and exterior and interior walls to a solid color other than Franchisor’s proprietary 

blue or a color specified in the Standards; and (4) removal of signage and architectural tumbler. If 

Franchisee fails to promptly make these alterations and modifications, Franchisor or its designee shall 

have the right (at Franchisee’s expense, to be paid upon Franchisee’s receipt of an invoice from 

Franchisor) to do so without being guilty of trespass or other tort; and 

(8) Franchisee and each Principal Owner shall, jointly and severally, pay all costs 

and expenses (including fees of attorneys and other engaged professionals) incurred by Franchisor in 

connection with the enforcement of this Section 22. 

B. Evidence of Compliance. 

Franchisee shall furnish Franchisor, within 30 days after the effective date of termination or 

expiration, evidence (certified to be true, complete, accurate and correct by the chief executive officer of 

Franchisee, if Franchisee is a corporation; by a manager of Franchisee, if Franchisee is a limited liability 

company; or by a general partner of Franchisee, if Franchisee is a partnership) satisfactory to Franchisor 

of Franchisee’s compliance with Section 22.A. 

C. Franchisee Prohibited from Engaging in Certain Conduct. 

Franchisee shall not, except with respect to a restaurant franchised by Franchisor or its affiliates 

which is then open and operating pursuant to an effective franchise agreement: (1) operate or do business 

under any name or in any manner that might tend to give the public the impression that Franchisee is 

connected in any way with Franchisor or its affiliates or has any right to use the System or the Proprietary 

Marks; (2) make, use or avail itself of any of the materials or information furnished or disclosed by 

Franchisor or its affiliates under this Agreement or disclose or reveal any such materials or information or 

any portion thereof to anyone else; or (3) assist anyone not licensed by Franchisor or its affiliates to 

construct or equip a foodservice outlet substantially similar to a Fridays Restaurant. 

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23. OPTION TO PURCHASE 

A. Scope. 

(1) Franchisee hereby grants to Franchisor an option (“Purchase Option”) to 

purchase the assets used in connection with the ownership and/or operation of the Restaurant. Franchisor 

may notify Franchisee between one year before and 30 days after the effective date of termination or 

expiration of this Agreement, if Franchisor desires to exercise its Purchase Option. Within 15 days after a 

request by Franchisor, Franchisee must provide to Franchisor a list of all assets used in connection with 

the ownership or operation of the Restaurant, and Franchisor will thereafter advise Franchisee which of 

such assets Franchisor desires to purchase (collectively, the “Assets”), which may include, without 

limitation, leasehold improvements, equipment, vehicles, furnishings, fixtures, signs and legally 

transferable inventory (non-perishable products, materials and supplies), the Occupancy Contract and, to 

the extent legally transferable, any Permits (as defined in Section 23.A(2)). 

(2) If Franchisor exercises the Purchase Option, Franchisee shall, at Franchisor’s 

option, assign the Occupancy Contract for the Premises and the liquor and all other transferable licenses 

and permits used in connection with the ownership or operation of the Restaurant (collectively, the 

“Permits”) to Franchisor or its designee. In the event that Franchisor exercises the Purchase Option after 

termination for Franchisee’s default, the purchase price for the Occupancy Contract and the Permits shall 

be included in the Early Termination Damages; in the event that Franchisor exercises the Purchase Option 

after expiration, the purchase price for the Occupancy Contract and the Permits shall be the fair market 

value of the Occupancy Contract and the Permits. 

(3) At any time after Franchisor provides notice to Franchisee under 

Section 23.A(1), Franchisor may elect: (a) to permit Franchisee to operate the Restaurant and maintain the 

Assets in the usual and ordinary course of business and maintain in full force all insurance policies 

required under this Agreement; (b) to appoint an interim manager (which may be Franchisor or its 

designee), at Franchisor’s expense, to control the day-to-day operations of the Restaurant, and Franchisee 

shall cooperate, and instruct its employees to cooperate, with that manager; or (c) to require Franchisee to 

close the Restaurant during such time period without removing any Assets from the Restaurant. 

(4) Franchisor shall have the unrestricted right to assign this Purchase Option and 

designate the assignee(s) of the Assets. Therefore, all references in this Section 23 to Franchisor shall 

include such assignee and/or designee, as applicable. Franchisor or its assignee shall be entitled to all 

customary representations and warranties that the Assets are free and clear (or, if not, accurate and 

complete disclosure) as to: (a) ownership, condition and title; (b) liens and encumbrances; 

(c) environmental and hazardous substances; and (d) validity of contracts and liabilities inuring to 

Franchisor or affecting the Assets, whether contingent or otherwise. 

(5) Franchisee hereby appoints Franchisor as its attorney-in-fact with full power 

and authority (which power and authority are coupled with an interest and irrevocable) for the purpose of 

consummating the transactions under this Section 23 and shall execute any forms or documents that 

Franchisor considers necessary for that appointment. 

B. Purchase Price. 

The purchase price for the Assets (“Purchase Price”) shall be their fair market value determined 

as of the effective date of purchase in a manner that accounts for reasonable depreciation and condition of 

the Assets; provided, however, that the Purchase Price shall take into account the termination or 

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expiration of this Agreement and shall be reduced by any Early Termination Damages. Further, the 

Purchase Price for the Assets shall not contain any factor or increment for any trademark, service mark or 

other commercial symbol used in connection with the operation of the Restaurant nor any goodwill or 

“going concern” value for the Restaurant. Franchisor may exclude from the Assets purchased in 

accordance with this Section any equipment, vehicles, furnishings, fixtures, signs, and inventory, 

including without limitation, any such Assets that are not approved as meeting then-current standards for 

a Fridays Restaurant or for which Franchisee cannot deliver a Bill of Sale in a form satisfactory to 

Franchisor. Franchisor shall have the right to set off against and reduce the Purchase Price by any and all 

amounts owed by Franchisee to Franchisor, and the amount of any encumbrances or liens against the 

Assets or any obligations assumed by Franchisor. 

C. Certified Appraisers. 

If Franchisor and Franchisee are unable to agree on the fair market value of the Assets within 15 

days after Franchisee’s receipt of Franchisor’s notice of its intent to exercise its Purchase Option, the fair 

market value shall be determined by two professionally certified appraisers, Franchisee selecting one and 

Franchisor selecting one. If the valuations set by the two appraisers differ by more than 10%, the two 

appraisers shall select a third professionally certified appraiser who also shall appraise the fair market 

value of the Assets. The average value set by the appraisers (whether two or three appraisers as the case 

may be) shall be conclusive and shall be the Purchase Price. 

D. Access to Restaurant and Other Assets. 

Franchisor and the appraisers shall be given full access to inspect the Restaurant, the Premises 

and other assets, and Franchisee’s books and records during customary business hours and upon 2 

business days notice to conduct inspections and the appraisal. The appraisers shall value the leasehold 

improvements, equipment, furnishings, fixtures, signs and inventory in accordance with the standards of 

this Section. The appraisers fees and costs shall be borne equally by Franchisor and Franchisee. 

E. Exercise of Purchase Option. 

(1) Within 10 days after the Purchase Price has been agreed to or determined by 

appraisers, Franchisor may proceed with exercising its Purchase Option by so notifying Franchisee in 

writing (“Fridays Purchase Notice”). The Purchase Price shall be paid in cash or cash equivalents at the 

closing of the purchase (“Closing”), which shall take place no later than 60 days after the date of Fridays 

Purchase Notice. Franchisee and Franchisor agree that, if issues arise relating to the liquor license and 

Franchisor is not able to operate the Restaurant, among other options, the date for Closing may be 

extended for a reasonable amount of time, not to exceed 270 days, for the parties to resolve such issues. 

(2) Franchisee shall promptly, at Franchisor’s option: (a) enter into an interim 

management or similar agreement whereby Franchisor or its designee (regardless of whether the Closing 

has occurred) may operate the Restaurant pursuant to any or all of the Permits, the Occupancy Contract 

and any other relevant contractual obligations; and (b) promptly take all steps necessary or helpful, 

including executing any forms or documents, in connection with the foregoing. 

F. Due Diligence Period. 

(1) For a period of 30 days after the date of Fridays Purchase Notice (“Due 

Diligence Period”), Franchisor shall have the right to conduct such investigations as it deems necessary 

and appropriate to determine: (a) the ownership, condition and title of the Assets; (b) liens and 

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encumbrances on the Assets; (c) environmental and hazardous substances at or upon the Premises; and (d) 

the validity of contracts and liabilities inuring to Franchisor or affecting the Assets, whether contingent or 

otherwise. Franchisee will afford Franchisor and its representatives access to the Restaurant and the 

Premises at all reasonable times for the purpose of conducting inspections of the Assets; provided that 

such access does not unreasonably interfere with Franchisee’s operation of the Restaurant. 

(2) During the Due Diligence Period, at its sole option and expense, Franchisor may 

(a) cause the title to the Assets that consist of real estate interests (“Real Estate Assets”) to be examined 

by a nationally recognized title company and conduct lien searches as to the other Assets; (b) procure “asbuilt” surveys of the Real Estate Assets; (c) procure environmental assessments and testing with respect to 

the Real Estate Assets; and/or (d) inspect the Assets that consist of leasehold improvements, equipment, 

vehicles, furnishings, fixtures, signs and inventory (“Fixed Assets”) to determine if the Fixed Assets are 

in satisfactory working condition. Before the end of the Due Diligence Period, Franchisor shall notify 

Franchisee in writing of any objections that Franchisor has to any finding disclosed in any title to lien 

search, survey, environmental assessment or inspection. If Franchisee cannot or elects not to correct any 

such title defect, environmental objection or defect in the working condition of the Fixed Assets, 

Franchisor will have the option to either accept the condition of the Assets as they exist or rescind its 

exercise of the Purchase Option on or before the Closing. 

G. Purchase Option Not Exercised. 

If Franchisor does not exercise its Purchase Option, Franchisee shall within 30 days after the 

expiration of Fridays Purchase Option make such alterations to the Restaurant as may be necessary, in 

Franchisor’s reasonable judgment, to distinguish the appearance of the Premises from that of other Fridays 

Restaurants as set forth in Section 22.A(7) above. If Franchisor does not elect to purchase all or any 

portion of the assets which bear any Proprietary Mark or are otherwise proprietary in nature, Franchisee 

shall dispose of such assets only in a manner to which Franchisor has given consent within the same 

period of time as required under this Section for the removal of all other assets. 

H. Ongoing Right of First Refusal. 

If Franchisor does not exercise its Purchase Option, for a period of one year after the termination 

or expiration of this Agreement, Franchisor shall have and is hereby granted a right of first refusal with 

respect to the sale by Franchisee of all or any portion of the assets used in connection with the ownership 

or operation of the Restaurant. Franchisee shall promptly notify Franchisor of any proposed sale of the 

assets and shall provide such information and documents relating thereto as Franchisor may require. 

Within 30 days after receipt of such notice, information and documents, Franchisor may notify Franchisee 

that it intends to exercise its right of first refusal with regard to such assets upon the same terms and 

conditions. If such transaction shall not be consummated within a reasonable period of time after 

Franchisor has given such notice, then Franchisor’s right of first refusal under this Section shall be a 

continuing right and failure to exercise such right shall not constitute a waiver of any other provision of 

this Agreement, including such right of first refusal with respect to future offers. 

I. Compliance with Law. 

Before the Closing, Franchisee and Franchisor shall comply with all applicable legal 

requirements, including the bulk sales provisions of the Uniform Commercial Code of the state in which 

the Restaurant is located and the bulk sales provisions of any applicable tax laws and regulations. 

Franchisee shall, before or simultaneously with the Closing, pay all tax liabilities incurred in connection 

with the operation of the Restaurant before Closing. 

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J. Premises Leased. 

If Occupancy Contract is assigned to Franchisor or Franchisor subleases the Premises from 

Franchisee, Franchisor will indemnify and hold Franchisee harmless from any ongoing liability under the 

Occupancy Contract from the date Franchisor assumes possession of the Premises, and Franchisee will 

indemnify and hold Franchisor harmless from any liability under the Occupancy Contract before and 

including that date. 

K. Premises Owned by Franchisee. 

If Franchisee owns the Premises, Franchisor, at its option, will either purchase the fee simple 

interest or, upon purchase of the Assets, enter into a standard lease with Franchisee on terms comparable 

to those for which similar commercial properties in the area are then being leased. The initial term of this 

lease with Franchisee shall be at least 10 years with two options to renew of five years each, and the rent 

shall be the fair market rental value of the Premises. If Franchisee and Franchisor cannot agree on the fair 

market rental value of the Premises, then appraisers (selected in the manner described in Section 23.C) 

shall determine the rental value. 

L. Franchisee’s Obligations at Closing. 

At the Closing, Franchisee shall deliver instruments transferring to Franchisor or its assignee: 

(A) good and merchantable title to the Assets purchased, free and clear of all liens and encumbrances 

(other than liens and security interests acceptable to Franchisor or its assignee), with all sales and other 

transfer taxes paid by Franchisee; (B) all Permits for the Restaurant that may be assigned or transferred, 

with appropriate consents, if required; and (C) the lease or sublease for the Premises, with appropriate 

consents and estoppels, if required. If Franchisee cannot deliver clear title to all of the purchased Assets 

as indicated in this Section, or if there are other unresolved issues, the Closing shall be accomplished 

through an escrow. 

24. RELATIONSHIP OF THE PARTIES AND INDEMNIFICATION 

A. Relationship of the Parties. 

(1) This Agreement does not create a fiduciary or other special relationship between 

the parties. No agency, employment, or partnership is created or implied by the terms of this Agreement, 

and Franchisee is not and shall not hold itself out as agent, legal representative, partner, subsidiary, joint 

venturer or employee of Franchisor or its affiliates. Franchisee shall have no right or power to, and shall 

not, bind or obligate Franchisor or its affiliates in any way or manner, nor represent that Franchisee has 

any right to do so. Franchisee shall not issue any press releases without the prior written approval of 

Franchisor. 

(2) Franchisee is an independent contractor and is solely responsible for all aspects 

of the development and operation of the Restaurant, subject only to the conditions and covenants 

established by this Agreement. Without limiting the generality of the foregoing, Franchisee 

acknowledges that Franchisor has no responsibility to ensure that the Restaurant is developed and 

operated in compliance with all applicable laws, ordinances and regulations and that Franchisor shall have 

no liability in the event the development or operation of the Restaurant violates any law, ordinance or 

regulation. Neither this Agreement nor our course of conduct is intended, nor may anything in this 

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Agreement nor our course of conduct be construed to state or imply that Franchisor is the employer of 

Franchisee’s employees. The sole relationship between Franchisee and Franchisor is a commercial, arms 

length business relationship. Franchisee’s business is, and shall be kept, totally separate and apart from 

any that may be operated by Franchisor. In all public records, in relationships with other persons, and on 

letterheads and business forms, Franchisee shall indicate its independent ownership of the Restaurant and 

that Franchisee is solely a franchisee of Franchisor. Franchisee shall post a sign in a conspicuous location 

in the Restaurant which will contain Franchisee’s name and state that the Restaurant is independently 

owned and operated by Franchisee under a franchise agreement with Franchisor. 

B. Indemnification. 

(1) Franchisee, Franchisee’s Principal Owners, and all guarantors of Franchisee’s 

obligations under this Agreement shall, at all times, indemnify, defend (with counsel reasonably 

acceptable to Franchisor), and hold harmless (to the fullest extent permitted by law) Franchisor and its 

affiliates, and their respective successors, assigns, past and present stockholders, directors, officers, 

employees, agents and representatives (collectively “Indemnitees”) from and against all “losses and 

expenses” (as defined below) incurred in connection with any action, suit, proceeding, claim, demand, 

investigation, inquiry (formal or informal), judgment or appeal thereof by or against Indemnitees or any 

settlement thereof (whether or not a formal proceeding or action had been instituted), arising out of or 

resulting from or connected with the operation of the Restaurant; employment matters in connection with 

the Restaurant; any unauthorized use of Customer Data; Franchisee’s breach of this Agreement; or 

Franchisee’s activities under this Agreement, including but not limited to any violations of laws applicable 

to the operation of the Restaurant but excluding losses and expenses determined to be caused solely by 

the gross negligence or willful misconduct of Franchisor in a final, unappealable ruling issued by a court 

or arbitrator with competent jurisdiction. Franchisee promptly shall give Franchisor written notice of any 

such action, suit, proceeding, claim, demand, inquiry or investigation filed or instituted against Franchisee 

and, upon request, shall furnish Franchisor with copies of any documents from such matters as Franchisor 

may request. 

(2) At Franchisee’s expense and risk, Franchisor may elect to assume (but under no 

circumstances will Franchisor be obligated to undertake), the defense and/or settlement of any action, 

suit, proceeding, claim, demand, investigation, inquiry, judgment or appeal thereof subject to this 

indemnification. Such an undertaking shall, in no manner or form, diminish Franchisee’s obligation to 

indemnify and hold harmless Franchisor and Indemnitees. An Indemnitee need not seek recovery from 

any insurer or other third party, or otherwise mitigate its or their losses and expenses, in order to maintain 

and recover from third parties fully a claim against Franchisee under this Section 24.B. Franchisee agrees 

that a failure to pursue a recovery or mitigate a loss will not reduce or alter the amounts that an 

Indemnitee may recover from Franchisee under this Section 24.B. 

(3) Notwithstanding anything to the contrary contained in this Agreement, 

Franchisee is not required to indemnify Franchisor with regard to any infringement, alleged infringement 

or other violation or alleged violation by Franchisee or any Principal Owner of any patent, trademark, or 

copyright or other proprietary right owned or controlled by a third party, to the extent that such action 

arises in connection with Franchisee’s use of the Proprietary Marks and System licensed to Franchisee 

when used in the manner authorized and required by Franchisor pursuant to this Agreement. In the event 

Franchisee is involved in such an action, Franchisor agrees to indemnify Franchisee and Franchisee’s 

Principal Owners in connection with the defense thereof, and to indemnify and hold Franchisee and 

Franchisee’s Principal Owners harmless from any and all losses and expenses (as defined below), in 

connection with such proceedings. Franchisee shall give notice to Franchisor of any such claim no later 

than 15 days after Franchisee becomes aware of or is given notice of the claim. This indemnity shall be 

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inoperative to the extent that failure to have timely provided such notice to Franchisor materially impairs 

Franchisor’s ability to defend any such claim, in whole or in part, or to minimize the costs of this 

indemnity. IN NO EVENT SHALL FRANCHISOR’S INDEMNITY OBLIGATIONS TO 

FRANCHISEE EXCEED AN AMOUNT EQUAL TO THE AVERAGE ROYALTIES 

FRANCHISOR HAS RECEIVED UNDER THE AGREEMENT FOR A ONE-YEAR PERIOD. 

Franchisee shall not be required to defend Franchisor with regard to Franchisee’s utilization pursuant to 

this Agreement of the Proprietary Marks and System provided such utilization is in strict compliance with 

that authorized and required by Franchisor pursuant to this Agreement. 

(4) As used in this Section 24.B, the phrase “losses and expenses” shall include, but 

not be limited to, all losses; compensatory, exemplary and punitive damages; fines; charges; costs; 

expenses; lost profits; reasonable attorneys’ fees; expert witness fees; court costs; settlement amounts; 

judgments; compensation for damages to Franchisor’s reputation and goodwill; costs of or resulting from 

delays; financing; costs of advertising material and media time/space and the costs of changing, 

substituting or replacing the same; and any and all expenses of recall, refunds, compensation, public 

notices and other such amounts incurred in connection with the matters described. 

25. CONSENTS, APPROVALS AND WAIVERS 

A. Approvals. 

Whenever this Agreement requires the prior approval, acceptance or consent of Franchisor, 

Franchisee shall make a timely written request to Franchisor therefor, and any approval, acceptance or 

consent received, in order to be effective and binding upon Franchisor, must be obtained in writing and be 

signed by an officer of Franchisor. 

B. No Warranties. 

Franchisor makes no warranties or guarantees upon which Franchisee may rely by providing any 

waiver, approval, acceptance, consent or suggestion to Franchisee in connection with this Agreement, and 

assumes no liability or obligation to Franchisee therefor, or by reason of any neglect, delay, or denial of 

any request therefor. Franchisor shall not, by virtue of any approvals, acceptances, advice or services 

provided to Franchisee, assume responsibility or liability to Franchisee or to any third parties to which 

Franchisor would not otherwise be subject. 

C. Waivers. 

No failure of Franchisor to exercise any power reserved to it by this Agreement or to insist upon 

strict compliance by Franchisee with any obligation or condition hereunder, and no custom or practice of 

the parties at variance with the terms of this Agreement, shall constitute a waiver of Franchisor’s right to 

demand exact compliance with any of the terms of this Agreement. A waiver by Franchisor of any 

particular default by Franchisee shall not affect or impair Franchisor’s rights with respect to any 

subsequent default of the same, similar or different nature, nor shall any delay, forbearance or omission of 

Franchisor to exercise any power or right arising out of any breach or default by Franchisee of any of the 

terms, provisions or covenants of this Agreement affect or impair Franchisor’s right to exercise the same, 

nor shall such constitute a waiver by Franchisor of any right hereunder, or the right to declare any 

subsequent breach or default and to terminate this Agreement before the expiration of its term. 

Subsequent acceptance by Franchisor of any payments due to it hereunder shall not be deemed to be a 

waiver by Franchisor of any preceding breach by Franchisee of any terms, covenants or conditions of this 

Agreement. 

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26. NOTICES 

No notice, demand, request or other communication to the parties shall be binding upon the 

parties unless the notice is in writing, refers specifically to this Agreement, and is addressed to the 

addresses shown on the signature page of this Agreement, unless and until a different address has been 

designated by written notice to the other party. Notices shall be effective upon receipt (or first refusal of 

delivery) and may be: (A) delivered personally; (B) transmitted by facsimile or electronic mail with 

electronic confirmation of receipt; (C) mailed in the United States mail, postage prepaid, certified mail, 

return receipt requested; or (D) mailed via overnight courier. Notices shall be deemed received: at the 

time of personal delivery, at the time of transmission in the case of email, electronic delivery, facsimile or 

similar delivery (provided confirmation of delivery is received by the sender), on the next business day in 

the case of overnight delivery, or within three business days in the case of registered or certified mail. 

27. ENTIRE AGREEMENT 

Franchisor and Franchisee acknowledge that each element of this Agreement is essential and 

material and that, except as otherwise provided in this Agreement, the parties shall deal with each other in 

good faith. This Agreement, the Manuals, the documents referred to herein, and the attachments hereto, 

constitute the entire, full and complete agreement between the parties concerning Franchisee’s rights, and 

supersede any and all prior or contemporaneous negotiations, discussions, understandings or agreements. 

There are no other representations, inducements, promises, agreements, arrangements, or undertakings, 

oral or written, between the parties relating to the matters covered by this Agreement other than those set 

forth in this Agreement and in the attachments to this Agreement. Nothing in this or any other agreement, 

however, is intended to disclaim the representations Franchisor made in the Franchise Disclosure 

Document that Franchisor furnished to Franchisee. No obligations or duties that contradict or are 

inconsistent with the express terms of this Agreement may be implied into this Agreement. Except as 

expressly set forth herein, no amendment, change or variance from this Agreement shall be binding on 

either party unless mutually agreed upon by the parties and executed in writing. 

28. SEVERABILITY AND CONSTRUCTION 

A. Severability. 

If any clause or provision of this Agreement is or should ever be held to be illegal, invalid, or 

unenforceable under any present or future law applicable to the terms hereof, then and in that event, it is 

the intention of the parties hereto that the remainder of this Agreement shall not be affected thereby, and 

that in lieu of each such clause or provision of this Agreement that is illegal, invalid, or unenforceable, 

such clause or provision shall be construed and interpreted to be as similar in substance and content to 

such illegal, invalid, or unenforceable clause or provision, as the context thereof would reasonably 

suggest, so as to thereafter be legal, valid, and enforceable. 

B. No Third Party Beneficiaries. 

Except as otherwise provided in Section 24.B, nothing in this Agreement is intended, nor shall be 

deemed, to confer upon any person or legal entity other than Franchisee and Franchisor and its affiliates 

and such of their heirs, successors and assigns, any rights or remedies under or by reason of this 

Agreement. 

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C. Interpretation. 

No provision of this Agreement shall be interpreted in favor of, or against, any party because of 

the party that drafted this Agreement. 

29. GOVERNING LAW, FORUM AND LIMITATIONS 

A. Choice of Law. 

This Agreement and any claim or controversy arising out of, or relating to, rights and obligations 

of the parties under this Agreement and any other claim or controversy between the parties shall be 

governed by and construed in accordance with the laws of the State of Texas without regard to conflicts 

of laws principles. Nothing in this Section is intended, or shall be deemed, to make any Texas law 

regulating the offer or sale of franchises or the franchise relationship applicable to this Agreement if such 

law would not otherwise be applicable. 

B. Choice of Forum. 

The parties agree that, to the extent any disputes cannot be resolved directly between them, 

Franchisee shall file any suit against Franchisor only in the federal or state court having jurisdiction in 

Dallas County, Texas. Franchisor may file suit in the federal or state court located in Dallas County, 

Texas or in the jurisdiction where Franchisee resides or does business or where the Restaurant is or was 

located or where the claim arose. Franchisee consents to the personal jurisdiction of those courts over 

Franchisee and to venue in those courts. 

C. Limitation of Actions. 

EXCEPT FOR PAYMENTS OWED BY ONE PARTY TO THE OTHER, AND UNLESS 

PROHIBITED BY APPLICABLE LAW, ANY LEGAL ACTION OR PROCEEDING (INCLUDING 

THE OFFER AND SALE OF A FRANCHISE TO FRANCHISEE) BROUGHT OR INSTITUTED 

WITH RESPECT TO ANY DISPUTE ARISING FROM OR RELATED TO THIS AGREEMENT OR 

WITH RESPECT TO ANY BREACH OF THE TERMS OF THIS AGREEMENT MUST BE 

BROUGHT OR INSTITUTED WITHIN A PERIOD OF TWO YEARS AFTER THE INITIAL 

OCCURRENCE OF ANY ACT OR OMISSION THAT IS THE BASIS OF THE LEGAL ACTION OR 

PROCEEDING, WHENEVER DISCOVERED. 

D. Waiver of Certain Damages. 

(1) FRANCHISEE AND FRANCHISOR WAIVE, TO THE FULLEST 

EXTENT PERMITTED BY LAW, ANY RIGHT OR CLAIM OF ANY PUNITIVE OR 

EXEMPLARY DAMAGES AGAINST EACH OTHER AND AGREE THAT, IN THE EVENT OF 

A DISPUTE BETWEEN THEM, EACH SHALL BE LIMITED TO THE RECOVERY OF 

ACTUAL DAMAGES SUSTAINED BY IT. FRANCHISEE AND FRANCHISOR WAIVE, TO 

THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO BRING, OR BE A CLASS 

MEMBER IN, ANY CLASS ACTION SUITS. 

(2) FRANCHISEE AND FRANCHISOR ACKNOWLEDGE AND AGREE 

THAT IN NO EVENT SHALL FRANCHISOR’S AGGREGATE LIABILITY TO FRANCHISEE 

OR ANY OF ITS OWNERS UPON ANY CAUSE OF ACTION (INCLUDING, WITHOUT 

LIMITATION, NEGLIGENCE, STRICT LIABILITY AND OTHER ACTIONS IN CONTRACT 

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OR TORT) ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT EXCEED 

THE TOTAL AMOUNT OF FEES ACTUALLY RECEIVED BY FRANCHISOR FROM 

FRANCHISEE PURSUANT TO THIS AGREEMENT. THE FOREGOING SHALL NOT 

MODIFY THE PROVISIONS OF SECTION 24.B(3) OF THIS AGREEMENT. 

E. JURY TRIAL WAIVER. 

THE PARTIES HEREBY UNCONDITIONALLY WAIVE THEIR RIGHT TO A JURY 

TRIAL OF ANY AND ALL CLAIMS OR CAUSES OF ACTION ARISING FROM OR 

RELATING TO THEIR RELATIONSHIP. THE PARTIES ACKNOWLEDGE THAT A RIGHT 

TO A JURY IS A CONSTITUTIONAL RIGHT, THAT THEY HAVE HAD AN OPPORTUNITY 

TO CONSULT WITH INDEPENDENT COUNSEL, AND THAT THIS JURY WAIVER HAS 

BEEN ENTERED INTO KNOWINGLY AND VOLUNTARILY BY ALL PARTIES TO THIS 

AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A 

WRITTEN CONSENT TO A TRIAL BY THE COURT. 

F. Reimbursement of Costs and Expenses. 

If either party brings an action to enforce this Agreement in a judicial proceeding, the party 

prevailing in that proceeding shall be entitled to reimbursement of costs and expenses, including, but not 

limited to, reasonable accountants, attorneys, attorneys assistants and expert witness fees, the cost of 

investigation and proof of facts, court costs, other litigation expenses, and travel and living expenses, 

whether incurred during, before, in preparation for, in contemplation of, or after the filing of, the 

proceeding. In any judicial proceeding, the amount of these costs and expenses will be determined by the 

court and not by a jury. 

G. Injunctive Relief. 

Franchisee recognizes that its failure to comply with the terms of this Agreement, including, but 

not limited to, the failure to fully comply with all post-termination obligations, is likely to cause 

irreparable harm to Franchisor, its affiliates and the System. Therefore, Franchisee agrees that, in the 

event of a breach or threatened breach of any of the terms of this Agreement by Franchisee, Franchisor 

shall be entitled to injunctive relief (both preliminary and permanent) restraining that breach and/or to 

specific performance without showing or proving actual damages and without posting any bond or 

security. Any equitable remedies sought by Franchisor shall be in addition to, and not in lieu of, all 

remedies and rights that Franchisor otherwise may have arising under applicable law or by virtue of any 

breach of this Agreement. 

H. Rights and Remedies Cumulative. 

No right or remedy conferred upon or reserved to Franchisor or Franchisee by this Agreement is 

intended to be, nor shall be deemed, exclusive of any other right or remedy herein or by law or equity 

provided or permitted, but each shall be cumulative of every other right or remedy. The provisions of this 

Section 29 shall survive the expiration or earlier termination of this Agreement. 

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30. MISCELLANEOUS 

A. Gender and Number. 

All references to gender and number shall be construed to include such other gender and number 

as the context may require. 

B. Captions. 

All captions in this Agreement are intended solely for the convenience of the parties and none 

shall be deemed to affect the meaning or construction of any provision of this Agreement. 

C. Counterparts. 

This Agreement may be executed in counterparts, and each copy so executed and delivered shall 

be deemed an original. 

D. Time. 

Time is of the essence of this Agreement for each provision in which time is a factor. Whenever 

this Agreement refers to a period of days or months, the first day or month to be counted shall be the day 

or month of the designated action, event or notice. Days shall be measured by calendar days, except that 

if the last day of a period is a Saturday, Sunday or national holiday, the period automatically shall be 

extended to the next day that is not a Saturday, Sunday or national holiday. 

E. Outsourcing by Franchisor. 

Franchisor may, in its sole discretion, elect to outsource and/or subcontract certain of Franchisor’s 

obligations under this Agreement to subsidiaries, affiliates, contract employees, third party vendors, 

and/or other third party suppliers; provided that any such outsourcing and/or subcontracting shall not 

discharge Franchisor from its obligations under this Agreement. 

F. Survival. 

Any obligation of Franchisee or Franchisee’s Principal Owners that contemplates performance of 

such obligations after termination, expiration or Transfer shall be deemed to survive such termination, 

expiration or Transfer. 

G. Force Majeure. 

No party shall be liable for any inability to perform by reason of Force Majeure (other than 

financial inability or insolvency) beyond their reasonable control; provided, however, that nothing herein 

shall excuse or permit any delay or failure: (1) to remit any payment on the date due; or (2) for more than 

180 days. The party whose performance is affected by an event of Force Majeure shall, within three days 

of the occurrence of such event, give written notice of such Force Majeure event to the other party setting 

forth the nature thereof and an estimate of its duration. As used in this Agreement, the term “Force 

Majeure” means any act of God, strike, lock-out or other industrial disturbance, war (declared or 

undeclared), riot, epidemic, act of any government or other third party, and any other cause not within the 

control of the party affected thereby. Franchisee’s inability to obtain financing (regardless of the reason) 

shall not constitute an event of Force Majeure. 

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31. REPRESENTATIONS 

Franchisee represents, acknowledges and warrants to Franchisor (and Franchisee agrees that these 

representations, acknowledgments and warranties shall survive termination of this Agreement) that: 

A. Legal and Business Rights and Risks. 

This Agreement involves significant legal and business rights and risks. Franchisor does not 

guarantee Franchisee’s success. Franchisee has read this Agreement in its entirety, conducted an 

independent investigation of the business contemplated by this Agreement, has been thoroughly advised 

with regard to the terms and conditions of this Agreement by legal counsel or other advisors of 

Franchisee’s choosing, recognizes that the nature of the business conducted by Fridays Restaurants may 

change over time, has had ample opportunity to investigate all representations made by or on behalf of 

Franchisor, and has had ample opportunity to consult with current and former franchisees of Franchisor. 

The prospect for success of the business undertaken by Franchisee is speculative and depends to a 

material extent upon Franchisee’s personal commitment, capability and direct involvement in the day-today management of the business. 

B. Franchisor’s Acceptance of Site(s). 

The acceptance of one or more sites by Franchisor and its refusal to accept other sites is not a 

representation that the Premises will achieve a certain sales volume or a certain level of profitability, or 

that the Premises will have a higher sales volume or be more profitable than a site which Franchisor did 

not accept. Acceptance by Franchisor merely means that the minimum criteria that Franchisor has 

established for identifying suitable sites for proposed Fridays Restaurants have been met. Because real 

estate development is an art and not a precise science, Franchisee agrees that Franchisor’s acceptance, or 

refusal to accept a proposed site, whether or not a site application is completed and/or submitted to 

Franchisor, shall not impose any liability or obligation on Franchisor. The decision to develop a 

particular site is Franchisee’s alone, subject to acceptance of the site by Franchisor. Preliminary 

acceptance of a proposed site by any representative of Franchisor is not conclusive or binding, because 

his or her recommendation may be rejected by Franchisor. 

C. Evaluation of Premises. 

Franchisor assumes no liability or responsibility for: (1) evaluation of the Premises soil for 

hazardous substances; (2) inspection of any structure on the Premises for asbestos or other toxic or 

hazardous materials; (3) compliance with the Americans with Disabilities Act (“ADA”); or 

(4) compliance with any other law. It is Franchisee’s sole responsibility to obtain satisfactory evidence 

and/or assurances that the Premises (and any structures thereon) is free from environmental contamination 

and in compliance with the requirements of ADA. 

D. Franchisor’s Construction Representatives. 

Franchisee shall not rely upon any opinions expressed by Franchisor or any of its officers, 

directors, stockholders, employees or agents regarding structural integrity, safety or construction 

procedures, building codes or ordinances or other matters properly within the responsibility of Franchisee 

and its architect. The duties of Franchisor’s construction representatives are limited solely to ensuring 

that development plans and other requirements under this Agreement are met. Franchisor and its 

employees do not act as an architect or agent of Franchisee. Franchisor assumes no liability or 

responsibility for architectural or engineering plans or judgments outside the scope of the duties stated 

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above. Franchisor’s final inspection and authorization to open the Restaurant is not a representation or a 

warranty that the Restaurant has been constructed in accordance with any architectural, engineering or 

legal standards for design or workmanship. It merely means that Franchisor is satisfied that the minimum 

requirements which Franchisor has established for consistency of design and layout have been met. 

Franchisee agrees that Franchisor’s final inspection and authorization to open the Restaurant shall not 

impose any liability or responsibility on Franchisor. 

E. No Representation of Franchisee’s Success. 

Franchisor makes no express or implied warranties or representations that Franchisee will achieve 

any degree of success in the development or operation of the Restaurant and that success in the 

development and operation of the Restaurant depends ultimately on Franchisee’s efforts and abilities and 

on other factors, including, but not limited to, market and other economic conditions, Franchisee’s 

financial condition and competition. 

F. Franchisor’s Agreements with Others. 

Franchisor has entered, and will continue to enter, into agreements with other franchisees. The 

manner in which Franchisor enforces its rights and the franchisees obligations under any of those other 

agreements shall not affect the ability of Franchisor to enforce its rights or Franchisee’s obligations under 

this Agreement. 

G. Initial Franchise Fee Not Refundable. 

The Initial Franchise Fee is fully earned by Franchisor when paid and is not refundable under any 

circumstances. 

H. System Modifications. 

Franchisor may change or modify the System, from time to time, including the Manuals, and 

Franchisee will be required to make such expenditures as such changes or modifications in the System 

may require. 

I. Franchise Application. 

All information Franchisee provided to Franchisor in connection with Franchisee’s franchise 

application and Franchisor’s grant of this Franchise is truthful, complete and accurate. 

J. Signatories to This Agreement. 

The persons signing this Agreement on behalf of Franchisee have full authority to enter into this 

Agreement and the other agreements contemplated by the parties. Execution of this Agreement or such 

other agreements by Franchisee does not and will not conflict with or interfere with, directly or indirectly, 

intentionally or otherwise, with the terms of any other agreement with any other third party to which 

Franchisee or any person with an ownership interest in Franchisee is a party. 

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K. Financial Performance. 

Except to the extent set forth in the Franchise Disclosure Document, Franchisee has not received 

from Franchisor or its affiliates or anyone acting on their behalf, any representation of Franchisee’s 

potential sales, expenses, income, profit or loss. 

L. No Representations Other Than Franchise Disclosure Document. 

Franchisee has not received from Franchisor or its affiliates or anyone acting on their behalf, any 

representations other than those contained in Franchisor’s franchise disclosure document (“Franchise 

Disclosure Document”) as inducements to enter this Agreement. 

M. No Actual or Apparent Authority. 

Even though this Agreement contains provisions requiring Franchisee to operate the Restaurant in 

compliance with the System: (1) Franchisor and its affiliates do not have actual or apparent authority to 

control the day-to-day conduct and operation of Franchisee’s business or employment decisions; and 

(2) Franchisee and Franchisor do not intend for Franchisor or its affiliates to incur any liability in 

connection with or arising from any aspect of the System or Franchisee’s use of the System, whether or 

not in accordance with the requirements of the Manuals. 

N. Waiver of Right to Jury Trial. 

In the event of a dispute between Franchisor and Franchisee, the parties have waived their right to 

a jury trial. 

O. Product Purchases. 

Franchisee and each Principal Owner acknowledge that each has been offered certain products 

and services in connection herewith and understands that Fridays Restaurant franchisees are free to obtain 

these and any other products or services used in the operation of the Restaurant from sources of their own 

choosing, subject only to compliance with the System Standards and the requirements of this Agreement. 

P. No Exclusivity. 

Franchisee understands that Franchisee has received no exclusive rights under this Agreement. 

[signature page follows] 

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Franchisor Signature Page [Store Name # ] 

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FRANCHISE AGREEMENT 

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IN WITNESS WHEREOF, the parties have duly executed, sealed and delivered this Agreement 

as of the Effective Date. 

FRANCHISOR: 

ATTEST: 

By: 

Name: 

TGI FRIDAYS FRANCHISOR, LLC 

By: 

Name: 

Title: 

Address for Notices: 

TGI Fridays Franchisor, LLC 

500 E. State Highway 114 

Suite 200 

Southlake, TX 76082 

Attn: General Counsel 

APPROVED 

AS TO 

LEGAL FORM 

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Franchisee Signature Page [Store Name # ] 

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4931-8848-6658.1 

FRANCHISEE: 

ATTEST/WITNESS: 

By: 

Name: 

[NAME] 

By: 

Name: 

Title: 

Address for Notices: 

Address: 

Email: 

Fax: 

Attn: 

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EXHIBIT A TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

EXHIBIT A [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

ACTIVE 684889259v1 

4931-8848-6658.1 

FRANCHISE INFORMATION 

1. Premises (Section 1.A(1)): 

2. Site Selection Search Area (Section 3.A) (describe or attach map): 

3. Initial Franchise Fee (Section 6.A): 

4. Interests in Other Restaurants (Section 20.C(3)): 

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EXHIBIT B TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

EXHIBIT B [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

FRANCHISEES INITIAL ADVERTISING AND PROMOTION OBLIGATION 

For the purpose of benchmarking the Franchisee’s initial APO under the Franchise Agreement Section 8, 

the following shall constitute the APO in place as of the date of the Franchise Agreement. Thereafter, the APO 

rates and totals may vary and change as contemplated under Section 8 of the Franchise Agreement: 

1. National Advertising Fund 4% of Gross Sales 

(Section 8.C) 

2. Regional Advertising Fund 0% of Gross Sales 

(Section 8.D) 

3. Regional Co-op 0% of Gross Sales 

(Section 8.E) 

4. Local Store Marketing 0% of Gross Sales 

(Section 8.G) 

TOTAL APO: 4% of Gross Sales 

FRANCHISEE 

By: 

Title: 

Date: 

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EXHIBIT C [Store Name # ] 

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FRANCHISE AGREEMENT 

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EXHIBIT C TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

LOCAL STORE MARKETING GUIDELINES 

1. If required by Franchisor, Franchisee must submit an annual Local Store Marketing Plan 

to Franchisor marketing department for approval. In addition to Section 8.G, Franchisor may, from time 

to time, provide Franchisee with an outline of the approval process for marketing plans and all advertising 

materials. Franchisor may also consult with Franchisee regarding the strategy of Franchisee’s marketing 

plan and may discuss marketing materials available to Franchisee. 

2. Franchisee must obtain prior approval from Franchisor on all advertising materials to be 

used for Local Store Marketing before production (including all in-store and external marketing pieces) at 

least 30 days before first use. 

3. All advertising materials used for Local Store Marketing must fall into the categories 

listed below: 

A. Advertising Materials for Use Inside Restaurant. Local Store Marketing 

expenditures may be used to pay approved third parties, ad agencies, and/or Franchisor for costs incurred 

to develop, design, obtain or produce Franchisor-approved advertising materials for use inside the 

Restaurant (e.g., food and drink photography, table tents, menu inserts, drink coasters, poster or other 

promotional signage, promotional t-shirts, and special promotional in-store bounce back certificates). 

B. Advertising Materials for Use Outside Restaurant. Local Store Marketing 

expenditures may be used to pay approved third parties, ad agencies, and/or Franchisor for costs incurred 

to develop, design, obtain or produce Franchisor-approved advertising materials for use outside the 

Restaurant (e.g., advertising on television, radio and cinema including talent and residual costs, 

copywriting, direct mail pieces, newspaper or magazine ads, geo-targeted digital ads, local social media, 

flyers, banners, door hangers, magnets, advertising on billboards, and advertising on subway, mall, airport 

and telephone kiosks). Good faith effort must be made to limit the impact of local marketing on any nonparticipating Franchise or Company-owned restaurant or restaurants unless agreed to in writing by 

affected locations. 

C. Public Relations or Promotional Events. Local Store Marketing expenditures 

may be used to pay public relations agency(ies) for costs incurred to develop, design, produce and execute 

Franchisor-approved public relations materials, events or sponsorships (e.g., media press releases, media 

kits, event invitations, promotional signage and promotional giveaway items such as pins, t-shirts, etc.). 

With Franchisor’s prior written approval, Local Store Marketing expenditures may be used for items such 

as athletic, business or community event sponsorships, contest POS materials, prizes given away for a 

consumer promotion, third party prize fulfillment and one time (non-recurring) remote radio broadcast 

events, unless and except to the extent the value of any of the foregoing is vendor, or third party funded. 

Any and all consumer promotions must meet all state and federal regulations. 

D. Cooperative Advertising Agreements. Local Store Marketing expenditures may 

be used to pay third parties approved by Franchisor for costs incurred as part of Franchisor-approved 

cooperative advertising efforts (e.g., advertising which may be required under the lease agreement for the 

Restaurant). 

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EXHIBIT C [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

4. The materials listed below, while not exhaustive, may be appropriate (and/or required) 

for use at the Restaurant (subject to this Agreement and Franchisor’s approval), but such materials are 

examples of materials that will not satisfy Franchisee’s obligations for Local Store Marketing 

expenditures. 

 Value of gift certificates, Buy One Get One Free’s, Be Our Guest certificates 

 Value of vendor-paid materials for any of the advertising materials referenced above 

 Value of any and all discounts on food or beverages 

 Value of comps for food, whether for VIPs or for promotions 

 Costs related to any menus (e.g., role-play menu, fax menu, kids menu, etc.) 

 Costs incurred in connection with internal incentive contests (e.g., beverage contests, 

etc.) 

 Value of vendor-funded table tents, promotional t-shirts, merchandising items, etc. 

 Costs related to newspaper or magazine subscriptions 

 Costs related to satellite or cable television at the Restaurant 

 Costs related uniforms, logos for uniforms, name tags, etc. 

 Value of salaries and benefits for Franchisee’s marketing employees, or Restaurant 

employees engaged in local marketing activity 

 Value of monthly retainer to local marketing, advertising or public relations agency 

 Costs related to travel to marketing meetings (e.g., airfare, lodging, meals, rental car, etc.) 

 Costs related to any signage at the Restaurant 

 Costs related to music licensing subscriptions 

 Value of any exchanged or bartered items 

 Ongoing and regular or recurring in-restaurant entertainment such as DJ, live music, 

karaoke, and live radio remotes 

 Groupon, Living Social, or similar type online discounted TGI Fridays certificates sold 

through an online site 

 Value of sports or entertainment tickets or other non-consumer-intended elements as part 

of a sponsorship package 

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EXHIBIT D [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

EXHIBIT D TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

LISTING OF FRANCHISEES OWNERSHIP INTERESTS 

Effective Date: This Exhibit D is current and complete as of . 

1. Form of Ownership. 

(a) Individual Proprietorship. Franchisee’s owner(s) (is) (are) as follows: 

(b) Corporation, Limited Liability Company, Partnership or Trust. Franchisee is a 

 incorporated, organized or formed on , under the laws of the 

State / Commonwealth of . Franchisee has not conducted business under any name 

other than its legal entity name and . The following is a list, as applicable, of the 

Franchisee’s partners, directors, officers, members, settlor, trustee, or beneficiary as of the effective date 

shown above: 

Name of Each Director/Officer/Member/Manager 

Settlor/Trustee/ Beneficiary Position(s) Held 

2. Owners. The following list includes the full name of each person who is an owner of a legal or 

beneficial interest in Franchisee, and fully describes the nature of each owner’s interest (attach 

additional pages if necessary). 

Name/Address/Tax Identification No. Percentage/Description of Interest 

(a) 

(b) 

(c) 

(d) 

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EXHIBIT D [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

3. Representative. Franchisee’s Representative as of the Effective Date is: . 

4. Operating Principal. Franchisee’s Operating Principal as of the Effective Date is . 

Franchisee may not change the Operating Principal without Franchisor’s prior written approval. 

5. Multi-Unit Manager. Franchisee’s Multi-Unit Manager as of the Effective Date is . 

Franchisee may not change the Multi-Unit Manager without Franchisor’s prior written approval. 

FRANCHISEE 

By: 

Title: 

Date: 

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EXHIBIT E TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

EXHIBIT E [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

ACH AUTHORIZATION FORM 

FRIDAYS RESTAURANT ADDRESS: 

DEPOSITOR (NAME OR LEGAL ENTITY): 

The undersigned depositor (“Depositor”) hereby authorizes TGI Fridays Franchisor, LLC (“Franchisor”) to 

initiate debit entries and credit correction entries to Depositor’s checking or savings account indicated below and 

Depositor hereby authorizes the depository designated below (“Bank”) to debit or credit such account pursuant 

to Franchisor’s instructions. This authorization is to remain in full force and effect until 60 days after Franchisor 

has received written notification from Depositor of its termination. 

DEPOSITOR INFORMATION 

Depositor Name: 

Mailing Address: 

City/ State/ Zip Code: 

Telephone: 

Email: 

DEBITING BANK ACCOUNT INFORMATION 

Bank Name: 

City / State / Zip Code: 

Branch: 

Account Number to Debit: 

Routing Number (9 digit #): 

Account Name: 

Telephone Number of Bank: 

Name of Contact Person at Bank: 

The undersigned representative of Depositor represents and warrants to Franchisor and the Bank that the person 

executing this ACH Authorization Form is an authorized signatory on the account referenced above and all 

information regarding the account is true and accurate. 

Depositor By: 

Print Name: 

Title: 

Date: 

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EXHIBIT F TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

EXHIBIT F [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

GUARANTY AND ASSUMPTION OF FRANCHISEES OBLIGATIONS 

In consideration of, and as an inducement to, the execution of the TGI Fridays Restaurant Franchise 

Agreement dated as of (“Agreement”) by TGI Fridays Franchisor, LLC 

(“Franchisor”), entered into with (“Franchisee”), 

 (“Guarantor”), who is an officer, director, or Principal Owner as 

defined in the Agreement (or a spouse of one of the foregoing), hereby executes this Guaranty and Assumption 

of Franchisee’s Obligations (“Guaranty”) and personally and unconditionally: (1) guarantees to Franchisor and 

its successors and assigns, for the term of the Agreement (including extensions) and thereafter as provided in the 

Agreement, that Franchisee shall punctually pay and perform each and every undertaking, agreement and 

covenant set forth in the Agreement (including any amendments or modifications of the Agreement); and 

(2) agrees personally to be bound by, and personally liable for the breach of each and every provision in the 

Agreement (including any amendments or modifications of the Agreement), both monetary obligations and 

obligations to take or refrain from taking specific actions or to engage or refrain from engaging in specific 

activities, including the provisions of Sections 18 (Transfers), 20 (Covenants), 21.E (Early Termination 

Damages), 23 (Option to Purchase) and 24.B (Indemnification) of the Agreement. All capitalized terms that are 

not defined in this Guaranty shall have the meaning given them in the Agreement. 

Guarantor waives: (1) acceptance and notice of acceptance by Franchisor of the foregoing 

undertakings; (2) notice of demand for payment of any indebtedness or nonperformance of any obligations 

hereby guaranteed; (3) protest and notice of default to any party with respect to the indebtedness or 

nonperformance of any obligations hereby guaranteed; (4) any right he may have to require that an action be 

brought against Franchisee or any other person as a condition of liability; (5) all rights to payments and claims 

for reimbursement or subrogation which Guarantor may have against Franchisee arising as a result of the 

execution of and performance under this Guaranty by the undersigned; (6) any law or statute which requires that 

Franchisor make demand upon, assert claims against or collect from Franchisee or any others, foreclose any 

security interest, sell collateral, exhaust any remedies or take any other action against Franchisee or any others 

before making any demand upon, collecting from or taking any action against Guarantor with respect to this 

Guaranty; (7) any and all other notices and legal or equitable defenses to which he may be entitled; and (8) any 

and all right to have any legal action under this Guaranty decided by a jury. 

Guarantor consents and agrees that: (1) Guarantor’s direct and immediate liability under this Guaranty 

shall be joint and several, both with Franchisee and among other guarantors; (2) Guarantor shall render any 

payment or performance required under the Agreement upon demand if Franchisee fails or refuses punctually to 

do so; (3) such liability shall not be contingent or conditioned upon pursuit by Franchisor of any remedies 

against Franchisee or any other person; (4) monies received from any source by Franchisor for application 

toward payment of the obligations under the Agreement and under this Guaranty may be applied in any manner 

or order deemed appropriate by Franchisor; and (5) such liability shall not be diminished, relieved or otherwise 

affected by any amendment of the Agreement, any extension of time, credit or other indulgence which 

Franchisor may from time to time grant to Franchisee or to any other person including, without limitation, the 

acceptance of any partial payment or performance or the compromise or release of any claims. None of the 

foregoing shall in any way modify or amend this Guaranty, which shall be continuing and irrevocable during the 

term of the Agreement (including all extensions, renewals, and replacements thereof and successors thereto), 

and for so long as any performance is or might be owed under the Agreement by Franchisee or any owner or 

guarantor, and for so long as Franchisor has any cause of action against Franchisee or any owner or guarantor. 

In addition, if Guarantor ceases to be a Principal Owner, officer or director of Franchisee or own any interest in 

Franchisee (or the spouse of any of the foregoing) before termination or expiration of the Agreement, Guarantor 

agrees that Guarantor’s obligations under this Guaranty shall continue to remain in force and effect 

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EXHIBIT F [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

unless Franchisor in its sole discretion, in writing, releases Guarantor from this Guaranty. Notwithstanding the 

provisions of the previous sentence, unless prohibited by applicable law, the obligations contained in 

Section 20.C of the Agreement shall remain in force and effect for a period of one year after any such release by 

Franchisor. A release by Franchisor of Guarantor shall not affect the obligations of any other guarantor. 

If Franchisor brings an action to enforce this Guaranty in a judicial proceeding, and Franchisor prevails 

in such proceeding, Franchisor shall be entitled to reimbursement of its costs and expenses, including, but not 

limited to, reasonable accountants, attorneys, attorneys assistants and expert witness fees, cost of investigation 

and proof of facts, court costs, other litigation expenses and travel and living expenses, whether incurred during, 

before, in preparation for or in contemplation of the filing of any such proceeding. In any judicial proceeding, 

these costs and expenses shall be determined by the court and not by a jury. 

If Franchisor utilizes legal counsel (including in-house counsel employed by Franchisor or its affiliates) 

in connection with any failure by Guarantor to comply with this Guaranty, Guarantor shall reimburse Franchisor 

for any of the above-listed costs and expenses incurred by it. 

This Guaranty shall be binding upon Guarantor and Guarantor’s respective heirs, legal representatives, 

successors and assigns. Franchisor’s interests in and rights under this Guaranty are freely assignable, in whole 

or in part, by Franchisor. Any assignment shall not release Guarantor from this Guaranty. 

The enforcement provisions of the Agreement (including, but not limited to, Section 29 (Governing 

Law, Forum and Limitations)) are incorporated by reference into this Guaranty and enforceable in accordance 

with the terms of this Guaranty. For the avoidance of doubt, this Agreement and any claim or controversy 

arising out of, or relating to, rights and obligations of the parties under this Agreement and any other claim or 

controversy between the parties shall be governed by and construed in accordance with the laws of the State of 

Texas without regard to conflicts of laws principles. Guarantor agrees that, to the extent any disputes cannot be 

resolved directly with Franchisor, Guarantor shall file any suit against Franchisor only in the state or federal 

court having jurisdiction in Dallas County, Texas. Franchisor may file suit in the federal or state court located in 

Dallas County, Texas, or in the jurisdiction where Guarantor resides or does business or where the Restaurant is 

or was located or where the claim arose. Guarantor irrevocably consents to the personal jurisdiction of those 

courts over Guarantor and waives any objection he or she might have to either the jurisdiction of or venue in 

those courts. 

[signature page follows] 

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EXHIBIT F [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

IN WITNESS WHEREOF, the undersigned has hereunto affixed his signature, under seal. 

GUARANTOR: 

Date: (Seal) 

Print Name: 

Address: 

STATE OF § 

§ 

COUNTY OF § 

On this day of 20 , before me, the undersigned Notary Public in and for the 

State of , personally appeared to me personally known who being by me duly 

sworn did say that s/he is 

the of , 

a , executing the foregoing instrument, that the instrument was 

signed on behalf of said entity by authority of said entity; and s/he acknowledged the execution of the instrument to 

be the voluntary act and deed of said entity. 

Witness my hand and official seal. 

Notary Public 

My commission expires: 

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EXHIBIT G [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

EXHIBIT G TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

NON-DISCLOSURE AND NON-COMPETITION AGREEMENT 

(OWNERS, OFFICERS, DIRECTORS & MANAGERS) 

THIS NON-DISCLOSURE AND NONCOMPETITION AGREEMENT (“Agreement”) is made as of 

the day of , 20 , by and between (“Franchisee”), and 

 , who is/are an owner, officer, manager, supervisor, member, partner, or a 

person in a managerial position with, Franchisee (“Member”). 

BACKGROUND: 

As a result of the expenditure of time, skill, effort and money, TGI Fridays Franchisor, LLC 

(“Franchisor”) has developed and owns a distinctive system (“System”) relating to the development, 

establishment and operation of full-service casual theme restaurants featuring a specialized menu and full bar 

service operating in buildings that bear Franchisor’s interior and exterior trade dress under the name Fridays or 

related tradenames (collectively, “Fridays Restaurants”). 

Franchisor identifies the System by means of certain names and Proprietary Marks including “TGI 

Fridays,” “Fridays” and other names, Proprietary Marks, logos, insignias, slogans, emblems, symbols and 

designs (collectively “Proprietary Marks”), which Franchisor has designated, or may in the future designate, 

for use with the System. The Proprietary Marks used to identify the System, including the principal Proprietary 

Marks, may be modified by Franchisor and/or its affiliates from time to time. 

Franchisor and Franchisee have executed a TGI FridaysTM Restaurant Franchise Agreement 

(“Franchise Agreement”) granting Franchisee the right to operate one (1) Fridays Restaurant (the 

“Restaurant”) and to produce and distribute products and services approved by Franchisor and use the 

Proprietary Marks in connection therewith under the terms and conditions of the Franchise Agreement; 

Member, by virtue of his or her position with Franchisee, will gain access to certain of Franchisor’s 

Confidential Information, as defined in the Franchise Agreement, and must therefore be bound by the same 

confidentiality and non-competition agreement that Franchisee is bound by. 

NOW THEREFORE, in consideration of these premises, the conditions stated herein, and for other 

good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties 

agree as follows: 

1. Confidential Information. Member shall not, during the Initial Term of the Franchise 

Agreement or thereafter, communicate, divulge, or use for the benefit of any other person, persons, partnership, 

entity, association, or corporation any confidential information, knowledge, or know-how concerning the 

methods of operation of the business franchised thereunder which may be communicated to Member or of which 

Member may be apprised by virtue of Franchisee’s operations under the terms of the Franchise Agreement. Any 

and all information, knowledge, know-how, and techniques which Franchisor designates as confidential shall be 

deemed confidential for purposes of this Agreement, except information which Franchisee can demonstrate 

came to its attention before disclosure thereof by Franchisor; or which, at or after the time of disclosure by 

Franchisor to Franchisee, had become or later becomes a part of the public domain, through publication or 

communication by others. 

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EXHIBIT G [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

2. Covenants Not to Compete 

(A) Member specifically acknowledges that, pursuant to the Franchise Agreement, and by 

virtue of its position with Franchisee, Member will receive valuable specialized training and confidential 

information, including, without limitation, information regarding the operational, sales, promotional, and 

marketing methods and techniques of Franchisor and the System. 

(B) Member covenants and agrees that during the term of Members employment with, or 

ownership interest in, Franchisee, and except as otherwise approved in writing by Franchisor, Member shall not, 

either directly or indirectly, for itself, or through, on behalf of, or in conjunction with any person, persons, 

partnership, corporation, or entity: 

(1) Divert or attempt to divert any business or customer, or potential business or 

customer, of any Fridays Restaurant to any competitor, by direct or indirect inducement or otherwise; or 

(2) Own, maintain, operate, engage in, advise, help, make loans to, or have any 

interest in, either directly or indirectly, any restaurant business that offers the same or similar products and 

services as offered by Fridays Restaurants or restaurants in any other concept or system owned, operated, 

managed or franchised by Franchisor or an affiliate, including, without limitation, waiter/waitress service, sitdown dining and bar services (a “Competing Business”). 

(C) Member covenants and agrees that during the Post-Term Period (defined below), except 

as otherwise approved in writing by Franchisor, Member shall not, either directly or indirectly, for itself, or 

through, on behalf of, or in conjunction with any person, persons, partnership, corporation, or entity, own, 

maintain, operate, engage in, or have any interest in a Competing Business that is, or is intended to be, located: 

(1) within three miles of the Restaurant; and (2) within three miles of any then-existing Fridays Restaurant 

operating under the System. 

(E) As used in this Agreement, the term “Post-Term Period” shall mean a continuous 

uninterrupted period of two years from the date of: (1) a Transfer by Member permitted under Section 18 of the 

Franchise Agreement; and/or (2) termination of Members employment with, and/or ownership interest in, 

Franchisee. 

3. Injunctive Relief. Member acknowledges that any failure to comply with the requirements of 

this Agreement will cause Franchisor irreparable injury, and Member agrees to pay all court costs and 

reasonable attorneys’ fees incurred by Franchisor in obtaining specific performance of, or an injunction against 

violation of, the requirements of this Agreement. 

4. Severability. All agreements and covenants contained herein are severable. If any of them, or 

any part or parts of them, shall be held invalid by any court of competent jurisdiction for any reason, then 

Member agrees that the court shall have the authority to reform and modify that provision in order that the 

restriction shall be the maximum necessary to protect Franchisor’s and/or Franchisee’s legitimate business needs 

as permitted by applicable law and public policy. In so doing, Member agrees that the court shall impose the 

provision with retroactive effect as close as possible to the provision held to be invalid. 

5. Delay. No delay or failure by Franchisor or the Franchisee to exercise any right under this 

Agreement, and no partial or single exercise of that right, shall constitute a waiver of that or any other right 

provided herein, and no waiver of any violation of any terms and provisions of this Agreement shall be 

construed as a waiver of any succeeding violation of the same or any other provision of this Agreement. 

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EXHIBIT G [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

6. Jurisdiction, Venue and Choice of Law. This agreement shall be interpreted in accordance with 

the laws of the State of Texas. Jurisdiction and venue shall be in the courts of the State of Texas or the United 

States District Court in Dallas County, Texas, or the state and county of the residence of Member or the location 

of the Restaurant, at the election of Franchisor. 

7. Third-Party Beneficiary. Member hereby acknowledges and agrees that Franchisor is an 

intended third-party beneficiary of this Agreement with the right to enforce it, independently or jointly with 

Franchisee. 

IN WITNESS WHEREOF, Franchisee and Member attest that each has read and understands the 

terms of this Agreement, and voluntarily signed this Agreement as of the day of , 20 . 

FRANCHISEE MEMBER 

By: By: 

Name: Name: 

Title: Title: 

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EXHIBIT H [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

EXHIBIT H TO THE 

TGI FRIDAYSTM RESTAURANT FRANCHISE AGREEMENT 

TGI FRIDAYS LOYALTY PROGRAM AGREEMENT 

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EXHIBIT H [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

TGI FRIDAYSTM LOYALTY PROGRAM AGREEMENT 

This TGI Fridays Loyalty Program Agreement (“Agreement”) is entered into effective the day of 

 , 20 , between TGI Fridays Franchisor, LLC, 500 E. State Highway 114, Suite 200, Southlake, 

Texas 76082 (“Franchisor”), and , [address] (“Franchisee”). 

SECTION I: DEFINITIONS 

Unless otherwise specifically defined herein, capitalized terms will have the meaning attributed to them in the 

applicable Franchise Agreement(s) identified on the attached Exhibit 1 (each a “Franchise Agreement”; 

collectively, the “Franchise Agreements”). 

As used in this Agreement, the following words and phrases will have the meanings attributed to them in this 

Section: 

“Loyalty Program” is the “Fridays Rewards” Program, and/or such other guest reward and recognition 

program(s) as Franchisor may institute from time to time. 

“Loyalty Program Costs” shall mean any and all “start up” fees, use fees and any other fees charged by Vendor 

for the use of the Software that Franchisee must pay in connection with participation in the Loyalty Program. 

Franchisor does not currently charge a fee for Franchisee’s participation in the Loyalty Program, however, 

Franchisor, in its sole discretion, reserves the right to charge a reasonable fee. 

“Participant Data” is the Customer Data (as defined in the Franchise Agreement) entered by each participant in 

the Loyalty Program and may include the individual’s name, mailing address, email address, phone number and 

birth date. 

“Software” is the software utilized to run the Loyalty Program. 

“Vendor” is the proprietor(s) of the Software, as the same may change from time to time. 

SECTION II: AGREEMENT 

1. Participating Restaurants. Franchisee operates one or more Restaurants (“Participating Restaurants”), 

each pursuant to an applicable Franchise Agreement. If Franchisee opens an additional Restaurant, 

upon opening, that Restaurant shall automatically be deemed subject to this Agreement without the 

necessity of an amendment and the term “Participating Restaurants” shall include that additional 

Restaurant. 

2. Loyalty Program. Franchisee agrees to adopt and use the Loyalty Program at the Participating 

Restaurants in accordance with the terms and conditions of the Loyalty Program, as amended from time 

to time, and in accordance with the terms and conditions of the Franchise Agreement. 

3. Term. For each Participating Restaurant, the term of this Agreement begins on the earlier of Loyalty 

Program inception on April 1, 2008 or such subsequent date that Franchisee begins operating any 

Fridays Restaurant and continue through the balance of the term of the Franchise Agreement which is 

the last to expire or be terminated, unless earlier terminated as provided herein. 

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EXHIBIT H [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

4. Operations Training. Franchisee agrees to train all management personnel and staff at the Participating 

Restaurants in accordance with the System Standards relating to the Loyalty Program, including 

compliance with Loyalty Program guidelines and proper execution of the Loyalty Program (such as 

following any in-restaurant scripting developed by Franchisor to recognize Loyalty Program 

participants and provide Loyalty Program benefits to participants). 

5. Loyalty Program Costs. The Loyalty Program Costs shall constitute a Payment under the Franchise 

Agreement for each Participating Restaurant, which Payment shall be due on a monthly basis on the due 

date specified (or other mutually agreed upon basis between Vendor and Franchisee) and payable to 

Vendor. 

6. Use of Loyalty Program. Franchisee may not copy, reproduce or in any way duplicate the Loyalty 

Program for use outside the System or in contravention of the terms of this Agreement. Franchisee shall 

have the right to access and use the Participant Data, limited to the aggregate performance data for each 

individual Participating Restaurant, solely for purposes associated with the Loyalty Program. Any 

unauthorized use of the Participant Data shall constitute a material default of this Agreement. 

Authorized uses of the Participant Data are: (a) research and analysis in support of the Participating 

Restaurants; and (b) site modeling for performance of obligations under existing development 

agreements with Franchisor. 

7. Compliance with Laws. Franchisee is responsible for complying with all state, federal and local laws, 

rules, statutes and ordinances in the locale in which each Participating Restaurant is located relating to 

the Loyalty Program, including but not limited to the sale of alcoholic beverages, awarding of points, 

prizes, email and text messaging and the like. 

8. Fraud. Franchisor assumes no responsibility to identify fraudulently obtained Loyalty Program 

memberships, points credits, reward issuances, reward redemptions and coupon redemptions, fraudulent 

creation of employee accounts, fraudulent use, trade or sale of coupons and/or rewards or the like, or to 

discover or report any fraud, theft or other dishonesty committed by any person not employed by 

Franchisor. Franchisee will be financially responsible for any fraudulent or erroneous issuance or 

redemption of points reward values, reward redemptions or coupon redemptions by Franchisee’s 

personnel. Franchisee will immediately notify Franchisor if Franchisee detects fraudulent issuance or 

redemption of points, reward values, reward redemptions or coupon redemptions. 

9. Indemnification. Franchisee is solely responsible for all expenses incurred in connection with this 

Agreement and Franchisee’s participation in the Loyalty Program. Franchisee hereby indemnifies and 

holds Franchisor harmless for all expenses and liabilities incurred by Franchisor, its franchisees, 

affiliates, officers, directors, employees and agents, in connection with Franchisee’s participation in the 

Loyalty Program in accordance with the terms of this Agreement and the Franchise Agreements. 

10. Ownership of Data. At all times, ownership of the Loyalty Program, Participant Data, and any other 

data derived through Franchisee’s participation in the Loyalty Program is the exclusive property of 

Franchisor and its affiliated companies. The Loyalty Program, the terms of this Agreement and all data, 

information, reports, specifications, written materials, software and computer data used with or derived 

from the Loyalty Program will be deemed Confidential Information as that term is defined in the 

Franchise Agreement. 

11. Transfer. In the event of any Transfer under the Franchise Agreements, Franchisee and its guarantors 

under the Franchise Agreement will remain liable for any Payments and other obligations pursuant to 

this Agreement arising through the date of Transfer. The transferee and its owners must execute and 

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EXHIBIT H [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

deliver to Franchisor the then-current form of agreement and related documents for any guest reward 

and recognition program. 

12. Use of Alternative Guest Reward and Recognition Programs Prohibited. Franchisee shall not use any 

guest reward or recognition program or collect any Participant Data outside of the Loyalty Program. 

Franchisee’s use of Participant Data or participation in any other guest reward or recognition program is 

a material default of this Agreement. 

13. Default. If Franchisee fails to pay any Loyalty Program Costs or fails to comply with any term of this 

Agreement, and any such failure is not cured within ten (10) days after the date Franchisee receives a 

written notice from Franchisor, such failure will be deemed a default of this Agreement and of any other 

agreement with Franchisor (including the Franchise Agreements or any development agreement). Upon 

any uncured default, Franchisor may do any one or more of the following: (a) discontinue providing the 

Loyalty Program to the Participating Restaurants; (b) initiate a collection action against Franchisee for 

all Loyalty Program Costs due; and/or (c) pursue any and all remedies for breach available under the 

Franchise Agreement, including but not limited to termination of the Franchise Agreement and any 

development agreement. Franchisee will, on demand, pay all costs and expenses, including interest and 

attorneys’ fees, paid or incurred by Franchisor, or its affiliates, to enforce this Agreement. Franchisee 

acknowledges that failure by Franchisee to timely pay all amounts due to Franchisor pursuant to any 

Franchise Agreement, development agreement or other agreement will entitle Franchisor to deem 

Franchisee ineligible to participate in the Loyalty Program and to discontinue the Loyalty Program at 

the Participating Restaurants. 

14. Integration. This Agreement, the attachments, and such terms and conditions as may be adopted in 

writing from time to time, constitute the entire agreement between the parties concerning the subject 

matter hereof. All prior agreements, discussions, representations, warranties and covenants are merged 

herein. 

IN WITNESS WHEREOF THIS AGREEMENT HAS BEEN EXECUTED ON THE DATE FIRST 

ABOVE WRITTEN. 

FRANCHISOR: FRANCHISEE: 

TGI FRIDAYS FRANCHISOR, LLC [NAME] 

By: By: 

Name: Name: 

Title: Title: 

Date: Date: 

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EXHIBIT H [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

EXHIBIT 1 

PARTICIPATING RESTAURANTS 

Restaurant # Franchise Agreement 

Date 

Restaurant Address 

 

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RIDER 1 

RIDER 1 [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

TGI FRIDAYS FRANCHISE AGREEMENT EXPIRATION DATE 

TO: 

The Restaurant located at first opened for business 

on . The initial term of the Franchise Agreement for the Restaurant expires on 

 . If Franchisee desires to renew the Franchise Agreement, Franchisee must give Franchisor 

notice no earlier than (18 months before the expiration date of the Franchise Agreement) and 

no later than (12 months before the expiration date). 

TGI FRIDAYS FRANCHISOR, LLC 

By: 

Print Name: 

Title: 

Date: 

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RIDER 2 

RIDER 2 [Store Name # ] 

[Franchisee]/TGIF 

FRANCHISE AGREEMENT 

4931-8848-6658.1 

ADA CERTIFICATION 

(TO BE COMPLETED BY FRANCHISEES ARCHITECT, ENGINEER, ADA 

CONSULTANT, OR OTHER LICENSED PROFESSIONAL) 

In connection with the Fridays Restaurant located at (the “Restaurant”), I hereby 

represent and certify to (“Franchisee”) and to TGI Fridays Franchisor, LLC that: 

1. I have used professionally reasonable efforts to ensure that the Restaurant conforms to and complies 

with the design standards and requirements of the Americans with Disabilities Act (“ADA”), the ADA 

Architectural Guidelines (“ADAAG”), and all other related or similar state and local laws, regulations, 

and other requirements governing public accommodations for persons with disabilities in effect at the 

time that this certification is made, and 

2. In my professional judgment, the Restaurant does in fact conform to and comply with such design 

standards and requirements. 

By: 

Print Name: 

Firm: 

Date: 

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4931-8848-6658.1 1 TGI Fridays – MD – 05/24 

AMENDMENT TO THE TGI FRIDAYS RESTAURANT 

FRANCHISE AGREEMENT 

REQUIRED FOR MARYLAND FRANCHISEES 

This Amendment to the TGI Fridays Restaurant Franchise Agreement dated 

 (“Franchise Agreement”) between TGI Fridays Franchisor, LLC 

(“Franchisor”), a Delaware limited liability company, and 

(“Franchisee”), a , is entered into simultaneously with the execution of the Franchise Agreement. 

1. The provisions of this Amendment form an integral part of, and are incorporated into the Franchise 

Agreement. This Amendment is being executed because: (A) the offer or sale of a franchise to 

Franchisee was made in the State of Maryland; (B) Franchisee is a resident of the State of Maryland; 

and/or (C) the Restaurant will be located in the State of Maryland. 

2. No statement, questionnaire or acknowledgment signed or agreed to by a franchisee in connection 

with the commencement of the franchise relationship shall have the effect of (i) waiving any claims 

under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming 

reliance on any statement made by any franchisor, franchise seller, or any other person acting on 

behalf of the franchisor. This provision supersedes any other term of any document executed in 

connection with the franchise. 

3. Based upon the Franchisor’s financial condition, the Maryland Securities Commissioner has 

required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall 

be deferred until the Franchisor completes its pre-opening obligations under the Franchise 

Agreement. 

4. The following sentence is added to the end of Sections 2.B.(2).(g) (Successor Terms), 18.B.(5) 

(Transfers by Franchisee) and 19 (General Release): 

This release shall not apply to any liability under the Maryland Franchise Registration and 

Disclosure Law. 

5. The following sentence is added to the end of Section 29.B. (Choice of Forum): 

Notwithstanding the foregoing, Franchisee may bring an action in Maryland for claims arising 

under the Maryland Franchise Registration and Disclosure Law. 

6. The following sentence is added to the end of Section 29.C. (Limitation of Claims): 

Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought 

within 3 years after the grant of the franchise. 

7. Sections 31.A. (Legal and Business Rights and Risks), 31.B. (Franchisor’s Acceptance of Site(s)), 

31.E. (No Representation of Franchisee’s Success), 31.K. (Financial Performance), and 31.L. (No 

Representations Other Than Franchise Disclosure Document) are deleted from the Franchise 

Agreement in their entirety. 

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4931-8848-6658.1 2 TGI Fridays – MD – 05/24 

8. The following sentence is added to the end of Section 31 (Representations): 

Section 14-226 of the Maryland Franchise Registration and Disclosure Law prohibits a franchisor 

from requiring a prospective franchisee to assent to any release, estoppel, or waiver of liability as 

a condition of purchasing a franchise. Representations in this Agreement are not intended to, nor 

shall they act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise 

Registration and Disclosure Law. 

9. Any capitalized terms that are not defined in this Amendment shall have the meaning given them 

in the Franchise Agreement. 

10. Except as expressly modified by this Amendment, the Franchise Agreement remains unmodified 

and in full force and effect. 

ATTEST: TGI FRIDAYS FRANCHISOR, LLC 

By: By: 

Print Name: Print Name: 

Title: Title: 

Date: 

ATTEST: 

By: By: 

Print Name: Print Name: 

Title: Title: 

Date: 

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EXHIBIT 10.2(b) FORM ASSIGNMENT OF THE ASSIGNED CONTRACTS AGREEMENT 

[Attached] 

Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14

Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14 

EXHIBIT 10.2(b) 

FORM ASSIGNMENT OF THE ASSIGNED CONTRACTS AGREEMENT 

[Attached] 

 

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Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14 

ASSIGNMENT AND ASSUMPTION AGREEMENT 

This Assignment and Assumption Agreement (the “Agreement”), made and entered into 

as of ______________, is delivered pursuant to the Closing under the Asset Purchase Agreement 

(the “Purchase Agreement”) dated as of ____________, by and among TGI FRIDAY’S INC., a 

New York corporation (“Seller”)1 and _________, a Delaware limited liability company 

(“Buyer”). Capitalized terms used in this Agreement without definition have the respective 

meanings given to them in the Purchase Agreement. 

WHEREAS, pursuant to the Purchase Agreement, Seller has agreed to sell, transfer, assign, 

convey and deliver to Buyer all of Seller’s right, title and interest held immediately before the 

Closing in and to the Acquired Assets, including, but not limited to the Assigned Contracts and 

Transferable Permits; 

WHEREAS, in partial consideration for such sale, assignment, transfer, conveyance and 

delivery of the Acquired Assets, the Purchase Agreement requires Buyer to assume and agree to 

discharge certain obligations and liabilities of Seller as set forth in Section 2.3 of the Purchase 

Agreement; 

WHEREAS, the execution and delivery of this Agreement is part of the consummation of 

the transactions contemplated by the Purchase Agreement. 

NOW, THEREFORE, intending to be legally bound and in consideration of the mutual 

provisions set forth in this Agreement and in the Purchase Agreement, and for other good and 

valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties 

agree as follows: 

Section 1. Assignment of Acquired Assets. Effective as of the Effective Time on the 

Closing Date, on the terms and subject to the conditions set forth in the Purchase Agreement, Seller 

does hereby assign, sell, transfer and set over to Buyer all of Seller’s rights, title and interest in 

and to the Acquired Assets, including, but not limited to the Assigned Contracts, Transferable 

Permits and all goodwill associated with the Restaurants. 

Section 2. Assumption of Liabilities. Buyer hereby accepts Seller’s assignment as 

described above, and, Effective as of the Effective Time on the Closing Date, on the terms and 

subject to the conditions set forth in the Purchase Agreement, Buyer hereby assumes and 

undertakes and agrees to pay, perform and otherwise discharge all of the liabilities as set forth in 

Section 2.3 of the Purchase Agreement, including, without limitation, the Assumed Liabilities and 

all liabilities, rights, interests and title to the Assigned Contracts and Transferable Permits listed 

on Schedule 1 hereto, but excluding those liabilities expressly excluded as set forth in Section 2.4 

of the Purchase Agreement, including, without limitation, the Excluded Liabilities. 

1

 Note to Draft: To be updated at Closing to include any other applicable Seller. 

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Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14 

Section 3. OTHER THAN AS SET FORTH IN THE PURCHASE AGREEMENT, 

THE SALE OF THE ACQUIRED ASSETS IS MADE WITHOUT REPRESENTATION OR 

WARRANT OF ANY KIND OR NATURE WHATSOEVER. Buyer shall unconditionally accept 

the Acquired Assets “AS IS, WHERE IS” and, except as set forth in the Purchase Agreement, 

neither Seller nor any Affiliate of Seller shall be deemed to have made, and each Seller hereby 

expressly disclaims, any representation or warranty, express or implied, as to the value, condition, 

design, operation, merchantability, quality of material or workmanship, fitness for use or a 

particular purpose, manufacture or marketability, of the Acquired Assets, against infringement of 

any patent or copyright or the like, or freedom from any latent or patent defect (whether or not 

discoverable), or compliance with laws, including, without limitation, any representation or 

warrant that arises or may be deemed to arise out of any course of performance, course of dealing, 

or usage of trade, all of which representations and warranties are hereby expressly disclaimed and 

waived by the parties hereto. 

Section 4. General. This Agreement (a) is irrevocable and effective upon Buyer’s 

signature to and delivery of a manually signed copy of this Agreement or facsimile or email 

transmission of the signature to this Agreement in connection with the Closing, if and only if the 

Closing is completed, (b) benefits and binds the parties to the Purchase Agreement and their 

respective successors and assigns, (c) does not modify, affect, expand or limit, and is subject to, 

the provisions of the Purchase Agreement and (d) may be signed in counterparts as provided in 

Section 13.6 of the Purchase Agreement. In the event of any conflict or inconsistency between the 

provisions of the Purchase Agreement and the provisions of this Agreement, the provisions of the 

Purchase Agreement will control. Sections 13.1 (Notices), 13.2 (Effect of Headings; Negotiated 

Agreement), 13.3 (Entire Agreement; Modification; Waiver), 13.4 (Parties in Interest), 13.5 

(Binding Effect; Assignment), 13.7 (Governing Law; Jurisdiction), 13.9 (Severability), 13.13 

(Further Assurances), 13.16 (Waiver of Jury Trial), 13.18 (Non-Recourse) and 13.21 (Seller 

Representative) of the Purchase Agreement are hereby incorporated herein by reference and shall 

apply as if fully set forth herein mutatis mutandis. 

[signature page follows] 

 

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Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14 

IN WITNESS WHEREOF, the parties to this Agreement have duly executed it on the day 

and year first above written. 

SELLER 

TGI FRIDAY’S INC., 

a New York corporation 

By: _____________________________ 

Name: __________________ 

Title: __________________ 

 

BUYER 

By: _____________________________ 

Name: __________________ 

Title: __________________ 

 

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Exhibit 10.2(b) 

4903-2558-8736, v. 1 

148483277_14 

Schedule 1 

Assigned Contracts and Transferable Permits 

Assigned Contracts 

Transferable Permits 

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EXHIBIT 10.2(c) FORM BILL OF SALE 

[Attached] 

Exhibit 10.2(c) 

4903-2558-8736, v. 1 

148483277_14

Exhibit 10.2(c) 

4903-2558-8736, v. 1 

148483277_14 

EXHIBIT 10.2(c) 

FORM BILL OF SALE 

[Attached] 

 

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Exhibit 10.2(c) 

4903-2558-8736, v. 1 

148483277_14 

BILL OF SALE 

This Bill of Sale (the “Bill of Sale”), made and entered into as of _______________, is 

delivered pursuant to the Closing under the Asset Purchase Agreement (as amended, the “Purchase 

Agreement”) dated as of ___________, by and among TGI FRIDAY’S INC., a New York 

corporation (“Seller”)2 and ______________, a Delaware limited liability company (“Buyer”). 

Capitalized terms used in this Bill of Sale without definition have the respective meanings given 

to them in the Purchase Agreement. 

WHEREAS, pursuant to the Purchase Agreement, Buyer has agreed to acquire the 

Acquired Assets. Buyer and Seller now seek to consummate the assignment, conveyance and 

transfer of such Acquired Assets. 

NOW, THEREFORE, intending to be legally bound and in consideration of the mutual 

provisions set forth in this Bill of Sale and in the Purchase Agreement, and for other good and 

valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties 

agree as follows: 

Section 1 Sale and Transfer of Acquired Assets. Effective as of the Effective Time 

on the Closing Date, on the terms and subject to the conditions set forth in the Purchase Agreement, 

Seller hereby sells, assigns, conveys, transfers and delivers to Buyer, and Buyer hereby purchases, 

acquires, and accepts from Seller, all of Seller’s right, title and interest in and to the Acquired 

Assets. For the avoidance of doubt, the parties acknowledge and agree that each Seller sells, 

assigns, conveys, transfers and delivers only that portion of the Acquired Assets owned by it. In 

accordance with the Purchase Agreement, Buyer hereby (a) acknowledges and agrees that the sale 

of the Acquired Assets is on an “AS IS, WHERE IS AND WITH ALL FAULTS” basis (except 

for the Express Representations contained in the Purchase Agreement), and (b) accepts the 

Acquired Assets without representation or warranty, express or implied (except for the Express 

Representations contained in the Purchase Agreement). For the avoidance of doubt, Buyer is not 

purchasing, acquiring or otherwise accepting (and is not obligated to purchase, acquire or 

otherwise accept) any right, title and interest in and to the Excluded Assets. 

Section 2 General. This Bill of Sale (a) is irrevocable and effective upon Seller’s 

signature to and delivery of a manually signed copy of this Bill of Sale or facsimile or email 

transmission of the signature to this Bill of Sale in connection with the Closing, if and only if the 

Closing is completed, (b) benefits and binds the parties to the Purchase Agreement and their 

respective successors and assigns, (c) does not modify, affect, expand or limit, and is subject to, 

the provisions of the Purchase Agreement and (d) may be signed in counterparts as provided in 

Section 13.6 of the Purchase Agreement. In the event of any conflict or inconsistency between the 

provisions of the Purchase Agreement and the provisions of this Bill of Sale, the provisions of the 

Purchase Agreement will control. Sections 13.1 (Notices), 13.2 (Headings), 13.3 (Entire 

Agreement; Modification; Waiver), 13.4 (Parties in Interest), 13.5 (Binding Effect; Assignment), 

13.7 (Governing Law/Jurisdiction), 13.8 (Negotiated Agreement), 13.9 (Severability), 13.13 

2

 Note to Draft: To be updated at Closing to include any other applicable Seller. 

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Exhibit 10.2(c) 

4903-2558-8736, v. 1 

148483277_14 

(Further Assurances), 13.16 (Waiver of Jury Trial), 13.18 (Non-Recourse) and 13.21 (Seller 

Representative) of the Purchase Agreement are hereby incorporated herein by reference and shall 

apply as if fully set forth herein mutatis mutandis. 

[signature page follows] 

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Exhibit 10.2(c) 

4903-2558-8736, v. 1 

148483277_14 

 IN WITNESS WHEREOF, the parties to this Bill of Sale have duly executed it on 

the day and year first above written. 

SELLER 

TGI FRIDAY’S INC., 

a New York corporation 

By: _____________________________ 

Name: ____________ 

Title: ____________ 

BUYER 

By: _____________________________ 

Name: ____________ 

Title: ____________ 

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EXHIBIT 10.2(d) FORM INTERIM MANAGEMENT AGREEMENT 

[Attached] 

Exhibit 10.2(d) 

4903-2558-8736, v. 1 

148483277_14

Exhibit 10.2(d) 

4903-2558-8736, v. 1 

148483277_14 

EXHIBIT 10.2(d) 

FORM INTERIM MANAGEMENT AGREEMENT 

[Attached] 

 

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Exhibit 10.2(d) 

4903-2558-8736, v. 1 

148483277_14 

INTERIM MANAGEMENT AGREEMENT

 THIS INTERIM MANAGEMENT AGREEMENT (this “Agreement”) is made as 

of this ___ day of __________ 2024 (the “Effective Date”), by and between TGI FRIDAY’S 

INC., a New York corporation (“Licensee” and/or “Seller”) and _________ (“Buyer”) (Buyer, 

Licensee, and/or Seller, each a “Party” and together the “Parties.”) 

RECITALS 

A. Licensee holds the liquor licenses summarized in Schedule I (collectively, the 

“Licenses”) issued by the Alcoholic Beverages Control Commission or comparable liquor 

licensing authority of the respective state identified therein (the “Licensing Authority”), which 

Licenses were used by Licensee in the operation of a hospitality business (the “Business”) under 

the name and style of “TGI Friday’s” at each of the leased premises identified therein (collectively, 

the “Premises”). 

B. Simultaneously with their execution of this Agreement, Buyer and Seller closed or 

are in the process of closing on the Asset Purchase Agreement dated __________, 2024 (the 

“APA”), whereby Licensee agrees to sell, and Buyer agrees to purchase, the assets used by Seller 

in connection with the operation of the Business. Capitalized terms used but not herein defined 

shall have the meanings set forth in the APA. 

C. In contemplation of consummating the transactions contemplated by the APA, 

Buyer and/or Seller will request the Licensing Authority to (i) allow Buyer to operate the Premises 

under the Licenses; (ii) approve Buyer’s applications for new licenses allowing Buyer to operate 

the Business with alcohol beverage service and full on-premise liquor licenses issued by the 

Licensing Authority (the “New Licenses”) for each of the Premises; and/or (iii) permit Buyer to 

operate the Premises pending Licensing Authority approval of operation of the Premises under the 

Licenses or issuance of New Licenses, or, until this Agreement is terminated for any reason listed 

in this Agreement, Seller allows Buyer to provide certain services and operations within each of 

the Premises (the “Beverage Alcohol Operations”), which services will be provided at the 

direction of Licensee, subject to the terms and conditions of this Agreement. Notwithstanding 

anything expressed in this Agreement to the contrary, this Agreement will terminate, solely with 

respect to the respective and applicable Premises location, as of the date a full on-premise liquor 

license is issued by the Licensing Authority for the respective and applicable specific Premises 

location or the date on which the Licensing Authority allows Buyer to operate the respective and 

applicable specific Premises location under the Licenses, but will continue in full force and effect 

as to each of the remaining Premises locations until such time as, for each of the remaining 

Premises locations, either a full on-premise liquor license is issued or Buyer is permitted to operate 

the respective and applicable specific Premises location under the Licenses, whichever occurs first, 

unless this Agreement is otherwise terminated for the reasons set forth in this Agreement. 

D. Buyer will submit applications (the “New Applications”) for the New Licenses to 

the extent that such New Licenses are required for Buyer to operate the Business with alcohol 

beverage service. Subject to Paragraph C above, this Agreement will govern the relationship 

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Exhibit 10.2(d) 

4903-2558-8736, v. 1 

148483277_14 

between Buyer and Licensee until such time as either all of the New Applications are approved 

and all of the New Licenses are issued to Buyer or Buyer is permitted to operate the Premises 

under the Licenses. Buyer will diligently complete the New Applications and then obtain the New 

Licenses from the Licensing Authority. Upon reasonable written request from Licensee, Buyer 

will promptly provide an update on the status of the New Applications through its counsel. If any 

New Applications are disapproved, Buyer will have six (6) months from the date of denial to (i) 

complete an appeal of the denial and (ii), if the appeal is denied, at Buyer’s sole discretion, close 

on the sale of the Business (only as it relates to the specific Premises for which the issuance of the 

New License(s) was denied) to a third party and terminate this Agreement (only as it relates to the 

specific Premises for which the issuance of the New License(s) was denied). Buyer will diligently 

complete any applicable appeal and/or sale to a third party, and Licensee will reasonably cooperate 

with any applicable appeal and/or sale to a third party. Notwithstanding the foregoing, if for any 

reason outside the control of the Parties, Buyer has not obtained all of the New Licenses within six 

(6) months from the date of this Agreement, this Agreement will be automatically extended for an 

additional ninety (90) days so long as Buyer continues to make good-faith and demonstrably 

diligent efforts to obtain the New Licenses. 

NOW, THEREFORE, in consideration of the foregoing recitals, which are fully 

incorporated into this Agreement, and for good and valuable consideration, the receipt and 

sufficiency of which are hereby acknowledged, the Parties agree as set forth below. 

ARTICLE I 

MANAGEMENT

1.1 Appointment. Upon the closing of the APA with respect to the Premises, Buyer 

will be the interim manager of Beverage Alcohol Operations pursuant to the terms and conditions 

of this Agreement pending the Licensing Authority’s issuance of New Licenses or approval of 

Buyer operation of the Premises under the Licenses. This Agreement will have no effectiveness 

prior to the closing of the APA with respect to the Premises. 

1.2 Control over Alcoholic Beverages; Inventory; Operations. 

 (a) During the Term (as hereinafter defined), Licensee will control the 

inventory of alcoholic beverages (including wine, spirits, and beer, the “Alcoholic Beverage 

Inventory”) on hand at the Premises. At the end of the Term, provided Buyer has obtained 

Licensing Authority approval of the New Applications or of Buyer operation of the Premises under 

the Licenses, Licensee will be deemed to have assigned to Buyer (in the case of New Applications 

approval), for no additional charge, but without warranty, any right, title, and interest in and to so 

much of the Alcoholic Beverage Inventory as may be on hand at the Premises as of the last day of 

the Term. 

 (b) Subject to the terms and conditions of this Agreement, Licensee grants to 

Buyer, at Buyer’s sole cost and expense, the authority to make all purchases necessary and/or 

desirable for the Beverage Alcohol Operations on behalf of the Business, provided, however, that 

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Exhibit 10.2(d) 

4903-2558-8736, v. 1 

148483277_14 

all purchases of Alcoholic Beverage Inventory must be made pursuant to Licensee’s Licenses and 

from the Operating Account (as hereinafter defined). 

 (c) During the Term of this Agreement, Licensee will compensate the manager 

of record of the Business at the Premises as previously approved by the Licensing Authority 

(collectively, the “GM”) solely to the extent that the GM continues in that position at the respective 

Premises and remains on the payroll of (or is otherwise paid by) Licensee for the purposes of 

maintaining the ability of the respective Premises to continue serving alcoholic beverages. Until 

such time as the Licensing Authority issues New Licenses for the Premises or approves Buyer 

operation of the Premises under the Licenses, Licensee will be responsible for and have exclusive 

control of the Beverage Alcohol Operations and the Alcoholic Beverage Inventory, and shall 

timely, and in conformity with all legal requirements, cause payment for all purchases of Alcoholic 

Beverage Inventory to the proper licensed distributors. Licensee, or any of its Affiliates, will not, 

under any circumstances, be liable for the wages, other compensation, actions, or omissions of any 

personnel retained by Buyer and used in the operation of the Business during the Term. Buyer 

will be responsible for, and have sole control of, (a) paying all salaries, wages, and other 

compensation or benefits, including vacation pay, social security taxes, federal and state disability 

insurance, workers’ compensation insurance, unemployment insurance, medical and life 

insurance, and pension plan contributions that are attributable to Buyer’s employment of the 

Business’s employees; (b) determining the hours of operation and establishing a menu for the 

Business and engaging in effective promotion of the Business as Buyer deems appropriate; (c) 

maintaining appropriate inventories (other than the Alcoholic Beverage Inventory) of materials, 

supplies, and equipment necessary to operate the Business; (d) paying for all food, beverage, taxes, 

supplies materials, insurance premiums, fees, equipment expenses, and other operational expenses 

incurred during the Term in operating the Business; (e) maintaining complete and accurate books 

and records of income, expenses, and operations of the Business (other than the Beverage Alcohol 

Operations, which are addressed below); (f) diligently supervising the Business and complying 

with all requirements of all licenses; and (g) all acts and omissions of Buyer’s employees. 

 (d) Buyer shall submit to Licensee, within a reasonable amount of time in 

advance of the filing deadline, the data and funds necessary for Licensee to accurately prepare, 

sign, and file all required sales tax and other returns and reports. Licensee shall, on a timely basis, 

sign and file with any and all appropriate authorities, along with any and all appropriate payments, 

which Buyer shall fund (to the extent sufficient funds are not available in the Operating Account) 

and which Licensee may pre-pay at its discretion to the extent a pre-payment option is available, 

all necessary sales tax and other returns and reports (proof of which filing and payment shall be 

provided to Buyer upon Buyer’s request therefor). 

 (e) Notwithstanding anything to the contrary contained above, neither Licensee 

nor any of its Affiliates is assuming any of the duties or liabilities of Buyer and will not be obligated 

or liable for any of the expenses, liabilities or debts of Buyer. 

1.3 Records. Licensee, with the cooperation and at the expense of Buyer, will 

maintain, or cause to be maintained, full and adequate books of account and other records 

reflecting the operation of the Beverage Alcohol Operations, which it will make available to Buyer. 

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Licensee will reasonably cooperate with Buyer in Buyer’s efforts to keep full and adequate books 

of account and other records reflecting the results of the Beverage Alcohol Operations. 

1.4 Licensee’s Duties. Without limitation, Licensee agrees, during the Term, to: (a) 

maintain Licensee’s good standing as a New York corporation; (b) at Buyer’s expense, provided 

that the expense is not unreasonably caused by Licensee, use reasonable efforts to obtain, maintain, 

and/or renew the Licenses and any other licenses and/or permits necessary to operate the Business, 

which efforts will include signing liquor-license renewal forms and related documentation, 

removing or causing the removal of “holds” on the renewal of any such licenses, and personally 

appearing or through counsel at the Licensing Authority and/or any other department or agency if 

reasonably required in order to renew the Licenses or to answer any charges, questions, or 

investigations relative to any of the existing Licenses; (c) at Buyer’s expense, provided that the 

expense is not unreasonably caused by Licensee, promptly cooperate with Buyer in the completion, 

filing, and prosecution to completion applications Buyer files with respect to the New Licenses 

and the New Applications; (d) not take any action to hinder, revoke, or withdraw the Licenses or 

any other licenses of the Business; (e) at Buyer’s expense, provided that the expense is not 

unreasonably caused by Licensee, assist Buyer in maintaining dram shop insurance and other 

insurance in conformity with any and all applicable laws, statutes, rules, and/or regulations; and 

(f) at Buyer’s expense, provided that the expense is not unreasonably caused by Licensee, 

reasonably cooperate with Buyer in discharging its duties under this Agreement. 

1.5 Term. Unless terminated sooner under another provision of this Agreement, the 

term of this Agreement (the “Term”) commences as provided in this Agreement and terminates 

on the earlier of: (a) the date Buyer delivers a written notice to Licensee electing to terminate this 

Agreement; (b) subject to the provisions of Paragraph D above, the date on which all of the New 

Applications are approved and all of the New Licenses are issued to Buyer by the Licensing 

Authority and/or the Licensing Authority permits Buyer to operate the remaining Premises under 

the Licenses; (c) upon the occurrence of an Event of Default (as hereinafter defined); or (d) the 

date that is six (6) months following the date of this Agreement. Notwithstanding the foregoing, 

if for any reason outside of the control of the Parties, Buyer did not obtain all of the New Licenses 

or obtain permission to operate the remaining Premises under the Licenses within six (6) months 

from the date of this Agreement, this Agreement and the Term will be automatically extended an 

additional ninety (90) days if Buyer continues to make good-faith and demonstrably diligent effort 

to obtain the New Licenses or obtain permission to operate the remaining Premises under the 

Licenses. 

ARTICLE II 

REVENUE AND EXPENSES

2.1 Revenues. All gross revenue and receipts derived from management of the 

Beverage Alcohol Operations (the “Beverage Alcohol Revenues”) are the exclusive property of 

Licensee. Notwithstanding the foregoing, during the Term hereof, the Beverage Alcohol Revenues 

will be collected and deposited by Buyer into a separate account in Licensee’s name (the 

“Operating Account”). Buyer’s designated employee will be given signatory authority for the 

Operating Account. During the Term, Licensee will not be entitled to any payment other than for 

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reimbursements, taxes, and any obligations incurred by or on behalf of Licensee or its Affiliates 

because of the existence of this Agreement or Buyer’s responsibilities under this Agreement, and 

any other payments as are specifically set forth in this Agreement. 

2.2 Beverage Alcohol Expenses. Buyer will pay, at the direction of Licensee, all 

expenses of the Beverage Alcohol Operations (the “Beverage Alcohol Expenses”), and all such 

payments will be made from the Operating Account. For the avoidance of doubt, Beverage 

Alcohol Expenses will include all costs and expenses incurred by or on behalf of Licensee or its 

Affiliates in connection with providing services under this Agreement, including costs and 

expenses arising out of, associated with or relating to (a) continued operation in bankruptcy and 

any delay in the wind-down or liquidation, including professional fees, case administration, any 

liabilities that come due or payable after the Closing that would otherwise not be payable absent 

the obligation to continue operations in connection with providing services under this Agreement 

or any expenses otherwise relating to the bankruptcy proceedings (each, a “Bankruptcy Case” 

and, collectively, the “Bankruptcy Cases”); (b) employing any individuals, including wages, 

benefit plans, payroll taxes, and any other related expenses, (c) maintaining insurance plans, 

including insurance related to continued employment of any individuals and (d) license fees and 

other expenses associated with maintaining systems to handle inventory, payments, and records. 

Licensee and its Affiliates will have no obligation to advance or supply funds under any 

circumstances related to this Agreement or the Business. All Beverage Alcohol Expenses and 

other expenses related to or arising out of this Agreement, including payment of credit card bills 

used for the purchase of Alcohol Beverage Inventory, will be advanced and paid from funds in the 

Operating Account by Licensee or Buyer at the direction of Licensee. If the Beverage Alcohol 

Expenses exceed Beverage Alcohol Revenues such that there are insufficient funds in the 

Operating Account to pay the Beverage Alcohol Expenses when due, Buyer shall have liability for 

funding the Operating Account to make up such shortfall. If there are insufficient funds in the 

Operating Account to timely and fully pay any and all taxes due associated with the Beverage 

Alcohol Operations, Buyer will deposit into the Operating Account any such shortfall so that all 

such taxes due can be paid in a timely manner. Any such deposits by Buyer can be reimbursed 

from the Operating Account in any later month in which sufficient cash is available for repayment 

of same. Buyer acknowledges and agrees that Licensee is a debtor in the Bankruptcy Cases and 

does not have sufficient liquidity to provide services under this Agreement unless Buyer pays all 

Beverage Alcohol Expenses and any other expenses required under this Agreement. If Licensee 

fails to perform under this Agreement solely as a result of Buyer failing to timely pay in full all 

such expenses, such Licensee failure to perform will not be considered a breach, gross negligence, 

or willful misconduct by or of Licensee. 

ARTICLE III

INSURANCE

3.1 Maintenance of Insurance. 

 (a) During the Term, Buyer will obtain and maintain, with a company 

reasonably satisfactory to Licensee, at the cost and expense of Buyer, a policy of commercial 

general liability insurance, including liquor-liability coverage, with limits of no less than Five 

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Million U.S. Dollars ($5,000,000.00), and that complies with all requirements under the leases for 

the Premises, as well as all applicable laws and ordinances, and names Licensee and any relevant 

affiliates of Licensee as an additional named insured. A certificate evidencing the described 

coverage will be delivered to Licensee prior to the commencement of the Term. Buyer must 

immediately notify Licensee of any failure to pay for any insurance premiums. Buyer’s failure to 

do so will be an Event of Default. 

 (b) The policies of insurance maintained by Buyer will (i) only be cancelable 

following at least thirty (30) days’ written notice to Licensee and (ii) be specifically endorsed to 

provide that the coverage will be primary and that the insurance carried by Licensee will be excess 

and non-contributory. 

3.2 Waiver of Subrogation. Buyer waives any claims against Licensee and its 

Affiliates for any liability, cost, or expense (including reasonable attorneys’ fees and 

disbursements) arising out of any insured claim, in part or in full of any nature whatsoever. To the 

extent it does not prevent it from obtaining coverage on commercially reasonable terms, Buyer 

will cause all policies of insurance maintained pursuant to this Agreement to provide that the 

insurance company will have no right of subrogation against Licensee or any of Licensee’s agents, 

employees, or affiliates. 

3.3 Waiver and Indemnity. 

 (a) Licensee will not, in the performance of this Agreement or in its dealings 

with third parties on behalf of Buyer, be liable to Buyer because of any act or omissions, negligent, 

tortious, or otherwise, of any agent or employee of Licensee; nor will Licensee, in the performance 

of this Agreement, be liable to Buyer because of any act or omission of Licensee, unless such act 

or omission constitutes gross negligence or willful misconduct of Licensee (except for acts or 

omissions contemplated by this Agreement), and the resulting damages are not covered by 

insurance. Notwithstanding the foregoing, Licensee will be responsible to Buyer for the 

reasonable performance of the services and duties to be rendered by Licensee under this 

Agreement, but Licensee will not be liable to Buyer for errors whether for commission or omission 

in the exercise of its business judgment as long as it is an act in good faith and does not involve 

engaging in willful misconduct or gross negligence. Buyer will indemnify, defend, and hold 

Licensee, its affiliates, and the respective employees, agents, attorneys, officers, directors, 

managers, members, and successors and assigns harmless from any and all liabilities, damages, 

penalties, fines, judgments, assessments, or claims, including reasonable attorneys’ fees and costs 

(the “Losses”), incurred by or on behalf of Licensee or its Affiliates in connection with this 

Agreement, including entering into this Agreement, or the Beverage Alcohol Operations from and 

after the date of this Agreement, including any such Losses caused by the negligence of Licensee, 

except for any such Losses caused by the gross negligence or willful misconduct of Licensee. 

 (b) The Parties agree that within ten (10) days of discovery by either Party of 

facts giving rise to a claim for indemnity under the provisions of this Agreement (each, a “Claim”), 

including receipt of notice of any demand, assertion, claim, action, or proceeding, judicial or 

otherwise, by any third party that a Party to this Agreement will give notice thereof in writing to 

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the other Party; provided, that failure to give notice of any such Claim within such time period 

shall not relieve the other Party of its obligations hereunder, except to the extent that the 

indemnifying Party is actually and materially prejudiced thereby. Upon receipt of such notice, the 

Party entitled to indemnification may make written demand for indemnification under this 

Agreement. 

 (c) Buyer will, at its sole cost and expense, contest and defend, by all 

appropriate legal proceedings, any Claim with respect to which it is called upon to indemnify 

Licensee or any of the individuals or entities described in this Article III under the provisions of 

this Agreement. Such contest will be conducted by attorneys reasonably approved by Licensee. 

Licensee will reasonably cooperate with Buyer in connection with such legal proceedings, 

including providing all relevant, non-privileged, and non-confidential information and documents 

within Licensee’s possession, custody, care, or control upon reasonable request of Buyer or 

Buyer’s counsel. Buyer further acknowledges its full financial responsibility for the operations of 

Beverage Alcohol Operations at the Premises, and agrees that Buyer will pay to Licensee or any 

of the indemnified individuals or entities described in this Article III the amount of any damages 

to which Licensee or any such individuals or entities may become entitled by reason of the 

provisions of this Agreement, such payment to be made within thirty (30) days after any such 

amount of damages is finally determined either by mutual agreement of the Parties or resolution 

of the Claim pursuant to Section 5.5. 

3.4 No Joint Venture. Nothing in this Agreement will be deemed or construed by 

the Parties or by any third person to create the relationship of principal and agent or of partnership 

or joint venture. Neither any provisions of this Agreement nor any acts of the Parties will be 

deemed to create any relationship between Licensee and Buyer other than the relationship set forth 

within the scope of this Agreement and the APA and any other agreements ancillary thereto. 

Without limitation, the Parties are not partners or joint venturers, and nothing in this Agreement 

will be construed so as to make them such or to render either liable for any of the debts or 

obligations of the other. 

ARTICLE IV 

EVENTS OF DEFAULT; TERMINATION

4.1 Events of Default. An “Event of Default” under this Agreement will arise if a 

Party fails fully to remedy any breach of its obligations under this Agreement within five (5) 

calendar days (or such longer time as the other Party may in writing allow), after receipt of written 

notice from the other Party specifying one or more of such breaches of this Agreement. 

4.2 Remedies. Upon an Event of Default, every right and remedy of the nondefaulting Party will be cumulative and the non-defaulting Party, in its sole discretion, may 

exercise any and all rights or remedies stated in this Agreement or otherwise available at law or in 

equity, including temporary or permanent injunctive relief. 

ARTICLE V 

MISCELLANY

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5.1 Notices. 

(a) All notices required or desired to be given under this Agreement must be in 

writing and delivered by (i) personal delivery; (ii) overnight courier; (iii) certified or registered 

mail, postage prepaid, return-receipt requested; or (iv) electronic mail, and addressed as follows: 

If to Seller/Licensee: TGI FRIDAY’S INC. 

 500 E State Highway 114, Suite 200, 

 Southlake, TX 76092 

Attn: General Counsel 

With a copy to (which shall not constitute notice): 

Ropes & Gray LLP 

191 North Wacker Drive, 32nd Floor 

Chicago, IL 60606 

Attention: Chris L. Dickerson 

Ellen Wheeler 

Email: chris.dickerson@ropesgray.com 

ellen.wheeler@ropesgray.com 

and 

Foley & Lardner LLP 

2021 McKinney Avenue, Suite 1600 

Dallas, TX 75201 

Attention: Holland N. O’Neil 

Mark C. Moore 

Zachary C. Zahn 

Email: honeil@foley.com 

mmoore@foley.com 

zzahn@foley.com 

If to Buyer: Sugarloaf Concessions, LLC 

 15995 N. Barkers Landing Road 

 Houston, TX 77079 

Attn: Raymond A. Blanchette 

 

With a copy to: Hoover Slovacek LLP 

 5051 Westheimer, Suite 1200 

 Houston, TX 77056 

 Attn: Edward W. Engel 

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or to such other address as either Party may designate from time to time by written notice 

to the other Party in the manner set forth herein. 

(b) All notices and other communications required or permitted under this 

Agreement that are addressed as provided in Section 5.1 and (i)if delivered personally or by 

overnight courier, will be effective upon delivery; (ii) if delivered by mail, will be effective upon 

receipt of delivery (as evidenced by return receipt), or upon the date of refusal to accept delivery; 

and (iii) if delivered by email, will be effective upon delivery if received by 5:00 PM Central Time, 

and otherwise the next business day following that email. The inability to deliver notice because 

of a changed address for which no notice was given will constitute receipt of notice as of the date 

of the inability to deliver. 

5.2 Survival. Unless expressly stated to the contrary, all obligations for any 

payment or reimbursement by one Party to the other will survive the end of the Term or until 

payment or reimbursement in full of all obligations of such Party by such Party following a 

permitted termination of this Agreement. 

5.3 No Waiver. The waiver by either Party of the breach of any of the terms and 

conditions of, or any right under, this Agreement will not be deemed to constitute the waiver of 

any other breach of the same or any other term or condition or of any similar right. No such waiver 

will be binding or effective unless expressed in writing and signed by the Party giving such waiver. 

5.4 Interpretation. The Recitals set forth above are incorporated fully as part of the 

Parties’ agreement. The provisions of this Agreement will not be construed more strictly against 

one Party than the other merely by virtue of the fact that it was initially drafted by counsel to one 

of the Parties, it being acknowledged that each Party was advised by independent counsel with an 

opportunity to review and comment upon each provision thereof. Wherever the term “including” 

is used in this Agreement, it means “including, but not limited to.” Wherever the term “will” is 

used in this Agreement, it will have the meaning of a command. 

5.5 Governing Law. This Agreement will be construed in accordance with the 

laws of the State of Texas without regard to conflict of laws principles. The rights and remedies 

of the Parties under this Agreement are cumulative and not exclusive of one another. Each of the 

Parties irrevocably agrees that any action that may be based upon, arising out of, or related to this 

Agreement or the negotiation, execution or performance of this Agreement and the transactions 

contemplated hereby (each, an “Action” and, collectively, “Actions”) brought by any other Party 

or its successors or assigns will be brought and determined only in (i) the Bankruptcy Court and 

any federal court to which an appeal from the Bankruptcy Court may be validly taken or (ii) in the 

event the Bankruptcy Case is closed, or if the Bankruptcy Court is unwilling or unable to hear such 

Action, any state or federal court within Dallas, Texas ((i) and (ii), each, a “Chosen Courts” and, 

collectively, the “Chosen Courts”), and each of the Parties hereby irrevocably submits to the 

exclusive jurisdiction of the Chosen Courts for itself and with respect to its property, generally and 

unconditionally, with regard to any such Action arising out of or relating to this Agreement and 

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the transactions contemplated hereby. Each of the Parties agrees not to commence any Action 

relating thereto except in the Chosen Courts, other than Actions in any court of competent 

jurisdiction to enforce any judgment, decree or award rendered by any Chosen Court, and no Party 

will file a motion to dismiss any Action filed in a Chosen Court on any jurisdictional or venuerelated grounds, including the doctrine of forum non conveniens. The Parties irrevocably agree 

that venue would be proper in any of the Chosen Courts, and hereby irrevocably waive any 

objection that any such court is an improper or inconvenient forum for the resolution of such 

Action. Each of the Parties further irrevocably and unconditionally consents to service of process 

in the manner provided for notices in Section 5.1. Nothing in this Agreement will affect the right 

of any Party to this Agreement to serve process in any other manner permitted by Law. In addition 

to any other right or remedy, the prevailing Party (as determined by the court) in any litigation, or 

other proceeding arising under this Agreement will recover its reasonable attorneys’ fees and costs 

from the other Party or Parties, including the costs of collection proceedings. 

5.6 Counterparts. This Agreement may be executed in two or more counterparts, each 

of which will be deemed an original but all of which together shall constitute one and the same 

Agreement. The counterparts of this Agreement and all ancillary documents may be executed and 

delivered by facsimile, email, or other electronic signature by either Party to the other Party and 

the receiving party may rely on the receipt of such document so executed and delivered by 

facsimile, email, or other electronic means as if the original had been received. 

5.7 Expenses. Except as otherwise provided, each Party will bear its own expenses 

(including all compensation and expenses of counsel, financial advisors, consultants, actuaries, 

and independent accountants) incurred in connection with this Agreement and consummation of 

the contemplated transactions. 

5.8 Partial Invalidity. If any part of this Agreement is declared invalid by final and 

non-appealable order, decree, or judgment of any court, this Agreement will be construed as if 

such part was not inserted, if the economic basis of this Agreement is not then altered. 

5.9 Assignment. This Agreement may not be assigned without the prior written 

consent of the other Party, which consent will not be unreasonably withheld, conditioned, or 

delayed; provided however, that (i) Buyer shall have the right, with the prior consent of Licensee 

not to be unreasonably withheld, conditioned or delayed, to delegate any of its respective 

obligations hereunder to any management company retained by Buyer for the purposes of the 

Premises and/or this Agreement and (ii) Seller shall be entitled, without the consent of Buyer, to 

assign its rights and obligation to any affiliate of Seller, liquidating trust or other designated third 

party performing any services hereunder. 

 

5.10 Confidentiality. The Parties will each maintain as strictly confidential the 

content of this Agreement, and will not disclose such information to any third party; provided, that 

a Party may disclose such material or information to (i) its advisors and to third-party professionals 

retained or consulted by the Party or its advisors in connection with the contemplated transaction 

so long as such advisors and third parties agree to maintain such material and information as 

confidential and not to disclose such material and information; (ii) its owners, investors, 

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prospective investors or purchasers, affiliates, auditors, advisors, and third-party professionals so 

long as such persons agree to maintain such material and information as confidential and not to 

disclose such material and information; and (iii) the Licensing Authority. No Party will make 

public this Agreement or any portion of it or make any public disclosure of the specific terms of 

this Agreement, except as required by law, including as reasonably necessary in connection with 

the Bankruptcy Cases, or otherwise set forth in this Agreement. If such publication or disclosure 

is arguably or allegedly required by law, but an exemption from such requirement may be 

available, the Party seeking to make such publication or disclosure will use all reasonable efforts 

to obtain such exemption or otherwise avoid the necessity of such publication or disclosure, and 

will in no event make such publication or disclosure without first notifying the other Party to this 

Agreement at least three (3) business days in advance (provided, that such three (3) business day 

notice period shall not apply to any disclosures required in connection with the Bankruptcy Cases). 

In the event the contemplated transactions are not consummated, each Party will promptly return 

to the other Party all information, documents, and other items received from such other Party in 

connection with this Agreement. The provisions of this Section 5.10 will survive the termination 

of this Agreement. 

5.11 No Oral Agreements; Amendments. The Parties acknowledge and agree that there 

are no oral agreements with respect to the subject matter hereof. This Agreement may not be 

amended or modified in any manner without a writing signed by each of the Parties. 

5.12 Entire Agreement. This Agreement and the APA contains the entire agreement of 

the Parties with respect to the subject matter hereof and supersedes any discussions, offers, 

proposals, agreements or promises with respect thereto. 

5.13 Electronic Signatures and Counterparts. This Agreement and any signed agreement 

or instrument entered into in connection with this Agreement, and any amendments hereto or 

thereto, may be executed in one or more counterparts, all of which shall constitute one and the 

same instrument. Facsimile or electronic signatures to any such counterpart shall be treated in all 

manner and respects as an original executed counterpart for all purposes. 

[Signatures appear on the next page] 

 

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IN WITNESS WHEREOF, Licensee and Buyer have duly executed this Agreement to be 

effective as of the Effective Date. 

LICENSEE/SELLER: BUYER: 

TGI FRIDAY’S INC. 

By: __________________________ By: _______________________ 

 

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SCHEDULE I 

Liquor Licenses 

Store No. State License# Town License# Premises Expiration 

____ ________ _____ ________ ________ 

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