Applebee`s - Altervista

Transcription

F-7487
STATE OF MINNESOTA
DEPARTMENT OF COMMERCE
REGISTRATION DIVISION
(651) 539-1627
IN THE MATTER OF THE REGISTRATION OF:
APPLEBEE'S NEIGHBORHOOD GRILL & BAR F/A
By APPLEBEE'S FRANCHISOR LLC
ORDER OF
REGISTRATION
WHEREAS, an a p p l i c a t i o n
Stat.
has been f i l e d pursuant t o Minn.
§80C.04; and
WHEREAS, t h e a p p l i c a n t has c o m p l i e d w i t h the requirements
of r e g i s t r a t i o n ,
NOW,
THEREFORE,
IT IS ORDERED, t h a t t h e r e g i s t r a t i o n be
d e c l a r e d e f f e c t i v e as o f t h e date s e t f o r t h
below.
^ m ^ i
MIKE ROTHMAN
Commissioner
Department of Commerce
85 7 t h P l a c e E a s t , S u i t e 500
St P a u l , MN 55101
Date: September 30, 2014
dlw
3
/
UNIFORM FRANCHISE REGISTRATION APPLICATION
File No.
(Insert file number of immediately
preceding filing of Applicant)
State:
Minnesota
Fee:
$400.00
APPLICATION FOR (Check only one):
X
INITIAL REGISTRATION OF A N OFFER AND SALE OF FRANCHISES
RENEWAL APPLICATION OR ANNUAL REPORT
ofMlnnw*.
PRE-EFFECTIVE AMENDMENT
*i*-«G~mmm
SEP 23 2014
POST-EFFECTIVE
1.
MATERIAL
AMENDMENT
1/Qfo
Full legal name of Franchisor:
APPLEBEE'S FRANCHISOR L L C
2.
Name of the franchise offering:
"Applebee's Neighborhood Grill & Bar"
3.
Franchisor's principal business address:
8140 Ward Parkway
Kansas City, M O 64114
4.
Name and address of Franchisor's agent in this State authorized to receive service
of process:
Commissioner of Commerce - State of Minnesota
Department of Commerce - Registration Division
85 Seventh Place East
St. Paul, Minnesota 55101
5.
The states in which this application is or will be shortly on file:
Hawaii, Minnesota, Washington and Wisconsin
1053556.1
1
t'fah
^
/ /
6.
Name, address, telephone and facsimile numbers, and e-mail address of person to
whom communications regarding this application should be directed:
Kate WalJman
DineEquity
8140 Ward Parkway
Kansas City, MO 64114
(913) 890-0137 Tel
(913) 890-9137 Fax
Kate.\[email protected]
Certification
I certify and swear under penalty of law that I have read and know the contents of this
application, including the Franchise Disclosure Document with an issuance date of October
1, 2014 attached as an exhibit, and that all material facts stated in all those documents are
accurate and those documents do not contain any material omissions. I further certify that
I am duly authorized to make this certification on behalf of the Franchisor and that I do so
upon my personal knowledge.
Signed at Kansas City, Missouri, September /*> , 2014.
Franchisor:
lEE^S FR
APPLEBEEIS
FRANCHISOR L L C
By:_
1053556.1
&m i
Name:
Patrick Dandino
Title:
Vice President, Franchise
EY
Ernst & Young L L P
Suite 500
725 South Figueroa
Tel: +1 213 977 3200
Fax: +1 213 977 3729
ey.com
c*™?
Acknowledgement of Independent Auditors
We agree to the inclusion in the Franchise Disclosure Document of our report dated
September 11, 2014, with respect to the balance sheet and related notes of Applebee's
Franchisor LLC as of August 24, 2014.
Los Angeles, California
September 11,2014
A member fum of Enisi 1 Young GloDat Linked
,
JCVl^t
^y
f
_
^fOUûLLf
EY
Ernst & Young L L P
Suite 500
725 South Figueroa
Tel: +1 213 977 3200
Fax: +1 213 977 3729
ey.com
*z,d«.cA,m,7
Acknowledgement of Independent Auditors
We agree to the inclusion in the Franchise Disclosure Document of our report dated February
26, 2014, with respect to the consolidated financial statements of DineEquity, Inc. and
Subsidiaries parent company of Applebee's Franchisor LLC.
February 26, 2014
A member lirm or Ernst & Young Global Limned
^ /
( O ^ ^ t
f
yoUÂ^LL?
^
Kenneth R. Costello, Esq.
Direct: (310) 576-2132
Fax: (310) 576-2200
[email protected]
September 19, 2014
Bryan Cava LLP
120 Broadway
Suite 300
VIA F E D E X
Santa Monica, CA 90401-2386
Tel(310)576-2100
Mr. Daniel Sexton
Minnesota Department of Commerce
85 7th Place East Suite 500
St. Paul, M N 55101
Fax (310) 576-2200
Re:
Atlanta
Applebee's International, Inc.
File No. F-6784
Dear Mr. Sexton:
www.brvancav9.com
Bryan Cave Oflicos
Boulder
Charlotio
Chicago
Colorado Springs
Dallas
I am writing to you on behalf of Applebee's International, Inc. ("Old Applebee's"),
which is currently registered in Minnesota to sell Applebee's Neighborhood Grill &
Bar® and Applebee's Grill® franchises, and on behalf of Applebee's Franchisor LLC
("New Applebee's"), which will commence franchising these restaurants on October
1, 2014, or upon approval by your office, if later.
Denver
Frankfurt
Hamburg
Hong Kong
Irvine
Jefferson City
I.
Introduction
DineEquity, Inc. (NYSE: D I N , the publicly traded, and 100% parent of Old
Applebee's, and the registered franchisor the Applebee's Neighborhood Grill & Bar®
restaurant chain) and its subsidiaries, are planning and structuring a corporate
reorganization in connection with a securitization financing transaction scheduled to
close on September 30, 2014 (the "Securitization"). We are enclosing a new
registration application on behalf of New Applebee's.
Kansas City
London
Los Angeles
Miami
New York
Paris
Phoenix
San Francisco
Shanghai
Singapore
We are writing to you in advance of the closing of the Securitization with the hope
that your office will be in a position to issue an effective order for New Applebee's
effective on October 1, 2014, following the closing. Upon New Applebee's
registration becoming effective, Applebee's registration will be deemed withdrawn.
We do not believe that there will be any increased risk to prospective franchisees in
your state. New Applebee's has already been formed and capitalized, and its audited
financial statements, reflect a $15 million net worth. The effect of the Securitization
itself will be neutral to New Applebee's net worth.
II.
The Securitization Transaction
Under the Securitization, two of DineEquity, Inc.'s indirect, special purpose
subsidiaries (the "Co-Issuers") have agreed to issue and sell $1.3 billion of senior
1054045.2
St. Louis
Washington, DC
8 ^ 0 ^ ^ ^
Mr. Daniel Sexton
September 1 ^ 0 1 4
Page^
seenred notes at the closing sebeduledfor September 30, ^014. Tbeproeeedsfromthesaleof^be
notes willbensedtoreflnanee approximately $l^billroninexisting debt
nsed primarily for transaction eosts associated witbtbe Securitization and general eor^
Following tbe closing of tbeSecnridzadon, all dênexisdngUS^^^^^
Applebee'swillbe transferred to Applebee's Restaurants EECwlncb will assume respond
"francltisor''totboseexis^
franclnsingofApplebee'sNeigbborboodGrill^Bar^RestaurantsintbeUnitedSta^^ Applebee's
Restaurants, El^C will not offer or sell any additional franchises. OldApplebee'swillretain all existing
and issue all new international franchise agreements.
The Securitization is designed to be neutral and effectively imperceptible to current and prospective
franchisees. NewApplebee'scurrent audited net worth is $15 million and it intends to maintainanet
worth of at least $15 million and otherwise have sufficient cash flow and assets to satisfy its
obligations to creditors and franchisees Substantially all of Old Applebee's currently disclosed
officers will also serve as officers of New Applebee's. Moreover, pursuant to a Management
Agreement executed in connection with the Securitization, D ^
Stewart its Chairman ofthe Board and OhiefExecutive Officer who has been with the company since
^00^,will continue to oversee NewApplebee'sandApplebee'sRestauân^sl^C, and their respective
franchisees, and perform various preDopeningandpostDopeningobligations under their respective
agreements with franchisees.
Ill
Filing
Enclosed is an application to register New Applebee's as the new franchisor of "Applebee's
NeighborhoodOrill^Bar®andApplebee'sOrill®"restaurants. Theapplicationconsistsofthe
following:
1.
Facing page^
^.
Signature page^
3.
Consent to Service ofProcess^
4.
Corporate Acknowledgments
5.
Franchisor'sCost and Source of Funds^
^.
Auditor'sConsent^
7.
Check for $400 00 to cover the filing fee^
8.
Two copies ofits proposed Franchise Disclosure Document ("FDD") and Exhibits^
10^52
Bryan Cave LLP
Mr. Daniel Sexton
September 19,2014
Page 3
9.
One redlined copy of the F D D and Exhibits, showing the differences from Old Applebee's
existing registered documents; and
10.
Salesperson Disclosure Forms for: James A . McDermott III, Eric Brown, Chris Wren, Edgar
Tholen, Gregg Benvenuto and John D. Morris.
Also enclosed is a C D containing an electronic copy of our submission. All of the information
contained in the electronic file on the C D is identical to the paper documents.
Please acknowledge your receipt of this letter and its enclosures by file-stamping the enclosed copy of
this letter and returning it in the enclosed, self-addressed, stamped envelope.
Please call me at (310) 576-2132, if you have any questions or if you require any additional information
or documentation.
yours.
f)
Costello, Esq.
cc:
1054045.2
Patrick Dandino
Kate Wallman
Check Date: Sep/16/2014
Invoice Number
FRANCHISEREGFEE09I5
Invoice Date
Sep/15/2014
Applebee's Services. Inc.
Voucher ID i
Gross Amount
03340462
Check No.
!
00000.12492
Paid Amount
400.00
400.00
Great franchisees. Great branos.
fcî
L,
Vendor Number
0000753663
Check Number
0000052492
V\
Name
MINNESOTA DEPARTMENT OF COMMERCE
Date
Total Amount
Sep/16/2014
$400.00
Total Paid Amount
$400.00
a
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Applebees
FRANCHISE DISCLOSURE DOCUMENT
Date of Issuance: October 1, 2014
1051987.4
FRANCHISE D I S C L O S U R E DOCUMENT
A P P L E B E E ' S FRANCHISOR L L C
G
Applebee's
A Delaware Corporation
8140 Ward Parkway
Kansas City, Missouri 64114
(913) 890-0100/1 -800-354-7363
www.applebees.com/about-us/refranchisinq
[email protected]
The franchisee will operate sit-down, table service restaurants, including the service
of food and alcoholic beverages, under the trade name of Applebee's Neighborhood Grill &
Bar®
The total investment necessary to begin operation of an Applebee's Neighborhood
Grill & Bar® franchised business ranges from $1,996,600 to $6,848,400. This includes
$35,000 that must be paid to us or an affiliate. See Items 5 and 7. You might pay the
franchisor more if you sign a Development Agreement to develop multiple restaurants. See
Items 5 and 7.
This Franchise Disclosure Document ("Disclosure Document") summarizes certain
provisions of your franchise agreement and other information in plain English. Read this
Disclosure Document and all accompanying agreements carefully. You must receive this
Disclosure Document at least 14 calendar days before you sign a binding agreement with,
or make any payment to, the franchisor or an affiliate in connection with the proposed
franchise sale or grant. Note, however, that no governmental agency has verified the
information contained in this document.
You may wish to receive your disclosure document in another format that is more
convenient to you. To discuss the availability of this document in different formats, contact
Nicole Durham-Mallory at the following e-mail address: [email protected].
The terms of your contract will govern your franchise relationship. Do not rely on the
Disclosure Document alone to understand your contract. Read all of your contract carefully.
Show your contract and this Disclosure Document to an advisor, like a lawyer or an
accountant.
Buying a franchise is a complex investment. The information in this Disclosure
Document can help you make up your mind. More information on franchising, such as "A
Consumer's Guide to Buying a Franchise", which can help you understand how to use this
Disclosure Document, is available from the Federal Trade Commission. You can contact
the FTC at 1-877-FTC-HELP or by writing to the FTC at 600 Pennsylvania Avenue, NW,
Washington, D.C. 20580^ You can also visit the FTC's home page at www.ftc.qov for
additional information. Call your state agency or visit your public library for other sources of
information on franchising.
There may also be laws on franchising in your state. Ask your state agencies about
them.
Date of Issuance: October 1, 2014
Applebee's Franchisor LLC 2014 FDD
1051987.4
i
STATE C O V E R PAGE
Your state may have a franchise law that requires a franchisor to register or file with a
state franchise administrator before offering or selling in your state. REGISTRATION
OF A FRANCHISE BY A STATE DOES NOT MEAN THAT THE STATE
R E C O M M E N D S THE FRANCHISE OR HAS VERIFIED THE INFORMATION IN THIS
DISCLOSURE DOCUMENT.
Call the state franchise administrator listed in Exhibit B for information about the
franchisor, or about franchising in your state.
MANY FRANCHISE A G R E E M E N T S DO NOT ALLOW Y O U TO RENEW
UNCONDITIONALLY A F T E R T H E INITIAL T E R M EXPIRES. Y O U MAY HAVE TO
SIGN A N E W A G R E E M E N T WITH DIFFERENT TERMS AND CONDITIONS IN
O R D E R TO CONTINUE TO O P E R A T E YOUR BUSINESS. B E F O R E YOU BUY,
CONSIDER WHAT RIGHTS Y O U HAVE TO RENEW YOUR FRANCHISE, IF ANY,
AND WHAT T E R M S YOU MIGHT HAVE TO A C C E P T IN ORDER TO RENEW.
Please consider the following RISK F A C T O R S before you buy this franchise:
1.
THE D E V E L O P M E N T A G R E E M E N T AND FRANCHISE A G R E E M E N T
REQUIRE THAT A L L D I S A G R E E M E N T S B E LITIGATED IN THE STATE OF
K A N S A S . OUT OF STATE LITIGATION M A Y F O R C E Y O U TO A C C E P T A L E S S
F A V O R A B L E SETTLEMENT. IT M A Y A L S O COST Y O U MORE TO S U E US IN
K A N S A S THAN IN Y O U R HOME S T A T E .
2.
THE D E V E L O P M E N T A G R E E M E N T A N D FRANCHISE A G R E E M E N T STATE
THAT K A N S A S L A W G O V E R N S THE A G R E E M E N T S , AND THIS L A W MAY NOT
PROVIDE THE S A M E PROTECTIONS A N D BENEFITS A S L O C A L LAW. Y O U MAY
WANT TO C O M P A R E T H E S E L A W S .
3.
T H E R E M A Y B E OTHER RISKS CONCERNING THIS FRANCHISE.
We may use the services of one or more FRANCHISE B R O K E R S or referral
sources to assist us in selling our franchise. A franchise broker or referral
source represents us, not you. We pay this person a fee for selling our franchise
or referring you to us. Y o u should be sure to do your own investigation of the
franchise.
Effective Date: See the next page for state effective dates.
1051987.4
ii
S T A T E EFFECTIVE DATES
The following states require that the Franchise Disclosure Document be registered or
filed with the state, or be exempt from registration: California, Hawaii, Illinois, Indiana,
Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota,
Virginia, Washington and Wisconsin.
This Franchise Disclosure Document is registered, on file or exempt from registration in
the following states having franchise registration and disclosure laws, with the following
effective dates:
California
Exempt effective
Hawaii
Effective
Illinois
Exempt effective
Indiana
Exempt effective
Maryland
Exemption effective
Michigan
Effective
Minnesota
Effective
New York
Exempt effective
North Dakota
Exemption effective
Rhode Island
Exemption effective
South Dakota
Exempt effective
Virginia
Exemption effective
Washington
Effective
Wisconsin
Effective
1051987.4
i l l
Table of Contents
ITEM
1.
THE FRANCHISOR AND ANY PARENTS, PREDECESSORS,
AND AFFILIATES ..
1
;
2.
BUSINESS EXPERIENCE
4
3.
LITIGATION
7
4.
BANKRUPTCY
8
5.
INITIAL FEES
8
6.
OTHER FEES
9
7.
ESTIMATED INITIAL INVESTMENT
8.
RESTRICTIONS ON SOURCES OF PRODUCTS
16
AND SERVICES
19
FRANCHISEE'S OBLIGATIONS
24
10.
FINANCING
26
11.
FRANCHISOR'S ASSISTANCE, ADVERTISING,
9.
COMPUTER SYSTEMS, AND TRAINING
26
12.
TERRITORY
38
13.
TRADEMARKS
40
14.
PATENTS, COPYRIGHTS, AND PROPRIETARY
INFORMATION
OBLIGATION TO PARTICIPATE IN THE ACTUAL
OPERATION OF THE FRANCHISE BUSINESS
RESTRICTIONS ON WHAT THE FRANCHISEE
MAY SELL
RENEWAL, TERMINATION, TRANSFER, AND
42
DISPUTE RESOLUTION
44
18.
PUBLIC FIGURES
51
19.
FINANCIAL PERFORMANCE REPRESENTATIONS
51
20.
OUTLETS AND FRANCHISEE INFORMATION
52
15.
16.
17.
1051987.4
i v
42
44
21.
FINANCIAL S T A T E M E N T S
66
22
CONTRACTS
66
23.
RECEIPTS
EXHIBITS
A.
Financial Statements - Applebee's Franchisor LLC and DineEquity, Inc.
B.
State Administrators
C.
Agents for Service of Process
D.
Applicant's Fee Letter Agreement
E.
Development Agreement
F.
Franchise Agreement and Weight Watchers Rider
G.
Manuals' Tables of Contents
H.
List of Franchisees and Franchise Outlets
L
List of Company-Owned Outlets
J.
Gift Card Participation Agreement
K.
Beverage Sales Participation Agreement
L.
Neighborhood Connect Subscription Agreement
M.
Information Privacy Participation Agreement
N.
Demographic System Participation Agreement
O.
State Specific Addenda
P.
Apple Supply Chain Co-op, Inc. Membership Application
Q.
Table Top Devices Participation Agreement
1051987.4
ITEM 1
THE FRANCHISOR A N D A N Y P A R E N T S , P R E D E C E S S O R S ,
AND AFFILIATES
To simplify the language in this Disclosure Document, 'Applebee's", "we", "us", or
"our" means Applebee's Franchisor LLC, the franchisor. "You" means the person or entity
that buys the franchise, called the "Developer" under the Development Agreement and the
"Franchisee" under the Franchise Agreements. When we refer to "Agreements," we mean
both the Development Agreement and Franchise Agreements.
Franchisor:
Applebee's was incorporated in Delaware on July 28, 2014. Our principal business
address is 8140 Ward Parkway, Kansas City, Missouri 64114, and do business only under
our company name and the trade names Applebee's Neighborhood Grill & Bar®,
Applebee's®, and Applebee's Grill®.
Since October 1, 2014, we have offered franchises for restaurants utilizing the
service marks Applebee's Neighborhood Grill & Bar® and Applebee's Grill®, using a system
(the "System") specializing in the sale of uniform, high quality, moderately priced food and
alcoholic beverages in a distinctive, casual setting ("Restaurants") in the United States and
abroad. We do not engage in any other business activities and do not operate any
Restaurants, although our affiliates do so, as further described below. We have not offered
franchises in any other line of business.
Our Agents for Service of Process:
Our agents for service of process are listed in Exhibit C.
Our Parents. Predecessors and Affiliates:
Our parent companies, all organized under Delaware law, are: Applebee's Funding
LLC; Applebee's S P V Guarantor LLC; Applebee's International, Inc.; and DineEquity, Inc.
(formerly known as IHOP Corp. and which changed its name in June 2008). The principal
business address of DineEquity is 450 North Brand Boulevard, 7th Floor, Glendale,
California 91203, and the principal business address of our other parent companies is 8140
Ward Parkway, Kansas City, Missouri 64114.
DineEquity, Inc. acquired the Applebee's restaurant chain on November 29, 2007.
On or about September 30, 2014, DineEquity, Inc. and various of its existing direct and
indirect subsidiaries closed a securitization transaction involving both the Applebee's and
the IHOP brands (the "Securitization"), as part of which various existing subsidiaries
contributed their assets, including intellectual property, real and personal property and
equipment and related leases and subleases (IHOP only), notes and indebtedness of
franchisees, and the business and related agreements concerning manufacturing, sourcing
1051987.4
and s a ^ s of goods and s e ^ i o e s ^
OS
Following Soptembor 30, 2014, Applebees International, Ino oeased offering and
selling new domestic franchises and contributed all then e x i s t i n g ^
agreements and related franchisee notes and guarantee agreements, among other assets,
to newly formed Applebee's Restaurants LLC, which will continue to serve as the
franchisor" for those franchisees Applebee's International, Inc also contributed all then
existingOS area development agreements to us,and we became responsible for all new
domesticfranchisesalescommencing Octobers,2014 Applebees International,lnc,has
retained international development agreements and continues to be the franchisor for
international franchised restaurants
We have no predecessors however,several of our existing and formerly affiliated
entities previously offered franchises under the Applebee's Neighborhood Grill^Bar® and
Applebee's Grill® brand names since the chain began in1938 Applebee's International,
Inc offered domestic franchises fromMarch 1938 toNovember 2007(and continued to
offer franchise agreements for the Restaurants abroad); Applebee's Franchising, LLC
("Applebee's Franchising") offered domestic franchises from November 2007 to December
2011, and Applebee's International, Inc again offered franchisesbothdomestically and
internationally, from January 2012 through September 2014 and continues to offer
international franchises presently)
As of December 29, 2013,there w e r e a t o t a l o f 1 , 8 3 3 Applebee's brand franchised
restaurants intheLlnitedStateslocated in 49 states There were also 23 "company owned"
Applebee's restaurants operated by affiliates ofApplebee's, and 150 Restaurants located
outsidethe 50 Onited States When we refer to"our Restaurants,""companyowned
Restaurants,"or "Restaurants we operated it means Restaurants operated by our affiliates
Gur affiliates that provide products orservices to our franchisees, all organized
under Delaware law are:
DineEquity, Inc, whose activities as manager include administering
collections, franchising, marketing, real property, intellectual property, and
certain pre opening and post-opening services to franchised restaurants.
Applebee'sServices,lnc f ^ a A I I Services, Inc ("Applebee's Services"), as
submanager of DineEquity, l n c , m a y provide certain services to you on our behalf,
including for example, training, site selection, and Restaurant inspections See Item
11of this Disclosure Document for more information Applebee's Services maintains
its principal place of business at 8149 Ward Farkway, Kansas City, Missouri 84114
It has not owned or operatedaRestaurant and has not offered franchises in any
other line of business
A C M Cards, l n c , a F l o r i d a corporation,administers the Applebee's gift card
program A C M Cards, Inc 's principal business address is 8140 Ward Farkway,
1051987.4
Kansas Cit^ Missouri 64114 A C M C a r d s ^ n o hasnotoonduotedabusinessofthe
type to be operated by you nor has it offered franchises inthi^
business
Our only affiliate that offers franchises in the Onited States in any iine of business i^
IHOP F r a n c h i s o r s ^ which
of Pancakes restaurants since October1,2014 IHOP Franchisor LLO's principal place of
b u s i n e s s i s 4 6 0 N o r t h Brand Boulevard,^FloorÔlendale,California 91203 Several of
OineFquity's then affiliated entities previously offered franchises under the "IHOP" and
"International House of Pancakes" brand names since the chain began in 1966, namely:
International House of Pancakes, Inc from 1960 until February 2007;
IHOP Franchising,LLC from March 2007 to February2009;
IHOP Franchise Oompany,LLO from April 2009 through December 2011;and
International House of Pancakes, L L O f r o m Oecember2011 through September
2014 (this is the same entity that franchised from 1960 until February 2007, but in
December 2006 converted toalimited liability company)
These restaurantsfeature "IHOP" p a n c a k e s a s w e l l a s a d i v e r s e menu of other
breakfast, lunch and dinner items As of December 29,2013therewere1,697 franchised
IHOP restaurants inthe LI S that were franchised under the franchise programs offered in
the IHOP Franchise Disclosure Document There were also16"company owned" IHOP
restaurants which are operated by International House of Pancakes LLC (or other related
affiliate)
Except as described in this I t e m l , none of our parents,predecessors or affiliates
have operated Restaurants or offered franchises for Restaurants or any other business
Other than the entities described in this Iteml,there are no other parents,affiliates
or predecessors required to be described in Iteml
Description of Franchise: You will develop and operate Restaurants within a defined
geographic area ("Territory") You will use our various trademarks, construction
specifications, designs, color schemes, signs and equipment for Restaurant premises,
procedures and recipes for preparing food and beverage products, inventory, operations,
and financial control methods, initial and ongoing management training and teaching
techniques, and advertising and promotional services and assistance
Each franchise arrangement consists of 2 parts: a development agreement
("Development Agreement") which requires you to open and operate at leastlRestaurant
pursuant to an initial development schedule and during the remaining term of the
Development Agreement, and a l l o w s y o u t o o p e n a n d o p e r a t e m o r e R e s t a u r a n t s i n t h e
Territory if needed; and separate franchise agreements ("Franchise Agreements") between
you and us for your operation of each Restaurant The Franchise Agreement names the
location of the Restaurant and tells you your rights and obligations for that Restaurant The
1051987.4
O e v e ^ p m e ^ Agreement and
ifyouareacorpoô^^
some or a^ of your partner Those people who sign as your
^
who guarantee your financial obligations to us under a Development Agreement and
Franchise Agreement are "Principal Shareholders "
Althoughthe Agreements a t t a c h e d a s E x h i h i t s P a n d F a s s u m e t h a t y o u a r e a
corporate franchisee, we do consider other types of business entities (for example, general
or limited partnershipsand limited liabilitycompanies) which meet the requirements for
franchisees described in the Agreements In those cases, you must execute amendments
to the Development Agreement and Franchise Agreement that conform those Agreements
to your form of business structure A sample form amendment is attached to the
Development Agreement included as F x h i b i t E t o the Disclosure Document a n d a s a m p l e
form amendment isattached to the Franchise Agreement included as Exhibit F t o t h i s
Disclosure Document
W e i n t e n d t o use and file, if a n d a s appropriate, aseparatefranchise disclosure
documenttoofferfranchisesforApplebee'sfull service restaurants and newApplebee's
concepts for fast casual and/or quick service restaurants to be located at another primary
business or in conjunction with other businesses or at institutional settings such as schools,
colleges and universities, military and other governmental facilities, hospitals, airports,
casinos, stadiums, and any other site, venue or location operated by a master
concessionaire or contract food service provider (a "Non Traditional Venues The terms of
such an offering may differ materially from the terms described in this franchise d i s c ^
document
Oomoetition and Market: The Restaurants compete with other national and local
restaurants which provide similar food, beverages and services to the general public Your
direct competitors will include other restaurants in the area of your Restaurant We believe,
however, that the Restaurants have particular appeal because of their distinctive
atmosphere and high quality food Each of the Restaurants is designed as an attractive,
friendly "neighborhood establishment" in a fun, casual setting
We believe that a
comfortable, warm atmosphere combined with fast service, good value, convenient
locations associated with traditional fast service restaurants a n d a w i d e r variety of menu
items (including alcoholic beverages) appeals to all ages and encourages regular
patronage by both families and adult groups
Specific Industry Reoulation: In addition to the laws, regulations and ordinances applicable
to businesses g e n e r a l l y , s u c h a s t h e Americans withDisabilitiesAct,federal and state
wage and hour laws, and the Occupational Safety and Health Act, you should consider that
certain aspects of the restaurant and related bar business are heavily regulated by federal,
state and local laws,rules and ordinances T h e O S Food and Drug Administration,the
O S Department of Agriculture, as well as state and local departments of health and other
agencies have laws and regulations concerning the preparation of food and sanitary
conditions of restaurant facilities State and local agencies routinely conduct
compliance with these requirements Onderthe Clean AirAct and state implementing laws,
1051987.4
certain state and local areas must a ^
air quality standards for czcne, carbon monoxide and particulate matters Certain
provisions of those laws impose caps on emissions resulting from commercial food
preparation.
cooperate the Restaurant, you must obtainaliquor license,unless the service of all
types of alcohol is prohibited by law State and local laws, regulations and ordinances vary
significantly in the procedures, difficulty and costtoobtain a l i c e n s e t o s e l l liquor, the
restrictions placed o n h o w liquor may be sold,and the potential liability dram shop laws
impose involving injuries, directly and indirectly, related to the sale of liquor and its
consumption You must understand and comply with those laws in operating the
Restaurant
ÊM2
BUSINESS E X P E R I E N C E
Chief Executive Officer:
JuliaA Stewart
Ms Stewart has served as our Chief Executive Officer since our formation on July
28, 2014
Ms Stewart has also served as Chief Executive Officer of our parent,
Applebee's International, l n c , a n d Applebee's Services'since November 2007 She has
also served as Chairman of the Board and Chief Executive Officer of IHOP Franchising,
LLC since March 2007 In addition, Ms Stewart has served as Chairman of the Board of
I H O P , l n c , n o w I H O P , L L C , a n d OineEquity,lnc,formerly known as IHOP,Corp,its parent
corporation since May 2006. Ms. Stewart served as President and Chief Operating Officer
of IHOP, Inc and IHOP Corp from December 2001 to November 2007 She also served
a s P r e s i d e n t o f l H O P E n t e r p r i s e s , l n c and IHOP Properties, Inc from December 2001 to
March 2007 and as Chief Operating Officer of IHOP, l n c , I H O P C o r p , I H O P Properties,
Inc and IHOP Enterprises, Inc from December 2001 to September 2006 In May 2002,
Ms Stewart assumed the office of Chief Executive Officer of I H O P , l n c , I H O P C o r p , n o w
k n o w n a s D i n e E q u i t y ^ l n c , I H O P Properties,Inc and IHOP Enterprises, Inc Ms Stewart
w a s e l e c t e d a d i r e c t o r o f l H O P , Inc and IHOP C o r p , now known as DineEquity, Inc in
May2002 She served as President and Chief Operating Officer of IHOP Restaurants, Inc
from December 6, 2001 to December 60, 2001 Prom October 1996 to August 2001, Ms
Stewart was our President, Domestic Division Since May 2006, Ms Stewart has also
served asadirectorofAveryDennison Corporation, Pasadena, California
1051987.4
P r e s i d e d Steven Lavt
Mr Layt has s e ^ e d as our P r e s i d e n t s
Mr Layt
hecarne President ofApplehee'sinternationaînc in February 201^
Vice President, Operations in Oecernber 2011 Prom Oecember 2007 to Oecem^
Mr Layt served as Chief Operating Officer and Executive Vice President of Buffets
Holdings, inc,iocated in Pagan, Minnesota Prom January 2007 to December 2007, he
s e r v e d a s P r a n c h i s e H e a d O o a c h f o r Y u m ^ Brands'Pizza Hut Division, Oaiias, Texas
Prom January 2006 to January 2007, Mr Layt was Pizza Hut's Franchise Business Director
for Northeast Operations
SeniorVice President StrateoicOoerationsandimpiementation:JavD
Johns
Mr Johns has served as our Senior Vice President, Strategic Operations and
impiementationsince our formationon July 26, 2014
Mr Johnsbecame Senior Vice
President, Strategic Operations and implementation of DineEquity, Inc in November 2016
after serving as Applebee's International, IncBs and Applebee's Services'Vice President,
Strategic Operations Implementation since February 2009 Prior to that, he was w i t h T O I
Friday's USA, a division of Carlson Restaurants Worldwide Inc , located in Carrollton,
Texas, beginning in September 1067 His most recent position there was Vice President,
Strategic Operations which he held until he coined us
Senior Vice President Marketing and Culinary: D a r i n P D u q a n
Mr Dugan has served as our Senior Vice President, Marketing and Culinary since
our formation on July 26, 2014 Mr Dugan became Applebee's International, Inc 's Senior
VicePresident,MarketingandCulinaryin June 2014 From January 1907 to September
2016, Mr Dugan was Vice President, Marketing for Kraft Foods Inc in Chicago, Illinois
Senior Vice President. Legal: General Counsel: Secretary: BrvanP Adel
Mr Adel hasserved a s o u r S e n i o r V i c e President, Legal, OeneralCounsel and
Secretary since our formation on July 26, 2014
Mr Adel has served as Applebee's
International, Inc's Senior Vice President, Legal, OeneralCounseland Secretary since
August 2011 He has also served as Senior Vice President, Legal, General Counsel and
Secretary for IHOP LLC, IHOP Franchise Company, LLC, IHOP Franchising, LLC, IHOP,
l n c , I H O P Property Leasing, LLC, IHOP Properties, L L C , I H O P Property Leasing II,LLC,
IHOP Peal Estate,LLC and DineEquity,lnc since August 2010 From July 2007 to March
2010, Mr Adel served as SeniorVice President, General Counsel and Corporate Secretary
ofViantHoldings,lnc,Naperville,lllinois From April 2006 to December 2006, Mr Adel
was S e n i o r V i c e President, General Counsel, Secretary and Chief Privacy Officerof
Rewards Network, lnc,Chicago,Illinois.
T h o m a s W E m r e v ^ C h i e f Financial Officer
A p ^ e b e e ^ F ^ o c h ^ LLC 2014 FOO
^9874
Mr Emrey h a s s l e d as our C h i e f s
Mr E m r e y h a s a ^ o s e r v e d a s C h ^
28, 2014 Mr Emrey became Chief F i n a n o i a l O ^ o e r o f O i o e E q u ^ ino in September,
2011
From January, 2008 toSeptember 2011, Mr Fmrey served a s C h i e f Operating
Otîoer of Oniversai Studios HomeFnterfainment,asubsidiary of NBC 0
City, California
Vice President. Oeveiooment: J a m e s A MoOermottiii
Mr MoOermott has served as our Vice President, Oeveiopment since our formation
on July 28, 2014
Mr McOermott hasserved as Appiebee'sinternationai, incBsand
Applebee's Services'VicePresident, Oevelopment,sinceNovember2010 Prom August
2005 to November 2010, Mr McOermott served as Vice President, Oeveiopment, of KPC
Corporation,located in Louisville,Kentucky,from August 2005 to November 2010
Vice President. Franchise and International. Associate General Counsel: Patrick Oandino
Mr Oandino has served as our Vice President, Franchise and International,
Associate General Counsel since our formation on July 28, 2014 Mr Oandino has served
as Vice President, Franchise and International of OineEquity,lnc,Applebee's Internationale
Inc 's, Applebee's Services, IHOP LLC, IHOP Properties, LLC, IHOP P r o p e r
IHOP PealPstate since March 2018 H e h a s served as Associate General Counsel of
OinePguity,Inc since September, 2011 From November,2010to the present, he serves
as President and Director of PourYourArf Out, lnc,Burbank, California From September,
2008 to August, 2010, he served a s V i c e President and Senior Counsel of Hilton Hotels,
lnc,Beverly Hills,California
Vice President. Quality Assurance: Gary Peter OuBois
Mr OuBois has served a s V i c e P r e s i d e n t , O u a l i t y A s s u r a n c e of OinePguity, Inc
since March 2000 From January 2008 to October 2007, Mr OuBois served as Senior
Director, Quality Assurance for Pizza Hut, lnc,Oallas,Texas,asubsidiaryofYuml Brands,
Inc
From February 1000 to January 2008, Mr OuBois was Senior Director, Quality
Assurance forYuml Restaurant Support Group,Dallas,Texas
Vice President. InformationTechnoloov^Prooram
Bogart
Management Organization: PandallW
Mr Bogart h a s s e r v e d as Vice President, InformationTechnologyand Program
Management Organization of DinePguity since March2010
Beforethat, he had been
Executive Director, Information Technology beginning in November 2007 He was our
Executive Director,lnformation Technology from October 2008 until November 2007
K e v i n P B u r n s ^ l n d e o e n d e n t Manager
1051987.4
Mr. Burns has served as our Independent Manager since our formation on July 28, 2014.
Since July 28, 2014, Mr. Burns has also served as Independent Manager for IHOP
Franchisor LLC. Since December, 1996, Mr. Burns has served as President and Director
of Global Securitization Services, LLC, Melville, New York.
Bernard J . Anqelo - Independent Manager
Mr. Angelo has served as our Independent Manager since our formation on July 28, 2014.
Since July 28, 2014, Mr. Burns has also served as Independent Manager of IHOP
Franchisor LLC. Since April, 1997, Mr. Angelo has served as Senior Vice President and
Director of Global Securitization Services, LLC, Melville, New York.
Vice President, Finance: Robert Nygren
Mr. Nygren has served as our Vice President, Finance since our formation on July
28, 2014. Mr. Nygren has also served as Applebee's International, Inc.'s Vice President,
Finance since August 2013 after serving as its Executive Director, Finance, beginning in
August 2012. He served as Applebee's International, Inc.'s Executive Director, Business
Analysis, from August 2011 through August 2012. Before coming to Applebee's
International, Inc., Mr. Nygren served as Senior Director, Finance, of NPC International,
located in Overland Park, Kansas, from August 2004 to August 2011.
ITEM 3
LITIGATION
Pending Actions
Candice Watkins v. DineEquity, Inc. e t a l (Superior Court New Jersey, Camden County,
Case No. L-5406-11). On or about October 31,2011, named plaintiff Candice Watkins filed
a class action lawsuit on behalf of herself and all others similarly situated alleging that
Applebee's restaurants in New Jersey violate the state's Consumer Fraud Act and Truth in
Consumer Contract Warranty and Notice Act by not disclosing beverage prices on the
menus. Defendants removed the case from state court to federal court on or about
December 9, 2011. On or about March 12, 2012, plaintiff amended her complaint and
alleged only the claim for Truth in Consumer Contract Warranty and Notice Act. The court
granted Defendants' motion to dismiss on August 29, 2012, but gave plaintiff an opportunity
to amend the complaint. Defendants filed another motion to dismiss the complaint, which
was granted with prejudice on January 30, 2013. Plaintiff filed a Notice of Appeal on
February 6, 2013, which was heard on November 7, 2013.
Litigation Against Franchisees in the Last Fiscal Year
Applebee's International, Inc. v. Northern Apple Restaurants Inc., Northern Apple
Restaurants (RD) Inc., William P. Hanson, and Sam F. Wong (Court of Queen's Bench
Action Number 130107353) On June 13, 2013, Applebee's International, Inc. filed an action
against its former franchisees in Canada to require removal of all Applebee's trade names,
1051987.4
logos, designs and Marks, inoioding all Identifying oharaoteristios from all former
Restauranfsandpaymentofmoneydamages On July 13, 2013, the former franchisees
oounterolaimedfor wrongful termination. Litigation is pending.
Other than these pending actions, no litigation or other actions are required t^
in this item
Until Oecemher2011, Steven Layt, Presidentof Applehee's(ltem 2), wasOhief
Operating Officer and Executive Vice President of Buffets Holdings, inc ("BH
Minnesota huffet restaurant company. On January 22, 2008, BHi and its subsidiaries
voluntarily sought protection under Chapter 11 of the United States Bankruptcy Code
(United States Bankruptcy Oourf for the
order entered on April 17, 2009, after meeting all closing conditions to the company's exit
financing and its Plan of Reorganization, BHI and its subsidiaries emerged from Ohapter11
reorganization
INÂLPEES
You m u s t p a y a f r a n c h i s e f e e o f $ 3 5 , 0 0 0 foreachPestaurantyou open during the
initialdevelopmentperiodsofthe Development Agreement If there isatransfer between
existing franchisees, we may reduce and defer the initial franchise fee when the selling
franchiseehasaterm lefton its existing franchise agreement(s) The franchise fee for each
Restaurant opened during a subsequent development period of the Development
Agreement will equai the standard Restaurant franchise fee in effect at the time the
respective Franchise Agreement is issued You may be required to payanonrefundable
applicant's fee of $15,000 The applicant's fee may be waived or reduced if the applicant is
an existing System franchisee, Restaurant operator or buying Oompany owned
Restaurants At the time you signaDevelopment Agreement, you must pay usadeposit
on the franchise fees to be incurred under the Development Agreement. The franchise fee
deposit amount required equals $10,000 f o r e a c h of the Restaurantsyou wili develop
during the"initialdevelopment periods" W e a l l o c a t e t h e f r a n c h i s e f e e deposit equally
toward the $35,000 f r a n c h i s e f e e d u e f o r e a c h Restaurant you open during theînitial
development periods" of the Development Agreement, provided you open such
Restaurantsonatimeiybasis (Development Agreement, S e c t i o n a l ) You must pay the
balance of the franchise fee for each of the Restaurants as follows: one half when you sign
the PranchiseAgreementfortheRestaurantand the remaining balance 14days before you
are scheduled to open the Restaurant
We do not refund the franchise fees or the franchise fee deposit
Except as stated above, franchise fees are the same for all franchisees subject to
this offering and are nonrefundable
1051987.4
ITEM 6
OTHER FEES
(2)
Amount
(3)
Due Date
(4)
Remarks
4% of Gross Sales. This
percentage can be increased
by us after January 1, 2020 .
Payable monthly
on the 12th day
of the next
month.
Weight Watchers
Royalty *
2.5% of Gross Sales of
Weight Watchers menu items.
Same as Royalty.
"Gross Sales" includes all
revenues from the
Restaurant.™ "Gross
Sales" does not include
sales or use tax or Weight
Watchers® Royalty.^
The Endorsement
Agreement with Weight
Watchers will expire in
November 2014.
Advertising
(National
Advertising
Fund)
Cooperative
Advertising
Currently, 3.25% of total
Gross Sales. This percentage
can be increased or
decreased by us at any time.
Maximum % % of total Gross
Sales. Any amounts paid to
an advertising cooperative will
reduce the amount required to
be spent on Local Market
Advertising on a dollar for
dollar basis.
Same as Royalty.
Late Fee™
Up to 18% interest or highest
rate allowed by law.
Immediately.
Campaign/Menu
$3-$5 per campaign/menu
implementation.
30 days after
billing.
Approximately $6 per disk;
approximately $36 per year
per restaurant for cost of
shared maintenance and
updates.
Costs of sample testing plus
other actual costs, such as
30 days after
billing.
(1)
Type of Fee
0
Royalty *
(12)
0
(1)
Training
C1)
E-Learning
Supplier/
Distributor
(1)
(3)
1051987.4
30 days after
billing.
10
We can require you to
form, or you and another
franchisee(s) in the same
market can form, an
advertising cooperative for
a market to cooperatively
spend the local advertising
fee noted above. We have
no vote in these
cooperatives unless our
Restaurants are in the
market. If so, our vote is
determined in the same
way your vote is
determined.
Payable if royalty or
advertising fee or other
amounts due to us are not
paid on time.
A training DVD is supplied
with each campaign and
menu implementation.
Initial program is free.
Maintenance and updates
are subject to change
based on actual shared
maintenance cost.
Payable if you want us to
approve a new supplier,
Approval
(3)
Due Date
(2)
Amount
(1)
Type of Fee
facility inspection.
05
(4)
Remarks
and we require a test of
the supplier's products
and/or inspection of the
supplier/distributor. Our
testing may include
sensory panels, audits and
consumer panels.
Payable if you want extra
Manuals, training materials
and the like. We make the
first set available to you for
free.
Payable if you fail to give
us annually a balance
sheet and profit & loss
statement and we pay to
have your books audited.
Extra Manuals™
$5 - $250
30 days after
billing.
Audit Fee
(Balance Sheet
and Profit & Loss
Preparations) *
Amount paid by us.
30 days after
billing.
Compliance
Audit Fee™
Cost of audit plus interest on
unpaid royalties.
30 days after
billing.
Payable if audit shows an
understatement of at least
3% of gross sales for any
month.
Insurance *
Cost of insurance and any late
fee.
30 days after
billing.
Payable if you fail to insure
your Restaurant and we
buy the insurance.
National Gift
Card Program
Charges ™
Currently, 8.42% of the
redeemed portion of gift cards
sold in the national program,
but the amount may change.
Cost is recovered
as part of the
periodic
electronic
settlement
process for sales
and redemptions
of gift cards.
Permits us or our affiliate
to recover cost incurred to
operate the national gift
card program (i.e., gift
cards sold through
channels other than the
Restaurant). Redemptions
of applicable gift cards at
our Restaurants are
subject to the same
charge.
$150-$450
30 days after
billing.
Required demographics
package ($150); Site
Processing Fee ($300)
0
11
(4)
Site
Development '
0
1051987.4
11
(10)
(1)
Type of Fee
(3)
OueOate
(^
Amount
(4)
Remarks
Oemographio
Sêm™^
$1,000 peryear
30 days after
b^ng
This is an optional
demographic tool for
potential development
sites. The fee reimburses
our cost for access to the
system.
Renews of
Franchise
Agreement™
Currently $ 3 ^ 0 0 each five
year renewal period
On expiration of
the Franchise
Agreement after
its initial 20-year
term.
If you are in compliance
(Franchise Agreement
S e c t i o n s , you may
renew the Franchise
Agreement forfour5year
terms at10%ofthe thencurrent Franchise Fee for
each renewal period
Applebee s F O S
Software License
Fee™^
Applebees Foint of Sale
license fee is currently $1,500
per site. This includes the
A1FOSandA1Cards
software components
30 days after
hiiiingtor
software
purchased from
Appiebees
We currently require you to
install the hardware and
software necessary for
Applebee's Foint of Sale
system (FOS) The
hardware,installation,
maintenance and
operating system must be
purchased from an
approved supplier
hardware and operating
systems must be Payment
Card Industry (FOI)
compliant ^
This fee is paid in
exchange forthe right to
receive all upgrades to the
A1FOSandA1Cards
software components.^*
This fee covers transaction
processing costs to route
transactions from the F O S
to the credit or gift card
provider. These fees are
in addition to any
processing fees charged
by your credit card and gift
card processors.
0
Applebee s F O S
Software
Maintenance
Fee™^
Awards
Subscription
Fee™
An annual maintenance fee of
$825 per Restaurant is
currently charged for the
Applebee's F C S a n d A I
Cards software.
An annual subscription fee of
$400 per Restaurant is
currently charged for ongoing
processing services within
A l C a r d s . Additional fees for
processing over dial up may
also apply and will vary based
upon usage
A p ^ e ^ F ^ ^ o r L L C 2014^00
^ ^ 7 4
1^
30 days after
hiiiing.
30 days after
billing
(2)
Amount
(^
Type of Fee
OioeFqoify
Restaurant
Solution Center
(HeipOes^™
(3)
OueOate
^
Remarks
Annual costs currently range
from $ ^ 0 $ ^ 0 per
Restaurant, based on actual
products supported. Additional
services, such as network
consulting, technology rollouts
and menu and software
configuration, are available for
additional project fees
$275 per re inspection event
30 days after
billing
Support services must be
provided by us, our aftiiiate
or an approved supplier.
Project fees are
determined based on effort
and duration ofthe specific
request.
Cn demand
Oeidentifioation
After
Termination™
Reimbursement of costs.
C n demand
Personal
Property
Removal Fee™
Reimbursement of costs.
30 days after
billing.
Transfer Fee™
$2,500 per agreement.
Indemnification™
Amount of costs
Before the
closing ofthe
transfer
30 days after
billing
Unsuccessful
Party Legal
Amount of fees
Restaurants wiii be
evaluated by an
independent inspector twice
annually if your Restaurant
experiencesafailingfood
safety score on an
operations audit, you must
paytohaêareinspection
byFcoûreasparto^the
food safety process
Payable if the Franchise
Agreement has ended and
you do not remove the
trade name and decor
items and repaint, and we
spend the money to do
thesethin^s
Payable if you lease your
Restaurant site, your
Franchise Agreement has
ended, you fail to remove
your personal property and
we take over the
Restaurant site but do not
buy the personal property
If we pay to remove the
property, you must
reimburse us
Payable when you transfer
ownership of your
Restaurant(s)
Payable if we have costs
for third party claims
(including attorneys'fees)
from the operation or
condition of your
Restaurant.
Payable if you are the
unsuccessful party i n a
eCaFS
(Evaluation of
Cleanliness and
Product
SafetyBEooSure
Audits
A ^ b ^ F ^ h ^ L L C
105^74
2014^00
C n demand
1^
(3)
OueOate
(2)
Amount
(1)
Type of Fee
Fees™
Team Member
Hiring*
("Poaching")
71
Guest Relations
Chargeback^
Government
Relations Fund™
With consent, reimbursement
of up to 50% of a team
member's annual salary.
Without consent, 3 times
annual salary of employee
plus costs and attorneys' fees.
Reimbursement of our costs.
$200 per Restaurant per year
recommended.
30 days after
b^ng.
30 days after
bîng
30 days after
b^ng
(4)
Remarks
lawsuit with us.ln this
case, you pay our
expenses and iegai fees
Payable if you hire or seek
to hireateam member of
oursoranotherfranohisee
inamanageriai position
Joint voluntary
lÔPBApplebee'sfundto
support industry^related
lobbying activities
Payable ifyou request us
or an affiliate to customize
local advertising
30 days after
$75 per hour.
Creative
bi^ng
Services Graphic
Design Jobs™
Notes:
(1)
Pee is payable to us o r o n e of ouraffiliates and is nonrefundable. These
payments w i l l b e n n a d e b y e l e c t r o n i c f u n d s t r a n s f e r (PPT) Unlessotherwise stated, all
Fees are uniformly applied to new System franchisees; however, we may waive or reduce
some or all of these Fees foraparticularPranchisee if, in our sole discretion,we decide it is
appropriate to do so
(2)
In the future, we may authorize certain other items to be excluded from Gross
Sales Although the Franchise Agreement does not require this, we authorize up to 3%
complimentary sales to be excluded from the Gross Sales computation We may withdraw
this permission at any time
(3)
After you sign a Franchise Agreement, we can increase ordecrease the
prospective monthly advertising fees for the Restaurant covered by that Franchise
Agreement, including both those to be paid to us (which we can increase toamaximum of
4% of gross sales) as well as those which the Franchise Agreement requires you to spend
for local advertising activities, but the total of those fees cannot exceed 5% of your Gross
Sales
(4)
You must participate in our Gift Gard Program As part of this, you must sign
aGift Card Participation Agreement in the form attached as PxhibitJ
(5)
We require you to h a v e a p o i n t of sale (PGS) system that will provide the
Restaurant with basic guest order entry and tracking, guest check printing, credit and gift
card processing, sales accounting and labor management tools, and that will permit us to
gather information concerning the Restaurant's operation and aggregate System wide
performance
1051987.4
14
(6)
App^bee^se^ceswi^
r e s e ^ e t h e nghtto r e q u ^ ^ a o c h ^ e e s t o p a y ^ o o s ^ a s s o c ^ e d with the iospeotien
program i o 2 0 1 5 a ^ after Franohiseewiii pay aiioosts associated with reiospeotion if
Restaurant faiis an audit
(7)
Payahie to either our affiliate or franchisee, depending en who was the team
memheBspriorempioyer (See Section 22 ofthe Franchise Agreement)
(8)
if we receiveacompiaint relating to an experience at your restaurant, we wiii
inform you ofthe complaint We will contact the guest approximately^husiness days after
receiving the complaint to determine if it has heen resolved If it has not heen resolved, we
reserve the right to compensate the guest as we determine appropriate and you must
reimburse us for an amount egual to the value of the compensation provided
(9)
This describes our current F O S system; however,we may,from time to time,
evaluate and approve other vendors as an additional F O S provider.
(10)
alternatives
This describes our current site development costs; however,we are studying
(11)
Thisoptionaltooiallows u n l i m i t e d a c c e s s t o o u r w e b b a s e d d e m o g r a p h i c
system for one calendar year per user agreement If you choose the Demographic system,
you must s i g n a O s e r Agreement in the form attached as Exhibits
(12)
As an incentive to eligible franchisees, we are offering several royalty rate
reduction plans for qualified newly developed Restaurants (the "Royalty Incentive Flans")
In order to be eligible to participate in one of the Royalty Incentive Flans, the franchisee
must have (a) executedaOevelopment Agreement requiring development of one or more
RestaurantsbetweenJanuary1,2012,and Oecember31,2014,and (b) be current with all
royaltyand adfundobligationsdueunderallexisting Franchise Agreements Following i s a
description of the terms and benefits of the Royalty Incentive Flans:
INCENTIVE PLAN
Incremental Incentive
BENEFITS
Royalty rate reduced to 0%
for first year of Franchise
Agreement term.
High Cost Incentive
Royalty rate reduced to 2%
during the Initial Term of the
Franchise Agreement.
1051987.4
15
T E R M S AND CONDITIONS
1. Franchisee and affiliates must meet
development obligations under existing
Development Agreement(s) at all times
during royalty reduction period.
2 If Franchisee is disqualified due to
its (or its affiliate's) failure to meet any
development obligations, all reduced
royalty amounts must be repaid.
1. Annual rent must be at least
$400,000 at all times during royalty
reduction period.
2. Total building cost must be at least
$3,000,000.
Urban Incentive
Royalty rate reduced to
0% for first year of
Franchise
Agreement
term.
Royalty rate reduced for
2 through 20 year of
the Franchise Agreement
term as follows:
o 2% on break-even
Sales + $500,000
o 3% on next $500,000
in sales
o 4% on all remaining
sales
nd
th
1.
Break-even
sales
to
be
approved for each Restaurant prior to
opening, and to include site specific
development costs, P&L costs, usual
and customary above store G&A costs,
and typical financing terms.
2.
Break-even sales will be reevaluated at end of first year of
Franchise Agreement term. Franchisor
may make adjustments based on
evaluation.
3.
Urban trade areas will be
typically defined as those that have,
within a 2-mile radius, a population
comprised of at least 55% ethnic
minorities (e.g. African American,
Hispanic, Asian American) and 40,000
households.
The Royalty incentive Plans, as they may be in effect from time to time, are made available
at the Franchisor's sole discretion. Unless you enter into a written agreement with us
regarding your participation in the Royalty Incentive Plans, our offer of the Royalty Incentive
Plan does not confer any contractual rights or entitles or amend your Franchise
Agreement(s).
The Royalty Incentive Plans are subject to termination, revision or
withdrawal by us, in whole or in part, at any time, without notice, in our sole discretion.
ITEM 7
ESTIMATED INITIAL INVESTMENT
Y O U R ESTIMATED INITIAL INVESTMENT
Amount
(3)
Method of
Payment
(4)
When
Due
$75,000-$120,000
As Incurred
As Incurred
Purchase of Land™
$272,000-$1,450,000
As Incurred
As Incurred
Owner of
Property
Building Costs (purchase,
construction, remodeling,
etc.)
$556,000-$2,600,000
As Incurred
As Incurred
Owner of
Property;
Contractors;
Suppliers
(1)
(2)
Type of Expenditure
Initial Organizational and
Training Expenses
(incorporation, legal and
accounting fees, training,
site location and
miscellaneous expenses)
1051987.4
16
(5)
To Whom
Payment Is
To Be Made
Employees;
Suppliers;
Airlines;
Hotels
(5)
To Whom
Payment Is
To Be Made
Contractors;
Suppliers
Amount
(3)
Method of
Payment
(4)
When
Due
Site Work
$50,000-$300,000
As incurred
As incurred
Professional Services
$61,000-$211,000
As incurred
As incurred
Architects;
contractors
$1,500-$75,000
As incurred
As incurred
City/State
Government
$410,000-$750,000
As Incurred
As Incurred
Suppliers
$20,000 - $35,000
As Incurred
As Incurred
Suppliers; Us
or ouraffiliates
Small wares (dishes,
silverware, other utensils,
etc.)
$25,000-$30,000
As Incurred
As Incurred
Suppliers
Initial Inventory
$25,500 -$47,300
As Incurred
Suppliers
Pre-Opening Expenses
(insurance, legal,
accounting, personnel and
training expenses)
$55,000-$100,000
As Incurred
Before
Opening
As Incurred
$35,000
2 equal
installments
(4)
Us
As Incurred
As Incurred
Suppliers
As Incurred
As Incurred
Licensing
Authorities; 3
Party
(1)
(2)
Type of Expenditure
Permits/Fees (See below for
Liquor License)
Furniture, Fixtures,
Equipment and Signaqe
Point Of Sale System^
Initial Franchise F e e
(2)
w , w
Initial Advertising Expense^
$5,000 - $40 000
Liquor License(s)
$500-$400,000™
Apple Supply Chain Co-op
Stock Purchase^
Additional Funds - 3
Months^
10
TOTAL* '
w
1
$100
$405,000-$655,000
Upon
subscription
As Incurred
As incurred
As Incurred
Employees;
Suppliers;
Utilities
rd
Apple Supply
Chain Co-op
Employees;
Suppliers;
Utilities; Us
$1,996,600-$6,848,400
Notes:
The preceding table shows our current estimates of the initial investment likely to be
required for the development and opening of our newest restaurant prototype. The low
range of the costs in the table for the newest prototype typically reflects our estimate of
costs for a 169-seat version. The high range of the costs in the table typically reflects our
estimate of costs for a 225-seat version of the newest prototype and also takes into
1051987.4
17
a o c o o n t s o m e a d d o o s t h a t may iocreasethe i o v e s t m e o t c o ^ ôludiog e o h a ^ e d f t r e
alarm systems pylon signs and costs r e l a ^ g to e x p a ^ d ^
op to 275 seats
The figures in the table above
time you signaDevelopment Agreement through approximately^months after you open
your first Restaurant The estimates for construction costs are based on the most recent
costs or on the expected costs for franchisees'Restaurants to be opened in 2014 Please
note that construction costs have fluctuated greatly (bothup and down) inrecent years
Your actual investment costs may be higher or lower than these estimates based on many
factors, including the following: land and building size, location, and development needs;
timeforconversionorconstructionof building; variations in decor packages;eguipment
specifications; signage; liguor license requirements; number of employees hired and
trained; and employee pay structure In our experience, the market in which you build your
Restaurant represents the source of the biggest variation in investment Please note that
the table above does not include amounts to cover your salary or draw or personal
expenses
(1)
The cost to purchase land varies because of geographic location if you do
not purchase the land and building for the Restaurant, you will need to lease this property
Typical annual rentals, which vary widely depending on factors like size, location and
condition ofthe leased premises, range from 2% to 8% ofthe Restaurants gross sales per
year Also, you might incur certain construction or remodeling costs for necessary
leasehold improvements Because the Restaurant may be located in a strip center,
s h o p p i n g c e n t e r o r a m a l l , or it may beafreestandingbuilding, costs will vary Free
standing Restaurantsizes using the newest prototype rangefrom approximately 4,951
square feet (seating 200) to approximately 5,410 square feet (seating 225) and
Restaurants located in strip centers, shopping centers and malls generally require more
square footage to achieve the same seating CertainRestaurants built using the newest
prototype may be expanded to seat 225, in which case the s i z e f o r a freestanding
Restaurant would be approximately 5,400 square feet A free standing building of
approximately4,051 square feet with needed parking on the site (approximately 85 spaces
minimum) requires a piece of land approximately 55,000 squarefeet in size
Afree
standing building of approximately 5,410 squarefeet with needed parking on thesite
(approximatelyHOspaces minimum) requiresapiece of land approximately 50,000 square
feet in size
(2)
You may wish to install additional signage which costs approximately $15,000
to$80,000 f o r a monument s i g n a n d $25,000 to $85,000 f o r a 8 5 f o o t p y i o n s i g n In
addition, if you require a security and fire alarm, itwillcostapproximately $25,000 to
$80,000 Cost may vary by region, as well as engineering and material costs
(8)
Y o u m u s t install the hardware, operating system andsoftware required to
e q u i p t h e R e s t a u r a n t w i t h a P C S t h a t w e a p p r o v e ( a s d e s c r i b e d i n l t e m 1 1 ) Youmust
haveanetwork in place before operating the system Typically, you will u s e 5 t o 7 P C S
workstations with guest check printers a n d a ^ i t c h e n Display system consisting o f 4 t o 5
displays A c a s h drawer is typically utilized at the bar and at l e a s t l C a r s i d e workstation A
1051987.4
18
remote order pnnter is used ^
t h e T a b i e T o p Devices that we approve (as described in i t e m l l ) T y p i c a l you wiii use
5 0 T a b i e T o p O e v i c e s per Restaurant T h e r e i s n o i n i t i a i fee for leasing t h e T ^
Devices from our approved supplier and there is no charge for instaiiation You may need
to purchaseaseparateprinterto route orders placed through theTahleTop Devices The
approximate cost is $300 per printer, per Restaurant Additionally, most Restaurants will
use labor scheduling,food cost management and Carside payment technology. Aseparate
desktop pc may be used as the Manager's workstation W e a r e currently testing new
technology for use by franchisees, including mobileonlineordering. These technologies
may require additional costs for installation and supplies We anticipate the fee for on^
o r d e r i n g w i l l n o t b e l e s s t h a n $ 4 5 p e r m o n t h p e r R e s t a u r a n t Thenewtechnologies,when
implemented, will become part of the System We are also testing new service models that
may require additional funds (See I t e m ^ f o r more information)
(4)
When you sign theDevelopmentAgreement,you must prepayaportion of
t h e t o t a l f r a n c h i s e f e e s f o r t h e Restaurants we requireyou to develop during theinitial
years of the Development Agreement This amount will vary based on your development
obligationsduringthe înitial development periods'' The franchise fee deposit
$10,000 per Restaurant ( S e e l t e m 5 )
(5)
Application of a parf of thefranchisefeedepositdescribed in Footnoted
reduces the franchise fee (See ltem5)The2installments are due as follows: 50% when
you sign the Franchise Agreementand the remaining balance 1 4 d a y s beforeyou are
scheduled to open the Restaurant.
(0)
You mustconductanadvertisingcampaigntopromotethe opening of the
Restaurant, and we will reimburse you for 50% of your expenditures for opening advertising
up toamaximum of $2,500 if you comply with the requirements described in Section 3.4of
the Franchise Agreement and the Field Marketing Intranet
(7)
The amount necessary to obtainaliquor license varies greatly depending on
thecity, countyand state licensing authority i n v o l v e d a n d m a y b e b a s e d o n w h e t h e r a
license isavailablefromthe licensing authority or must be purchased fromathird party In
stateswith large urbanareas,suchas NewYork and New Jersey,the cost may range up to
$1,000,000 forasingle liquor license
(3)
You are required to becomeamember of the Apple Supply Chain C o o p , I n c ,
aDelaware corporation (Âpple C o o p " ; therefore,you must purchaselshare of Apple Co
op stock for $100 Payment must be made to Apple Co op at the address set forth in the
Membership Subscription Agreement found in Exhibit F and not to us (See Item 3
^Purchasing and Distribution Cooperative" for more information )
(0)
This estimates your initial expenses for 3 months of operation These
expenses include workingcapital, payrollcosts, food and liquor costs, utilities, ordinary
maintenance, local advertising, royalty fees, advertising fees, telecommunication services,
Internet and other expenses normal in operatingaRestaurant These figures are estimates,
1051987.4
19
and we cannot guarantee that you will not have additional expenses starting the business.
Your costs depend on factors such as how much you follow our methods and procedures;
the area of the country in which you locate your Restaurant; your management skill,
experience and business acumen; local economic conditions; the local prevailing wage
rate; competition; and sales level reached during the initial period.
(10) These figures do not include the applicant's fee of $15,000. (See Item 5).
We relied on the experience of our affiliates and franchisees who provided projected or
actual costs of Restaurants to compile this estimate. You should review these figures
carefully with your business advisor before making a decision to acquire a franchise.
(11)
None of the payments described in Item 7 are refundable.
(12) We currently do not offer direct or indirect financing to franchisees for any
items. (See Item 10 for more explanation.)
(13) Please note that the range of total costs does not include the investment
required for the conversion of an existing restaurant. We expect that costs for such
conversion would be lower.
ITEM 8
RESTRICTIONS ON S O U R C E S OF
P R O D U C T S A N D SERVICES
In order to maintain the uniform high standards of appearance, service, and food
and beverage quality necessary to retain and enhance the goodwill and acceptance of the
Restaurants, you must adhere to our current and future requirements, specifications and
standards for the following: form, content and media of any advertising, including the form
and content of any websites; the selection, purchase, distribution and preparation of all
food and beverage products; all equipment, signs, interior and exterior furnishings or decor
items; site acquisition, construction, site work and development, including remodeling
criteria; fixtures; uniforms; plate ware; glassware; accounting, bookkeeping, and other
business systems; POS systems; computer hardware and software; gift card program;
guest satisfaction surveys; and all other materials, supplies and services we require for the
operation of your Restaurants.
We develop and modify our specifications internally. As part of this process, we may
consult with suppliers, professionals or other third parties. Our standards, operating
specifications and procedures for developing and operating a Restaurant are
communicated to you via the Manuals as described in Item 11. You must obtain our prior
written approval to deviate from these standards, specifications or procedures. Certain
detailed specifications for equipment, food and other products may only be communicated
to suppliers. We will notify you in writing of any modification to our specifications previously
disclosed to you.
1051987.4
20
Except ^ pnot, radio and teievisioo adverting and site acquisition you must
purchase or iease aii of the ahove items necessary to establish and operate your
Restaurant from sellers, lessors, distributors or suppliers we approve in writing. We make
available to y o u a l i s t of approved suppliers. We estimate that your cost to purchase and
lease all goods and services that we require you to obtain from us or an approved supplier
rangesfrom 16% t o 2 6 % of the total purchases and leases toestablish a Restaurant
excluding real estate, building and site work, franchise deposit and fee
None of our officers currently owns an interest in any of our suppliers
Purchasino and Oistribution Cooperative
In 2001, we began a new muiti year
supply chain management initiative designed to leverage its size, improve sourcing of
products and optimize distribution Effective February 16, 2000, Centralized Supply Ch
Services, LLC ^ C S C S " ) , a Delaware limited liability company and a purchasing and
distribution cooperative, assumed the procurementdutiesfor franchised and company
operatedApplebee'sand IHCF restaurants (See ^Group Purchasing Program" beiow )
Group Purchasing Prooram Effective February 16, 2000, we designated C S C S as
the sole authorized purchasing agentforali Restaurants C S C S and Apple Co op are not
affiliated with us and both are operated independent of us Fiowever,Applebee's Services
i s a s t o c k h o l d e r m e m b e r o f t h e A p p l e C o o p a n d is entitled to designatel voting member
of the Apple Co op Board of Directors and 1 voting member of the C S C S Board of
Directors C S C S administers purchasing programs onacooperative basis for the benefit of
its members, Apple Co op as well as Pancake Supply Chain Co op, Inc (for IFiCP
restaurants). Apple Co op was formed to allow operators of franchise or company-owned
Restaurants to conducta purchasing programthrough C S C S . Neither C S C S nor Apple
Co op is our affiliate
C S C S procures products and services only through suppliers approved by us See
^Purchasing and Distribution Cooperative" above for procedures for the approval of
suppliers from which C S C S purchases products or services
You are required to becomeamember of Apple C o o p The establishment of Apple
C o o p isnotaguaranteethatitwillremain in existence; it may be modified or discontinued
at any time,in accordance withits Bylaws,which C S C S will provide to you uponrequest.
C S C S was organized in accordance with Delaware l a w a n d f e d e r a i t a x l a w s relating to
entities operating onacooperative basis,to act asapurchasing agent for its members In
accordance with those laws, C S C S intends to distribute substantially all of its net income
not requiredfor working c a p i t a l o r r e s e r v e s t o i t s m e m b e r s e a c h y e a r a s a ^ p a t r o n a g e
dividend" For purposes of the cooperative, any Restaurants owned by us or our affiliates
will be treated the same as franchised Restaurants
You b e c o m e a m e m b e r of Apple C o o p by executingaMembership Subscription
Agreement in the form found in ExhibitPand by paying $100 for the purchase o f l s h a r e of
Apple Co op stock Curaffiliateswho operate company owned Restaurants pay the same
purchase price for stock in Apple Co op that you do Voting rights are determined in
accordance with the Bylaws of Apple Co op
10519874
21
Apple O o e p or OSOS may fromtlme t o t l m e charge Apple Oeep's members
administration fees to fund Apple Co op and C S C S ' s supply chain pro^
The administrative fees may he collected from suppliers and distributors by adding^
specific products and services (See Item6)
In many cases, we, Applebee's Services or CSOS have negotiated purchase and
distribution agreements with most of our suppliers and distributors to benefit the System
through volume discounts These arrangements sometimes assure you of the price to be
charged to any franchisee or might assure that the product or equipment will be available
when needed
Atanytlmeônwrltten request, you (oraprospectlvesuppller^dlstrlbutor) can ask us
toapproveasuppller^dlstrlbutor
Effective February 16, 2009, such written requests by
OSOS's members must be submitted through OSOS Before approval or disapproval, we
can require that we be allowed tolnspect the s u p p l i e d
We can
conduct field tests on products and require full production runs We can also require that
samplesfrom t h e s u p p l i e r b e d e l i v e r e d to us or to adesignated independent testing
laboratory for testing We must notify you within 60 days after receipt if we require
additional testing or disapprove your request ofaparficularsupplier^distributor We can re^
inspect the facilities of, or retest products of^
rescind our approval if the suppiierBdistributor does not continue to meet our criteria
Approved suppliersBdistributors and propo
the costs, which will vary, associated with the inspections, testsand other procedures
involved in the approval process
We currently evaluate potential suppliers and distributors based upon their ability to
meet all of our product standards and specifications (including nutritional content and
Weight Watchers F o i n t s F l u s ^ values), their location, cost, adequacy of their quality
controls,and capacity and facilities to supply your and otherfranchisee needs promptly and
reliably We are not obligated to provideacertain number of approved suppliers for any
given product or service
In 2016, the total revenues received by our affiliates from all products and services
requiredto be purchased byafranchisee,whether from our affiliates or another supplier,
was$1,640,160Thisamountrepresents 0 2 6 7 % of our and our affiliates'total revenues in
2016 Based on the results of operations of company owned restaurants, we estimate that
the revenuesdescribed in this paragraph represent approximately 1^10^ o f 1 % o f the total
annual operating expenses incurred in the first year of operatingaRestaurant
GiftOards In 2002, w e i n t r o d u c e d a g i f t card system to replace the paper gift
certificate An approved supplier produces or supplies and processes all gift cards,
redemptions andsettlements The process fees are currently $016 per card The card
production fees vary based on the volume of cards produced and typically range between
$010 and $ 0 1 6 for each Restaurant gift card We have the same fee structure as our
franchisees have New franchisees must s i g n a G i f t O a r d F a r t i c i p a t i o n Agreement with
1051987.4
22
AOMOard^ l o c ^ o u r a ^ ^
s u p p e r of gift card p r o o e ^ ^
VaiueSysfems, ino (or any future soppier of gift card prooessiogservioe^ a o o p y o f
whioh is attached as Exhibits Ooder the gift oard program,fraooh^
direct payment to A O M O a r d s , ioc for the cards, hut wiii reimburse AOM Cards, ioc for
costs incurred to operate the gift card program (SeeitemO)
Peosi Coia in 2012, Appiehee^s Services, certain of its affiliates a o d O S C S entered
iotoamuiti^year agreement withPepsiCo Sales, Inc.^Pepsi^,awholly-owned subsidiary
of PepsiCo, Inc., to be the fountain beverage supplier for the System in the United States.
Pepsi contributes an amount per gallon of product sold in Restaurants, depending on the
percentageoffranchiseesthatmeetanagreed upon performance level, to an advertising
and marketing fund Pach year, the fund proceeds will be distributed to our company and
franchise Restaurants that have signedaparticipation agreement with Pepsi and met their
performanceobligations under the participation agreement New franchisees must s i g n a
parficipationagreementwithPepsitosupplytheirfountain beverages,acopy of which is
attached as Pxhibitl^
Weioht Watchers In May 2003, we entered into a muiti year exclusive license
agreement with Weight Watchers International, Inc ^ Weight Watchers"), whereby we and
Weight Watchers developed Weight Watchers menu items forsale in Restaurants In
January 2009, we entered into an Endorsement Agreement with Weight Watchers to
continue offering menu items The Endorsement Agreement with Weight Watchers will
expire in November 2014 You must sign a Weight Watchers Rider ^Weight Watchers
Rider") attached to the Franchise Agreement We may enter into replacement agreements
with Weight Watchers from time to time and require you to execute replacement or
additional riders with those actions
Guest Experience Measurement Program (GEM) We have entered into an
agreement with a vendor toadministeraguestexperience survey program for company
and franchise Restaurants. All franchisees must participate in the survey program.
Applebee's Services will pay for the costs of the program in 2014 We reserve the right to
reguirefranchiseestopayforailcostsoftheprogram in 2015and after
Computer Systems You arereguired topurchase, install and useaneiectronic
pointofsalecashregister system approved by us Currently, NCR and Spartan are the
only approved suppliers for point of saie equipment and guest check printers, and QSR,
NCR and Spartanare the only approved suppliers for the kitchen Display System You
must use the QSR computer software programs for the kitchen Display System Currently,
QSR is the only approved supplier for this software The number of required P C S terminals
mayvaryasweimplementTableTop Devices (described below)
TableTop Devices You are required tolease, install and use approved portable
ordering, point of sale, and entertainment devices that allow customers the ability to review
themenu,place food and drink orders,access premium content,view advertisements and
make payments at their table ^ T a b l e T o p Devices") Currently,Ela Carte,Inc is the only
1051987 4
23
approved s u p p e r o f T a b l e T o p Oevioes T h e r e i s n o ^ a l fee to lease t h e T a b l e T o p
Oevloes Franchisees must slgnaparticlpatloo agreement w l t h E l a Carte,loc^
thelrTahleTop Devices for their r e s t a u r a ^
Except as stated ahove, neither we nor any of our affiliates are approved suppliers
of any required goods or services, and neither we nor any of our affiliates derive material,
substantive revenue because of required purchases or leases by franchisees in
accordance with specifications or standards required by us, or from suppliers approved by
us At times, certain suppliers provide sponsorship funds that we use to offset expenses
for franchise conventions or other events to which our franchisees are invited At times,
members of Apple Co-opmayreceivepatronage dividends withrespect to sales through
the cooperative andindirect sales through distributors participating with the cooperat^^
E x c e p t a s noted above, when similar products, goods and services are purchased for
companyownedRestaurants,each supplier charges our affiliates for these items on the
same basis as the supplier chargesafranchisee
Restaurant Site Aooroval You must obtain our approval of the site for the
Restaurant before you acquire the site We will supply required demographic reports for
the current price of $150, which is subject to change, and will approve the site through our
Real Estate Review Committee At the time you submit your request for site approval, you
must also submit the related contract of sale or lease agreement (and any other information
required) in order to obtain our approval for the Restaurant Ifyou lease the premises fora
Restaurant, you and the landlord must s i g n a r i d e r to the lease in substantially the same
form as A p p e n d i x C t o the Development Agreement subject to the modifications that we
make to the form rider occasionally We require the lease to provide, among other
provisions, that the lease term is at least as long as the term of the Franchise Agreement,
and that if the applicable Franchise Agreement terminates beforethe expiration of that
t e r m , y o u c a n assignthe l e a s e t o u s without landlordconsent and without thelandlord
imposing conditions on the assignment or obtaining any payment because of the
assignment The lease must also contain other provisions as m a y b e required by our
current lease approval policy or required by the terms and conditions of our approval of the
site Wewill not approveasite for the Restaurant unless we approve the economic terms
of the purchase or lease of the site, including the rental rate You must not make any
binding commitment toaprospective seller or landlord of real estate unless we notify you
that the site has been approved and that the lease complies with the requirements
described immediately above as well as the other provisions of the Development
Agreement and theFranchise Agreement We will notify you whether the sale or lease
agreement complies within 45 days of receiving your request for approval in the form o f a
complete site submittal package Failure by us to notify you within the 45 day period
constitutes an approval of the sale or lease agreement
Insurance Before you open the Restaurant for business, you must obtain the type
and amount of insurance coverage for the Restaurant we specify in the Franchise
Agreement, theFranchiselnsuranceBulletin, and the Manuals, or o t h e r w i s e i n w r i t ^
Certificates of insurance evidencing compliance with our requirements must be forwarded
to our Risk Management Department before opening of the Restaurant and at the time of
each policy renewal You must obtain and maintain the specified insurance coverage
10519874
24
during the term of the Franchise Agreement, without any exclusions unless you have our
consent to them, from an A+ carrier or carriers we find acceptable. Required insurance
(and minimum limits of liability) include Workers Compensation (statutory limits),
Employer's Liability ($500,000 bodily injury by accident, $500,000 bodily injury by disease),
General Public Liability, including Product Liability, Injury and Liquor Liability ($1 million
each person, $1 million each occurrence, $2 million aggregate), Fire and Extended
Coverage (full replacement value) and Umbrella Liability Insurance (currently $30 million).
Business Interruption and Service Interruption insurance is also required. All of the policies
must name us (including our designated affiliates) and Weight Watchers International, Inc.
as additional insureds. We may adjust the minimum limits of liability and other required
insurance provisions at any time, even if your Franchise Agreement specifies a different
minimum limit. Each insurance policy is subject to review by us and copies of policies must
be forwarded to us upon request.
Other than the contribution by Pepsi described above, no supplier will make
payments to us because of the transactions with our franchisees. We and our affiliates
reserve the right, however, to accept payments from suppliers in the future and to receive
patronage dividends from any cooperatives in which we or our affiliates are members.
Other than as described above, we do not provide any material benefits to
franchisees based on their use of approved suppliers. When determining whether to grant
new or additional franchises, we consider many factors, including whether you have
complied with the requirements described above.
ITEM 9
F R A N C H I S E E ' S OBLIGATIONS
This table lists your principal obligations under the development and franchise
agreements and other agreements. It will help you find more detailed information
about your obligations in these agreements and in other items of this Disclosure
Document.
Obligation
a. Site selection and
acquisition/lease
b. Pre-opening
purchases/leases
c. Site development and
other pre-opening
requirements
d. Initial and ongoing
training
10519874
Section in agreement
Sections 5.1, 5.2, 5.3, 10.2 of Development
Agreement; Section 7.3 of Franchise
Agreement
Sections 10.2, 10.3 of Development Agreement;
Sections 2.1, 3, 5.1, 5.4, 5.5, 5.6, 5.9, 5.10,
5.11, 16.2, 23 of Franchise Agreement
Sections 5.1, 5.2, 5.3, 6, 12.2, 12.4, 12.5 of
Development Agreement; Sections 3, 4.2, 5.5,
5.6, 5.10, 5.11, 8.4, 17, 23 of Franchise
Agreement
Sections 12.5, 12.6 of Development
Agreement; Sections 4.2, 5.1, 6.1 - 6.5 of
Franchise Agreement
25
Disclosure
document item
Items 7, 8, 11
Items 7, 8, 11
Items 5, 6, 7, 8, 11
Items 7, 11
Obligation
e. Opening
f. Fees
g. Compliance with
standards and
policies/operating manuals
Sections 2.1, 3, 5.1 - 5.10, 8.4, 23 of Franchise
Agreement
Sections 4.1 - 4.4, 6, 8.9 of Development
Agreement; Sections 8.2, 8.3, 9.1, 9.2, 9.3, 9.4,
9.5, 12.7, 14.3, 16.3 of Franchise Agreement;
Section 7 of Weight Watchers Rider to
Franchise Agreement
Sections 2.3, 3.3, 5.1 - 5.3, 7.2, 7.3, 10.2, 10.3,
11.1, 11.2, 12.2- 12.5 of Development
Agreement; Sections 2.1, 3, 5.2 - 5.11, 7.1,
8 . 3 - 8 . 5 , 10.1 - 10.4, 14.1, 14.2, 14.4, 15.3,
16.1, 16.4, 17, 22, 23 of Franchise Agreement;
Sections 8, 11, 12, 13, 17, 18, and 19 of
Weight Watchers Rider to Franchise Agreement
Disclosure
document item
Items 7, 11
Items 5, 6, 7
Items 11, 16
h. Trademarks and
proprietary information
Sections 11.1, 11.2 of Development Agreement;
Sections 5.11, 13.1, 13.4, 18 of Franchise
Agreement; Sections 5, 6, and 18 of Weight
Watchers Rider to Franchise Agreement
Items 5, 11, 13, 14
i. Restrictions on
products/services offered
Sections 2.1, 5.4, 5.5, 5.6, 5.8, 5.9, 5.10, 5.11,
18.2 - 18.6 of Franchise Agreement; Section 19
of Weight Watchers Rider to Franchise
Agreement
Sections 2.1, 3, 5.4, 5.5, 5.6, 5.8, 5.9, 5.10 of
Franchise Agreement
Sections 2.1 - 2.3, 3.1 - 3.4 of Development
Agreement
Sections 2.1, 3, 5.5, 5.6, 5.8, 5.9, 5.10, 5.11,
7.2 of Franchise Agreement
Sections 5.1, 5.2, 10.2 of Development .
Agreement; Sections 1.3, 1.5, 2.1, 3, 5.6, 7.1,
7.2, 7.3 of Franchise Agreement
Sections 16.1 - 16.4 of Franchise Agreement;
Section 17 of Weight Watchers Riderto
Franchise Agreement
Sections 8.1 - 8.6 of Franchise Agreement;
Sections 5, 15, 18 and 19 of Weight Watchers
Rider to Franchise Agreement
Sections 15.2, 15.3 of Franchise Agreement;
Section 17 of Weight Watchers Riderto
Franchise Agreement
Sections 10.2, 12.2-12.6 of Development
Agreement; Sections 5.1 - 5.6, 22 of Franchise
Agreement
Sections 5.1, 5.2, 7.1, 7.3, 7.4 of Development
Agreement; Sections 8.2, 10.1 -10.5, 11.1,
11.3, 14.3, 14.4 of Franchise Agreement;
Items 8, 11, 16
j. Warranty and customer
service requirements
k. Territorial development
and sales quotas
1. Ongoing product/service
purchases
m. Maintenance,
appearance and
remodeling requirements
n. Insurance
o. Advertising
p. Indemnification
q. Owner's participation/
management/staffing
r. Records and reports
1051987.4
26
Items 11, 16
Items 11, 12
Items 6, 8
Items 6, 11
Items 6, 8
Items 6, 11, 16
Item 6
Items 11, 15
Item 6
Obligation
s. Inspections and audits
t. Transfer
Disclosure
document item
Section 13 of Weight Watchers Rider to
Franchise Agreement
Sections 8.2, 14.1 -14.4 of Franchise
Agreement; Sections 11,12 of Weight
Watchers Riderto Franchise Agreement
Sections 8.1 - 8.9 of Development Agreement;
Sections 12.1-12.9 of Franchise Agreement
Items 6, 11
Items 6, 17
u. Renewal
Sections 1.3, 19.4 of Franchise Agreement
Item 17
v. Post-termination
obligations
Sections 11.1 - 11.5, 12.4 of Development
Agreement; Sections 13.1 -13.5, 19.2 -19.5 of
Franchise Agreement; Sections 3, 13, 14, 15,
16, 17, 18, 20 of Weight Watchers Riderto
Franchise Agreement
Sections 11.1 -11.5, 12.4 of Development
Agreement; Sections 13.1 -13.5 of Franchise
Agreement; Section 19 of Weight Watchers
Rider to Franchise Agreement
Sections 15.1-15.3 of Development
Agreement; Sections 21.1 - 21.3 of Franchise
Agreement
Item 17
w. Non-competition
covenants
x. Dispute resolution
Items 15, 17
Item 17
y. Other (Describe)
ITEM 10
FINANCING
We do not offer direct or indirect financing. We do not guarantee your note, lease or
obligation.
ITEM 11
F R A N C H I S O R ' S A S S I S T A N C E , ADVERTISING,
C O M P U T E R S Y S T E M S AND TRAINING
Except as
assistance.
listed below, we
are
not
required to
provide you
with
any
As described in Item 1, the assistance described below may be performed by
DineEquity, Inc. or Applebee's Services on our behalf.
P R E - O P E N I N G OBLIGATIONS:
Before you open a Restaurant, we will provide the following assistance and services:
10519874
27
1
O n e o ^ o ^ Manual W ^
Agreem^you w ^ a f t e n d a n o ^ ^ o n s e s s ^
^ ^ ^ ^ ^ ^ each of our departments w^h whom yo^
access to our Manuals on the Applehee's^fraoef or an alternate format (the
These Manuals are confidential and rema^
the modification will not alter your status and rights undertheOevelopmentAgreement
Franchise Agreement (Franchise Agreement, S e c t i o n s 5 4 a n d 5 5 ) You will receive or he
given access to the following Manuals, training materials or information:
D
D
^
D
D
D
D
D
D
Beverage Recipe Manual
Flate Presentation Manual
Recipe Manual
Chart Package
Restaurant Operations Manual
Team MemherTraining Process Guide
Manager's Restaurant Opening Guide
Prototype Building Drawings
Appiehee's Brand Assessment Evaluation Guide
The Manuals provide our specifications and standards for the operation of
Restaurants, including specifications and standards for administration, personnel
employee uniforms and dress), accounting, bookkeeping, record retention and other
business systems,safety,insurance,preparation and presentation of all food and beverage
items, advertising and marketing (including co op advertising policies, media buying
guidelines and allowable marketing expenditures), and training programs for your
employees The Manuals include the Grand Opening Reimbursement Program Policy
Guidelines,which includea^Press Release kit",to assist you with the advertising campaign
you conducttopromotethe opening of each Restaurant (Franchise Agreement,Section
6 4) The Manuals contain valuable confidential information, such as recipes, specifications
and the like, which you may only use in the operation of the Restaurant You must return
any of the Manuals loaned to you upon request and immediately upon termination of the
Franchise Agreement The Manuals includealist of approved manufacturers and suppliers
(Franchise A g r e e m e n t , S e c t i o n s 6 4 , 6 6 , 6 6 ^ 6 7 , 6 6 , 6 0 a n d 5 B i 1 )
TheTablesof
Contents for the Manuals we consider our operations manuals are attached as PxhibitG
2
Restaurant Site Selection T h e s e l e c t i o n o f a s i t e is your responsibility We
will provide certain demographic information to you about the site f o r a f e e (Item 6) We
may,at our discretion, conduct a n o n s i t e i n s p e c t i o n before approvingasite We will
r e v i e w a n y l e a s e o r p u r c h a s e a g r e e m e n t regarding the site(Oevelopment Agreement,
Section6Bl) We will approve or disapprove your site within 46 days after we receive your
request for approval of the location inacompleted site submittal package Our approval
will be deemed to be grantedif we fail to notify you within the 46 days W e w i i l a p p r o v e a
site in accordance with our then current site approval procedure (Development Agreement,
Section 6Bl) W e w i l l r e v i e w a i l f e a t u r e s t h a t w e d e e m relevant devaluating a s i t e ,
including general location and neighborhood, impact on existing Restaurants, traffic
patterns, parking, size, lease terms and average income of nearby households We will not
1051987.4
28
unreasonably w^hholdoor oo^
wlllnotbepernêdtooonst^
Seoôn^BI) W e d o n o t g e n e r a l l y o w n y o u r s l t e a n d l e a s e i t t o y o u , butmay ofterto
subleaseasftetoyou
3
Restaurant Plans and Soeoôatlons We will give yeu, at no cost, one set of
POP drawings and one set of AutoCAO files of site adaptable prototype plans and
specifications for our^typloal sizes of Restaurants soon after you sign tbeOevelopment
Agreement development Agreement, Section 5 2) and tbe required Indemnification
agreement You blre your own architect and engineers, at your cost, to bavetbem prepare
arcbltectural/englneerlng plans forconstructlon o f a Restaurant meeting alllocal safety,
accesslblllfyandbuildlng codes Youmust submit the plans and we must approve them
before the start of construction. After you submit those plans to us, we will review them for
compliance with all trade dress guidelines for Restaurants and, within 45 days, tell you If we
approve or disapprove those plans. If changes are needed, we will tell you and review any
resubmitted plans within 21 days. Our approval will be deemed granted If we fall to notify
you within the number of days discussed above development Agreement, Section 5.2).
4.
RestaurantTrainers. I f y o u a r e a new franchisee,for approximately^days
beforeand5daysafteryou open each Restaurant,we will provide you with the services of
upto5certifiedtraining personnel to train your Restaurant employees in the operation of
the kitchen, bar and dining room areas. This will vary for existing franchisees Also, we will
assist in coordinating the Restaurant's pre opening activities (Franchise Agreement,
S e c t i o n s 4 2 a n d 5 B I ) We may provide additional trainers or allow trainers to stay longer,
billed to you at cost
5
0 0 andManaêrTrainin^ After you sign the Oevelopment Agreement, we
willtrainyourOirectorofOperations(Oevelopment Agreement, Section 12 5) Also, we will
train your Restaurant managers (Franchise Agreement, S e c t i o n s 5 1 a n d 5 2 ) The current
training includes onthejobtraining in one of our Restaurants More about training will
follow later in this Item11
5.
Approved Suppliers/Manufacturers. We do not provide you assistance in the
purchase or lease of equipment, signs, fixtures, opening inventory or supplies except for
certain inventory items our affiliate may supply as described in item 5 (Franchise
Agreement, Section 50) W e h a v e a p p o i n t e d O S O S a s t h e s o l e a u t h o r i z e d purchasing
agent for all Restaurants OSOSprocuresproductsandservicesonlythroughsuppliers
approved by us Our standards, operating specifications and procedures for developing and
operating a Restaurant are communicated to you via the Manuals Certain detailed
specifications for equipment, food and other products may only be communicated to
suppliers S e e l t e m 6
We are not required to provide any other service or assistance to you before you
open the Restaurant
POSTOPENiNOOOLiOATiONS
1051987.4
29
We provide the l o w i n g services aod assistance after you open each of ycor
Restaurants:
1
Assistance/insoecticns We wiii advise and assist you in operating and
managing each of your Restaurants and, to that end, wiii provide you, at training session
on premises visits, and hy written or other material, with information on new d
techniguesandimprovementsin restaurant management,food and beverage preparation
and safety,saies promotion and service concepts At least twice yeariy,our representatives
wiii visit the Restaurant to consult with you, and conduct inspections/consuitations at the
Restaurant Also, we will make available to you all additional services, facilities, rights and
privilegeswhich we makeavailableto our franchisees generally (Franchise Agreement,
Sections4BI,5Bland14^
2
Refresher Courses We oroviderefresher courses in Restaurant operations
available to your Oirector of Operations, supervisory employees, General Managers,
kitchen Managers and Assistant Managers (OevelopmentAgreement, Section 12 5(b) and
Franchise Agreement, S e c t i o n s )
3
New Menu Items Throughout the term of each Franchise Agreement, we will
developand test new menu items T h e m e n u whichyou must present may berevised
several times each year with each of our promotional campaigns and/or product features
The menu includes selections f r o m a l i s t of national items approved by us; however, you
may propose additional items that appeal to local trends and traditions for inclusion in your
menu We must test a n d a p p r o v e t h e l o c a l itemsyou propose(Franchise Agreement,
Sections)
4
AdvertisinoandFromotion We will develop and administer advertising and
sales promotion programs designed to promote and enhance the collective success of all
Restaurants and will utilize your monthly national advertising fees for marketing studies and
services, and the purchase of advertising time, space and materials in national, regional or
other advertising media to publicize the Restaurants
WithinOmonthsoftheendofour
ftscalyear,wewill
provide you with an accounting of all advertising fees we received and
spentforadvertising,marketing and related expenses (Franchise Agreement, Sections^BI
and62)
5
Ooenino Advertisino Expenses If you comply with the requirements of
S e c t i o n 6 3 o f the Franchise Agreement,we will reimburse 5 0 ^ of your expenditures for
opening advertising up toamaximum of $2,500 (Franchise Agreement, S e c t i o n s )
5
Force Majeure If Bb^ce ^ a / e ^ e (including condemnation proceedings)
prevents you from operating your Restaurant at the designated location and you apply for
approvaltorelocatetheRestaurant,wewillassistyouinfindingan alternative location in
the same general area where you can operate the Restaurant for the balance of the term
as long as the Oevelopment Agreement has not expired or terminated You must reimburse
1051987.4
30
us for our reasonable ouf of pookef expenses Incurred because of your relocation
(Franchise Agreement, Section 24 3)
Except for the services described above, we are not obligated to provide you with
any other services in addition,if we say that ^we may provide"youaservice or use similar
words, it means that we are not obligated to provide that service to you
LOOALAOVER^S^G
As a franchisee, you must currently spend, annually throughout theterm ofthe
Franchise A g r e e m e n t , ^ ( 0 5 ) ^ of the Gross Sales of the Restaurant on Local Advertising
for the Restaurant We must approve all advertising and promotional materials before you
use it. You must provide us with copies of your proposed advertising, promotional and
creative materialsand media buys, and wewillapproveordisapprovetheadvertising in
writing, within 15 d a y s o f our receipt. If we donot respond, the advertising is approved
(Franchise Agreement, Section 3 5 ) You may use only "approved advertising mediae
which is defined in the Franchise Agreement, and only monies spent on this type of Local
Advertising are c o u n t e d f o r p u r p o s e s o f s a t i s f y i n g t h e ^ ( 0 5 ) ^ Local Advertising spending
requirement. If you want to use other mediaand advertising,you must receive our prior
written approval, which approval must be granted or denied within 30 days of our receipt of
your request (Franchise Agreement, S e c t i o n 3 5 )
NA^GNALAOVER^S^GFONO
1
National Advertisino Fee: Fund You must currently contribute325^ ofthe
G r o s s S a l e s o f t h e Restaurant as anadvertising fee toanational advertising fund(the
"Fund") we have established and administer to advertisethe System on a regionalor
national basis, which must be paid in the same manner as the royalty payments (Franchise
Agreement,Section32) You must pay Fund contributions separately from royalty fees
As discussed in Item 5, we can decrease or increase either the amount you must contribute
t o t h e Fund o r t h e a m o u n t y o u m u s t s p e n d o n local advertising (Franchise Agreement,
Section32)
2
AdvertisinoFroorams We or our designees direct all advertising programs
and have the right to approve the creativeconcepts, materialsand media used in the
programs and their placement and allocation The Fund is intended to maximize general
public recognition and acceptance of the Marks and improve the collective success of all
Restaurants operating under the System For Restaurants our affiliates operate, they will
contribute to the Fund on the same basis as you In administering the Fund, we and our
designees will use reasonable commercial efforts in each calendar year to ensure that the
expenditures for advertising placement are approximately proportional to each franchisee's
contributions to the Fund within any given territory (as that term is defined in each
franchisee's respective Oevelopment Agreement) during that 12 month period (Franchise
Agreement, S e c t i o n s 3 1 a n d 3 2 )
1051987.4
31
3.
F o o d O p e ^ o n s . We or our designee may use the Fund to sa^sfy the costs
of maintaining, administering, directing and preparing advertising, including the cost of
consumer research; preparingandconducting television, digital, social, radio, magazine
and newspaper advertising campaigns; direct mail and outdoor hiiihoard advertising; public
relations activities;email marketing; loyalty programs; third parfy p r o m o s
employing advertising agencies; shortfalls in Weight Watchers royalties; marketing
personnel and otherdepartmental costs for advertising that we administer or prepare
internally and any other expenditures for marketing activities we make Interest earned on
the Fund will become the sole property of us or our affiliate (Franchise Agreement,
Sections^BI a n d ^ ^ O i n e E g u i t y will maintain an account designated as the applebee's
Advertising Fund Accounf'in the n a m e o f OineFguity (orasubsidiarythereof)forfees
payable by o u r o r Applebee's Restaurants L L C s franchisees, and by ouraffiliates that
operate company owned Restaurants to fund the national marketing and advertising
activities and local advertising cooperatives with respect to the Applebee's brand All sums
you pay to the Fund are kept i n a s e p a r a t e account and are used to defray any general
operating expenses, except for reasonable costs, if any, that may be incurred in the
administration or direction of the Fund and advertising programs for you and the System
The Fund operates solely a s a m e a n s for collecting and expending the advertising fees as
outlined above Any sums paid to the Fund that are not spent in the year they are collected
will be spent in the following year If the Fund is required to getashortterm loan to satisfy
apayment obligation prior to receipt of sufficient amounts due from franchisees,the Fund
would be responsible for any interest on the loan.
We prepare an annual audited statement of the operations of the Fund that is made
available to you within 6 months o f t h e end of our fiscal year (Franchise Agreement,
S e c t i o n s ) Ouring the last fiscal year of the Fund (ending Oecember 20,2013),the Fund
s p e n t 0 7 ^ of its income on the production and deployment ofadvertisements, 3 0 5 ^ for
media placement, 0 5 ^ for research and development, and 3 0 ^ for otherexpenses,
including advertising agency retainer The Fund position at the end of fiscal year 2012was
2 ^ (Note: percentages may total more t h a n 1 0 0 ^ because of rounding decimal points )
4
Termination of Fund Although t h e F u n d i s intended to be permanent,we
may terminate the Fund at any time The Fund will not be terminated, however,until all
monies in the Fund have been spent for advertising or promotional purposes or returned to
contributors (including those Restaurants operated by our affiliates) without interest
basis of their respective contributions
5
MediaOutlets We a n d o u r designees currently advertisetheRestaurants
and the products offered by the Restaurants in various forms of media, including television,
radio, magazine, newspaper, e m a i l a n d internet advertising campaigns;direct mail and
outdoor billboard advertising; and through ourgift card program The majority of our
advertising is developed byoutsideagencies W e u s e national advertisingagencies to
assist us in the development and placement of advertising We advertise nationally with
the funds contributed to the Fund
1051987.4
32
6
AdvertôoCoope^ves W e m a y d e s ^ o a t e a o y ^ o ^ p h ^ a ^ a ^ w h i c h ^
or more R e s ^ o r a ^ are located and owned by d ^ e r e ^ p a ^ ^
establishing ao a d v e r t i n g Cooperative IfaCooperative is established,the members of
the Cooperative for that region will consist of all Restaurants whether operated by us, ^
franchisees, or franchisees of our affiliate We will determine in advance how each
Cooperative will be organized and governed and wheo it must start operation Cnce
established,we d o n o t havetheright to dissolve, merge or change the structure of the
Cooperatives Each Cooperative will be organized for the exclusive purposes of
administering adverfisingprograms and developing, subject to our approval, promotional
materials for use by the members in Local Advertising If a Cooperative has been
established forageographic area where your Restaurant is located when the Franchise
Agreement is signed, or if any Cooperative is established during the term of the Franchise
Agreement, you must sign all documents we request and become a member o f t h e
Cooperative according to the terms of the documents. We will provide to y o u a c o p y of the
Cooperative documents applicable to the geographic area io which your Restaurant will be
located if you request it
You must contribute to the Cooperative the amounts required by the documents
governing the Cooperative Your payments to the Cooperative apply toward satisfaction of
your Local Advertising requirement. All contributions to the Cooperative will be maintained
and administered according to the Cooperative governing documents The Cooperative will
be operated solely a s a m e a n s for the collection and expenditure of the Cooperative fees
for the purposes outlined above No advertising or promotional plans or materials may be
used by the Cooperative or furnished to its members without first obtaining our approval
Cooperative(s) will not be obligated to prepare ao annual financial statement reporting its
expenditures for the previous year to its members
7
Maximum Required Advertisino Contributions We have the right to increase
or decrease your required advertising contributions or payments to the Fund, to a
Cooperative, or for Local Advertising Fiowever,we will not increase the total amount of
your required contributions or payments to more than 5 ^ of Gross Sales (Franchise
Agreement, S e c t i o n s )
Neither the Fund nor any Cooperative uses any funds for advertising that is
principallyasolicitation for the sale of franchises for Restaurants
GRANOCRENING CAMPAIGN
Y o u m u s t plan and conductagrand opening campaign for the Restaurant that is
sufficient to meet the needs of the market and is conducted according to the parameters
set forth in the Field Marketing Intranet If this campaign is timely conducted, and we
receive all requested documentation within 120 days after the Restaurant opens, we will
reimburseyou 5 0 ^ ofyourexpendituresforthegrand opening advertising up t o a t o t a i
reimbursement of $2,500 We must approve all advertising materials and methods you use
in the grand opening campaign Y o u m a y not credit any amounts you pay for the grand
10519874
33
opeôg campaign t o w a ^
Sections
Except as described above, we bave no obligation to spend any amount on
advertising in tbe area wbere your Restaurant is located.
ROÔRELAÔNÔRÔOMMOÔAÔNS
1
Public Relations You must inform us if and wben you retainalocal public
relations firm and provide us witbtbe identity of tbat firm Regardless of wbetber you bave
retainedalocal public relations firm,you must allow us to review and approve,in our sole
discretion, all press releases relating to us or our affiliates, tbe System or R e s t a u r a n t
before their distribution to the media
2
crisis communications
You mustcomply with our or OineEguity's crisis
communication protocol in effect at the time of the crisis You must alert us to any actual
crisis situation (or any potential crisis situation) that develops, regardless of whether you
have obtained the assistance o f a l o c a l public relations fi^n
R E S T A U R A N T T E C H N O L O G Y (COMPUTER,
S Y S T E M S AND T A B L E TOP DEVICES)
ELECTRONIC
CASH
REGISTER
As described in Items 6, 7 and 8, with all approved POS Software you must install
specified technology we approve (Franchise Agreement, Section 10.1). Before operating
the P O S , you must have a network in place. The required POS functions include guest
order entry and tracking, guest check printing, tax calculation, credit card and gift card
processing, kitchen display system, employee time clock, product mix reporting, server
level and sales reporting. The P O S system is integrated with support and reporting tools
that enable us to have independent immediate access to the information monitored and
stored by the P O S system, and there is no contractual limitation on our use of the
information we obtain.
Point of Sale Computer System. All Applebee's Restaurants must have a P O S
computer system that meets Applebee's specifications. As of December 31, 2013,
Applebee's Restaurants use either Applebee's proprietary software system, known as
A1POS (for the Windows-based version) or a third party system called Squirrel. If you are
purchasing a Restaurant, you must use the A 1 P O S software.
From time to time, we may evaluate and approve other systems for use.
Support Services. You have the option of purchasing support services from the
Restaurant Solution Center (Help Desk) provided by DineEquity at a cost of $1,200 to
$1,700 annually per Restaurant (see Item 6). The P O S systems approved by Applebee's
are specifically designed for tracking information relevant to the Restaurant's business.
The POS systems are integrated with support and reporting tools that enable us to have
10519874
34
iodepeodent i m m e d ^ e access to the ôrmaticn mcmtcred and stored by the POS
system,and there is no c c n t r a c t u a l ^ m ^
Aoorcved P O S Hardware Suooiier Post
We have an arrangement with cur
approved suppliers to provide the hardware described above for our franchised
Restaurants on the same terms that it offers the equipment to us and our affiliates You are
currently required to use the NOP P O S Workstation, the Ppson guest check printers, and
the O S P kitchen Display System NOP and Spartan are currently the approved suppliers
for the P O S Workstation and t h e g u e s t c h e c k printer NOP, S p a r t a n a n d O S P a r e t h e
approved suppliers for the lîtchenOisplay System If you choose to purchaseadifferent
point of sale system other than ours, the system must be approved first. We may revise our
specifications for the hardware as we determine necessary to meetthe needs o f t h e
System. There is no contractual limitation on our ability to require the hardware be
improved or upgraded. Prom time to time, we may evaluate and approve alternative
hardware suppliers
You mustprovidedatafeedstotheApplebee'ssystem wide Data Warehouse using
the standard P O S menu numbering schemes at your own expense. Computer hardware
must be maintained and this maintenance may beprovided t o y o u f o r a n approximate
annual cost of $4,000 to $6,000 per Restaurant by an approved maintenance provider The
current price to purchase approved hardware is approximately $20,000 to $65,000 per
Restaurant based on the size of the Restaurant and the equipment selected, in addition to
wiring costs
TableTop Devices You mustlease,install and use approvedTableTop Devices in
your Restaurant Currently, P l a C a r t e , Inc is the only approved supplier o f T a b l e T o p
Devices There is noinitialfeeto lease theTableTop Devices You may need to purchase
aseparate printer to route orders placed through theTableTop Devices The approximate
cost is $600 per printer, per Restaurant The printer must be compatible with the software
driver available in our P O S system P l a C a r t e , I n c is obligated to replace,free of charge,
anyTableTop Devices that fail to work due to workmanship andalimited number ofTable
TopDevicesperRestaurantperyearifthereisinternalorexternaldamage P l a C a r t e , I n c
has anobligationto develop and enhancethe premium content and functionality of the
TableTop Devices Approved software upgrades will be rolled out to all franchisees free of
charge There is no annual cost to franchisees for upgrades or maintenance We will not
have independent access to the information generated and stored by the Table Top
Devices.
STARTOPTIME
1
Factors We estimate that the applicant's fee will typically be paid within2to
6 m o n t h s b e f o r e y o u s i g n t h e Development Agreement, and that the opening of your first
Restaurant will range f r o m 6 t o 1 4 months from the date of the Development Agreement
Pactorsaffectingyourstartuptime include selection o f a s i t e satisfactory to you and us,
obtaining any necessary financing, completing the acquisition (or leasing) o f t h e site,
obtaining architectural drawings and permits, soliciting bids and completing all renovat^^^
10519874
35
remodôgornewcoost^
c o n s u m e a ^ m a ^ e ^ weather oeodôos existing during the construotien period,
oompiying with ieoai ordinances (inoiuding obtaining iiguor iioenses), purchasing and
instating fixtures and eguiprnent, purchasing inventory, hiring and training p e ^ ^
attending our pre opening training programs
2
Franchise Aoreement You must sign a Franchise Agreement in theform
attached to the Oeveiopment Agreement as AppendixBapproximateiy 00 days before the
opening ofaRestaurant For those Restaurants which you agree to develop over the initial
years o f t h e Oevelopment Agreement, you must pay onehalf of the balance of any
remaining franchise fee at the time of signing the Franchise Agreement and the remainder
o f t h e fee 14 days before the scheduled opening of each Restaurant As part o f t h e
Franchise Agreement, you must sign the Weight Watchers Rider which grants an
endorsement to use the Weight Watchers endorsement icon in the Restaurant
TRACING
1
Executive Overview Whiienotatraditionaltraining course,we require your
new principal shareholders to attendaweekiongônboarding" program at our Restaurant
Support Center in Kansas City, Missouri, in connection with signing a Oevelopment
Agreement Thisprogram is provided at no cost; however, you must pay for your own
traveling expenses
2
Manaoement Training Fro^rams. We provide a basic Restaurant
management and operations program for Oirectors of Operations, other persons with
development or supervisory responsibility over more thanlRestaurant, General Managers,
kitchen Managers, Assistant Managers and other Restaurant managers a t o n e of our
Restaurants or that ofafranchisee Your General Manager,îtchen Manager and Assistant
Managers for eachRestaurant must be trained to our reasonable satisfactionbefore the
opening of the Restaurant which they will manage (and after the restaurant opens, as you
hire each new manager) Your Director of Operations and any other supervisory employee
you designate must successfully complete the program to our reasonable satisfaction
(OevelopmentAgreement, Section 12 3)
Our current training program for management includes in store,performance based,
task oriented training
The training covers the following functions: server/expo,
host/hostess, bartender, C a r s i d e T o Go specialist, kitchen operation, managementand
administration We will o b s e r v e a n d e v a l u a t e t h e trainees'performance of these tasks
(See theTrainingFrogram Chart below) At our option, individuals who fail evaluations
may not be permitted to complete our training program The Restaurant training will take
approximately 1 0 1 2 w e e k s ( a w o r k w e e k o f 5 t o 0 d a y s ) , d e p e n d i n g o n t h e position and
performance of the individuals involved In the case of your first Restaurant, our personnel
will supervise training in one of our Restaurantsorother training facility. This training
course begins each week, depending on space availability After you open your first
Restaurant, we may, at our option, permit you to conduct Restaurant training for the new
Restaurants in one of your existing Restaurants
If so, you must provide qualified
1051987.4
36
personnel to v a c a t e pertorm^
for soooessfol completion of the operations training course Our trainers undergo a
selection and certification process before being permitted to train managem
Our trainers are annually re certified
If the opening of your Restaurant is delayed and the managers are out of training
and not working in an operating Applebee's Restaurant for more than 00 days, tbey must
attenda"refresber courseBwbicbtypically lasts two weeks There is no c ^
refreshercourse, though you must pay for actualcosts (eg travel, lodging, meals)of
approximately $1,400 per person If the duration of their delay exceeds12months,the
managers must then be retrained in the entire program at your cost
M A N A G E M E N T TRAINING P R O G R A M
Hours of
Classroom
Training
0
Hours of
On-The-Job
Training
220
0
55
Authorized Training
Restaurant *
Service Operations including
Server & Bartender Duties,
Sanitation & Guest
Satisfaction Training
Front of House Management
0
55
Authorized Training
Restaurant *
0
55
Specialization (Front or
Back of House
Management) Management
Operations & Administrative
Training including Guest
Satisfaction, Computer
Training Techniques,
Financial Reporting,
Inventory Purchasing &
Alcohol Sales & Awareness
0
165
Authorized
Restaurant
Authorized
Restaurant
Subject
Kitchen Operations
(including Safety, Sanitation,
Food Preparation, Plate
Presentation, Use of
Equipment, Storage); Host
Back of House Management
1051987.4
37
Location
Authorized Training
Restaurant *
Training
*
Training
*
Hours of
On-The-Job
Training
Hours of
Classroom
Training
•
0
Subject
Training
Structured Transitions
110
Location
Authorized Training
Restaurant*
1
|
Âuthorized Training Restaurants are located near the Applebee's Support Center in
Kansas City, Missouri, and in certified training restaurants of existing Franchisees. All
instructors are Applebee's General Managers assigned to an Authorized Training
Restaurant, typically with more than 5 years' experience as a General Manager.
Our training materials include our Manuals as well as other written and visual
training techniques provided in hardcopy and/or electronically by computer disk or over the
Internet.
We can offer refresher courses regarding the Restaurant operations which, on our
request, your Director of Operations, supervisory employees, General Managers, Kitchen
Managers and Assistant Managers must successfully complete to our satisfaction. Except
as stated above, we currently do not require any courses.
We also require that the Manager on Duty or the person in charge is certified
through an accredited food safety manager program (ServSafe or equivalent). ServSafe
certification is sponsored by the National Restaurant Association. The cost is approximately
$65 for the materials and test.
All required training for managers and other persons with development or
supervisory responsibility over more than 1 Restaurant that we provide is tuition-free at our
training restaurants. You must pay for all salaries, travel, hotel, meal, training material
(books and uniforms), bonus for training store manager, and other incidental costs when
your employees participate in this training.
3.
Non-Manaaement Training. Before the opening of the Restaurant and for
approximately 1 week after the Restaurant opens, we provide a basic training program for
the non-management Restaurant employees. This program includes in-store, task-oriented
training by up to 6 certified trainers that we provide at no charge. Additional trainers may be
provided at your cost. Training is provided for the following restaurant functions: host,
server, bartender, Carside to Go specialist, mid cook, broil cook, fry cook and prep/expo.
The following topics are addressed for each function: Food Safety, Menu Knowledge, Food
Preparation Standards, Service Standards, Safe Equipment Usage, Kitchen Display
System training and Point of Sale training. The restaurant trainers undergo a selection and
certification process that includes management recommendation, interview process, and
background checks. To be considered for selection, a prospective trainer should be in good
standing and perform at or above the established performance for his/her position. Training
materials include our Manuals, written quizzes and exams, and visual training, such as
computer disks and videos.
N O N - M A N A G E M E N T TRAINING P R O G R A M
1051987.4
38
Subject
Average Hours of
Classroom Training*
Average Hours of OnThe-Job Training*
Restaurant Front of
House: Menu Knowledge,
Service Standards, Point
of Sale training, Safety,
Guest Satisfaction,
Sanitation, ServSafe
certification
29%
33
Location
^Franchisee's or
other Certified
Training
Restaurant using
Certified Trainers
Kitchen Operations:
32
"Franchisee's or
39
Food Safety, Menu
other Certified
Knowledge, Sanitation,
Training
Food Preparation
Restaurant, using
Standards, Kitchen
Certified Trainers
Display System training,
Plate Presentation, Use of
Equipment & Storage
"Training is performance-based, so training con tinues until tasks are mastered.
'Certified Trainers from the Restaurant Support Center in Kansas City, Missouri, or from
existing franchisees.
ITEM 12
TERRITORY
You will not receive an exclusive territory. You may face competition from other
franchisees, from outlets that we own, or from other channels of distribution or competitive
brands that we control. Under the terms of the Development Agreement, we grant you the
right to develop one or more Restaurants within a specified territory (the "Territory") during
1 or more initial development periods. This right will continue during any subsequent
development periods (as defined in Section 3.2 of the Development Agreement) if it is
determined that additional Restaurants should be constructed to fully develop the Territory.
However, airports (serviced by one or more public or charter carriers), train stations, bus
terminals, port authorities, colleges, universities and post-secondary education institutions
campuses, hospitals and other health care facilities, arenas, stadiums, state and national
parks, and military forts, posts and bases, travel plazas and casinos will be excluded from
your Territory and may be developed by us or a third party without any participation by or
payment to you. After the initial development period(s), we will determine the number of
Restaurants that you must develop under the Development Agreement based on the
Territory's population, per person or family income, current and potential development, your
financial strength and certain other related factors. The term of initial development periods
shown in the Development Agreement may vary from franchisee to franchisee. Before
signing the Development Agreement, we will give you a written description and/or map of
your Territory.
The Development Agreement does not restrict you from developing more than the
minimum number of Restaurants called for, but you may only develop the Restaurants we
10519874
39
approve for development Under the Oevelopment Agreement, you oannot develop
Restaurants outside ofyourTerrltory The Oevelopment Agreement does not allow
aogulreaddltlonalTerrltory You have no options, rights of first refusal or slml^^^
aogulre additional franchises heyond the development rights granted hy your Oevelopment
Agreement
Undereaoh Franchise Agreement, we allow you t o o p e r a t e a Restaurantatthe
single specific location described in the Franchise Agreement We must approve the
location ofthe Restaurant in advance You may not enter into any lease or other agreement
which imposes restrictions on your (or our) right to operate additional Restaurants at any
particular location, and we must approve in advance any purchase contract or lease you
enter. You and your landlord must signarider to any lease in substantially the same form
ourthencurrent form of lease rider Our current form of lease rider is attached as Appendix
OtotheOevelopmentAgreement
O n c e w e i s s u e a Franchise Agreement to you, you must obtain our approval in
advance to relocate or close theRestaurant for any reason, including condemnation or
events outside your control
While the Oevelopment Agreement is in effect, we may not operate, and may not
f r a n c h i s e o r l i c e n s e a n y other parfytooperate, any Restaurant using the Applebee's
Neighborhood O r i l l ^ B a r ^ trade name in yourTerritory
If the Oevelopment Agreement
expires or terminates, but your Franchise Agreement remains in effect, we may not
establish or grant any franchise t o a t h i r d p a r f y for the establishment of,aRestaurant
(using the Applebee's Neighborhood O r i l l ^ ^
radius of the Restaurant covered by the Franchise Agreement or a radius from the
Restaurant which includes eithera residentialordaytimepopulation o f 4 0 , 0 0 0 o r m o r e
people These radius restrictions will not apply toaRestaurant located in an airport, train
station, bus terminal, port authority, campus at any college, university or other post
secondary education institution, h o s p ^
or national park, or military fort, post or base, travel plaza, casino or across an international
border
TheFranchise Agreement allows you t o u s e the Applebee's Neighborhood G r i l l e
8ar^ and other related service marks or trademarks for the operation of your Restaurant
only You may not sell pre packaged food products, giftcards or any other products or
services from or through any location or channel of distribution other than your Restaurant,
such as grocery,mass merchandise,wholesale/club,convenience,drug stores or any other
type of outlet or channel of distribution We and our affiliates retain the right to sell ^
and servicesinyourTerritory (orin theprotected radius of your Franchise Agreement)
underour principal trademarks o r a n y other trademarksor service marks through any
channel of distribution other thanaRestaurant For example,although we do not currently
do so,we reserve the right to sell prepackaged food products at outlets in yourTerritory or
protected radius like grocery,mass merchandise,wholesale/club,convenience,drug stores
or any other channel of distribution (including the Internet) We may engage in these
activities without paying any compensation to you
1051987.4
40
We r e ^ o the right to o p e r a s
^
use the Appiehees Neighhorh^^
offer similar products and services mother R e s t a o r a n ^ ^
operation of, Other Restaurants within your Territory or within the rad^
inyourFranchiseAgreementwithoutpaying any compensation to you At present,we do
not plan to operate, or franchise the operation of, Other Restaurants
T o c o n t i n u e y o u r right to develop under the Oevelopment Agreement, you must
comply with the development schedule stated in the Development Agreement (discussed in
Item 17) Otherwise, continuation of your territorial rights under the Oevelopment
Agreement and Franchise Agreement are not contingent onacertain sales volume,guota
or market penetration W e w i l l not reduceorchangeyourTerritory due tochanges in
population; however, it is possible for the protected radius underaFranchise Agreement to
he reduced upon increases in residential or daytime population
As noted in I t e m l , in November 2007,we were acquired by OineEguity,formerly
IHOP Oorp. Subsidiaries of OinePguity are the franchisor and operator of the
IHOP/lnternational House ofPancakesfamily restaurant chain,which servesawide variety
of breakfast, lunch and dinner selections The chain currently offers, among other things, a
variety of pancakes as well as omelets, breakfast specialties, burgers, sandwiches, salads,
chicken and steaks The diverse menu of the IHOP restaurants appeals to people of all
ages As of Oecember 20, 2013, there were 13 companyowned IHOPrestaurantsand
1,307 franchised IHOP restaurants in operation, 50 of which were outside of the 50 United
States These restaurants operate under the IHOP andlnternational House of Pancakes
marks IHOP restaurants may solicit and accept orders within theTerritory and within the
above described radius surrounding your Restaurant We do not expect that there will be
material conflicts between the 2 systems regarding territory, customers or franchisor
support The orincipal business address forthe IHOP chain's operations is 450 North Brand
Boulevard, 7^Floor,Olendale,Oalifornia 01203 We and the IHOP franchisor currently
intend to maintain physically separate offices and training facilities for the2systems.
ITEM 13
TRADEMARKS
In the Franchise Agreement, we allow you to operate a Restaurant under the service
mark Applebee's Neighborhood Grill & Bar® and under any other trade names, trademarks,
service marks and logos that we may authorize in the future. The Franchise Agreement
does not allow you to use the service marks T.J. Applebee's, T.J. Applebee's Rx for Edibles
and Elixirs®, or T.J. Applebee's Edibles and Elixirs. Restaurants which opened on or after
October 1, 1985 must operate under our service mark Applebee's Neighborhood Grill &
Bar® and under any other related trade names, trademarks, service marks and logos that
we may in the future authorize the franchisee to use in the operation of Restaurants. You
must use all licensed,names, marks and logos in compliance with the rules contained in the
Agreements and the Manuals, and any modifications we later make to the Manuals.
1051987.4
41
Neither you nor any other person can use any of the names, trademarks, service marks or
logos to sell any product or service not authorized by us.
The service marks listed in the tables below are the primary marks you will use to
identify your Restaurants. Except as specifically stated below, all the marks have been
registered on the principal register of the U.S. Patent and Trademark Office and are held by
Applebee's International, Inc.
Mark
Registration
Number
Registration
Date
07/21/08
10/17/05
08/08/06
02/16/88
Yes
Applebee's Neighborhood Grill & Bar
2,174,392
1,927,107
1,927,107
1,477,153
America's Favorite Neighbor
1,601,596
06/12/1900
Yes
Applebee's (Design)
1,695,071
06/16/1992
Yes
Carside To Go
3,852,095
09/28/10
Yes
There's No Place Like the
Neighborhood
3,920,803
02/15/11
Yes
Eatin' Good in the Neighborhood
2,510,402
11/20/01
Yes
Applebee's and Design (Apple)
3,435,400
05/27/08
Yes
Miscellaneous Design (new Apple)
3,495,064
00/02/08
Yes
It's a Whole New Neighborhood
3,624,094
05/10/00
Yes
SEE YOU TOMORROW
4,241,027
11/13/2012
N/A
Applebee's
Renewed
Yes
All required affidavits for the marks above have been filed.
Each registration described in this Item 13 is currently effective.
We are not aware of any material determinations, rulings or orders of the U.S.
Patent and Trademark Office, Trademark Trial and Appeal Board, or of the trademark
administrator of any state or of any court, any pending infringement, interference,
opposition or cancellation proceeding or pending material litigation involving our principal
trademarks or service marks listed in this Item 13, which prohibit or limit their use by you or
us, or any agreements in effect which significantly limit our right to use or license to you the
use of the principal trademarks or service marks listed in this Item 13 in any manner
material to the franchise.
You must notify us as soon as possible of any infringement claim. We are not
required to take affirmative action when you notify us of an infringement claim. We and our
affiliates have the sole right to conduct the defense of and settle the claim and to retain
10519874
42
conôfanynegoônsreêdtoanyc^m Youmustcoopeêioâôosweor
oura^ês^kerega^ngac^maodmuâss^^
expeoseôthe depose o f a c ^ m
You agreeoever to contest our or o o r a f f i ^ e ^ o w n e r s h ^
our names, marks or logos or take
attempt by you to adopt, use or register any name, mark or logo similar to those we
to you
At any time, we oannotify you that youmust modlty any of the licensed names,
marks or logos to the extent to which we, in good faith, determine that it is in overall best
interests ofthe franchised operations
We know of no superior prior rights or infringing uses of our service marks that couid
materially affect your use ofthose trademarks or service marks
Subject to the terms and conditions of Applebee's Services' Endorsement
Agreement with Weight Watchers, we have the right to use the Weight Watchers licensed
marks on menus in our Restaurants in connection with the sale of Weight Watchers menu
items and in certain advertising, marketing and promotion of those items We also have the
limited right to sub license the right to use the licensed marks to our franchisees In return
for the right to use those marks, we have the obligation to protect the Weight Watchers
names, marks, and logos, including taking any action which Applebee's Services and
Weight Watchers deem to be appropriate regarding any claimed or apparent infringements
of these licensed marks We have the right to use the Weight Watchers endorsement icon
under similar conditions.
ITEM 14
P A T E N T S C O P Y R I G H T S ANO PROPRIETARY INFORMATION
Wedonotownnghtsinoôe^
oot have any apôations for patents pending Pxoept as stated in this item 14, no
oopynghts are matenai to the franchise We o
the System, including the prototype plans and specifications, form construction plans,
Manuals and promotional materials used in the System Also, the information disclosed to
you and your employees concerning the development and operation of Restaurants
includes proprietary information of us and Applehee's Services regarding recipes,
marketing, operational techniques and the like You must acknowledge that the information
concerning thefranchised operationscontained in the Manualsand other materialswe
provide to you is our property and that you will keep it confidential ( L o o k a t l t e m U for
more information )
You also agree not to disclose, use or sell any portion of this proprietary information
except as we permit (Look at ItemBl^for more information) You must also have your
Director of Operations,your other employees who will haveasupervisory authority over the
10519874
43
devôpment or o p e r a s
Manager, Kôheo Manager ao^
attached t o t h e Oevelopment Agreement and Franohise Agreement, generally agreeing
with the oonfidentlal nature of these materials
You must notify us as soon as possible of any oopyrlght Infringement olalm We are
not required to take affirmative aotlon when you notify us of an Infringement olalm We a ^ ^
our affiliates have the sole right to oonduot the defense of and settle the olalm and to retain
oontrol of any negotiations related to any olalm You must cooperate In all aotlons we or our
affiliates t a k e r e g a r d l n g a o l a l m a n d m u s t assist us and our affiliates, at our and
^
expense,In the defense ofaolalm
ITEM^
O O ^ O A ^ O N T O P A R ^ P A T E ^ T H E A O T O A L OPERATION OF
THE FRANOHISE BUSINESS
We do not require you to supervise personally your franohlsedRestaurants You
must employ a Olreotor of Operations (or an Individual with equivalent or greater
responsibility and authority) to devote his/her full tlme efforts to your Restaur^^
Territory The OlreotorofOperatlons may be one ofyour Individual Principal Shareholders If
we agree he/she has sufficient restaurant experience to perform the ôb of the Olreotor of
Operations If we determine that the person does not have sufficient restaurant experience,
then you must locate and hire another Individual as the Olrector of Operations Y o u m a y
also appoint an additional supervisory employee to oversee the operation of more than one
Restaurant In your Territory The Olrector of Operations and any other additional
supervisory employee must also successfully complete our operations training course and
any refresher courses we require
Under e a c h P r a n c h l s e A g r e e m e n t , y o u m u s t e m p l o y a O e n e r a l Manager who will
devote hls/herfull tlmeeftorts to supervising the day to dayoperatlon of each Restaurant
a n d a K l t c h e n Manager who will devote his/her fulltlme efforts to supervising the dayto
d a y o p e r a t i o n o f t h e Restaurant kitchen TheOeneral Manager, Kitchen Manager and
Assistant Managers for each Restaurant must successfully complete our operations
training course before the opening of the Restaurant for which they are responsible (and
after the restaurant opens, as you hire each new manager) and must successfully complete
any refresher courses we require
Your selection of your Olrector of Operations and any additional supervisory
employee Is subject to our prlorwrltten approval,which we cannot arbltrarllywl^^^
None of the persons descrlbedln the above paragraphs must have an ownership
Interest In the franchise
You mustenterlntoawrittenagreementwlth each employee described In the above
paragraphs which prohibits that employee from misusing any of our proprietary Information
(as described In Item 14) The Olrector of Operations also must enter Into a written
agreement which prohibits him/her, while In your employ or within 2 years following
A p ^ ^ ^ o ^ o r L L C 2014^00
10^74
44
^ m ^ ^ o o of h ^ h e r employment from engaging in or aogoiring any merest in a
resfauranf business iooated in fheTerritory defined in fheOeveiopmenfAgre^
Area of Dominant infioenoe (ooonfies within a speoifio television advertising range,
determined by Arbitron in 1066) of any Restaurant you open, whose menu or method of
operation is the same as or similar to that employed by the Restaurants These agreements
also must permit us to enforce theseprohibitionsdireotly against those employees The
forms of agreement those employees wili sign are attached to the Oevelopment Agreement
and Franchise Agreement(seeltem 17) We can alsoreguire you to obtain from your
Director of Operations an agreement verifying his or her employment status.
Each individual or entity that owns more t h a n a l O ^ direct or indirect interest in the
franchisee must sign the Oevelopment Agreement and Franchise Agreement and agree to
dischargeall obligations of theÔeveloper/Franchisee" under thoseagreements
Ona
case by case basis, we may apply this requirement to individuals or entities with less than
a 1 0 ^ d i r e c t o r i n d i r e c t i n t e r e s t i n thefranchisee Individuals or entities other thanthe
franchisee that must sign the Oevelopment Agreement and Franchise Agreement and
agree to discharge (i e , personally guarantee) all obligations of the "Oeveloper/Franchisee^
under those agreements, are called "FrincipalShareholders" Frincipal Shareholders must
also agree not to disclose our confidential information and may not compete with us See
Items 14and 17
ITEM 18
RESTRICTIONS O N W H A T T H E F R A N O H I S E E M A Y S E L L
You may offer for sale in the Restaurants only those products and services specified
in the Franchise Agreement and the Manuals which satisfy our standards and
specificationsandwhichyoupurchasefromapprovedsuppliers See Item6 Unless we
specifically consent in writing, you must offer all the products and services specified in the
preceding sentence We can modify any of our specifications, standards and requirements
whenever we deem necessary, and if so, you must modify your operations. Our right to
modify or add to what you must offer is not limited in any way.
You may not use the Restaurant location for any purpose other than the operation of
aRestaurant complying with our requirements,and you may only advertise locally through
media we approve, including periodicals, radio,television, outdoor signs onbillboards or
buildings, newspapers, flyers, direct mail, social media and other approved electronic
media See Item 12 You must notify us ifyou plan to close the Restaurant for remodeling
SubêcttoourapprovalinSection66oftheFranchiseAgreement,youmayusethe
Internet to identify locations of your Restaurants at which products are sold, but you may
notsell any products, including giftcards, on the Internet You may not sell any pre
packaged items, including anything from theRestaurants, nor conduct retail sales or gift
card sales in other locations We retain the exclusive right to sell products at grocery,mass
merchandise, wholesale/club, convenience, drugstores, other similar locations and any
other channel of distribution, including the Internet
10519874
45
You are not limited in the customers whom you may serve.
ITEM 17
R E N E W A L , TERMINATION,
T R A N S F E R AND DISPUTE RESOLUTION
Development Agreement
THE FRANCHISE RELATIONSHIP
This table lists certain important provisions of the franchise and related agreements.
Y o u should read these provisions in the agreements attached to this Disclosure
Document.
Section in franchise or
other agreement
Section 1.1, 9.1
From 1 to 20 years.
b. Renewal or extension
of the term
c. Requirements for
franchisee to renew or
extend
Not applicable
Not applicable
Not applicable
Not applicable
d. Termination by
franchisee
Not applicable
Not applicable
e. Termination by
franchisor without cause
Sections 1.1, 9.1
When the term expires.
f. Termination by
franchisor with cause
Sections 2.3, 3.3, 9.1,
9.2, 9.3, 9.4
We can terminate only if you default.
g. "Cause" defined curable defaults
Sections 2.3, 3.3, 9.2,
9.3
h. "Cause" defined - noncurable defaults
Sections 9.2, 9.3, 9.4
(i) You have 60 days to cure a default of
your development schedule; (ii) you have
30 days to cure non-payment of fees; (iii)
you have 90 days to dismiss a bankruptcy
petition filed by or against you; (iv) you
have 90 days to employ your first Director
of Operations and 180 days to find a
replacement if his/her employment with
you terminates, all of whom we must
approve; (v) you have 30 days to cure
other defaults under the agreement not
mentioned here or in item "h".
Non-curable defaults: (i) if you open a
Restaurant and fail to get the site and/or
the plans pre-approved; (ii) if you try to
Provision
a. Length of the franchise
term
1051987.4
46
Summary
Provision
other agreement
Summary
i. Franchisee obligations
on termination/nonrenewal
Section 4.4
j. Assignment of contract
by franchisor
k. "Transfer" by franchisee
- defined
Not applicable
transfer the agreement before you open
all the Restaurants required, or later if you
did not get our consent; (iii) if you or one
of your
Principal Shareholders is
convicted of or pleads nolo contendere to
a felony or a crime involving moral
turpitude; (iv) if you made a misrepresentation to us about a material fact;
(v) if you misuse our trademarks or
disclose any confidential information to a
third party; (vi) if you default under a
franchise agreement and we terminate
that agreement; (vii) if you have 2 or more
of the same defaults in a 12-month
period.
Obligations include payment of any fees
or expenses due us (also see item "r"
below).
No restriction on our right to assign.
Sections 8.2, 8.3, 8.4,
8.5
Includes pledge or transfer of agreement
or assets or ownership change.
1. Franchisor approval of
transfer by franchisee
Section 8.5
If you have the right to transfer, we may
approve or withhold our consent, but if we
withhold consent, we must tell you why. If
we do not respond to a request for
transfer within the 45 days provided in the
agreement, our consent is deemed given.
If you are a Principal Shareholder
transferring to another Principal
Shareholder, we cannot unreasonably
withhold our approval.
m. Conditions for
franchisor approval of
transfer
Sections 8.8, 8.9
New franchisee qualifies; transfer fee
paid; purchase agreement/merger
documents approved; training set-up if
needed; release signed by you; fees paid;
transfer of current agreement signed by
new franchisee; Manuals returned (also
see item "r" below).
n. Franchisor's right of first
refusal to acquire
franchisee's business
Section 8.7
We can match any offer for your
business. If offer includes non-cash
items, we can pay you in cash or our
securities for the value of those non-cash
items.
1051987.4
47
Provision
o. Franchisor's option to
purchase franchisee's
business
p. Death or disability of
franchisee
other agreement
Not applicable
Summary
Not applicable
Section 8.5
Your estate may transfer your interest in
the agreement to your spouse, children or
person designated in your will or trust
without our approval, if your successor
agrees to be bound by the agreement.
q. Non-competition
covenants during the term
of the franchise
Section 11.1
r. Non-competition
covenants after the
franchise is terminated or
expires
Section 11.1
No involvement in competing business in
the Territory, or in the Area of Dominant
Influence in which the Territory is located
or within a 5-mile radius of any
Restaurant anywhere.
No competing business for 2 years within
Influence in which the Territory is located,
within a 5-mile radius of any Restaurant
anywhere or within an area which has
been defined as a Territory in another
franchisee's development agreement at
the time your agreement expires or
terminates.
s. Modification of the
agreement
Section 16.4
No modification without all parties'
consent, but we can update the Manuals.
t. Integration/merger
clause
Section 16.3
All agreements are merged into this
agreement and the franchise agreement
(subject to state law). Any other promises
may not be enforceable unless contained
in this Disclosure Document. Nothing is
intended to disclaim any representation
made in this Disclosure Document.
u. Dispute resolution by
arbitration or mediation
v. Choice of forum
Not applicable
Not applicable
Section 15.3
w. Choice of law
Section 15.2
Litigation must be in Johnson County,
Kansas. A right to a jury trial is waived.
(Subject to state law)
Kansas law applies. (Subject to state law)
1051987.4
48
Franchise Agreement
THE FRANCHISE RELATIONSHIP
This table lists certain important provisions of the franchise and related agreements.
You should read these provisions in the agreements attached to this Disclosure
Document.
Provision
a. Length of franchise
term
other agreement
Section 1.2
Summary
Term is 20 years.
b. Renewal or extension
Section 1.3
If you are in good standing each time, you
may renew 4 times for 5 years each.
c. Requirements for
franchisee to renew or
extend
Section 1.3
Each time you renew, all of your
Restaurants must be in good standing, you
must sign a new agreement, you must pay
a fee equal to 10% of the franchise fee
paid or that would be paid by new
franchisees and you must notify us 7-12
months before your agreement expires
that you want to renew. Upon renewal you
may be asked to sign a franchise .
agreement with materially different terms
and conditions than your original Franchise
Agreement.
d. Termination by
franchisee
Not applicable
Not applicable
e. Termination by
franchisor without cause
Not applicable
Not applicable
f. Termination by
franchisor with cause
Section 19.1
We can terminate you if you default or if
you are prohibited from selling liquor.
g. "Cause" defined curable defaults
Section 19.1
You have 60 days to cure: (i) nonsubmission of reports; (ii) failure to spend
local advertising fee; (iii) payment of
miscellaneous fees due us; (iv) failure to
pay your debts and any other matters not
listed in Section 19.1(a) - 19.1(f), except
10519874
49
Provision
other agreement
Summary
you have 90 days to dismiss a bankruptcy
filed by or against you. If you default for
the same obligations 2 times in a 12-month
period, we may terminate you on 30 days'
notice without any cure period.
h. "Cause" defined - noncurable defaults
Section 19.1
Non-curable defaults: (i) failure to pay
your royalty and advertising fee by the
12th day of the next month; (ii) an
unapproved transfer; (iii) disclosure of
confidential information; (iv) competing
with the Restaurants; (v) failing to keep
your Restaurant in compliance with the
operating specifications set forth in the
Manuals; (vi) loss of your liquor license for
more than 30 days during any 12- month
period; (vii) if you lose your lease or your
right to operate your Restaurant (unless it
is because of "Force Majeure"); (viii) the
discovery by us of a material
misrepresentation of information you
furnished us; (ix) if you or one of your
Principal Shareholders is convicted or
pleads nolo contendere to a felony or a
crime involving moral turpitude; (x) if you
breach the terms of our Asset Purchase
Agreement, if applicable, following any
cure period.
i. Franchisee obligations
on termination/nonrenewal
Sections 19.2, 19.3,
19.4, 19.5
You must close your Restaurant and not
remove any property for 30 days. You
must stop using all our trade names,
trademarks, service marks and logos and
all recipes and methods of operation
described in the Manuals. If you own the
Restaurant premises, we have the option
for 30 days to buy the premises for fair
market value. (We also have the option for
30 days to buy the equipment for fair
market value.) Fair market value is either
the price agreed to by you and us or set by
appraisers chosen as described in the
agreement. If you do not want to sell the
premises, you must lease it to us. If
leasing the Restaurant premises, you must
assign your lease to us (also see item "r"
below).
1051987.4
50
Provôo
j Assignment of contact
by franchisor
other agreement
Not applicable
Summary
Noreôtiononournghttoassign
k transfer" by franchisee
defined
Section 1 2 ^ 1 2 ^ 1 2 4
Includes pledge or transfer of oonâot,
assets or ownership change
i Franchisor approval of
transfer by franchisee
Sections 1 2 B I ^ 2 ^
^ ^ 1 2 8
We have the right to approve all transfers.
Ifwewlthhold consent, we musttell you
why. If we do not respond toareguest for
transfer within the 45 days provided In the
agreement, our consent Is deemed given.
Ifyou areaPrlnclpal Shareholder
transferring to another Principal
Shareholder, we cannot unreasonably
withhold our approval.
m Conditions for
franchisor approval of
transfer
Sections 1 2 8 , 1 2 9
n Franchisor's right offirst
refusal to acgoire
franchisee's business
Section 127
New franchise qualifies; transfer fee paid;
purchase/merger agreement approved;
training, If needed, arranged; release
signed; assignment of agreement or new
agreement signed by new franchlsee(also
see Item "r" below)
We can match any ofter for your business.
If offer Includes non-cash Items, we may
pay you In cash or our securities for the
value of those non cash Items.
o Franchisor's option to
purchase franchisee's
business
Sectionsig4,ig5
p. Death or disability of
franchisee
Section 1 2 5
g. Non-competition
covenants during the term
ofthe franchise
Section 181
A p p ^ e e ^ F ^ o ^ s o r L L C 2014 FOO
105^74
Upon your termination or nonrenewal, If
you own the Restaurant premises, we
have the option for 30 days to buy the
premises for fair market value If you do
not want to sell the premises, you must
lease It to us. If leasing the premises, you
must assign your lease to us (Also, see
Item^'above)
Your estate may transfer your Interest In
the agreement to your spouse, children or
person designated In your will or trust
without our approval, If your successor
agrees to be bound by the agreement.
No Involvement In competing business In
theTerritory, or In the Area of Dominant
Influence InwhlchtheTerrltory Is located
or wlthlna5mlle radius of any Restaurant
anywhere.
5^
Provision
r. Non-competition
covenants after the
franchise is terminated or
expires
other agreement
Section 13.2
Summary
No competing business for 2 years within
Influence in which the Territory is located,
within a 5-mile radius of any Restaurant
anywhere or within an area which has
been defined as a Territory in another
franchisee's development agreement at
the time your agreement expires or
terminates.
No modification without all parties'
consent, but we can (i) make changes in
the Manuals; (ii) change the advertising
fee and the amount spent on local
advertising; (iii) increase the royalty fee;
(iv) terminate the agreement if you do not
get a liquor license or some third party has
superior rights in the area in our trade
name; (v) change the trade name or
trademark used.
All agreements are merged into this
agreement and the development
agreement (subject to state law). Any
other promises may not be enforceable
unless contained in this Disclosure
Document. Nothing is intended to disclaim
any representation made in this Disclosure
Document.
s. Modification ofthe
agreement
Sections 8.2, 9.1, 23,
25.6
t. Integration/merger
clause
Section 25.5
u. Dispute resolution by
arbitration or mediation
v. Choice of forum
Not applicable
Not applicable
Section 21.3
Litigation must be in Johnson County,
Kansas. A right to a jury trial is waived.
(Subject to state law)
w. Choice of law
Section 21.2
Kansas law applies. (Subject to state law)
ITEM 18
PUBLIC FIGURES
We do not use any public figure to promote our franchise.
We may, however, retain a well-known person to appear in various advertising
campaigns for the Restaurants. We may also enter into an agreement with a well-known
personality for his or her services which may result in a positive public image for the
System.
10519874
52
ITEMIO
^ N A N O I A L P E R F O R M A N O E REPRESENTATIONS
The P T O s Praochise Rule permit afraochlserte provide infermatloo about the
actual or potential finanolalpertor^
there i s a reasonable b a s i s t o r t h e information, and if the information is included in the
Oisclosure Oocument Pinancial performance information that differs from that included in
Item 1 0 m a y b e g i v e n o n l y i f ^ ) a f r a n c h i s o r p r o v i d e s t h e a c t u a l records of an existing
outlet that you areconsidering buying; o r ^ a f r a n c h i s o r s u p p l e m e n t s t h e information
provided in Item 10, for example,by providing information about possible performance a t a
particular location or under particular circumstances
The average weekly domestic franchise unit sales for the 52 weeks ended
Oecember 20, 2013, was $4S,775 Some Restaurants have achieved this sales level
T h e r e i s n o assurance that you will do as well If y o u r e l y u p o n o u r figures, you must
accept the risk of not doing as well.
Bases
This sales figure was derived from the sales at t h e l , 3 1 7 franchised Restaurants
t h a t w e r e i n operationfor a l l o t thefiscal year 2013 (excluding t h e 2 3 companyowned
Restaurants) Of t h e l , 3 1 7 Restaurants includedin this survey,770 (420%) attained at
least the stated average sales
Information that forms the basis for this representation is available to you on
reasonable request
If you are purchasing an existing outlet, we may provide you with the actual records
of that outlet
The financial results of your Restaurant may be directly affectedby many factors,
such as the Restaurant's size; geographic location; weather; the effectivenessof your
regional and local marketing efforts; the level of existing brand awareness and acceptance
in the market; the presence of other competing restaurants; and the quality of management
and service atyourRestaurant Yourindividualfinancial resultsmay vary substantially
from the results stated in this financial performance representation
A ^ e ^ s F ^ o o h ^ LLC 2014^00
^9874
5^
ITEM 20
O U T L E T S A N D FRANCHISEE INFORMATION
T A B L E NO. 1
SYSTEMWIDE OUTLET S U M M A R Y
FOR 2011-2013
As described in more detail in Item 1, we began offering franchises in October 2014 and so
the following information describes information related to the franchising activities of
Applebee's International, Inc., which offered franchises from January 2012 through
September 2014 (and previously offered franchises from March 1988 to November 2007),
and of Applebee's Franchising, LLC which offered domestic franchises from November
2007 to December 2011. Effective September 30, 2014, all then-existing franchises were
transferred to Applebee's Restaurants LLC and company-owned Restaurants will be
operated by affiliates of Applebee's.
Outlet Type
Franchised
Company Owned
Total Outlets
Year
2011
2012
2013
2011
2012
2013
2011
2012
2013
Outlets at the
Start of the Year
1,553
1,694
1,862
309
177
23
1,862
1,871
1,885
Outlets at the
End of the Year
1,694
1,862
1,838
177
23
23
1,871
1,885
1,861
Net Change
+141
+168
-24
-132
-109
0
+9
+14
-23
Note: Numbers are for U.S. outlets for fiscal years ending January 1, 2012; December 31,
2012; and December 29, 2013.
10519874
54
TABLE NO. 2
TRANSFERS OF FRANCHISED OUTLETS
[TRANSFERS OF OUTLETS FROM FRANCHISEES TO NEW OWNERS]
(OTHER THAN THE FRANCHISOR)
FOR FISCAL YEARS 2011 -2013
State
Alabama
Arizona
California
Colorado
Florida
Georgia
Idaho
Illinois
Indiana
Kansas
Kentucky
Mississippi
1051987.4
Year
Number of Transfers
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
0
8
0
0
0
24
0
5
0
0
25
0
0
61
35
40
24
3
0
12
0
0
0
15
0
0
7
0
3
0
0
0
33
0
1
0
55
Missouri
Nebraska
New Mexico
North Carolina
Ohio
Oklahoma
Oregon
Pennsylvania
South Carolina
Texas
Washington
Wyoming
Total
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
2011
2012
2013
0
2
0
0
11
0
0
8
0
0
4
0
0
0
37
0
5
0
0
16
0
0
0
1
13
27
0
0
32
0
0
13
0
1
5
0
54
262
155
Note: Numbers are for fiscal years ending J January 1, 2012; December 31, 2012; and
December 29, 2013.
10519874
56
TABLE NO. 3
STATUS OF FRANCHISED OUTLETS
FOR FISCAL YEARS 2011-2013
State
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Florida
Georgia
Terminations
NonRenewals
Reacquired by
Franchisor
Ceased
OperationsOther
Reasons
0
0
0
0
0
30
30
0
0
0
0
0
30
2013
30
0
0-
0
0
0
30
2011
2
0
0'
0
0
0
2
2012
2
0
0
0
0
0
2
2013
2
0
0
0
0
0
2
2011
33
0
0
0
0
0
33
2012
33
0
0
0
0
0
33
2013
33
0
0
0
0
6
27
2011
9
0
0
0
0
0
9
2012
9
2
0
0
0
0
11
2013
11
0
0
0
0
0
11
2011
112
2
0
0
0
0
114
2012
114
0
0
0
0
0
114
2013
114
5
0
0
0
2
112
2011
27
0
0
0
0
0
27
2012
27
0
0
0
0
0
27
2013
27
0
0
0
0
1
26
2011
8
0
0
0
0
0
8
2012
8
0
0
0
0
0
8
2013
8
0
0
0
0
1
7
2011
12
0
0
0
0
0
12
2012
12
0
0
0
0
0
12
2013
12
0
0
0
0
0
12
2011
109
1
0
0
0
0
110
2012
110
2
0
0
0
0
111
2013
111
1
0
0
0
4
108
2011
69
0
0
0
0
0
69
2012
69
0
0
0
0
0
69
2013
69
1
0
0
0
2
70
Year
Outlets at
Start of
Year
Outlets
Opened
2011
30
2012
1051987.4
57
Outlets at
End of Year
State
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Terminations
NonRenewals
Reacquired by
Franchisor
Ceased
OperationsOther
Reasons
0
0
0
0
0
12
12
0
0
0
0
0
12
2013
12
0
0
0
0
0
12
2011
52
10
0
0
0
1
61
2012
61
3
0
0
0
0
64
2013
64
0
0
0
0
18
46
2011
59
0
0
0
0
0
59
2012
59
7
0
0
0
0
66
2013
66
0
0
0
0
0
66
2011
27
0
0
0
0
0
27
2012
27
0
0
0
0
0
27
2013
27
0
0
0
0
0
27
2011
19
0
0
0
0
0
19
2012
19
5
0
0
0
0
24
2013
24
0
0
0
0
0
24
0
0
0
32
Year
Outlets at
Start of
Year
Outlets
Opened
2011
12
2012
-
v
Outlets at
End of Year
2011
32
0
o
2012
32
5
0
0
0
0
37
2013
37
1
0
0
0
1
37
2011
17
1
0
0
0
0
18
2012
18
0
0
0
0
0
18
2013
18
0
0
0
0
0
18
2011
0
11
0
0
0
0
11
2012
11
0
0
0
0
0
11
2013
11
1
0
0
0
0
12
2011
14
12
0
0
0
0
26
2012
126
0
0
0
0
0
26
2013
26
0
0
0
0
0
26
2011
0
29
0
0
0
0
29
2012
29
0
0
0
0
0
29
2013
29
0
0
0
0
1
28
2011
21
0
0
0
0
0
21
2012
21
65
0
0
0
0
86
2013
86
0
0
0
0
0
86
10519874
58
State
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
Terminations
NonRenewals
Reacquired by
Franchisor
Ceased
OperationsOther
Reasons
0
0
0
0
2
59
59
0
0
0
0
1
58
2013
58
0
0
0
0
0
58
2011
15
0
0
0
0
0
15
2012
15
5
0
0
0
0
20
2013
20
1
0
0
0
0
21
2011
2
26
0
0
0
0
28
2012
28
20
0
0
0
0
48
2013
48
0
0
0
0
2
46
2011
7
1
0
0
0
0
8
2012
8
01
.0
0
0
0
8
2013
8
0
0
0
0
0
8
2011
19
0
0
0
0
0
19
2012
19
0
0
0
0
0
19
2013
19
0
0
0
0
1
18
2011
14
0
0
0
0
0
14
2012
14
0
0
0
0
0
14
2013
14
0
0
0
0
0
14
2011
0
14
0
0
0
0
14
2012
14
0
0
0
0
0
14
2013
14
0
0
0
0
0
14
2011
55
1
0
0
0
0
56
2011
56
1
0
0
0
0
57
2012
57
0
0
0
0
0
57
2011
18
0
0
0
0
0
18
2012
18
0
0
0
0
0
18
2013
18
1
0
0
0
1
18
2011
109
2
0
0
0
1
110
2012
110
2
0
0
0
0
112
2013
112
1
0
0
0
0
113
2011
55
1
0
0
0
0
56
2012
56
2
0
0
0
0
58
2013
58
0
0
0
0
0
58
Year
Outlets at
Start of
Year
Outlets
Opened
2011
61
2012
1051987.4
59
Outlets at
End of Year
State
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Terminations
NonRenewals
Reacquired by
Franchisor
Ceased
OperationsOther
Reasons
0
0
0
0
11
1
0
0
0
1
11
11
1
0
0
0
0
12
2011
96
0
0
0
0
1
95
2012
95
0
0
0
0
0
95
2013
95
1
0
0
0
3
93
2011
21
0
0
0
0
0
21
2012
21
1
0
0
0
0
22
2013
22
1
0
0
0
0
23
2011
21
0
0
0
0
0
21
2012
21
0
0
0
0
0
21
2013
21
0
0
0
0
0
21
2011
74
2
0
0
0
0
76
2012
76
2
0
0
0
0
78
2013
78
0
0
0
0
1
77
2011
0
8
0
0
0
0
8
2012
8
0
0
0
0
0
8
2013
8
0
0
0
0
0
8
2011
40
0
0
0
0
0
40
2012
40
0
0
0
0
0
40
2013
40
0
0
0
0
0
40
2011
6
1
0
0
0
1
6
2012
6
0
0
0
0
0
6
2013
6
0
0
0
0
0
6
2011
34
0
0
0
0
0
34
2012
34
7
0
0
0
0
41
2013
41
1
0
0
0
0
42
2011
90
5
0.
0
0
0
95
2012
95
5
0
0
0
0
100
2013
100
2
0
0
0
1
101
2011
16
0
0
0
0
0
16
2012
16
0
0
0
0
0
16
2013
16
0
0
0
0
0
16
Year
Outlets at
Start of
Year
Outlets
Opened
2011
11
0
2012
11
2013
105I987.4
60
Outlets at
End of Year
State
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Totals
Terminations
NonRenewals
Reacquired by
Franchisor
Ceased
OperationsOther
Reasons
3
0
0
0
0
3
3
0
0
0
0
0
3
2013
3
0
0
0
0
0
3
2011
22
14
0
0
0
0
36
2012
36
37
0
0
0
0
73
2013
73
0
0
0
0
0
73
2011
39
1
0
0
0
0
40
2012
40
0
0
0
0
0
40
2013
40
2
0
0
0
0
42
2011
15
2
0
0
0
0
17
2012
17
0
0
0
0
0
17
2013
17
0
0
0
0
0
17
2011
44
0
0
0
0
0
44
2012
44
0
0
0
0
0
44
2013
44
0
0
0
0
0
44
2011
5
0
0
0
0
0
5
2012
5
0
0
0
0
0
5
2013
5
0
0
0
0
0
5
2011
1,553
147
0
0
0
6
1,694
2012
1,694
160
0
0
0
6
1,862
2013
1,862
20
0
0
0
44
1,838
Year
Outlets at
Start of
Year
Outlets
Opened
2011
0
2012
Outlets at
End of Year
Note: Numbers are for fiscal years ending January 1, 2012; December 31, 2012; and
December 29, 2013.
1051987.4
61
TABLE NO. 4
STATUS OF COMPANY-OWNED OUTLETS
FOR FISCAL YEARS 2011-2013
State
Arkansas
Illinois
Indiana
Kansas
Kentucky
Maine
Maryland
Massachusetts
Michigan
Mississippi
Year
Outlets at Start
of Year
Outlets
Opened
Outlets Reacquired from
Franchisees
Outlets
Closed
Outlets Sold to
Franchisees
Outlets at End
of Year
2011
2
0
0
0
0
2
2012
2
0
0
0
2
0
2013
0
0
0
0
0
0
2011
14
0
0
0
10
4
2012
4
0
0
0
4
0
2013
0
0
0
0
0
0
2011
7
0
0
0
0
7
2012
7
0
0
0
7
0
2013
0
0
0
0
0
0
2011
15
0
0
0
0
15
2012
15
0
0
0
5
10
2013
10
0
0
0
0
10
2011
5
0
0
0
0
5
2012
5
0
0
0
5
0
2013
0
0
0
0
0
0
2011
11
0
0
0
11
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
12
0
0
0
12
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
29
0
0
0
29
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
65
0
0
0
0
65
2012
65
0
0
0
2013
0
0
0
0
0
0
2011
3
0
0
0
0
3
2012
3
0
0
0
3
0
2013
0
0
0
0
0
0
10519874
'
62
. 65
0
Year
Outlets at Start
of Year
Outlets
Opened
Outlets Reacquired from
Franchisees
Outlets
Closed
Outlets Sold to
Franchisees
Outlets at End
of Year
2011
59
0
0
0
26
33
2012
33
0
0
0
20
13
2013
13
0
0
0
0
13
2011
14
0
0
0
14
0
New
2012
0
0
0
0
0
0
Hampshire
2013
0
0
0
0
0
0
2011
1
0
0
0
1
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
2
0
0
0
0
2
2012
2
0
0
0
2
0
2013
0
0
0
0
0
0
2011
2
0
0
0
2
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
8
0
0
0
8
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
4
0
0
0
0
4
2012
4
0
0
0
4
0
2013
0
0
0
0
0
0
2011
3
0
0
0
3
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
51
0
0
0
14
37
2012
37
0
0
0
37
0
2012
0
0
0
0
0
0
2011
2
0
0
0
2
0
2012
0
0
0
0
0
0
2013
0
0
0
0
0
0
2011
309
0
0
0
132
177
2012
177
0
0
0
154
23
2013
23
0
0
0
0
23
State
Missouri
New York
North Carolina
Pennsylvania
Rhode Island
Tennessee
Vermont
Virginia
West Virginia
Totals
1051987.4 •
63
Note: Numbers are for fiscal years ending January 1, 2012; December 31, 2012; and
December 29, 2013.
T A B L E NO. 5
P R O J E C T E D OPENINGS
A S OF J A N U A R Y 1,2014
State
Franchise Agreements
Signed But Outlet Not
Open
Projected New
Franchised Outlet in the
Next Fiscal Year
Projected New
Company-Owned Outlet
in the Next Fiscal Year
Alabama
California
Colorado
Florida
Georgia
Hawaii
Kansas
Michigan
Minnesota
Mississippi
New Jersey
New Mexico
New York
North Carolina
Pennsylvania
Tennessee
Texas
Total
0
0
0
0
0
1
0
0
0
1
1
0
0
0
0
1
0
4
1
7
2
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
1
1
1
1
1
1
2
3
1
1
2
6
35
_j
Current Franchisees
As of December 29, 2013, 1,838 Applebee's Neighborhood Grill & Bar Restaurants®
were operating under a Franchise Agreement in the United States (excluding companyowned Restaurants), and 150 Applebee's Restaurants were operating under a Franchise
Agreement outside the United States. A complete list of our franchisees, including their
names, addresses and telephone numbers, is attached as Exhibit H. Also included in
Exhibit H is the address and telephone number for the individual franchise outlets operated
by each franchisee in the United States.
As of December 29, 2013, our affiliates operated 23 Applebee's Neighborhood Grill
& Bar Restaurants® in the United States. A complete list of the company-owned outlet
locations operated by our affiliates in the United States is attached as Exhibit I.
1051987.4
64
Former Franchisees
The name and last known address and telephone number of each franchisee whose
Franchise Agreement(s) has been terminated, canceled, not renewed, or who otherwise
voluntarily or involuntarily ceased to do business under a Franchise Agreement within the
fiscal year preceding the date of this Disclosure Document or who have not communicated
with us or our affiliates within 10 weeks of the date of this Disclosure Document are as
follows:
AmRest, LLC, 2120 Powers Ferry Road, Suite 350, Atlanta, GA 30339, (770) 951-0586
(Voluntarily closed 3 Restaurants and left the System).
Apple Arkansas, Inc., 5120 Summerhill Road, Texarkana, Texas 75503, (903) 794-3743
(Voluntarily closed 1 Restaurant).
Apple American Group LLC, 6200 Oak Tree Boulevard, Suite 250, Independence, Ohio
44131, (216) 525-2775 (Voluntarily closed 1 Restaurant).
Apple Sauce, Inc., 741 Centre View Boulevard, Suite 100, Crestview Hills, Kentucky 41017,
(859) 331-3900 (Voluntarily closed 1 Restaurant).
Applelilinois, LLC, 741 Centre View Boulevard, Suite 100, Crestview Hills, Kentucky
41017, (859) 331-3900 (Sold 15 Restaurants, closed 18 Restaurants and left the System).
Delaware North Companies Travel Hospitalities, Inc., 40 Fountain Plaza, Buffalo, New York
Delaware Valley Rose, L.P., 29 Friends Lane, Newtown, Pennsylvania 18940, (215) 5799220 (Voluntarily closed 1 Restaurant).
Gator Apple, LLC, 525 S. Flagler Drive, Suite 500, West Palm Beach, Florida 33401, (770)
670-7220 (Sold 38 Restaurants, closed 3 Restaurants and left the System).
Mid River Restaurants LLC, 296 Highland Drive, Natchez, Mississippi 39120, (601)4459710 (Voluntarily closed 2 Restaurants).
Neighborhood Restaurant Partners, LLC, 1455 Lincoln Parkway, Suite 430, Dunwoody,
Georgia 30346, (770) 623-0360 (Voluntarily closed 2 Restaurants).
RMH Franchise Corporation, 1701 Windhoek Drive, P.O. Box 6212, Lincoln, Nebraska
Thomas and King, Inc., 249 East Main Street, Suite 101, Lexington, Kentucky 40507, (859)
254-2180 (Sold 78 Restaurants, closed 10 Restaurants and left the System).
10519874
65
Ifyou buy this ^ a o o h ^ y o o r c ^ ^
when you leave the fraoohise system
Purchase of Prevlouslv OwnedFranohlse Outlet
Ifyou are purchasing a previouslyowned franchised outlet, w e w i l l provide you
additional information on the previousiyowned franchiseoutlet in an addendum to this
Oisclosure Document.
Oonfidentialitv Clauses
During the l a s t ^ f i s c a l years,we have not signed any agreements with franchisees
that contain confidentiality clauses that w o u ^
about their experience
Trademark Specific Franchisee Organizations
Other than the A p p l e b e e ' s N e i g h b o r h o o d O r i l i ^ B a r F r a n c h i s e B u s i n e s s O o u n c i i ,
Franchise MarketingOouncil, Franchise Operations Council, Franchise F o o d ^ O e v e r a g e
Council,Franchise FeopleCouncilandFranchiseTechnology Council discussed below, we
are not currently aware of any trademark specific franchisee organizations associated with
the franchise system which we have created, sponsored or endorsed, or any independent
franchisee organizations that have asked to be included in this Disclosure Document
FRANC^SE POSSESS COONC^
A s o f t h e d a t e o f t h i s Disclosure Document, the Applebees Neighborhood O r i l l ^ O a r
F r a n c h i s e B u s i n e s s C o u n c i l ^ F B C ^ i n c l u d e s ^ f r a n c h i s e e representatives^ permanent
andêlected) a n d ^ m e m b e r s of our management The F 8 C holds an annual meeting and
other meetings throughout the year At F B C meetings, the representatives exchange
information regarding operations, marketing, productdeveiopmentand other aspects of
Restaurant operations for the purpose of improving the System Subject to any changes in
FBC organization, you will have the opportunity to vote for the franchisee representatives to
the F 8 C While we are not obligated under the Franchise Agreement to establish or
continue the FBC, we currently intend to continue the F 8 C as described above
A s p a r t o f the F B C d i s c u s s e d above, a Franchise Marketing Council ^FMO'), a
Franchise Operations Council ^ O p s Councils,aFranchise Food and Beverage Council ^ F
^ B ^ , a F r a n c h i s e T e c h n o l o g y Council ^ F T C ^ a n d a F r a n c h i s e People Council ^People
Councils exist These councils include franchisees appointed by the F B C and serve in an
advisory capacity only We have the right to change or dissolve the FBC, and therefore, if
we dissolve the F B C , the F M C , the Ops Council, t h e F ^ B , the FTC and the People
Council would be dissolved
The FBC's address i s ^ 4 0 Ward P a r k w a y , K a n s a s C i t y , M i s s o u r i ^ 1 4 , T e l : t 8 0 0
3547363 It does not haveawebsite or an email address
10519874
66
FRANO^SEÂRK^NGOOONO^
The F M O , p r e s e n t made op o f O f r ^ ^
management werks d i r e c t with Appiehees S e m e s ' Marketing Department and its
advertising agencies te provide feedback and guidance regarding new and existing
advertising and ether prcmcticnai items for use in the advertising of the Restaurants
FRANO^SEFOOO^BEVERAOEOOONO^
The F ^ B, presents made up of 7 franchise representatives and 5 company
representatives, inciuding^memhers of our senior management,works with Appiehee's
Services'Menu Oevelopment and innovation Department to provide insight into food and
beverage development and optimization
FRANO^SEORERATiONSOOONC^
The Ops Council is currently made up ofOfranchise representatives and^company
representatives,including^members of our management The Ops Council works with the
Company Operations, Franchise Operations and Strategic Implementation departments to
h e l p t h e S y s t e m drive sales and improvethe Restaurant economicsthrough evaluating
processes and procedures, and developing new practices.
FRANC^SETECÔLOOYCOUNC^
The FTC IncludesOfranchisee representatives, 1 representative from our Strategic
Implementation Department and 4 representatives from the DineEguity Information
Technology Department The FTC holds an annual meeting and other meetings throughout
the year at which the representatives review restaurant information technology policy,
supported hardware and software alternatives, and technology strategy
FRANCHISE F E O R L E C O O N C ^
The Feople Council includes 9 franchisee representatives and 5 company
representatives, including 2 members of management The Feople Council works with
Human Resourcesto guide prioritization and strategic directionof short and longterm
talent strategies, process and tools The Feople Council also works with Oovernment
Affairstopromoteeducationofand involvement in employment related legislation
ITEM 21
FINANCIAL S T A T E M E N T S
The following documents are attached to this Disclosure Document as Exhibit A:
Exhibit A: Our audited financial statements as of August 24, 2014. We have not been in
business for three years or more, and cannot include all financial statements reguired in
10519874
67
Instructions (1)(i) and (ii) of Item 21 ofthe American Securities Administrators Association,
Inc. 2008 Franchise Registration And Disclosure Guidelines.
Also included are the audited financial statements of our parent company, DineEguity, Inc.
as of its fiscal years ending December 31, 2011 and December 31, 2012 and December
31, 2013. These financials are included because DineEguity, Inc. performs certain postsale obligations for the franchisor; DineEguity, Inc. does not guaranty our performance of
obligations to our franchisees.
ITEM 22
CONTRACTS
The following agreements are attached as Exhibits to this Disclosure Document:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Applicant's Fee Letter Agreement (Exhibit D).
Development Agreement with Lease Rider and form addendum for alternate
company structure (Exhibit E).
Franchise Agreement with Weight Watchers Rider and form addendum for
alternate company structure (Exhibit F).
Gift Card Participation Agreement (Exhibit J).
Beverage Sales Participation Agreement (Exhibit K).
Neighborhood Connect Subscription Agreement (Exhibit L).
Information Privacy Participation Agreement (Exhibit M).
Demographic System Participation Agreement (Exhibit N).
Apple Supply Chain Co-op, Inc. Membership Agreement (Exhibit P).
Table Top Devices Participation Agreement (Exhibit Q).
ITEM 23
RECEIPTS
Two copies of a Receipt for this Disclosure Document are attached as the last 2
pages of this Disclosure Document. Please sign, date and return 1 copy to us and retain
the other copy for your files.
1051987.4
68
EXHIBIT A
Financial Statements - Applebee's Franchisor L L C and DineEquity, Inc.
BALANCE
SHEET
Applebee's Franchisor LLC
August 24, 2014
With Report of Independent Auditors
Ernst & Young LLP
inI '
EY
Building a better
working world
Applebee's Franchisor L L C
Balance Sheet
August 24, 2014
Contents
Report of Independent Auditors
1
Balance Sheet
Balance Sheet
Notes to Balance Sheet
1409-1311197
3
4
EY
Building a better
working world
Ernst S Young LLP
Suite 500
725 South Figueroa Street
Los Angeles. CA 90017-5418
Tel: +1 213 977 3200
Fax: +1 213 977 3729
ey.com
Report of Independent Auditors
The Member
We have audited the accompanying balance sheet of Applebee's Franchisor LLC, a Delaware
limited liability company and a wholly-owned subsidiary of Applebee's Funding LLC ("the
Company"), as of August 24, 2014, and the related notes, (the financial statement).
Management's Responsibility for the Financial Statement
Management is responsible for the preparation and fair presentation of this financial statement in
conformity with U.S. generally accepted accounting principles; this includes the design,
implementation and maintenance of internal control relevant to the preparation and fair
presentation of the financial statement that is free of material misstatement, whether due to fraud
or error.
Auditor's Responsibility
Our responsibility is to express an opinion on the financial statement based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statement is free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statement. The procedures selected depend on the auditor's judgment,
including the assessment of the risks of material misstatement of the financial statement, whether
due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the entity's preparation and fair presentation of the financial statement in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express
no such opinion. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of significant accounting estimates made by management, as well as
evaluating the overall presentation of the financial statement.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
1409-1311197
A member firm ol Ernst S Young Global Limited
Building a better
working world
Opinion
In our opinion, the balance sheet referred to above presents fairly, in all material respects, the
financial position of Applebee's Franchisor LLC at August 24, 2014, in conformity with U.S.
generally accepted accounting principles.
^>A^t
September 11,2014
1409-1311197
A member firm of Ernst S Young Global Limited
"ft
LL?
Balance Sheets
August 24, 2014
Assets
Cash
Total assets
$ 16,500,001
$ 16.500.001
Member's equity
Contributed capital
Total member's equity
$ 16,500,001
$ 16.500.001
See accompanying notes.
1409-1311197
Applebee's Franchisor L L C
Notes to Balance Sheet
August 24, 2014
1. Formation and Business
Organization
Applebee's Franchisor LLC (the Company) is a single-member limited liability company formed
in Delaware on July 28, 2014, and is governed by the limited liability company agreement dated
July 28, 2014. The Company is a wholly-owned subsidiary of Applebee's Funding LLC (Funding
or the Member), which, through various entities, is a wholly-owned subsidiary of Applebee's
International, Inc. (All), which is a wholly-owned subsidiary of DineEquity, Inc. (DineEquity).
The Company has a 52/53 week fiscal year ending on the Sunday nearest to December 31 of each
year and the fiscal month of August 2014 ends on August 24.
Nature of Operations
The Company was formed as a special purpose entity to hold all rights, title and interest in new
franchise agreements issued for Applebee's restaurants in the United States after September 30,
2014 (the Agreements), and all accrued and future rights to collection under the Agreements. In its
capacity as the franchisor, the Company will enter into all additional development and franchise
agreements for Applebee's restaurants within the United States (including all substitute or
replacement franchise agreements for existing Applebee's restaurants).
Contributions
On August 21, 2014, the Member contributed $16,500,001 of cash to the Company representing
100% ownership.
Profits and Losses and Distributions
All profit and losses and distributions will be allocated entirely to the Member.
2. Summary of Significant Accounting Policies
Concentrations of Credit Risk
The Company is subject to a concentration of credit risk with respect to cash. The Company places
its cash withfinancialinstitutions. At times, the balances in the Company's cash accounts may
exceed the Federal Deposit Insurance Corporation (FD1C) insurance coverage limit of $250,000.
Management believes that the credit risk attributable to its cash is not significant.
1409-1311197
App^bee^F^nch^LLC
Notes to Bânce Sheet ôn^nue^
^ S u m ^ a r y o f S i g n i f i c a n t Accounting P o ^ e s ^ o n t m u ^
t^scofFstimates
The preparation of the balance sheetincon^rmity with
in the United States requires managemcntto make estimates and assumptions that afiect the
reported amounts ofassets and hahiiities and the disclosure ofcontingent assets and liahihties at
the date ofthe balance sheet. Actual results could differ ^rom those estimates and assumptions.
^Commitments and Contingencies
Cn August 13, 2014, entities under common control ofDineEquity consisting of Funding and
another related entity (the Co-Issuers) and other various related entities (together, the
Securitization Entities)enteredintoapu^
which the Co-lssuershave agreed tojointly issue and sell $1.3billion of their Series 20141
4 277% Fixed Rate Senior Securitiêd Not
seven years inaprivately placed securitiêdtransaction(theTransaction).The closing of the sale
ofthe Notes is subject to the satisfaction ofvarious closing conditions specified in the Purchase
Agreement and is scheduled to close on September 30, 2014, at which time the Company will
guaranteetheobligationsoftheCo-Issuersunderall series of notes outstandingandallother
obligations.
4 Subsequent Fvent
The Company has evaluatedsubsequenteventsfor potential recognitionor disclosure through
Septemberll,2014, the date the balance sheet is considered issued.
^^3^97
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The insights and quality services we deliver help build trust and confidence
in the capital markets and in economies the world over. We develop
outstanding leaders who team to deliver on our promises to all of our
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EY refers to the global organization, and may refer to one or more, of
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Report of Independent Registered Public Accounting Firm
The Board of Directors and Shareholders of DineEquity, Inc. and Subsidiaries:
We have audited the accompanying consolidated balance sheets of DineEquity, Inc. and Subsidiaries as of December 31, 2013
and 2012, and the related consolidated statements of comprehensive income, stockholders' equity and cash flows for each ofthe
three years in the period ended December 31, 2013. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial
position of DineEquity, Inc. and Subsidiaries at December 31,2013 and 2012, and the consolidated results of their operations
and their cash flows for each of the three years in the period ended December 31, 2013. in conformity with U.S. generally
accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States),
DineEquity, Inc. and Subsidiaries' internal control over financial reporting as of December 31, 2013, based on criteria
established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Tread way
Commission (1992 framework) and our report dated February 26,2014 expressed an unqualified opinion thereon.
/s/ ERNST & YOUNG LLP
February 26,2014
63
DineEquity, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share amounts)
Demiiboi'31.
2013
2012
Assets
Current assets:
s
Cash and cash equivalents
Receivables, net
Prepaid gift cards
Prepaid income taxes
Deferred income taxes
Other current assets
Total current assets
Long-term receivables
Property and equipment, net...
Goodwill
Other intangible assets, net
Other assets, net
Total assets
$
Liabilities and Stockholders' Equity
Current liabilities:
$
Current maturities of long-term debt
Accounts payable
Gift card liability
Accrued employee compensation and benefits........
...
Accrued interest payable
Current maturities of capital lease and financing obligations ....;;
Other accrued expenses
Total current liabilities
—
Long-term debt, less current maturities
„....
Capital lease obligations, less current maturitie^y.................................
.................
Financing obligations, less current maturities
•Deferred income taxes
Other liabilities
Total liabilities
Commitments and contingencies
Stockholders' equity:
Common stock, SO.O I par value; shares: 40,000,000 authorized; 2013 - 25,299,315 issued,
19,040,890 outstanding; 2012 - 25,362,946 issued, 19,197,899 outstanding
Additional paid-in-capital
Retained earnings
Accumulated other comprehensive loss
Treasury stock, at cost; shares: 2013 - 6,258,425; 2012 - 6,165,047
Total stockholders' equity
,
;
Total liabilities and stockholders' equity
s
r
See the accompanying notes to the consolidated financial statements.
64
106,011 s
144,137
49,223
4,708
23,853
3,650 ,
331,582
197,153
274,295
697,470
794,057
110,085
2,404342 $
64,537
128,610
50.242
16,080
21,772
13,214
294,455 .
212,269
294,375'
697.470
806,093
110,738
2,415,400
7,420
4,720 $
30,751
40,050
161,689
171,955
24,956
22,43513,236
13,575
12,247
.10,878
i 6,770
21.35 f 284,273
267,760
" 1,202,063
1,203,517
11 U707
124,375 ,
52,049
48,843
362,171
341,578
99,545
98,177
2,089,463
2,106,595
:
253
274,202
336,578
(164)
(295,690)
315J79"
2,404,642 $
254
264^42
322.045
(152)
(277,684)
308,805
2,415,400
Consolidated Statements of Comprehensive Income
(In thousands, except per share amounts)
2013
Year Knded I)fccmhcr3],
2012
2011
Segment Revenues:
Franchise and restaurant revenues
Rental revenues
Financing revenues
.:
$
...^
;
Total segment revenues;
Segment Expenses:
/;
'.
.....
Franchise and restaurant expenses ...^
Rental expenses
Financing expenses
Total segment expenses
Cross segment profit
General and administrative expenses
interest expense.
Amortization of intangible assets
„
125,960
19,715
640,467
849,928
1,075,198
173-232
359,1,96
97,165
563,449
1,623
457,984
391,944
5,973
;
;
T
Income tax provision
Net income
12^93
4,218
58
5,554
Less; Net income allocated to unvested participating restricted stock
(43^253)
: 104,998
(67,249)
(29,806)
72,037
: 127,674
' 75.3 92 ;
—
340
—_ .
2
$•'
127,816
02)
s
72,037 .' $""'
(1,200)
127^674
70,837
122,458
s
6.81
s
6.63
$'
Less: Accretion of Series B preferred' stock...
$
29,865
11,159
4,031
194,923
(12)
$
155,822
I32;707
12,300
—
(102,597)
: 72,025 $
Net income available to common stockholders:
667,569
407,629
163,215
~ I2,2g2
1,812
Other comprehensive income (loss), net of tax:
Adjustment to unrealized loss on available-for-s
Foreign currency translation adjustment
Total comprehensive income
98,347
114,338
(223)
110,617
(38,580)
Income'before income taxeis ,.. ......^..,..^.:..,., ^.; ..
929,523
122,859
14,489
" : i^z*:
Debt modification costs
Gain on disposition of assets
s
- 124,769
13,112
369,692
143,586
100,264
Closure and impairment charges......:..
Loss on extinguishment of debt
r
712,580
$
97,298
245'
270,775,
:
;
502,586
$
, s
'.
(21718)
(2,498)
75.180
75,192
"(1,886)
-X2i5#
70,733
Net income available to common stockholders per shared
Basic
Y
,
Diluted.
:
.$,
?
3.75 $
• 3.70 .$ •
3.96
3.89
Weighted average shares outstanding:
Basic
;
Diluted.
Dividends declared per common share
Dividends paid per common share..?
$
$
I
- 18,871
17.992
17,846
19,141
18,877
18,185
3.00
3.00^ $
65
s
$
—
—
Consolidated Statements of Stockholders' Equity
(In thousands, except share amounts)
Preferred Slock
Shares
Outstflnding
Balance, December 31, 2010.
„
Net income _
,
. ^
Other comprehensive loss-u,
Purchase of DineEquity common slock ....4
Reissuance of Ireasuiy stt,x;k
Net issuance of shares pursuant lo stock plans
Repurchase of restricted shares,...;
.,.. ^+.„..,„,.
Stock-based compensation
^
Tux benefit from stock options exercised
Conversion of Scries B preferred slock...^_L_,_i.
Accretion of Series B preferred stock
Balance, December31,2011 .,»...._,....^...,__..
Net income
^...^^.^.^
Other comprehensive income
«
1 .
Reissuance oftreasur^' stock *.:'
.«••,
Nel issuance of shares pursuant to stock plans
Repurchase of restricted shares
^ . ^ - ^
Tax benefit from stock-based compensation..,.— .
Conversion of Series B preferred stock
v.,...
Accretion of Series B preferred stock
Balance, December 31. 2012
-.• ,;^^. .
Net income
;
„
Other comprehensive loss
Purchase of DineEquity common stock
Reissuance of treasury stock
Net issuance of shares pursuant to stock plans,..
Repurchase of restricted shares
u*..
Tax benefit from stock-based compensation
*
Dividends on common stock
Conversion of liability award to equity award
Balance, December 31, 2013
,
35.000
| ( M
t
S
42,055
18,183,083
—
**" —
—
•~
(120)
—
1573
34,900
44,508
_
—
$
$
„
243
—
—
—
~
—
. —
....—
Amount
Additional
Paid-in
Capital
Shares
Outstanding
(100)
-
I
Scries B
Amount
—
—
—
—
—
—.
—
—
it
Common Stack
192.214
—
(534J01)
135,230
366,055
4
—
—
—
—
—
18,060,206.
247
1,737
.
—_
124,250
75.192
Shares
$
6,199,908
120
—
(12)
—
—
—
—
—
—
—
—
.
(2,573)
196,869
205,663
(282)
—
—
—
—
—
—
—
—
—
• 2.423
(5.080)
9,492
6,494
(91,798)"
—
—
S
—
—
—
_
—
^
Retained
Earnings
(294)
, ~..."*7 R7>74"
:
Trcusury Slock
Accumulatfd
Other
Cumprehensive
Loss
Cost
Tfttal
$ (274,901) S
—
—
_
—
534,101
(135,230)
(21.170)
4,298
—
_
_
—
—
—
—
—
—
—
—
—
6,598,779
(291,773)
.. . -7.
—
H33,73:)
14,089
—
—
—
—
—
—
—
—
—
—
—
—
142
'• -
•'
_
—
,_ —
—
—
—
'
i
(34,900)
_
_
433,732
' '59.622'
{34,829)
—
—
—
(47,006)
27498
679,168
^
'
7
_•
j
—
.
~
.T
—
S
—-
(412,022)
318.644
(17,659)
(45,972)
—
—
_
—
19.040.890
—
254
^
—y 1' —
-.
— ""."Tzi^r
_—
264,342
"2
—
—
—
(!)
— "
jr..
—
"'
—
$
— '
" — "
—
—
—
. .. (1.740)
11,442
* 6,814
46,999
'"
19,197,899
_
—
—
—
—
—
—_
—
—
—
•_
—
"_~
—
—
(6,636)
1,800
253
—
•
'— "
_
'—
—
—
—
—
—
(2.498)
322,045
72.037 '
(152)
—
(12)
—
.
—
—
_
—
—
—
—
—
—
(2,612)
—
_
_
—
—
"(3.324)
" ^364
3,690
139
2,603
$ 274.202
(57,504)
_
J
336,578
$
66
(164)
6,165,047
(277,684)
—
—
' __
—
412,022
(318,644)
(29,698)'
11,692
—
—
—
_
—
_
—
—
—
—
—
—
6.258.425
$ (295,690) $
33.579
75.192
(12)
(21.170)
4,298
2.427
(5.080)
9,492
6,494
—
155,220
127.674
142
7,453
1.800
(1,740)
11,442
6,814
—
308,805
72,037
(12)
(29,698)
9,080
(0
(3.324)
9,364
3,690
(57,365)
2,603
315.179
Consolidated Statements of Cash Flows
(In thousands)
Year Ended Demnber 31,
2013
Cash flows from operating activities
Net income
$
Adjustments to reconcile net income to cash flows provided by operating
activities:
Depreciation and amortization
Non-cash interest expense
,
Closure and impairment charges
Non-cash stock-based compensation expense
Tax benefit from stock-based compensation
Excess.tax benefit from stock options exercised....
Gain on disposition of assets
Other
;
.„.„..„
72,037
2012
$
35,355
6,246
58
2,195
(22,674)
9,364
3,690
(2,858)
(223)
(492)
Changes in operating assets and liabilities:
Receivables
. (15,226)
Current income tax receivables and payables
6,143
Other current assets
9,334
Accounts payable
8,532
Accrued employee compensation and benefits
2,521
Gift card liability
10,266
3,547
Cash flows provided by operating activities
127,815'
, Cash flows from investing activities
Additions to property and equipment
...^
" (7,037)
Proceeds from sale of property and equipment and assets held for sale
—;
Principal receipts from notes, equipment contracts and other long13,982
term receivables
Other
,.
58
Cash flows provided by investing activities
7,003
Cash flows from financing activities
Borrowings under revolving credit facilities
_—
Repayments under revolving credit facilities
Repayment of long-term debt (including premiums)
(4,800)
Principal payments on capital lease and financing obligations
(9.968)
Payment of debt modification/issuance costs
(1,296)
Dividends paid on common stock..
(57,445)
Repurchase of DineEquity common stock
(29,698)
Repurchase of restricted stock
(3,324}
Proceeds from stock options exercised
9,080
Excess tax benefit from stock options exercised
2,858
Change in restricted cash
1,249
Cash flows used infinancingactivities
:
(93,344)
Net change in cash and cash equivalents
41,474
Cash and cash equivalents at beginning of year
64,537
Cash and cash equivalents at end of year
106,011 S
$
Supplemenlal disclosures
Interest paid
106,784 $
$
Income taxes paid
50,702 $
s
See (he accompanying notes to the consolidated financial statements.
67
127,674
2011
$
75,192
39,538
5,985
5,554
3.931
(22,832)
11,442
6,814
(5,669)
(102,597)
(8,991)
50,220
6,160
11,159
8,448
11,835
9,492
6,494
(5,443)
(43,253)
(J,765>
(11,629)
1,272
(9,119)
1,778
(3756)
14,735
(1,251)
52,879
(1.6,722)
20,479
(5,354%
(3,533)
(6,656);
21,983
(17,050)
121,686
(16,952)
168.881
(26,332)
115,642 j
12,250
1.238
165,417
13,122
(753)
101,679
50,000
(50,000)
(216,037)
(10,849)
—
40,000
(40,000)
(225,681)
(13,391)
(12,295)
—'
(21,170)
(5,080)
6,725
5.443 .
466
(264,983)
(41,618)
.102,309
60,691
—
(1,740)
9,254
5,669
(747)
(214,450)
3,846
60,691
64.537 S
123.926
91,354
s
s
148,982
24,139
îoe^qoi^lncandûbsidîes
^ ^ ^ ^ e C o n ^ d a t e d Finance Sêments
L ^ h e Company
T h e f i ^ ^ ^ i o ^ ^ o ^ o f P ^ a k ^ ^ ^
^ e ^ 4 the Company^ p^decessor began developing and
as lÔPCorpunder the laws ofthe State o f ^
Internationa^ Ine^whiehbeeameawhollyowned subsidiary of the Company
Company was changed to DineEqnity^lne^Dine^quity^ The Company owns, ^
eonoepts:Applebees Neighborhood Criii and 8 a ^ ^ A p p i e b e e ^ ^ m t h e bar and grilisegm
category of the restaurant industry,and^lCP in the family dining eatego^ of the restaurant in^
As ofDecember^l,2013,there w a s a t o t a i o f l ^ O l ^ C ^
agreements,168 were subject to area hcense agreements andl3were company-operated restaurants. l ^ C P restaurants
located in alt 50 states ofthe united states, the District ofColumbia, two united States t e r ^ ^
the united States. As ofDecember31,2013,there wereatotalof2,011Applebee^ restaurants, ofwhich 1 ^
franchise agreements and 23 were company-operated restaurants.Applebee^ restaurants were located in 49 s^^
States, one united States territory andl5eountries outside of the united States.
References herein to Applebees and il lCP restaurants are to these restaurant concepts, whether ope
area licensees or the Company.Retail sales at restaurants that are owned by franchisees and area licensees are not a t t r ^
to the Company
^^sisof^resentation and nummary ofîgnificant Accounting policies
^ r ^ ^ ^ ^ C ^ ^ ^ ^ ^
The consolidated financial statements include the accounts ofDmeEquity,lnc. and its wholly-owned s u b s ^
intercompany accounts and transactions have been eliminated in consolidation
^ ^ ^ r ^ ^
The Company hasa52^3 week fiscal year that ends on the Sunday nearest to Decembcr31of each yearlna52week
fiscal year, each fiscal quarter contains 13 weeks, comprised oftwo,four^week fiscal months followed byafiveweekfis
month lna53^week fiscal year, the last month of the fourth fiscal quarter contains six weeks, ôr convenience, the Company
refers to all fiscal years as ending on Deeember31 and fiscal quarters as ending on ^lareh31,ûne 30 and September 30. The
2013^2012and2011fiscal years presented herein ended December 29,2013,December 30,2012and January 1,2012^
respectively, and each contained 52 weeks
^ ^ ^ ^ ^ ^ ^
The preparation offinancial statements in conformity with united States generally accepted accounting pr^^^^
^ . S . C A A P ^ requires the Company^ management to make estimates and assumptions that affect the r^^
assctsand liabilities, disclosure of contingent assets and liabilities, if any,at the date of the consolidated fi
and the reported amounts ofrevenuesandexpensesduringthereportingperiod.cn an ongoing basis, the Company evaluates
its estimates, including those related to provisions for doubtful accounts, legal contingencies, income
goodwill and intangible assets.The Company bases its estimates on historical experience and on various other assumptions t^^^
are believed to be reasonable under the circumstances. Actual results could differ from those estimates.
C^^^r^^^Cr^^^^
The Company^ cash, cash equivalents and accounts receivable are potentially subject to concentration of credit risk.^
and cash equivalents are placed with financial institutions that management believes are creditworthy. T^^^
believe that it is exposed to any significant credit risk on cash and cash equivalents. At times, cash and cash equivalent balan^^^
may be in excess ofl^DlC insurance limits.
Accounts receivable are derived from revenues earned from franchisees and area licensees located primarily in the l^ni^^^
States.financing receivables arise from the financing of restaurant equipment, leases or f r a n c h i s e e
The Company is subject toaconcentration ofcredit risk with respect to receivables from^franchisees that ownalar^^
of Applebees or ll^lCP restaurants. As ofDccember31.2013,there wercl5franchisees that owned 57 or more restaur^^^
(llApplebee^s franchisees and four l^CP franchisees). These franchisees operatedl,659 Applebees
68
îne^q^^lnc
^ndS^bsidi^^
^^totheConîd^dînanc^sêmen^ô^mu^
^^ôfPr^n^d^^dSu^^ryofS^n^Âôo^^P^^
the ^ n ^ d S ^ e ^ which cooîsed
ofthe total
States Receivables from these f r a n e h ^
The Company maintains an allowance for credit losses based upon historical experien^
economic conditions.
C ^ ^ ^ C ^ ^ ^ ^ ^
The Company considers all highly liquid investment securities with remaining maturities a t ^
months or less to be cash equivalents. These cash equivalents are stated at cost which approximates market value. Cash held
related to IÎCP advertising funds and the Company^ gif^ card programs are classified as unrestricted cash as there are no leg
restrictions on the use ofthese funds. Total cash balances related to the lÔP advertising funds
programs were ^53.2 million a n d ^ l ^ m i i l i o n as ofDecember3l,20l3and20l^respectively.
^
^
^
B
^
^
^ ^ ^ C ^
The Company receives funds from Applebees franchisees pursuant to franchise agreements, usage of which is rest^^^
advertisingactivities Restricted cash balances as ofDecember3^20l3 and 2012totaled^0.7mdlionand^
respectively These balances were included as other current assets in the consolidated balance sheet.
^ ^ ^ ^ ^ ^ ^
AtDecember3l^013and201^restricted assets related toacaptive insurance subsidiary totaled Î9mi^^^
million, respectivelyând were included in other assets in the consolidated balance sheets.The captive insurance subsidiary^
which has not underwritten coverage since January 2006, was farmed to provide insurance coverage to Applebees
franchisees.These restricted assets are primarily investments, use of which is restricted to the payment of
incidents that occurred during the period the insurance coverage had been provided.
B ^ ^ ^ ^
The Company^ investments comprise certificates ofdeposit, money market funds and an auction rate security that are the
restricted assets related to the captive insurance subsidia^. The Company has classified all investments as availab^
with any unrealised gain or loss included in Accumulated Cther Comprehensive Loss. The contractual mature
rate security is 2030.
^ r ^ r ^ ^ ^ ^ ^ ^ ^
Rroperty and equipment are stated at cost, net of accumulated depreciation.Properties under capital leases are stated a t ^
present value of the minimum lease payments Depreciation is computed using the straight linemet^^
useful lives ofthe assets or remaining usetul lives. Leasehold improvements and properties under capital leases are a m o ^
onastraight-line basis over their estimated usefid lives or the lease term,ifless.The Company has capitals
incurred in connection with the development ofinternal-use software which are included in equipment andfixturesand
amortized over the expected useful life ofthe asset. The general ranges ofdepreciable and amortizable lives are as foll^^
^ a ^ ^
D^r^bteLI^
ûildrngs and improvement
Shorter ofprimary lease term or between three to 40 years
Equipment and
TwotolOyears
fixtures
Properties under capital leases
^
years
Leaseholds and improvements
^
D
^
^
B
^
-
Primary iease term or remaining primary lease term
^
The Company evaluates the reeoverahifityofitsionglived assets in accordance with L l ^ G A A R T ^ ^
impairment using historical cash fiows and other relevantfi3Ctsand circumstances as the primary h a s i s ^
cashflows.The Company considers factors such as the number of yearsarestaurant has been in operation, sales trends, c
flow trends, remaining lease life and other factors which apply onacasebycase basis. The analysis is performed at the
individual restaurant level for indicators of permanent impairment.
69
^ne^qu^l^^ds^^^^
^^^^Coôhdêdû^
^8aôfPên^don^dSu^^ôfSi^fl^Âô^^P^
R e e o v e ^ h ^ o f a ^ a o r a n f s a ^ ^ is measured by c o m ^
flows expected to be generated over the assets rearming useful h ^ or remamm^
expected undiseounted future cash flows are less than t h e c a l
Impairment Iflt Is decided that there has been au Impairment, the carrying an^^
fair value as determined in accordance with
GAAP governing fair value measurements. The primary
fair value is by discounting the future cash flows based on the Company^ cost of capital Aloss resulting tromimpai^^^^
recognized asaeharge against operations
The Company may decide to close certain company-operated restaurants. Typically such decisions are based on ope^^
performance or strategic considerations. In these instances, the Company reserves, or writes off, the full c
restaurants as impaired.
Cnaregularâtaminimum, semiannual) basis, the Company assesses whether events or changes in circumstances have
occurred that potentially indicate the carrying value oflong-lived assets may not be recoverable See Note 12.^
Impairment Charges.
^ ^ ^ ^ ^ ^ B ^ ^ ^ ^ B I ^ ^
Goodwill is recorded when the aggregate purchase price ofan acquisition exceeds the estimated tair value ofthe net
identified tangible and intangible assets acquired. Intangible assets resulting from the acquisition a^^
purchase method ofaccounting and are estimated by management based on the fair value ofthe assets received. The Company^
identifiable intangible assets are comprised primarily oftheApplebee^s tradename and Applebees franch^
Identifiable intangible assets with finite lives (franchise agreements, recipes and menus)are amortized over
estimated benefit using the straight line method and estimated useful lives. Goodwill and intangible assets
an indefinite life (primarily the Applebees tradename)are not subject to amortization. The determination ofm^
subject to reassessment ifchanges in facts and circumstances indicate the period ofbenefit has become finite.
Goodwill has been allocated to three reporting units, the Applebees companyoperated restaurants unitÂpplebee^s
company unit^theApplebee^s franchised restaurantsunitÂpplebee^s franchise
unit ( ^ C P franchise unit^), in accordance with l^.S.GAAR.The significant majority ofthe Con^
the November 29, 2007 acquisition ofApplebee^s and was allocated between the two Applebees units.The goodwills
to the Applebees company unit was fully impaired in 2008.
TheCompanyperformsaquantitative test for impairment ofthe goodwill ofthe Applebees franchise unit and the
tradename of the Applebee^scompany and franchise units as of Cctober^l of each year.The goodwill of the l^CPfiancln^^
unit is assessed qualitatively as ofDecember^lofeachyearln addition toflêannual test ofimpairment, goodwill and
indefinite life intangible assets are evaluated more frequently ifthe Company believes indicators ofimpairmen^
indicators include,but are not limited to, events or circumstances such asasignificant adverse change in the business climate,
unanticipated competition.alossofkey personnel, adverse legal or regulatory developments orasignificantdec^
market price ofthe Company^ common stock.
In the process ofthe annual quantitative test ofgoodwill, the Company primarily uses the income approach method of
valuation that includes the discounted cash flow method as well as other generally accepted valuation methodologies to
determine the tair value ofgoodwill and intangible assets. Significant assumptions used to determine tair value und
discounted cash flow model include future trends in sales, operating expenses, overhead expenses, capital expenditures and
changesinworking capital,along with an appropriate discount rate based on the Company^ estimated cost of equity capital
and afler^tax cost of debt.The first step ofthe quantitative impairment test compares the fair value of each of our reportm^
units to their carrying value. Ifthe fair value is in excess ofthe carrying value, no impairment exists. Ifthefir^^
indicate impairment.asecond step must take place, lender the second step, the fair value of the assets and l i a b i l i ^
reporting unit are estimated as ifthe reporting unit were acquired inabusiness combination.The excess ofthe fair value o f ^
reporting unit over the amounts assigned to its assets and liabilities is the implied fair value ofthe go
carrying value of the goodwill must be adjusted.The fair value of all reporting units is then compared to the current marked
value ofthe Company^ common stock to determine ifthe fair values estimated in the impairment testing process are reasot^^^
in light ofthe current market value
70
^n^q^^^c ^dSîdi^r^
^^^^consohd^dF^ne^
^â^^Pênôn^dS^m^ryofSîficÂôonfio^
In the process ofthe Company^ annual impairment review o
asset, the Company primarily uses the reiiet ot royaity method under income approach method of
assumptions used to determine fair value nnder the relief of
discount rate to be applied to the forecast revenue stream
There were no impairments of goodwill or intangihleassets recorded in 201^2012or 2011.
^ ^ ^ ^ ^ ^ ^ ^ ^
The Company^ revenues are recorded in four categories: franchise operations, company restaurant operat^^
operations and financing operations
franchise operations revenue consists primarily ofroyalty revenues, sales of proprietary l^CPprodu
tees and the portion ofthe francldse fees allocated to the Company^ intellectual property. Company
sales at company-operated restaurants. Rental operations revenue includes revenue from operating leases and
from direct financing leases, financing operations revenue consists primarily ofinterest income f r o m ^
fees and equipment leases, as well as sales ofequipment associated with refranchisedll^CP restaurants
^
Revenues from franchised and area licensed restaurants include royalties, continuing rent and service fees a
franchise fees. Royalties are recognized in the period in which the sales are reported to have been earned, which occurs at th^
franchisees pointofsale. Continuing rent and fees are recognized in the period earned. Initial franchise fees a^^
upon the opening ofarestaurant, which is when the Company has performed substantially all initial services req^^^
franchise agreement. Pees from development agreements are deferred and recorded into income as restaurants under the
development agreement are opened.
Sales by company operated restaurants are recognized when food and beverage items are sold Company restaurant sales
are reported net ofsales taxes collected from guests that are remitted to the appropriate taxing authorities.
TheCompanyrecordsaliability in the period in whichagift card is sold.As gifi cards are redeemed, this liability^
reduced,with revenue recognized only on redemptions at company-operated restaurantsThe Company recognizes gifi card
breakage income on gift cards issued when the assessment ofthe likelihood ofredemption ofthe gifl card becomes remote.
This assessment is based uponApplebee^s and ll^CP^s historical experience with gift card redemptions fb^
card program.The Company recorded gifl card breakage revenue of^0.2million,^1.3 million and ^ 2 . I m i ^ ^
ended December^l,2013,2012and 2011,respectively. The progressive decline is due to the decrease in the number of
Applebees company-operated restaurants.
B l ^ ^ ^ ^ ^ r C r ^ ^ ^ ^
The allowance for doubtful accounts is the Company^ best estimate ofthe ainountofprobable credit losses in existing
receivables^ however,changes in circumstances relating to receivables may result in additional allow
Company determines the allowance based on historical experience, current payment patterns, future obligations and th^
Company^ assessment ofthe franchisees or area licensees ability to pay outstanding balances. The primary indi^^^
quality is delinquency, which is considered to beareceivable balance greaterthan 90 days past due. The Company continual^^
reviews the allowance for doubtful accounts. Past due balances and future obligations are reviewed individuals^
collectability.Account balances arecharged against the allowance afêr all collection efforts hav
potential for recover is considered remote
^.^^
The Company is the lessor or sublessor of the properties on which 723 l^lCPrestaurants and oneApplebee^s restaurant
are located.The restaurants are subleased to franchisees or, inafew instances, are operated by the Company. The Compan^^^
l^CP leases generally provide for an initial term o f l ^ t o 25 years, with most having one or more flveyear renewal o p ^
the Company^ option.In addition, the Company leasesamajo^
Applebees companyoperated leases generally have an initial terrnofl0to20years, with renewal terms o f ^
and provide foraflxed rental plus, in certain instances, percentage rentals based on gross sales. The rental payments or r^^
on leases that meet the operating lease criteria are recorded as rental expense or rental income, respectively.Rentalex^^^
rental income for these operating leases are recognized on the straight line basis over the o r i g ^
difference between straight line rent expense or income and actual amounts paid or received represents d e ^
included in the consolidated balance sheets another assets or other liabilities, as appropriated
71
^^^q^^l^^ds^h^d^r^
^ ^ ^ ^ c ^ ^ d ^ d F ^ ^
^^ôfPr^^d^^dSu^^ryofSî^Âcco^d^
m ^ ^ ^ ^ i v e ^ o f d ^ ^ ^ ^ e ^ ^
defend rent payable mc^dedmotherâbihfios
The rental payment or receipts on those p ^
Interest expense or Interest income andareduetion of capital lease obligate
Capital lease obligations are amortized based on the Company^ incremental borrowing rate and
amortized nsing the implicit interest rate
The lease term used lor straigbt line rent expense is calculated from the date the Company obtains p
premises through the lease termination date Tbe Company records rent from the possession date throngs
as expense. Oncearestaurant opens for business, the Company records straight-line rent over the lease term plus c^^^^
rent to the extent it exceeded the minimum rent obligation per the lease agreement. The Company usesaconsistent iease tert^
when calculating depreciation ofleaseholdimprovements, when determining straightline rent ex
classification ofits leases as either operating or capital.Por leases that contain rent escalations, the Company^
rent payable during the lease term, as determined above, on the straight-line basis over the term ofthe lease
holiday period beginning upon our possession ofthe premises), and records the difference between the minimum rents p
the straightline rent asalease obligation.Certain leases contain provisions that require addh^^
restaurant sales volume (^contingent rent^). Contingent rentals are accrued each period as the l i a b i l ^
to the straight line rent expense noted above.
Certain lease agreements contain tenant improvement allowances, rent holidays and lease premiums, which are amortize
overthe shorter ofthe estimated useful life or lease tern^.ôrtenant improvement allowances, the Company also recor^^
deferred rent liability or an obligation in non current liabilities on the consolidated balance sheets
rent over the term of the lease asareduction to company restaurant expenses in the consolidated statements of operations.
^ ^ ^ ^ ^ ^ ^
Expenditures related to the opening ofnew or relocated restaurants are charged to expense when incurred
Bf^^r^^
franchise fees designated for l^CP^s national advertising fund and local marketing and advertising e
recognized as revenue as the fees are earned and become receivables from the franchisee in accordance with Li.S.CAAP
governing the accountingfor franchise fee revenue.In accordance with D.S.CAAP governing advertising costs, r^^
advertising obligations are accrued and the costs expensed at the sanre time the related revenue is recognized. Due to d i ^
contractual terins in Applebees marketing agreements, franchise fees designated for Applebees natio^^^
local advertising cooperatives constitute agency transactions and arc not recognized as revenues and expenses In both cases,
the advertising fees are recorded asaliability against which specific costs are chargedÂdvertising fees inch^
franchise revenue and expense for the years ended Deeember^l,2013, 20l2and20flwere ^79.5 m i l l i o n , ^ 4
^75.5 million, respectively.
Advertising expense reflected in the consolidated statements ofcomprehensive income includes local markctm^
advertising costs incurred by company operated restaurants, contributions to the national advertising
and II^CP company-operated restaurants and certain advertising costs incurred by the Company to benefit future
operations. Costs of advertising are expensed either as incurred ortheflrsttime the advertisingtake^
expenseincluded in company restaurant operations f o r t h e y e ^
^13.1 million and ^23.3 nnilion, respectively The progressive decline is due to the decrease in the number of Appl^^
company operated restaurants.
^ r ^ ^ ^ ^ ^ r ^ ^ ^
The Company determines the fairmarket values ofits financial assets and liabilities,^
liabilities that are recognized or disclosed at fair value onarecurring basis, based on the fair value hierarchy e s ^
^ . S . C A A P . A s necessary, the Company measures its financial assets and liabilities using inputs from t^^
ofthe fair value hierarchy:
Eevell inputs are quoted prices in active markets for identical assets or liabilities.
Eevei2inputs are observable forthe asset or liability, cither directly or indirectly, incl^^^^
markets for similar assets or liabilities.
Level3inputs are unobservable and reflect the Company^ own assumptions.
72
DineEquity, Inc. nnd Suhsidiaries
Notes to the Consolidated Financial Statements (Conlimifil)
2. Hnsis of Presentation and Summary of SigniiicHnt A ecu mi ting Policies {Continued)
The Company docs not have a material amount of financial assets or liabilities that are required under U.S. GAAP to be
measured at fair value on either a recurring or non-recurring basis. None of the Company's non-financial assets or non-financial
liabilities is required to be measured at fair value on a recurring basis. The Company has not elected to use fair value
measurement, as provided under U.S. GAAP, for any assets or liabilities for which fair value measurement is not presently
required.
The Company believes the fair values of cash equivalents, accounts receivable, accounts payable and the current portion of
long-term debt approximate their carrying amounts due to their short duration.
The fair values of non-current financial instruments, determined based on Level 2 inputs, are shown in the following table:
December 31, 2012
December 3 1 , 2 0 1 3
Currying
Amount
Long-term debt, less current maturities
1,203.5 $
S
_ .
,
Carrying
Fair Value
Amount
(In millions)
1,306.2" S
1,202.1 ;$
Fair Value
1,334.2
Income Taxes
The Company utilizes the liability method of accounting for income taxes. Under the liability method, deferred taxes are
determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using
enacted tax rates. A valuation allowance is recorded when it is more likely than not that some ofthe deferred tax assets will not
be realized. The Company also determines its tax contingencies in accordance with U.S. GAAP governing the accounting for
contingencies. The Company records estimated tax liabilities to the extent the contingencies are probable and can be reasonably
estimated.
The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax
position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax
benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater
than fifty percent likelihood of being realized upon ultimate resolution.
Stock-Based Compensation
Members of the Board of Directors and certain employees are eligible to receive stock options, restricted stock, restricted
stock units and performance units pursuant to the DineEquity, Inc. 2011 Stock Incentive Plan. The Company accounts for all
stock-based payments to employees and non-employee directors, including grants of stock options, restricted stock and
restricted stock units to be recognized in the financial statements, based on their respective grant date fair values. The value of
the portion ofthe award that is ultimately expected to vest is recognized as expense ratably over the requisite service periods.
The Company reports the benefits of tax deductions in excess of recognized compensation cost as afinancingcash flow.
The grant date fair value of restricted stock and stock-settled restricted stock units is determined based on the Company's
stock price on the grant date. The Company estimates the grant date fair value of stock option awards using the Black-Scholes
option pricing model, which considers, among other factors, a risk-free interest rate, the expected life ofthe award and the
historical volatility ofthe Company's stock price. Cash-settled awards are classified as liabilities with the liability and
compensation expense related to cash-settled awards adjusted to fair value at each balance sheet date.
Net Income (Loss) Per Share
Net income (loss) per share is calculated using the two-step method prescribed in U.S. GAAP. Basic net income (loss) per
share is computed by dividing the net income (loss) available to common stockholders for the period by the weighted average
number of common shares outstanding during the period. Diluted net income (loss) per share is computed by dividing the net
income (loss) available to common stockholders for the period by the weighted average number of common shares and
potential shares of common stock outstanding during the period if their effect is dilutive. The Company uses the treasury stock
method to calculate the weighted average shares used in the diluted earnings per share calculation. Potentially dilutive common
shares include the assumed exercise of stock options, assumed vesting of restricted stock and, during fiscal years in which
Series B Preferred Stock was outstanding, assumed conversion of Series B Preferred Stock using the i f converted method.
73
DêFqo^lnândsnhsâr^
ô^^^C^^hda^dFioane^Sêmeo^ôn^nu^
2 . ^ ^ o f P r ^ n t a f i o n and Summary o f S ^ ^ ^ A e e o u n f i ^ P ^ ^
^ ^ C ^ ^ r ^ ^ ^ ^ ^ ^ ^ ^
For dê years ended December31,201^2012and2014^mcome tax
comprehensive income was not signifieanL
^ r ^ ^ ^ ^
The Company may trom time to time utilize treasury stock when vested stock options are exercised^wh^
awards are granted and when restricted stock units settle in stock upon vesting The cost oftreasury stock re-issue
determined using the first in,first-outmethod.
^ ^ ^ ^ ^ ^
The Company identifies its reporting segments hased on the organizational units used hy management to monitor
performance and make operating decisions. These reporting segnênts are as follows: franchise operations, comp
operations,rental operations and financing operations.îthin the franchise and company restaurant segments,the Compa
operatestwodifferentrestaurantconcepts,Applehe^sandlllCRApplehee^ has no material ren^
Franchise Segment
As ofDecemher^l,2013,the franchise operations segment consisted ofl,988 restaurants operated hyApplehee's
franchisees in theUnited States, one United States territory andf^countries outside ofth^
operated hyll lCP franchisees and area licensees in the United States, two United States t e r ^
ofthe United States. Franchise operations revenue consists primarily offianchise royalty revenues, sales of p
products (primarily ll^CP pancake and walfledrymixes)and the portion of the franchise fees allocated t^
Applehee's intellectual property.Additionally,franchise fees designated for IPlCP'snati^^
marketing and advertising cooperatives are recognized as revenue and expense of franchise operations^ however, due to
difi^rentcontractualtern^sinApplehee^smarkefingagreements,Applehe^s national advertisings
agency transactions and therefore is not recognized as franchise revenue and expense.
Franchise operations expenses includell^CP advertising expense, the cost of proprietary products, preopening
expenses and other franchise related costs.
Company Segment
As ofDecemher31,2013,the company restaurant operations segment consisted of23Applehee's companyoperated
restaurants, lOffÔF companyoperated restaurants and three ll^CR restaurants reacquired from fiân^^^
the Company onatemporaryhasis until refranchised.All companyôperated restaurants are located in the United Stated
Company restaurant sales are retail sales at company-operated restaurants. Company restaurant expenses are operating
expenses at company operated restaurants and include food, beverage, lahor, benefits, utilities, rent and
Rental Segment
Rental operations revenue includes revenue from operating leases and interest income from directfinaneinglea^^^^^
operations expenses are costs ofoperating leases and interest expense of capital le^
rental operations revenue and expenses are primarily generated by llÔR Applebee's has an insignificant amount of
activity related to one property that was retained after refranchisingacompanyoperated restaurant
Financing Segment
Financing operations revenue primarily consists ofinterest income from thefinancingofll^CF franchisee
equipment leases, as well as sales of equipment associated with refr^^^
of restaurant equipment.
recently Adopted Accounting standards
In ûly 2012^ the Financial Accounting Standards Board (^FASB^) issued Accounting Standards U p d a t e d
2012-02,^^^
^û^^^^^^^
2012^02 allows an entity the option to first assess qualitative factors in determining whether it is necessary to pe^^
quantitative impairment test on indefinite-lived intangibles An entity electing to p e ^
required to calculate the fair value ofan indefinite-lived intangible asset unless the entity determines, based on the qualh^^
74
DineEquity, Inc. anil Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
2. Basis ofl'rcscntation and Summary of Significant Accounting Policies (Continued)
assessment, that it is more likely than not that the asset is impaired. The adoption of ASU 2012-02 as of January I. 2013 did not
have any impact on the Company's consolidated financial statements.
In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other
Comprehensive Income ("ASU 2013-02"). The amendments in ASU 2013-02 do not change the current requirements for
reporting net income or other comprehensive income. However, the amendments require disclosure of amounts reclassified out
of accumulated other comprehensive income in their entirety, by component, on the face of the statement of operations or in the
notes thereto. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other
disclosures that provide additional detail. The adoption of ASU 2013-02 as of January 1, 2013 did not have any impact on the
Company's consolidated financial statements or disclosures because the Company had no material amount of reclassifications.
New Accounting Pronouncements
In February 2013, the FASB issued ASU No. 2013-04, Obligations ResultingfromJohn and Several Liability
Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date ("ASU 2013-04"). The
amendments in ASU 2013-04 require an entity to measure obligations resulting from joint and several liability arrangements as
the amount the entity agreed to pay on the basis of the arrangement among its co-obligors plus the amount an entity expects to
pay on behalf of co-obligors. ASU 2013-04 also requires an entity to disclose the nature, amount and other information about
each obligation or group of similar obligations. The Company will adopt ASU 2013-04 effective January 1, 2014, and does not
anticipate the adoption will have a material impact on its consolidated financial statements.
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes - Presentation of an Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a Similar Tax Loss, or a Tax Gvdit Carryforward Exists ("ASU 2013-11"). ASU 2013-11
provides guidance on the financial statement presentation of an unrecognized tax benefit, as either a reduction of a deferred tax
asset or as a liability, when a net operating loss carryforward, similar tax loss, or a tax credit carryforward exists. ASU 2013-11
may be applied on a retrospective basis, and early adoption is permitted. The Company will adopt ASU 2013-11 effective
January 1,2014, and does not anticipate the adoption will have a material impact on its consolidated financial statements.
The Company reviewed all other newly issued accounting pronouncements and concluded that they either are not
applicable to the Company's operations or that no material effect is expected on the Company's financial statements as a result
of future adoption.
75
DineEquity, Inc. nnd Subsidiaries
3. Receivables
2013
Accounts receivable
Gift card receivables
Notes receivable
Financing receivables:
Equipment leases receivable
Direct financing leases receivable
Franchise fee notes receivable
Other
S
'.:
'
115.1
88.6
1.7
HX6
344.8
(3.5)
341.3
(144.1)
197.2 $
Less: allowance for doubtful accounts
Less: current portion
2012
(In millions)
59.3 S
68.3
1.2
$
67.4
44.6
2.2
122.4
95.1
2.7
92_
343.6
(2.7)
340.9
(128.6)
212.3
Accounts receivable primarily includes receivables due from franchisees and distributors. Gift card receivables consist
primarily of amounts due from third-party vendors. Interest is not charged on gift card receivables.
Financing receivables primarily relate to IHOP franchise development activity prior to 2003 when IHOP typically leased or
purchased the restaurant site, built and equipped the restaurant then franchised the restaurant to a franchisee. IHOP provided the
financing for the franchise fee, leasing of the equipment and the leasing or subleasing of the site. Equipment lease contracts are
due in equal weekly installments, primarily bear interest averaging 9.8% per annum at December 31,2013 and 2012 and are
collateralized by the equipment. The term of an equipment lease contract coincides with the term of the corresponding
restaurant building lease. The IHOP franchise fee notes have a term of five to eight years and are due in equal weekly
installments, primarily bear interest averaging 6.6% and 6.8% per annum at December 31,2013 and 2012, respectively, and are
collateralized by the franchise. Where applicable, franchise fee notes, equipment contracts and building leases contain crossdefault provisions wherein a default under one constitutes a default under all. There is not a disproportionate concentration of
credit risk in any geographic area.
The primary indicator ofthe credit quality offinancingreceivables is delinquency. As of December 31,2013 and 2012,
approximately $0.4 million offinancingreceivables were delinquent more than 90 days.
The following table summarizes the activity in the allowance for doubtful accounts:
Allowance for Doubtful Accounts
Balance at December 31, 2010
Provision
- Charge-offs J..
Recoveries
_
Balance at December 31,2011
Provision
Charge-offs
Recoveries
Balance at December 31. 2012...
Provision
Charge-offs
Balance at December 31, 2013
(In millions)
6.2
0.4
(3.1),
0.1
3.6
0.5
(1.9)
0.5
2.7
1.5
(0.7)
$
3.5
$
,
_
.'
'.
As of December 31, 2013 and 2012, approximately. $0.3 million and $0.5 million, respectively, ofthe allowance for
doubtful accounts related tofinancingreceivables.
76
4. Property and Equipment
Property and equipment by category is as follows:
2013
Land
Buildings and improvements
Leaseholds and improvements
Equipment and fixtures
Construction in progress
Properties under capital lease
Property and equipment, gross
Less: accumulated depreciation and amortization
Property and equipment, net
.„...._.
„
S
y^,—.
.
$
(In millions)
63.9 S
60.1
274.9
81.8
3.6
60.0
544.3
(270.0)
274.3 $
2012
65.4
60.1
279.8
74.9
4.7
60.8
545.7
(251.3)
294.4
The Company recorded depreciation expense on property and equipment of $23.1 million, $27.9 million and $37.7 million
for the years ended December 31, 2013, 2012 and 2011, respectively.
Accumulated depreciation and amortization includes accumulated amortization for properties under capital lease in the
amount of $34.7 million and $32.5 million at December 31, 2013 and 2012, respectively.
5. Goodwill
The significant majority of the Company's goodwill and other intangible assets arose from the November 29,2007
acquisition of Applebee's. As of December 31, 2013 and 2012, the balance of goodwill was $697.5 million, of which $686.7
million has been allocated to the Applebee's franchise reporting unit and $10.8 million to the IHOP franchise reporting unit.
In accordance with U.S. GAAP, goodwill must be evaluated for impairment, at a minimum, on an annual basis, and more
frequently if the Company believes indicators of impairment exist. Such indicators include, but are not limited to, events or
circumstances such as a significant adverse change in the business climate, unanticipated competition, a loss of key personnel,
adverse legal or regulatory developments, or a significant decline in the market price of the Company's common stock. In the
process ofthe Company's annual impairment review, the Company primarily uses the income approach method of valuation
that utilizes a discounted cash flow model to estimate the fair value of its reporting units. Significant assumptions used to
determine fair value under the discounted cash flows model include future trends in sales, operating expenses, overhead
expenses, depreciation, capital expenditures, and changes in working capital, along with an appropriate discount rate.
During the fiscal years ended 2013 and 2012, the Company made periodic assessments as to whether there were indicators
of impairment, particularly with respect to the significant assumptions underlying the discounted cash flow model, and
determined an interim test ofgoodwill was not warranted. Accordingly, the Company performed a quantitative test for
impairment ofgoodwill of the Applebee's franchise reporting unit in the fourth quarter of 2013 and 2012. In the first step of
each year's impairment test, the estimated fair value of the Applebee's franchising unit exceeded the carrying values and the
Company concluded there was no impairment of goodwill. The Company performed a qualitative assessment ofthe goodwill of
the IHOP franchise reporting unit and concluded there was no impairment of goodwill.
77
Notes lo the Consolidated Financial Statements (Continued)
6. Other Intangible Assets
As of December 31, 2013 and 2012, intangible assets were as follows:
Not Subject to Amortizntion
Liquor
Licenses
'IVudename
Suhjccl to Ainorlizntiou
Franchiiing
Rights
Other
Recipes miU
Menus
Leiiseholds
Total
(In millions)
* Balance, December 31,2010...... $
Amortization expense
'Impairment
Refranchising
' Other
Balance, December 31,2011
!Amortization expense
Refranchising
< Other
Balance, December 31,2012
; Amortization expense
Other.....
^Balance, December 31,2013
$
652.4 $
^
—
—
—
652.4
—
—
—
652.4
—
—
652.4 $
2.6 $
0.3, $
—•
—
—
'—
(1.1)
—
^
0-2
1.5
0.5
—
— '
(1.5)
(0.1)
^_
*"
—
0.4
—
—
—
0.3 .
— $
0.7' $
169.3
(10.0)
$
—
159.3
(10.0)
(0.3)
149.0
(10.0)
—
139.0 $
8.9 $
(2.3)
—
—
—
6.6
. •.(2.3) "
—
—
4.3
(2.3)
—
2.0 $
2.4
(0.6)
—
6.3
2.1
(0.2)
(1.9)
.—
—
—
'ZZ
—
$ ' 835.9
(12.9)
—
(0.8)
0-2
822.4
(12.5)
(3.8)
—
806.1
(12.3)
03
$
794.1
Annual amortization expense for the next five fiscal years is estimated to be approximately $10.4 million per year. The
weighted average life of the intangible assets subject to amortization was 19.0 years at December 31,2013 and 2012.
Gross and net carrying amounts of intangible assets subject to amortization at December 31,2013 and 2012 are as follows:
December 31, 2012
December 31, 2013
Accumulfltrd
Amortiziition
Gross
Net
Accumulated
Amortization
Cross
Net
(In millions)
S
Recipes and menus
.:.
$
Total
15.7
0.3
216.0
*
" (61.0) $ " 139.0 S 200.0 $
(13.7)
2.0
l5.7
—.
0.3
(0.3)
(75.0) $ 141.0 S 216.0 $
(51.0) $
(11.4)
(0.3)
(62.7) $
149.0
4.3
—
153.3
7. Long-Term Debt
Long-term debt consists of the following components:
2012
2013
(hi millions)
Senior Secured Credit Facility, due October 2017, al a variable interest rate of 3.75% and
k.25% as of December 31,2013 and 2012, respectively
Senior Notes due October 2018, at a fixed rate of 9.5%
Discount
1
:
Total debt
;Less: current maturities.;;
".
Long-term debt
:
s
;
t
Ss
467.2* $
760.8
(1.9.8)..
1,208.2
(4.7)
1,203.5 $
472.0
760.8
(21.3).
1,209,5
,(7.4)
1,202.1
Senior Secured Credit Facility
On October 8, 2010, the Company entered into a Credit Agreement, by and among the Company, a group of lenders and .
other financial institutions party thereto (the "Credit Agreement"). The Credit Agreement established a senior secured credit
facility (the "Credit Facility") that consisted of a $900.0 million senior secured term loan facility maturing in October 2017 (the
"Term Facility") and a $50.0 million senior secured revolving credit facility maturing in October 2015 (the "Revolving
Facility"). The Revolving Facility originally provided for borrowings up to $50.0 million, with sub-limits for the issuance of
78
DmeEqu^lândSu^diaês
No^^^Con^da^Fmanc^
^Long-T^mD^(Coofinued)
êôfcredhand^swmghnebo^wmgândmay^
permed a c q u ^ i f i o n ^ e o p i ^ e x p e n d ^ ^ d ^
uncomm^dmcreme^
to $250^milfion,provided that the aggregate amount of the
miihon.SeeÂmendmentstoCreditAgreement"
interest Rate
Loans madeundertheTermFaeiiity ("Term Loans^) and the RevoivingFaeiiity^R^
Company's option, at an annual rate equai t o ( i ) a L l B O ^
(originally 4^0%)or(ii) the haserate(the "Base Rate^(originahy subject t o a f l o o r o ^
highest of(a) the federal funds rate plus050%,(h)the prime rate and(e)the one month LIBOR rate
floor o f L ^ O ^ plus L00%,piusamarginof3^0%Bfhe margin forthe Revolving Faeih^
stepdowns.Both the Term Facility and the RevolvingFaeility were subject to upfront fees of LO^
thereof See"Amendments to CreditAgreement".
Amendments to CreditA^reement
On February 25,2011,the Company entered into Amendment ô.l("Amendment No l ^ t o the CreditAgreemenL
Pursuant to Amendment No I,the interest rate margin applicable to LIBORbased Term Loans was reduced from450%
3.00%, and the interest rate floors used to determine the LIBOR and Base Rate reference rates for Term Loans was reduced
ftomL50% to L25% for LIBORbasedTerm Loans and from250%to225% for Base RatedenominatedTerm Loans. In
addition, Amendment No.lincreased the lender commitments under the Revolving Facility from $50.0 million to $75.^
million. Amendment No.lalso modified certain restrictive covenants of the Credit Agreement, including those r^^^
repurchases ofother debt securities, pemîtted acquisitions and payments on equity.
The Company paid$l2.3 million in fees and costs related to Amendment No.I,of which $7.4nnllion in
lenders was recorded as additional discount on debt and $0.8 million of costs related to the increase in the RevolvingFacili^^
was recorded as deferred financing costs.Fees paid to third parties of$40million were recorded as "Debt modificati^^
in the Consolidated Statement of Comprehensive Income for the year ended December3420IL
On February 4, 2013, the Company entered into Amendment No.2("Amendment No 2^) to the CreditAgreement.
FursuanttoAmendmentNo 2, the interest rate margin applicable to LfBOR-basedTerm Loans was reduced from3.00% to
2 75%, and the interest rate floors used to determine the LIBOR and Base Rate reference rates for Term Loans was reduced
fromL25%tol.OO%fbrLIBOR basedTermLoansandfrom2.25%to2.00%forBaseRate denominatedTerm Loans.The
interest rate margin for Revolving Loans was reduced from 3.50% to L75% for Base Rate loans and from4.50% to 2.75^
LIBOR Rate loans. The connnitment fee for the unused portion ofthe Revolving Facility was reduced from 0.75% toO
and,iftheconsolidatedleverageratio is reduced below4.75:f,from 0.50%to0.375%.
In addition, Amendment No.2established the following consolidated leverage ratio thresholds foresee
prepayments: 50% if the consolidated leverage ratio is5.75:l or greater 25% ifthe consolidated leverage ratio is
5 75:1 and greater than or equal to5.25:4and0%ifthe consolidated leverage ratio is less thah 525:L
AmendmentNo.2revisedthedefinitionofexcesscashflowto eliminate the deduction for any extraordinary rec
disposition proceeds Finally,AmendmentNo.2revised the definition of certain permitted payments so that the calcu^
allowable restricted payments is perforinedonaquarterly basis instead of an annual basis that was required p ^
Amendment No. 2. All other material provisions, including maturity and covenants under the Credit Agreement,
unchanged
Fees of$f.3 million paid to third parties in connection with Amendment No^2wcre included as "Debt modification costs"
in the Consolidated Statement of Comprehensive Income for the year ended December3l,2013.
79
DmeEqnhÎnc a n d S u b ^ d ^ i ^
No^^theCoosohd^dFmanc^Sêmen^ôntmu^
^LongTermD^^nfinn^
Boôwin^ Under Senior Secured CredhFacifi^
ConeurrentwithAmendmentNoLon February 25,
the Compa^^^
retiring the amount then outstaudm^
Amendment No.2, on February 4,20i^theCompany borrowed $4720mdiionunderthe Term
Loan"), retiring the amount then outstanding ofthe amount borrowed under Amendment No.LThere was $467.2 mi^^^
the New Term Loan outstanding at Deeember3420i3
The Company did not utilize the RevoivingFaeiiity during 2013 As ofOeeember3i,20i3,there were no amounts
outstanding undertheRevoivingFaeihty^ however, available borrowing capacity undertheRevoivm^
$1^9 million ofletters of credit outstanding as ofDeccmber31,2013pursuant to sublimits ofthe
Guarantees
The loans made undertheCreditAgreement are guaranteed by the Company's domestic whollyowned restricted
subsidiaries, other than immaterial subsidiaries^the "Guarantors^), and are secured b y a p e r ^
in substantially all ofthe tangible and intangible assets ofthe Company and the Guarantors, including, witho^^
(i) substantially all personal, real and mixed property^!!) all intercompany debt owing to the Company and the Gu^^^
(iii)100%ofthe equity interests held by the Company and each of the Guarantors(with customary l i m ^
subsidiaries), subject to certain customary exceptions.
Mandatory Frepavments
Term Loans undertheCreditAgreement are subject to the following prepayment requirements:
D Mandatory prepayments equal to0.25%of the aggregate principal amount ofthe NewTerm Loan must be made ona
quarterly basis(1.0%fbrafiscalyearând
^ 50% of excess cash flowâs defined in the CredltAgreement or amendments thereto)if the consolidated leverage ratio
5.75:1 or greater 25% if the consolidated leverage ratio is less than5.75:l and greaterthan or equal to5^^^
the consolidated leverage ratio is less than5 25:l.
TheCreditAgreement permits the Company to purchase loans undcrthe Term Facility pursuantto customary Dutch
auction provisions and subject to customary conditions and limitations.
Covenantsêstrictions
The CreditAgreement requires the Company to comply with certain financial covenants, includingaminimum
consolidated interesteoverageratioandamaximum consolidated leverage ratio, in each case, commencing with the fiscal
quarter ending March^l,2011.The CreditAgreement also includes certain negative covenants customary for transact^^^
this type, that restrict the ability ofthe Company and the Company's existing and future restricted subside
things, modify material agreements andôr incur additional debt, incur liens, make certain investments and aequ^^
fundamental changes, transfer and sell assets, pay dividends and make distributions, modify the nature of d^^
business, enter into agreements with shareholders and affiliates, enter into burdensome agreements, changed
fiscal year, make capital expenditures and prepay certain indebtedness, subject to certain customary exceptions, i n c ^ ^
carveouts and basketsThe Company was in compliance with all financial covenants at December^l,2013
The CreditAgreement contains certain customary representations and warranties, affirmative covenants and events
default, including change ofcontrol provisions and cross-defaults to other debt. Upon the occurrence of an event of d
lenders,byamajorityvote,will have the ability to direct theAdministrativeAgent to terminate t^^
accelerate all loans and exercise any of the lenders'other rights under the CreditAgreement and the related loan documents on
behalf of the lenders.
effective Interest Rate
Taking into account fees and expenses associated with the CreditAgreement and Amendment No.lthat will be amortized
as additional noncash interest expense overaseven-yearperiod, the weighted average effective interest
Facility as ofDecember31,2013was5.0%.
80
DmeEq^tylândSu^dAîes
N o ^ ^ ^ C ^ o h d ^ d F m a n ^
7.LongêrmDebt(Conôued)
^ ^ ^ ^ ^ ^ ^ 2 ^
OnOôberl^20l^theCompany issued $825^miîonaggreg^
October 30, 2 0 1 8 ^ e ^ N o t e s ^ p u ^ ^
WeiisFargo Bank, Nations Association, as trustee(tbe"Trustee^^
and are jointly and severaiiy guaranteed onaseuior unsecured basis by the Ouarant^^^
interest^ffective Interest
Tbe Notes bear interest at tbe rate 0^9.5% per annum, interest on tbe Notes is payabie on April 30 and October
year, beginning onApril 30, 2014Taking into account iees and expenses associated witbtbelôtestbatwih
additional non-casb interest expense over an eigbt-year period, tbe weighted average elective interest r^^
December31,2013was10.9%.
Prepayment
The Oompany may redeem the Notes for cash in whole or in part, at any time or from time to time, on
October 30, 2014, at specified redemption premiums, plus accrued and unpaid interest, as specified in the Indenture in
addition, prior to October 30, 2014. the Oompany may redeem the Notes for cash in whole or in part, at any time and from t^^
to time, ataredemption price equal tol00% of the principal amount plus accrued and unpaid interest anda^makewhole"
premium,as specified in the Indenture.The make-whole payment was approximately $92.Imillion at December31,2013.The
makewhole payment will decline progressively to $36.1million as of October 30,2014and remain atthat amount until
October 30, 2015.The make-whole payment then will decline in two stepdowns, first to$18.1million on October 30, 2015
and to zero on October 30, 2016.
In addition, prior to October 30, 2013,the Oompany could redeem up to 35%ofthe aggregate principal amount ofNotes
issued with the net proceeds raised in one or more equity offerings. Ifthe Oompany undergoesachange of control under ce^^^
circumstances, the Oompany may be required to offer to purchase the Notes atapurehase price equal to 101%of the p r i n c e
amount plus accrued and unpaid interest. Ifthe Oompany sells assets under certain circumstances, the Oompany may be
required tooffer to purchase theNotesatapurchase price equal to 100% ofthe principal amount plus accrued and unpaid
interest.
Oovenantsêstrictions
The Indenture limits the ability ofthe Oompany and its restricted subsidiaries to incur additional indebt^^
certain indebtedness under the Oredit Facility), issue certain preferred shares, pay dividends and make other equity
distributions, purchase or redeem capital stock, make certain investments, create certain liens on its assets to secure
debt, enter into certain transactions with achates, agree to any restrictions on the ability ofthe Oompany^srest^^^
subsidiaries to make payments to the Oompany,merge or consolidate with another company, transfer and sell assets, engage in
business other than certain permitted businesses and designate its subsidiaries as unrestricted subsidiaries,^
forth in the IndentureThese covenants are subject toanumberofimportant limitations, qualifications and excepts
including that during any time that theNotes maintain investment grade ratings, certain ofthese covenants will not be
applicable to the Notes.
The Indenture also contains customary event ofdefault provisions including, among others, the f o l l o w s
payment ofthe principal ofthe Notes when the same becomes due and payables default for 30 days in the payment when due of
interest on theNotes^ failure to comply with certain covenants in the Indenture, in some cases without notice f^^^
or the holders ofNotes^ and certain events ofbankruptcy or insolvency with respect to the Oompany or any significant
restricted subsidiary, in each case as set forth in the Indenture. In the case of an event of default, other thanabank^^
with respect to the Oompany, theTrustee or the holders of at least 25% in aggregate principal amount of theNotes then
outstanding, by written notice to the Oompany(and to theTrustee ifthe notice is given by the holders of the Notes), ma^^
theTrustee at the written request ofthe holders ofat least 25% in aggregate principal amount ofthe Notes then outstanding
shall, declare the principal ofand accrued interest on the Notes to be immediately due and payable.
Restricted Payments
The Oredit Agreemcnt contains covenants considered customary for similar types of facilities that limit cert
restricted payments, including those related to dividends on and repurchases of our common stock. Such ^
are limited toacumulative amount comprised ofti)agencral restricted payments allowance o f $ 3 5 . 0 m i l l ^
excess Oash Plow for each fiscal quarter in which the consolidated leverage ratio is greater than575:lîii) 75% ofF^^
81
Notes to Hie Consolidated Financial Statements (Continued)
7. Long-Term Debt (Continued)
Cash Flow for each fiscal quarter if the consolidated leverage ratio is less than 5.75:1 and greater than or equal to 5.25:1; (iv)
100% of Excess Cash Flow for each fiscal quarter in which the consolidated leverage ratio is less than 5.25:1; and (v) proceeds
from the exercise of options to purchase our common stock, less any amounts paid as dividends or to repurchase our common
stock. As of December 31, 2013 our permitted amount offuture restricted payments under the CreditAgreement was
approximately $89 million.
The Indenture under which our Senior Notes were issued also contains a limitation on restricted payments that is calculated
on an annual basis. Such restricted payments are limited to a cumulative amount comprised of (i) 50% of consolidated net
income (as defined in the Indenture), plus (ii) proceeds from exercise of stock options, less (iii) restricted payments made. The
permitted amount of future restricted payments under the Indenture, calculated as of December 31, 2013, was approximately
$112 million.
Deferred Financing Costs
In connection with the Credit Agreement and the issuance of the Notes, the Company recorded approximately $28.2
million of deferred financing costs. In connection with the increase to the Revolving Credit Facility the Company recorded an
additional $0.8 million of deferred financing costs. These deferred financing costs are being amortized using the effective
interest method over the estimated life of the related debt. Amortization of the deferred financing costs associated with the
Credit Agreement and the issuance of the Notes included in interest expense for the years ended December 31.2013, 2012 and
2011 was $2.7 million, $2.6 million and $2.7 million, respectively. Additionally, $2.3 million and $3.1 million, respectively, of
deferred issuance costs were written off in connection with debt retirement for the years ended December 31. 2012 and 2011
and is reflected in the loss on extinguishment of debt in the Consolidated Statements of Comprehensive Income, with a nominal
amount written off for the year ended December 31,2013.
As of December 31, 2013 and 2012, $14.0 million and $16.8 million, respectively, of deferred financing costs was reported
as Other Assets in the Consolidated Balance Sheets.
Discount on Debt
The Company recorded a discount on debt from the October 2010 Refinancing of $29.6 million. In connection with
Amendment No. 1, the Company recorded an additional discount of $7.4 million. The discount on debt reflects the difference
between the proceeds received from the issuance of the debt and the face amount to be repaid over the life ofthe debt. The
discount will be amortized as additional interest expense over the weighted average.estimated life of the debt under the
effective interest method. For the years ended December 31, 2013,2012, and 2011, $3.5 million, $3.4 million and $3.4 million,
respectively, ofthe discount was amortized as additional interest expense under the effective interest method. Additionally,
$2.7 million and $3.1 million, respectively, was written off in connection with debt retirement for the years ended
December 31,2012 and 2011 and is reflected in the loss on extinguishment of debt in the Consolidated Statements of
Comprehensive Income, with a nominal amount written off for the year ended December 31, 2013.
Maturities of Long-term Debt
At December 31, 2013, the aggregate principal amounts of existing long-term debt maturing in each of the next five years
and thereafter are as follows:
(In millions)
2014
2015
'2016
2017
2018.....
Thereafter
S
„..].
;...L
4.7
4.7
4.7
453.0
760.8
—
1,227.9
8. Financing Obligations
On May 19, 2008, the Company entered into a Purchase and Sale Agreement relating to the sale and leaseback of 181
parcels of real property (the "Sale-Leaseback Transaction"), each of which is improved with a restaurant operating as an
Applebee's Neighborhood Grill and Bar (the "Properties"). On June 13, 2008, the closing date ofthe Sale-Leaseback
Transaction, the Company entered into a Master Land and Building Lease ("Master Lease") for the Properties. The proceeds
82
received from the transaction were $337.2 million. The Master Lease calls for an initial term of twenty years and four, five-year
options to extend the term.
The Company has an ongoing obligation related to the Properties until such time as the lease related to each ofthe
Properties is assigned to a qualified franchisee in a transaction meeting certain parameters set forth in the Master Lease. Due to
this continuing involvement, the Sale-Leaseback Transaction was recorded under the financing method in accordance with
U.S. GAAP. Accordingly, the value ofthe land and leasehold improvements will remain on the Company's books and the
leasehold improvements will continue to be depreciated over their remaining useful lives. The net proceeds received were
recorded as a financing obligation. A portion ofthe lease payments is recorded as a decrease to the financing obligation and a
portion is recognized as interest expense. In the event the lease obligation of any individual property or group of properties is
assumed by a qualified franchisee, the Company's continuing involvement will cease. At that time, that portion of the
transaction related to that property or group of properties is expected to be recorded as a sale in accordance with U.S. GAAP
and the net book value of those properties will be removed from the Company's books, along with a ratable portion ofthe
remaining financing obligation.
As of December 31, 2013, the Company's continuing involvement with 148 ofthe 181 Properties ended by assignment of
the lease obligation to a qualified franchisee or a release from the lessor. In accordance with the accounting described above,
the transactions related to these properties have been recorded as a sale with property and equipment and financing obligations
each reduced by approximately $264.4 million.
As of December 31,2013, future minimum lease payments under financing obligations during the initial terms of the leases
related to the sale-leaseback transactions are as follows:
Fiscal Ymrs
(In millions)
,2014
$
2015")
12016
'.
2017
12018
Thereafter
! Total minimum lease payments
Less: interest
: Total financing obligations
Less: current portion'
Long-term financing obligations
21
:
$
5.7,
6.2
5.7
5.2
"6.0
92.4
121.2
(72.3)
48.9
(0.1)
48.8
Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made in fiscal 2015.
Included in current maturities of capital lease and financing obligations on the consolidated balance sheet.
9. Leases
The Company is the lessor or sub-lessor of approximately half of all IHOP franchise restaurants. The restaurants are
subleased to IHOP franchisees or in a few instances operated by the Company. These noncanceiable leases and subleases
consist primarily of land, buildings and improvements.
The following is the Company's net investment in direct financing lease receivables:
December 31,
2013
2012
(In millions)
s
(
Less: unearned income
Net investment in direct financing lease receivables.
Long-term direct financing lease receivables
$
83
144.8 S
' (56.2)
88.6
(7.0)
81.6 $
163.4'
(68.3)
95.1
(6.2)
88.9
9. Leases (Continued)
Contingent rental income, which is the amount above and beyond base rent, for the years ended December 3 I, 2013, 2012
and 2011 was $12.7 million, $12.5 million and $13.1 million, respectively.
The following is the Company's net investment in equipment leases receivable:
December 31,
2013
2012
(In millions)
$
Total minimum leases receivable...
Less: unearned income
Net investment in equipment leases receivables
"
$
184.2 S
(69.1)
115.1
(7.1)
108.0 S
209.3
(S6.9)
122.4
(6.8)
115.6
The following arc minimum future lease payments on noncanceiable leases as lessee at December 31,2013:
Cnpita)
Operating
Lcscs
Lenses
(In millions)
2014
2015
—
2016
2017..:
'.
.'.
2018
1
Thereafter...."."
„.
Total minimum lease payments...
Less: interest
._.
'Capital lease obligations.
Less: current portion'
Long-term capital lease obligations
0 1
11
:
—
'..
....._.„
_
-• ••
$ "24.3
S 7 6 . 7
26.1
82.3
.'.
23.9 :
74.4
21.2
67.0
20.4
. 71.1
76.3
392.2
_ 192.2 S
763.7
- - --(68.4)
123.8
(12.1)
$
111-7
:
:v
^ Due to the varying closing date ofthe Company's fiscal year, 13 monthly payments will be made in fiscal 2015
Included in current maturities of capital lease andfinancingobligations on the consolidated balance sheet.
(2)
The asset cost and carrying amount on company-owned property leased at December 31,2013 was $90.1 million and
$66.1 million, respectively. The asset cost and carrying amount on company-owned property leased at December 31, 2012, was
$90.1 million and $67.8 million, respectively. The asset cost and carrying amounts represent the land and building asset values
and net book values on sites leased to franchisees.
84
DineEquity, Inc. itnd Subsidiaries
9. Leases (Continued)
The minimum future lease payments shown above have not been reduced by the following future minimum rents to be
received on noncanceiable subleases and leases of owned property at December 31, 2013:
Direct
Financing
Opera! in"
Leases
Leases
(In millions)
2014
2015"*
2016
2017
2018
:
s"
.
./.i......(..
:~
C-
18.1 $
18.3 "
17,8
17.9
17.5
55.2
144.8 S
98.9
101.1
99.0
99.0
98.3
652.2
1,148.5
'Due to the varying closing date of the Company's fiscal year, 13 monthly payments will be made infiscal2015
The Company has noncanceiable leases, expiring at various dates through 2032, which require payment of contingent rents
based upon a percentage of sales of the related restaurant as well as property taxes, insurance and other charges. Subleases to
franchisees of properties under such leases are generally for the full term of the lease obligation at rents that include the
Company's obligations for property taxes, insurance, contingent rents and other charges. Generally, the noncanceiable leases
include renewal options. Contingent rent expense for all noncanceiable leases for the years ended December 31,2013,2012
and 2011 was $2.8 million, $2.7 million and $2.8 million, respectively. Minimum rent expense for all noncanceiable operating
leases for the years ended December 31, 2013, 2012 and 2011 was $75.4 million, $78.0 million and $81.8 million, respectively.
10. Commitments
and Contingencies
Purchase Commitments
In some instances, the Company enters into commitments to purchase advertising and other items. Most ofthese
agreements are fixed price purchase commitments. At December 31,2013, the outstanding purchase commitments were $90.9
million, the majority of which related to advertising.
Lease Guarantees
In connection with the sale of Applebee's restaurants to franchisees and other parties, the Company has, in certain cases,
guaranteed or had potential continuing liability for lease payments. As of December 31,2013 and 2012, the Company has
outstanding lease guarantees or is contingently liable for approximately $417.8 million and $448.5 million, respectively. This
amount represents the maximum potential liability offuture payments under these leases. These leases have been assigned to
the buyers and expire at the end ofthe respective lease terms, which range from 2014 through 2048. In the event of default, the
indemnity and default clauses in our sale or assignment agreements govern our ability to pursue and recover damages incurred.
No material liabilities have been recorded as of December 31, 2013.
Contingencies
In February 2013, an IHOP franchisee and its affiliated entities which owned and operated 19 restaurants located in the
states of Illinois, Wisconsin and Missouri filed for bankruptcy protection. As a result of an order issued by the bankruptcy
court, two ofthe 19 restaurants were returned to the Company in the third quarter of 2013. A non-cash charge of $0.5 million
was recorded in the Consolidated Statement of Comprehensive Income against deferred rental revenue associated with the
leases for those two restaurants. During the third quarter of 2013, the Company received favorable rulings from the bankruptcy
court which, if upheld, would allow the transfer of the remaining 17 restaurants to another franchisee. These rulings have been
appealed by the current franchisee and are presently subject to a continued stay order, pursuant to which the current franchisee
is operating these restaurants only on a day-to-day basis and is continuing to make payments to the Company pursuant to the
terms ofthe original franchise agreements. Accordingly, the Company is unable to determine the ultimate outcome ofthe
bankruptcy proceedings at this time.
85
^ ^ ^ ^ c ^ ^ ^ ^ ^ ^ ^
The Company i s s u b j e ^ m v ^ o u s ^
arisinginthe ordinary course ofhusiness. Some ofthese iawsnitspnrp^
The Company is required to record an aeerual for hfigafion toss eondngeneies that are ho^^
Legal tees and expenses associated with the defenseof aii ofthe Company's iitigadon are expensed as such fees and e^^^
are incurred, inthe opinion of management, these matters are adequately covered hy insurance 04 if not so c o v e ^
merit or are of suchanature or involve amounts that would not haveamaterial adverse impact on the Company's business or
consolidated financial statements. Management regularly assesses the Company's insurance deductibles, analyzes
information with the Company's attorneys and evaluates its loss experience in connection with pending legal proceedi^^^
WhiletheCompanydoesnotpresentlybelievethatany ofthe legal proceedings to which the Company is currentlyaparty will
ultimately haveamaterial adverse impact on the Company, there can be no assurance that the Company will prevail in all ^
proceedings the Company is party to, or that the Company will not incur material losses from them.
^ ^ ^ C r ^
The Company provides letters ofcredit, primarily to various insurance carriers to collateralize obli^^^
claims. As ofDeeember^l,2013,the Company had approximately$109million of unused letters of credit outs^^
letters expire on various dates in 2014and are automatically renewed for an additional year if no cancellation n o ^
submitted.
1L preferred Stoe^ and Stockholders'equity
^ ^ r r ^ ^ ^
SeriesBConvertible Preferred Stock
Cn November 29,2007,the Company issued and sold 35,000 shares ofSeriesBConvertible Preferred Stockfor an
aggregate purchase price of$35.0 million in cash.Total issuance costs were approximately $0.8 million.All ofthe
sold to affiliates of Chilton Investment Company,LLC(collectively, "Chilton^ pursuantto
ûly 15, 2007.The shares ofSeriesBConvertible Preferred Stock ranked (i)seniorto the common stock, and any se^^
preferred stock specifically designated as junior to the SeriesBConvertible Preferred Stock, with respect to the payment of
dividends and distributions, inaliquidation,dissolution or winding up, and upon any other distribution of the Com
assets; and (ii)onaparity with all other series of preferred stock, with respect to the payment of dividends and d i s ^
aliquidation,dissolutionorwindingup, and upon any other distribution of the Company's assets.
âch share ofSeriesBConvertible Preferred Stock had an initial stated value of$l,000, that increased at the rate 0
per annum, compounded quarterly,commencmg on the issue date of such share ofSeriesBConvertible Preferred Stock to and
including the earlier of(i) the date ofliquidation, dissolution or winding up or the redemption of such sha
share is converted into the Company's common stock.The stated value ofashare as so accreted as of any date was referred to
as the accreted value ofthe share as ofthat date. The SeriesBConvertible Preferred Stock entitled the h o ^
receive certain dividends and distributions to the extent that any dividends or distributions paid on the Company'^
stock exceeded the annual accretion on the SeriesBConvertible Preferred Stock. ôldersofSeriesBConvert^
Stock were entitled to vote on all mattersîncludingtheelection of directors^submitted to the holders 0
common stock, asasingle class with the holders of the Company'scommon stock, with each share ofSeries 13 Convertible
Preferred Stock having one vote per share ofthe Company^ common stock then issuable upon conversion ofsuch share of
Series 13 Convertible Preferred Stock.
At any time and from time to time, any holder ofSeriesBConvertible Preferred Stock could convert all or any portion 0
the SeriesBConvertible Stock held by such holder intoanumber of shares of the Company'scommon stock computed by
multiplying (i)each $1,000 of aggregate accreted value of the shares to be converted by (ii) the conversion rate^^
(which initially was 1444878 shares of conmôn stock perSl,000 ofaccreted value, but subject to c u s ^
adjustments).
TheCompanyalsoenteredintoaregistration rights agreement, dated as ofNovember29,2007,with Chilton pursua
which the Company granted Chilton certain registration rights with respect to the shares ofSeriesBC^^^^
Stock issued to Chilton and the shares ofcommon stock issuable upon conversion
86
11. Preferred Stock and Stockholders' Equity (Continued)
In January 2011, 100 shares of Series B Convertible Preferred Stock with an accreted value of approximately $120,000
were converted by the holder into 1,737 shares of the Company's common stock. On November 29. 2012, the fifth anniversary
of the issue date, the remaining 34,900 outstanding shares of Series B Convertible Preferred Stock, with an accreted value of
approximately $47.0 million, were automatically converted into 679,168 shares of the Company's common stock.
On December 14,2012, the Company filed a Certificate of Elimination ofthe Series B Convertible Preferred Stock with
the Secretary of State of the State of Delaware to eliminate its Series B Convertible Preferred Stock. The Certificate of
Elimination, effective upon filing, had the effect of eliminating from the Corporation's Restated Certificate of Incorporation, as
amended, all matters set forth in the Certificate of Designations ofthe Series B Preferred Stock with respect to such series,
which was previously filed by the Corporation with the Secretary of State on November 29, 2007.
Stock Repurchase Programs
On February 26, 2013, the Company's Board of Directors approved a stock repurchase authorization of up to $100 million
of DineEquity common stock, replacing an authorization approved in 2011 to repurchase up to $45 million of DineEquity
common stock. Under the current program, the Company may repurchase shares on an opportunistic basis from time to time in
open market transactions and in privately negotiated transactions based on business, market, applicable legal requirements, and
other considerations. The repurchase program does not require the repurchase of a specific number of shares and may be
terminated at any time. During the year ended December 31, 2013, the Company repurchased 412,022 shares of stock for $29.7
million. There were no stock repurchases in 2012. During the year ended December 31, 2011, the Company repurchased
534,101 shares of stock for $21.2 million. Repurchases of common stock are subject to limitations under our Credit Agreement
and Senior Notes (see Note 7 - Long-Term Debt).
Treasury Stock
Repurchases of DineEquity common stock are included in treasury stock at the cost of shares repurchased plus any
transaction costs. Treasury stock may be re-issued when vested stock options are exercised, when restricted stock awards are
granted and when restricted stock units settle in stock upon vesting. The cost of treasury stock re-issued is determined on the
first-in, first-out ("FIFO") method. The Company re-issued 318,644 shares, 433,732 shares and 135,230 shares, respectively,
during the years ended December 31,2013, 2012 and 2011 at a total FIFO cost of SI 1.7 million, $14.1 million and $4.3 million,
respectively.
Dividentts
During the year ended December 31,2013, we declared and paid dividends on our common stock as follows:
Dividend per
Year ended December 31,2013
Declaration date
Payment date
...
share
lolar '
(In millions)
; First quarter.!..:
February 26,2013
Second quarter
Third quarter
,
Fourth quarter
Total
!
,
March 29, 2013
$ '
0.75
$
14,6
May 14,2013
June 28,2013
0.75
14.4
August 2, 2013
September 27,2013
0.75
14.3
October 3, 2013
December 27, 2013
,
0/75
S
3.00
14.3
$i
57.6
(I) Includes dividend equivalents paid on reimcied nock units
On February 25, 2014, the Company's Board of Directors approved payment of a cash dividend of $0.75 per share of
DineEquity common stock, payable at the close of business on March 28, 2014 to the stockholders of record as ofthe close of
business on March 14,2014
Payment of dividends is subject to limitations under our CreditAgreement and Senior Notes (see Note 7 - Long-Term
Debt). There were no dividends declared or paid on common shares in 2012 or 2011.
87
12. Closure and Impairment Charges
Closure and impairment charges for the years ended December 31, 2013,2012 and 2011 were as follows:
Year Ended December 31,
2011
2012
2013
. (In millioiu)
$
Closure charges
Long-lived tangible asset impairment
Lenexa lease termination
Total closure and impairment charges
1.0
0,8
S
,
—
S
1.8
'2.3 $ "
"'
$
r.9
4.2 $
2.0
4.9
23.0
29.9
Closure Charges
Closure charges for the year ended December 3 I, 2013 primarily related to adjustments to the estimated reserve for closed
surplus I HOP and Applebee's restaurants. Closure charges for the year ended December 31, 2012 primarily related to the
closure of one IHOP restaurant that was taken back from the franchisee operator and to adjustments to the estimated reserve for
previously closed surplus IHOP properties. Closure charges for the year ended December 31, 2011 primarily related to
adjustments to the estimated reserve for previously closed surplus IHOP properties.
Long-lived Tangible Asset Impairment
Long-lived tangible asset impairment charges for the year ended December 31, 2013 related to three Applebee's companyoperated restaurants in the Kansas City, Missouri area. The Company evaluated the causal factors of all impairments of longlived assets as they were recorded during 2013 and concluded they were based on factors specific to each asset and not
potential indicators of an impairment of other long-lived assets.
Long-lived tangible asset impairment charges for the year ended December 31,2012 related to equipment at five IHOP
restaurants that were taken back from the franchisee operator and subsequently refranchised and to a parcel of land previously
intended for future restaurant development. The Company evaluated the causal factors of all impairments of long-lived assets
as they were recorded during 2012 and concluded they were based on factors specific to each asset and not potential indicators
of an impairment of other long-lived assets.
Long-lived tangible asset impairment charges for the year ended December 31,2011 were primarily related to termination
of the Company's sublease of the commercial space occupied by the Applebee's Restaurant Support Center. The Company
recognized a $4.5 million impairment charge related to the furniture,fixturesand leasehold improvements at that facility.
Lenexa Lease Termination
In April 2011, the Company entered into a sublease termination agreement related to the Company's sublease of the
commercial space occupied by the Applebee's Restaurant Support Center in Lenexa, Kansas. The Company recognized a
charge of S23.0 million for the termination fee and other closing costs.
13. Stock-Based Incentive Plans
General Description
From time to time, the Company has granted nonqualified stock options, restricted stock awards, cash-settled and stocksettled restricted stock units and performance units to officers, other employees and non-employee directors of the Company.
Currently, the Company is authorized to grant stock options, stock appreciation rights, restricted stock awards, cash-settled and
stock-settled restricted stock units and performance units to officers, other employees and non-employee directors under the
DineEquity, Inc. 2011 Stock Incentive Plan (the "2011 Plan"). The 2011 Plan was approved by stockholders on May 17,2011
and permits the issuance of up to 1,500,000 shares ofthe Company's common stock for incentive stock awards. The 2011 Plan
will expire in May 2021.
88
DmeEquiÎnc ^ d S u b ^ d ^ r i e s
Ô^^^Consohd^dF^
I^Sto^^sedlncenêP^ns(Contmued)
The IHOP C o ^ ^ l S ^ ^ m i v e ^ ^ ^ ^
2008to^horize the i ^ a n e e o f u p ^ ^ O O ^ O O shares of
stoek awards and stoek o p t i o n
The Stoek Option Plan torNon EmployeeDireetors^he
ml999 to authorize the issuance of op to 400^00 shares ofoomrnonstoekpnrs^
Oirectors Plan has expired hut there are stock options issued under the Directors Plan outstanding as ofDeeem^
The ^ 5 Stock Incentive Plan for ôn 8mployeeOirectors(the ^005 P ^ ^
issuance ofup to 200,000 shares ofcommon stock t^^
may he made in common stock, in options to purchase common stock, or in shares ofRestricted Stock, or any comhina^
thereof.
The 20IIPIan, the 2005 Plan, the 2001 Plan and the Directors Plan are collectively referred to as the ^ P ^ ^
^ ^ ^ ^ C ^ ^ ^ ^ ^ ^ ^ ^ ^
Prom time to time, the Oompany has granted stock options and restricted stock to oncers, directors and employe
Oompany underthe Plans. The stock options generally vest ratably overathree yearperiod in one-third increments^
maturity of ten years from the issuance date. Options vest immediately uponachange in control of the Oompany,as defined in
the Plans Option exercise prices equal the closing price on the New York Stock Exchange of the Company's common
the date ofgrant. Restricted stock and restricted stock units are issued at no cost to the holder and vest overtermsdetermm^
by the Compensation Committee ofthe Company's Board ofDirectors, generally three years following the dat^
immediately uponachange in control ofthe Company, as defined in the Plans The Company generally utilizes treasu
or issues new shares from its authorized but unissued share pool when vested stock options are exercised, when restricted stock
awards are granted and when restricted stock units settle in stock upon vesting.
The following table summarizes the Company's stock-based compensation expense included asacomponent of general
and administrative expenses in the consolidated financial statements:
Year^dedD^mh^t,
^
(Inmittio^
^Totalstock based compensation expense:
Equi^classifiedawards ^
^ .
^
Liability classified awards
Total pre tax compensation expense
^ Taxbenefd
B.^
Total stock-based compensation expense, net of tax
^^^^^^ ^
^
^
^
$
^
^
^
10.3
(3^
6.4
^
^
16 3
(62)
101^ $
^11
^
i0.6
^2)
6.4
As ofDecember3l,2013, total unrecognized compensation cost related to restricted stock and restricted s ^
$8.2 million and $4.1 million related to stock options is expected to be recognized overaweighted average per^^^
approximately 1.83 years for restricted stock and restricted stock units andl.57 years for stock options
^ ^ C ^ ^ ^ ^ r ^ - ^ c ^ ^ ^ ^
The per share fair values of the stock options granted have been estimated as ofthe date ofgrantorassumption using the
Black-Scholes option pricingmodel.TheBiackScholes model considers, among otherfactors,t^^
and the expected volatility ofthe Company's stock price. The Black-Scholes model meets the requirements o
the fair values generated by the model may not be indicative ofthe actual fairvalues ofthe Company's stockbasedawa^^^^
following table summarizes the assumptions used to value options granted in the respective periods:
89
liincKquity, Inc. and Subsidiaries
13. Stock-Based Incentive Plans (Continued)
0.8%
83.4%
4.15%
4.6
11.0%
36.00 $
$
2011
2012
2013
Risk free interest rate
Weighted average historical volatility
Dividend yield
Expected years until exercise..
Forfeitures
Weighted average fair value of options granted
0.9%
84.5%
—%
4.7
11.0%
33.53
$
1.8%
79.1%
—%
4.6
11.0%
34.31
Stock option activity for the years ended December 31, 2013, 2012 and 2011 is summarized as follows:
Number of
Shares Under
Option
Outstanding at December 31, 2010
Granted
Exercised
Forfeited
Expired
._.
„.
\ Granted
Exercised
Forfeited
Expired
Outstanding at December 31,2012
Granted
„
- - J ™ :•;
Exercised
.„.„..
Forfeited
' Outstanding at^December 3 C20i3~
Vested and Expected to Vest at December 31, 2013.
'Exercisable at December 31. 2013
t
Weighted
Average
Exercise Price
Per Share
1,523.710 $
233,449
(393,075)
(42,593)
(2,851)
1,318,640
147,674
(455,217)
(39,381)
(13,470)
958,246_
81,328
(225,272)
(39,243)
775.059 $
758,338 s
567,630 s
24.90
53.04
17.11
27.89
47.08
32.06
51.63
20.91
46.97
38.64 "
39.67
72.28 '
40.31
55.78
42.09
41.64
35.91
Weighted
Average
Remaining
Contractual
Term (in Years)
.
6.28
6.23
5:55
AggregHlc
Intrinsic
Valuf
Y 327i6o.'6oo:
$ 31,800,000
$ 27.000,000 i
The total intrinsic value of options exercised during the years ended December 31,2013,2012 and 2011 was $7.5 million,
$15.0 million and $14.6 million, respectively.
Cash received from options exercised under all stock-based payment arrangements for the years ended December 31,2013,
2012 and 2011 was $9.1 million, $9.3 million and $6.7 million, respectively. The actual tax benefit realized for the tax
deduction from option exercises under the stock-based payment arrangements totaled $3.7 million, $6.2 million and $5.8
million, respectively, for the years ended December 31,2013,2012 and 2011.
90
Equity Classified Awards - Restricted Stock and Restricted Stock Units
Activity in equity classified awards of restricted stock and restricted stock units for the years ended December 31,2013,2012
and 2011 is as follows:
Shares of
Rcstrieted Stock
Granted
Released
Forfeited
'Outstanding at December 31, 2011
Granted
'.
Released
Forfeited
Outstanding at December 31., 2012
Granted
Conversion of cash-settled restricted stock units
Released
.Forfeited
Weighted
Average
Granl-Uate Per
Share
Fair Value
666,244 $
164,632
(287,735)
(56.608)
486,533
137,852
(179,465)
(98,357)
346,563
97,812
—
(117,075)
(61,048)
266.252 $
......
28.62
53.03
37.82
31.56
31.08
52.23
13.83
44.40
44.74
73.11
'—
30.96
55.37
58.87
Weighted
Average
Grant-Date
Per Share
Fair Value
Restricted
Stock Units
18,000
*
29.32
—
—
-' •
—
18,000
19,152
(3,910)
—
33,242
15,804
37,184
(39,000)
—
47,230 $
29.32
52.23
40.58
—
•
i —
41.19
72.04
72.28
54.66
—
64.57
Liability Classified Awards - Restricted Stock Units
The Company previously had issued shares of cash-settled restricted stock units to members ofthe Board of Directors.
Originally these instruments were expected to be settled in cash and were recorded as liabilities based on the closing price of
the Company's common stock as of each period end. In February 2013, it was determined that, pursuant to the terms of the
Plan, these restricted stock units would be settled in shares of common stock and all outstanding restricted stock units were
converted to equity classified awards. Activity in liability classified awards of restricted stock units for the years ended
December 31, 2013, 2012 and 2011 is as follows:
Cash-Settled
Restricted Stock
Units
Outstanding at December 31,2010;:,
Granted
/Released
„„
Granted
Released
Outstanding at December 31, 2012.„;
.,
Conversion to stock-settled restricted stock units.
26,000 $
15,957
41,957
(4,773)
37,184
(37,184)
Weighted
Average
Per Share
Fair Value
64.231
64.30
" " 6436'
49.66
66.13
72.28
For the years ended December 31, 2013, 2012 and 2011, $0.3 million, $1.0 million and $0.5 million, respectively, was
included as stock-based compensation expense related to these cash-settled restricted stock units. At December 31, 2012, a
liability of $2.4 million was included as other accrued expenses in the consolidated balance sheet.
The Company has granted cash long-term incentive awards to certain employees ("LTIP awards"). Annual LTIP awards
vest over a three-year period and are determined using a multiplier from 0% to 200% ofthe target award based on the total
shareholder return of DineEquity, Inc. common stock compared to the total shareholder returns ofa peer group of companies.
Though LTIP awards are only paid in cash, since the multiplier is based on the price of the Company's common stock, the
awards are considered stock-based compensation in accordance with U.S. GAAP and are classified as liabilities. For the years
ended December 31, 2013,2012 and 2010, $0.6 million, $3.8 million and $0.6 million, respectively, were included in stock-
91
DineEquity, Inc. -And Subsidiaries
based compensation expense related to the LTIP awards. At December "3 I, 2013 and 2012, liabilities of $2,8 million and $4.5
million, respectively, were included as accrued employee compensation and benefits in the consolidated balance sheet.
14. Employee Benefit Plans
401 (k) Savings ami Investment Plan
Effective January 1, 2013, the Company amended the DineEquity, Inc. 401 (k) Plan to (i) modify the Company matching
formula and (ii) eliminate the one year completed service requirement that previously had to be met to become eligible for
Company matching contributions. As amended, the Company matches 100% of the first four percent of the employee's eligible
compensation deferral and 50% of the next two percent of the employee's eligible compensation deferral. All contributions
under this plan vest immediately. DineEquity common stock is not an investment option for employees in the 401(k) plan, other
than shares transferred from a prior employee stock ownership plan. Substantially all of the administrative cost of the 401 (k)
plan is borne by the Company. The Company's matching contribution expense was $2.3 million, $2.2 million and $2.8 million
for the years ended December 31, 2013, 2012 and 2011, respectively.
15. Income Taxes
The provision (benefit) for income taxes for the years ended December 31, 2013, 2012 and 2011 was as follows:
2(112
iim
ion
(111 million!,)
?
Provision (benefit) for income taxes:
Current
.
.FWeral.L..Li.._...Z ^
State
[ Foreign....!
...Z.
"
Deferred"
'
Federal
1.
L
'
State _..J™..„.....
L..—
$
,.
L
48.5 $ 7 7 , 4
$ "'"
2.1
1.9
" 2.4 "
'
,1.8
53.0
81.1
112
1.0^
LK!
16.0
(13.5)
1M
_2
(0.9)' .
Provision for income-taxes
:
S
_ (12.2)
"
(14.4)'
38.6 $
(1.7)
"
2.4 :
(13.9)
67.2 $
13.8
29.8 '
The provision for income taxes differs from the expected federal income tax rates as follows:
Year Ended December31,
2013
Statutory federal income tax rate
State and other taxes, net of federal tax benefit
Change in unrecognized tax benefits
Change in valuation allowance
State adjustments induding audits and settlements
.Compensation related tax credits, net of deduction offsets.
Changes in tax rates and state tax laws
Kansas High Performance Incentive Program credits
Other
Effective tax rate
;
2012
35.0%
2.9
1.4
(2.7)'
(II)
(0.6)
• ™
—
—
34.9%
92
35.0%
2.8
(0J)
0.7
0.2
(04)
(3.2)
—
0.1
34.5%
2011
35.0%
3/7 :
" Aio)"
i.7
0.2
(4.9)
(3.9)
0.5
O.I
28.4%
Notes lo the Consolidated Financial Statements (Continued)
Note 15. Income Taxes (Continued)
Net deferred tax assets (liabilities) consisted of the following components:
2013
Differences in capitalization and depreciation and amortization of reacquired franchises and $
Differences in acquisition financing costs
Employee compensation
Deferred gain on sale of assets
Book/tax difference in revenue recognition
Other.!
.'.
•
Deferred tax assets..
,
...
Valuation allowance
Total deferred tax assets after valuation allowance
Differences between financial and tax accounting in the recognition of franchise and
equipment sales
• Differences in capitalization and depreciation "
Differences in acquisition financing costs
«Book/tax difference in revenue recognition...
Differences between book and tax basis of property and equipment
c
^ O t h e r . . . . . . . . . . . . . . . . . . . . . . . . ..„_...„..„._....„.
Deferred tax liabilities
Net deferred tax liabilities
Net deferred tax asset—current
i Valuation allowance—current..
Net deferred tax asset—current
' Deferred tax liability—non-current .
Valuation allowance—non-current
{Net deferred tax Ijabjlity—non-current
Net deferred tax liabilities
(I)
„
,
$
$
$
(In millions)
4.8
1.8
15.0
6.3
29.8
35.0
92.7
(1.1)
91.6
2012
4.9
1.8
s •
is.2:
"~5.9
22.2;
35.7
85.4 ;
(4.1)
81.3-
(51.2)
(301.1)
W)
()9.5)
(10.1)
(20J)
(409.3)
(317.7)
24.2 $
(0.3)
23.9
(340.8)
(0"8)~
(341.6)
(317.7) $
s
(55.1)
(310.2)
(7.7)
(19.5)
(9.8)
(19.4)
(421.7)
(340.41
22.3
• "(0.5)
21:8
(358.6)
" (3 6).
(362^)
(340.4)
Primarily related to the Applebee's acquisition.
The Company files federal income tax returns and the Company or one of its subsidiaries file income tax returns in various
state and foreign jurisdictions. With few exceptions, the Company is no longer subject to federal, state or non-United States tax
examinations by tax authorities for years before 2008. In the second quarter of 2013, the Internal Revenue Service ("IRS")
issued a Revenue Agent's Report ("RAR") related to its examination of the Company's U.S federal income tax return for the
tax years 2008 to 2010. The Company disagrees with a portion of the proposed assessments and has contested them through the
IRS administrative appeals procedures. We anticipate the appeals process to continue into 2014. The Company continues to
believe that adequate reserves have been provided relating to all matters contained in the tax periods open to examination.
The total gross unrecognized tax benefit as of December 31, 2013 and 2012 was $2.7 million and $6.7 million,
respectively, excluding interest, penalties and related income tax benefits. The decrease of $4.0 million is primarily related to
recent settlements with taxing authorities. The entire $2.7 million will be included in the Company's effective income tax rate if
recognized.
The Company estimates the unrecognized tax benefits may decrease over the upcoming 12 months by an amount up to
$0.2 million related to settlements with taxing authorities and the lapse of the statute of limitations. A reconciliation of the
beginning and ending amount of unrecognized tax benefits is as follows:
93
DineFqni^ Inc. and Subsidiary
NntestnlbeConsoiidated Financial Statenien^(Continned)
Nntc 15. IncnmcTaxcs (Continued)
(InnuOi^n^
Unrecognized tax benefit as ofDecember^lÔil
Change asaresnlt of prior year tax positions
Cbangeasaresuit ofenrrent year tax positions
Decreases relating to settlements with taxing authorities
Decreases asaresnltofalapse of the statute oflhnitations
Unrecognized tax benefit as ofDecember^l,2012
Change asaresultofprior year tax positions
Decreases relating to settlements with taxing authorities
Decreases asaresultofalapse of the statute oflimitations
UnrecognizedtaxbenefitasofDecember31,2013
$
^
^
^
^
$
8.2
0.8
02
(0.9)
(1^)
6.7
0.8
(4.7)
(0.1)
2.7
As ofDecember34201^the accrued interest and penalties were
anyrelatedincometaxbenefits As ofDecember^l,2012, the accrued interest and penalties were$1.4rnillion and $0.2
million, respectively, excluding any related income tax benefits. The increase o f $ 1 5 m i l l ^
related to an increase in unrecognized tax benefits asaresult of recent audits by taxing authorities. The Company recogni^^^
interest accrued related to unrecognized tax benefits and penalties asacomponent of the income tax provision recognized i n ^
Consolidated Statements of Comprehensive Income
For the years ended December31,2013and 2012, the Company hadatotal valuation allowance in the amounts o f $ l l
million and S4.1million, respectively. The entire$l.l million in 2013is related to the Massac^^^
requiringunitarybusinessestofilecombinedreports.Thedecrease of$3.0 million in the valuation allowance was asaresu^
releasing valuation allowance that was previously set up for various state net operating losses at DineEquity,!^^^
International House ofFancakes, L L C and Subsidiaries.The Company implementedatax planning s t ^
Company to utilize the state net operating loss carryovers from prior years before they expire.
As ofeach reporting date, the Company's management considers new evidence, both positive and negative, that could
impact management's view with regards to future realization of deferred tax assets. As ofDecember^l,2013,because the
Company implementedatax planning strategy that was prudent and feasible in the current year,managementdet^
sufficient positive evidence existed as ofDecember3f,2013,to conclude that was more likely than not that additional d e ^ ^
taxes ofS3.0 million are realizable, and therefore, reduced the valuation allowance
94
16. Net Income Per Share
The computation ofthe Company's basic and diluted net income (loss) per share is as follows:
2013
2012
2011
(In thousands, except per share data)
Numerator for basic and diluted income per common share:
Net income
Less: Series A preferred stock dividends
Less: Accretion of Series B preferred stock
Less: Net (income) loss allocated to unvested participating restricted
stock
Net income available to common stockholders - basic
Effect of unvested participating restricted stock
Efleet of dilutive securities:
Convertible Scries B preferred stock.
Numerator - net income available to common shareholders - diluted
Denominator:
Weighted average outstanding shares ofcommon stock - basic
Effect of dilutive securities:
Stock options
Convertible Series B preferred stock
Weighted average outstanding shares of common stock - diluted
Net income (loss) per common share:
Basic
• Diluted
s
72,037 $
127,674 $
„,
s
—
(2,498)
__%573)
(U200)
70,837
4
(2,718)
122,458
127
(1,886)
70,733
34
70,841 $
2,498
125,083 $
70,767
18,871
270
_
19.141
$
s
75,192
,
3.75 " $
3.70 $
17,992
17,846
264
621
18.877
339
6.81
6.63 $
18,185
196
3.89
For the year ended December 31,2011, diluted income per common share is computed using the basic weighted average
number ofcommon shares outstanding during the period, as the 643,000 shares from common stock equivalents would have
been antidilutive.
95
DineEquity, Inc. and Suhsidiaries
Notes to tlic Consolidated Financial Statements (Continued)
17. Segment Reporting
Information on segments and a reconciliation to income (loss) before income taxes are as follows:
YtJir Ended December 31,
2013
Company restaurants
;Rental operations....
Corporate
i Total,......,..!.......,
Company restaurants........^.............
Corporate
*_*
TOai..................
Capital expenditures
i Company restaurants.
Corporate
' Total " :
^
_
Goodwill (all franchise segment)
Total assets
_
Franchise operations
'Company restauran^..........^....
Rental operations
Financing operations
Corporate
Total...
.;
2012
2011
(In millions)
Revenues
Franchise operation^....„
„
Company restaurants
Rental operations....,
,
Total....;....*..'.....'....!.!.....'."...'.
Income (loss) before income taxes
Franchise operations
Company restaurants
;Rental operations...
7.....
Corporate......
Interest expense
Company restaurants
' Rentaj operations.....
Corporate
Total
Depreciation and amortization
$
^ ^
$
.
,
$
$
2.2
13.4
9.0
35.4
:
.$
L
-
$
$
$ \
7.
„
a
.:
;
%
1.8
—
1.8
1.3
5.7
7.0
697.5
1,606.4
191.6
364.0
117.1
125.5
2.404.6
421.4
291.1
122.9
14.5
849.9
398.5.
531.0
126.0
19.7
1.075.2
293;5 72.6
27:8 ".
13.7
•(302.6):
105.0
311.5
41.8
~ 25.7
12.9
(197.0V
194.9
329.5
(0.2)
27.5
12.9
(259.1)
10.6
"l6.8~'
$
.
'
$
$
$
,
=
$
....
:
$
0.4
•15.7
100.3
116.4 $
$
'.
=
439.2
63.4
124.8
13.1
640.5
^ ^
s
$/
s
$.;
$
$
$
$
"
0.4
17.0
114.3
131.7 S
~ 0.?
9.8 $
6.9
13.6
9.2
39.5 -S
9.9!
16.6
14.0:
9.7
50:2'
4.2 .*
—
4.2 s
2:4 '
27.5
29.9 '
9.5 ;$_
7.5
17.0 $
697.5 $
' 1,523.0
186.2
397.3
125.4
183.5
2.415.4
.J
$
"18.0
13271
151.2
•
15:5'
10.8
26.3 i
697.5
1,472.3
423:1 !
407.9
" 136.4
174.6
2,614.3'.
18. Consolidating Financial Information
Certain of our subsidiaries have guaranteed our obligations under the Credit Facility. The following presents the
condensed consolidating financial information separately for: (i) the Parent Company, the issuer of the guaranteed obligations;
(ii) the Guarantor subsidiaries, on a combined basis, as specified in the CreditAgreement; (iii) the Non-guarantor subsidiaries,
on a combined basis; (iv) Consolidating eliminations and reclassification; and (v) DineEquity, Inc. and Subsidiaries on a
consolidated basis. Each guarantor subsidiary is 100% owned by the Parent Company at the date of each balance sheet
presented. The Term Loans under the Credit Facility are fully and unconditionally guaranteed on a joint and several basis by
each guarantor subsidiary. Each entity in the consolidating financial information follows the same accounting policies as
described in the consolidated financial statements.
96
1
Note 18. Consolklating Financial Information (Conlinueil)
Supplemental Condensed Consolidating Balance Sheet
December 31,2013
(In millions" )
1
Combined
Giiantntor
Subsidiaries
Pnrent
Combined
Non-«ii»rantor
.Subsidiaries
F.Hininalions
and
Rci-lassificHlion
Omsolidaled
. Assets
Current. Assets
$
Receivables, net
._.
Prepaid expenses and other current assets
Intercompany
...
Goodwill
Other assets, net
:
Investment in subsidiaries
S
Total assets
Current Liabilities
$
Accounts payable
;
Gift card liability.
".
_
„
Long-term debt
Capital lease obligations
1 Deferred income taxes
Other liabilities
$
1
50.3- S
2.0
189.2
(4.1)
(435.2)
(197.8)
—
23.5
—
—
16.2
1,697.6
1.539.5 S
12.7
1.4
14.5
54.7 $
150.0
56.1
28.0
429.4
718.1
197.2
249.7
697.5
794.1
93.9
—
2,750.4 S
— $
(13.7)
15.0
1,203.5
—
—
(0.3)
5.9
1,224.2
315.3
1.539.5., $
1.0 $
0.1
—
—
5.8
7.0
—
1.0
—
—
—
—
8.0 S
—
38.6
10.4
172.0
244.1
465.0
48.8
111.7
342.1
92.7
1-060.4
1,690.0
2.750.4. S
$
— $
#4)
(187.7)
_
(195.7)
—
—
—
_
T -
'
(1,697.6)
(1,893.3) $
(8.0) $
187.7)
(195.7)
—'
—
(OJ)
0.9
0.6
7.4
8.0
(195.7)
(1,697.6)
(1,893.3) $
Supplemental statements presented in millions may not foot/crossfoot due to rounding from Consolidated Statements presented in thousands
97
106.0
144.1
57.6
23.9
:
331.6
197.2
274.3
697.5
794.1
110 1
—
2,404.61
4.7
40.1
25.0
172.0^
^42.<r
284.3
1,203.5
, 48.8
111.7
341.6'
99.5
2,089.5 :
315.2
2,404.6
18. Consolidating Financial Inrnrmation (Continued)
Supplemental Condensed Consolidating Balance Sheet
December 31, 2012
(In millions'")
Combined
Guarnntor
Subsidiaries
Pnrenl
Assets
Current Assets
Cash and cash equivalents'
$
Receivables, net
Prepaid expenses and other current assets .......
Intercompany
Goodwill
.....
Other assets^net
Investmentjn jmbsidiaries
Total assets..
. $
Current Liabilities
Accounts payable
.....
Gift card hability . . . ™ _ . . . . . . „ . . . ! _ . . . . . . Z
Long-term debt
Financing obligations.,
Capital lease obligations
™
Other liabilities
Total liabilities
Total stockholders' equity
Total liabilities and stockholders' equity .... S .
r
1
:
9.9
2.8
151.3
(3.2)
(394.9)
(234.1)
—
23.2
—
18.4
1,697.6
1.505.1
15.4
"i.4
9.4
—
(423)
(16.3)
1,202.1
-_
—
- _
5.6
s
s
s "
;
Combined
Non-gmirantor
Subsidinrics
54.0 $
133.7
64.6
24.1
389.0
665.4
212.3
270.2
697.5
806.1
92.3
—
2,743.8 S
— $
29J
13.0
161.7
223.8
427.8
—
52.0
124.4
" 357,6
91.9
1,053.8
1,690.0
2,743.8' $•
r
309.0
1,505.1 S
Kliminations
anil
KechissifiiHtion
0.6 $
0.1
—
(L8
6.0
7.5
—
0.9
—
—
—.
—
8.5 S
s
0.1
—
—
"d.5"
0.6
—
: _
.
(0.2)
0.7
1.1
7.4
8.5 S
Consolidated
— $
(8.0)
(136J)
—
—
(144.3)
_—
—
—
—
(1,697.6)
(1,841.9) S
<*% $"
—
—
(136.3)
(144.3)
7.4
30.8 ,
22.4*
161.7
45.5
267.8 ;
1,202.1
•—
—
^Yiol
124.4
362.2 ,
.
2,106.6:
308.8
2,415.4 1
2
(144.3)
(1,697.6)
(1.841.9). $
Supplemenlal siateinents presented in millions may not'foot/crossfoot due to rounding from Consolidated Statements presented in thousands
98
64.5 "
128.6
79.5
21.8
-—
294.5
212.3
294.4
697.5
806.1
110.7
—
2.415/1
DineEquity, Inc. and Subsidiaries.
Notes to the Consolidated Financial Statements (Ciuitinucd)
18. Consolidating Financial Information (Continued)
Supplemental Condensed Consolidating Statement of Operations
For the Year Ended December 31,2013
(In millions" )
1
Combintd
Guarantor
Sohsidiaries
Parent
$
Rental revenues
Financing revenues
Total revenue
Franchise and restaurant expenses
Rental expenses
Financing expenses
Interest expense
: Loss (gain) on disposition of assets
Other expense
Intercompany dividend
Income before income taxes^.
Benefit (provisionj for income taxes
(1>
2.8
S
__•
—
2.8
2,7
—
:
~~
38.7
98.9
—
—
0.1
—
1.3
(173.6)
34.7
~37.3
$
72.0 $
498.5
124.8
13.1
636.4
"170.5
97.3
0.2
103.6
1.4
1.5
12.3
—
0.8
—
Combined
Non-guarantor
Subsidiaries
S
1.2
—
—
1.2
0.1
—
—
1.3
s
- 7 -
0.3
. ^
:
(1,0)
—
—
0.6
—
0.6 $
-; •
248.9
(75.9)
173.0 $
Eliminations nnd
Reclassifiration
Consolidated
— $
—
—'
—
,—
•—
—
—
—
—
—•'
—
—
—
173.6
(173.6)
—
(173.6) $
Supplemental statements presented in millions may not foot/crossfoot due lo rounding from Consolidated Statements presented in thousands
99
502.6
124.8
13.1 :
640.5
173.3
97.3
0.2 .
143.6
100.3 ;
1.8
12.3 ,
0.1
(0.2)
1.3
•"'—:
110.6
(38.6)!
72.0
DineEquity, Inc. ant! Subsidiaries
For the Year Ended December 31, 2012
(In millions" )
1
Parent
Rental revenues
Financing revenues
Total revenue
Rental expenses
Financing expenses
. Interest expense
(Loss) gain on disposition of assets
Intercompany dividend
Benefit (provision) for income taxes
Net income (loss)
.".
1
$
S
Combined
Guarantor
Subsidiaries
2.6
—"
—_
2.6
2.5
—
—
36.3
106.1
—
—
5.6
1.2
(220.7)
71.6
5*6.0
127.6
Combined
Non-guarHntor
Subsidiaries
708.8
122.9
1.1
Eliminations and
Keclassirication
s
Consolidated
— $
14^_
846.2
356.6
97.2
1.1
0.1
712.5
122.9
14.5
849.9
359.2;
97.2
T6
1.6
163.2
l74.3"
4.2
1.2.31
5.6
(102.6)'
2.0
124.9
8.2
3.5
12.3
!
0.7
(.102.2)
(1.6)
344.1
(123.2)
(0.1)
220.7
220.9
$
(OA) $
(220.7)
(220.7) .S
Supplemental statements presented in millions may not foot/crossfool due lo rounding from Consolidated Statements presented in thousands
100
194.9
(67.2)
127.74
(In millions'")
Combineil
Guarantor
Subsidiaries
Parent
Rental revenues
Financing revenues
Total revenue
Rental expenses
Financing expenses
Interest expense
Amortization o f intangible assets
Gain on disposition o f assets
Other (income) expense
Benefit (provision) for income taxes
Net income.....
$
2:5
^
2.5
2.1
.......
28.3
117.2
924.8
125.8
19.7
1,070.3
560.4
98.1
6.0
125.3
15.5
29.5
12.3
Combined
Non-guarantor
Subsidiaries
$
Eliminations and
Rcclassincation
2.3
0.1
—
Consolidated
$'
2.4
0.9
0.1
2.2
0.4
11.2
150.6)
's
- (5.7)
61.3
55.6 $
(43.3)
21.2
245.3
(90.9)
154.4 $:
(1.7)
0.5
(0.2)
0.3' $
135.1
(I35J)
—
(135.1) $
v
101
929.5
126.0
19.7;
1,075.2
563.4
98.2
6.0
155.8
132/7
29.9
12.3
11.2
(43.3).
4.0
105.0:
(29.8)
75.2
Notes to I lie Consolidated Financial Statements (Continued)
Supplemental Condensed Consolidating Statement of Cash Flows
(In millions'")
Parent
Cash flows provided by (used in) operating
activities
$
Investing cash flows
Principal receipts from long-term receivables.
Proceeds from sale of assets
Other
Cash flows provided by (used in) investing
activities
Financing cash flows
Payment of deM.............
Payment of debt issuance costs
"
Dividends paid on common stock
Restricted cash".""
Other
..^
Intercompany transfers.........
Cash flows provided by (used in) financing
activities
Net change
........T.,
Beginning cash and equivalents
Ending cash and equivalents..
S
Combined
Nonguarantor
Subsidiaries
Combined
Ctiflrantor
Subsidiaries
(i 13.1) $
240.8
$
0.1
Eliminations and
Reclassification
S
Consolidated
— S
127.8.
;
(5.4)
——^
—_
(1.7)
14.0
—
0.1
—
—
—
—
—
—
(7.0)
14.0
—.
0.1
(5.4)
12.4 ^
—
^2.
7.0 :
—
—
—
—
—
—
—
—
'—
(14.8);
(1.3)
(29.7-ji
(57.4)
1.2 [
" 8.6
"—,.
—
"
—
—
(93.3)
4 f5 ;
' 64.5
.106.0'
(4.8)
(1.3)
(29.7)
(57.4)
—'
8.3
243.7
(10.0)
—
—
—
1.2
0.3
(244.1)
:
158.8
~J0A _
9^9
50.3' $
(252.5)
0.7
54.0
54.7 _$
—
—
—
04
0.4
..9d.77~
0^6
f0_ _S
I"
;
$
<nSupplemental statements presented in millions may not foot/crossfoot due to rounding from Consolidated Statements presented in thousands
102
(In millions'")
Parent
activities
$
Additions to property and equipment'
.....
Other
.7.
activities
Revolving credit borrowings
Revolving credit repayments
Payment of debt
•
Purchase of DineEquity commonjstock
i
Restricted cash
Other
„.....7.7...~....
:
Intercompany transfers
Cash flows provided by (used-in) financing
activities
.v.
Net change
Beginning cash and equivalents......
Ending cash and equivalents
$
1
Combined
Nonguarantor
Subsidiaries
Combined
Gun ran tor
Subsidiaries
(130.1) S
182.5
f^):
—
—
—
(12.0)
12.2
168.9
1.2
(4.9)
170.3
50.0
(50.0)
(216.0)
—.
(10.9)
$
0.4
Eliminations and
Re<1 ass ifieation
Coiisolidalcd
$
S
—
—.
—
. —
—-
(17.0)
12.2
168.9
1.2
—
165.4
—
• 7
.
—
11.8
339.2
.
(0.7)
1.4
(339.0)
—
(0.2)
135.0
—
9.9,
9.9 $
(349.2)
3.6
50.4
54.0 $
(0.2)
0.2
0.4
0.6 S
. ^r-r
„ , . , . .
50.0 1
(50.0)
J22&9);
—
.-• _—
~
—
—
:
(0.7)
13.2
—
—
(214.5)'
3.8
' 60.7 i
64.5
S
" Supplemental statements presented in millions may not foot/crossfoot due to roundingfromConsolidated Statements presented in thousands
103
52.9
DineEquity, Inc. anil Subsidiaries
Notes to tlie Consolidated Financial Statements (Continued)
(In millions^)
Parent
$
activities
....
.....
Other
activities
Revolving credit borrowings
;
Revolving credit repayments
Payment of debt
Restricted cash
Other
Intercompany transfers
Cash flows provided by (used in) financing
activities
;
Net change
„.
Beginning cash and equivalents
!
$
Combined
Nonguarantor
Subsidiaries
Combined
Guarantor
Subsidiaries
261.4
(139.4) $
$
Eliminations and
Reclassification
(03)$
ConsolidHttd
— .$
121.7
_
—
—
(19.6)
13.1
1 15.6
(0.7)
—.
—
(263}
13.1
115.6
(0.8)
(6.7)
108.4
—
—
101.7
—*.
—
(13.4)
—
—
0.5
.
(67)
—r-.
40.0
(40.0)
(225.7)
(12.3)
(21^)—
6.2
~ 385.6
. ..
o
9
(384.7)
132.6
(13.5)
23.4
9.9 $
(396.7)
(26.9)
77.3'
50.4 $
—.
—
™ .
—
—
—
—
—
— '
(0.9)
. (0.9)
(1.2)
1.6
0.4 $
;
40.0
(40.0)
(239.1)
(12.3)
(21.2)'
0.5
7.1 (
—,
—
•
—
—
—
—
—
—
—.
_
—
—
—""
— $
104
:
(265.0)'
(41.6)
102.3
60.7
1
EXHIBIT B
STATE ADMINISTRATORS
Exhibit B - State Administrators
1051971.2
STATE ADMINISTRATORS
We have filed Applications for Registration or Applications for Exemption of our
franchise disclosure document or are exempt from registration with the following state
agencies:
CALIFORNIA
Commissioner of Department of Business Oversight
Department of Business Oversight
320 W. 4 Street, Suite 750
Los Angeles, California 90013
(213) 576-7500
th
FLORIDA
Florida Division of Consumer Services
2005 Apalachee Parkway
Tallahassee, FL 32399-6500
Attention: Finance & Accounting
(800) 435-7352
HAWAII
Commissioner of Securities
Dept. of Commerce & Consumer Affairs
335 Merchant Street, Room 203
Honolulu, Hawaii 96813
(808) 586-2722
ILLINOIS
Franchise Bureau
Office of Illinois Attorney General
500 South Second Street
Springfield, Illinois 62706
(217) 782-4465
INDIANA
Indiana Securities Division
Office of Secretary of State
302 W. Washington, Room E - l l l
Indianapolis, Indiana 46204
(317) 232-6681
MARYLAND
Franchise Office
Maryland Division of Securities
200 St. Paul Place
Baltimore, Maryland 21202
(410) 576-7042
SM01 DOCS-#1051971-v2-Exhibit_B_-_State_Administrators. DOCX
1051971.2
MICHIGAN
Franchise Section
Michigan Dept. of Attorney General
525 W. Ottawa Street
P.O. Box 30213
G. Mennen Williams Building, 7 Floor
Lansing, Michigan 48909
(517) 373-7117
th
MINNESOTA
Franchise Registration Division
85 7 Place East, Suite 500
St. Paul, Minnesota 55101
(651)296^6328
lh
NEW YORK
Franchise & Securities Division
Office of the New York Attorney General
120 Broadway, 23 Floor
New York, New York 10271
(212)416-8211
rd
NORTH DAKOTA
Franchise Division
Office ofSecurities Commissioner
600 East Boulevard, 5 Floor
Bismarck, North Dakota 58505
(701) 328-4712
lh
RHODE ISLAND
Department of Business Regulation
Securities Division
John O. Pastore Complex
1511 Pontiac Avenue, Building 69-1
Cranston, Rhode Island 02910
(401)462-9588
SOUTH DAKOTA
Franchise Administration
Division of Securities
445 East Capitol Avenue
Pierre, South Dakota 57501
(605) 773-4823
SM01DOCS-#1051971-v2-Exhibit_B_-_State_Administrators. DOCX
1051971.2
TEXAS
Statutory Documents Section
Office of Texas Secretary of State
1019Bravos Street
Austin, Texas 78701
(512) 475-1769
UTAH
Utah Department of Commerce
Division of Consumer Protection
160 East Three Hundred South
P.O.Box 146704
Salt Lake City, Utah 84145
(801) 530-6601
VIRGINIA
Division of Securities & Retail Franchising
State Corporation Commission
1300 East Main Street, 9 Floor
Richmond, Virginia 23219
(804) 371-9051
lh
WASHINGTON
Department of Financial Institutions
Securities Division
150 Israel Road SW
Tumwater, Washington 98501
(360) 902-8760
WISCONSIN
Dept. of Financial Institutions
Wisconsin Division ofSecurities
345 W. Washington Avenue, 4 Floor
Madison, Wisconsin 53703
(608) 261-9555
th
SM01DOCS-#1051971-v2-Exhibit_B_-_State_Administrators. DOCX
1051971.2
EXHIBIT C
AGENTS FOR SERVICE OF PROCESS
1051972.2
REGISTERED AGENT ADDRESSES
STATE
AGENT NAME
Alaska
Corporation Service Company
9360 Glacier Highway, Suite 202
Juneau, A K 99801
Alabama
CSC-Lawyers Incorporating Service Inc.
150 South Perry Street
Montgomery, A L 36104
Montgomery
Arkansas
300 Spring Blvd., Suite 900
Little Rock, A R 72201
Pulaski
Arizona
2338 W. Royal Palm Road, Ste. J
Phoenix, A Z 85021
Maricopa
California
California Commissioner of Department of Business Oversight
California Department of Business Oversight
320 West 4 Street, Suite 750
Los Angeles, C A 90013-2344
COUNTY
th
Colorado
1560'Broadway, Suite 2090
Denver, CO 80202
Connecticut
50 Weston Street
Hartford, CT 06120-1537
District of Columbia
1090 Vermont Avenue, N.W.
Washington, D.C. 20005
Delaware
2711 Centerville Road, Suite 400
Wilmington, DE 19808
1051972.2
Denver
New Castle
Florida
1201 Hays Street
Tallahassee, FL 32301
Leon
Georgia
40 Technology Parkway South, #300
Norcross, G A 30092
Gwinnett
Hawaii
Dept. of Commerce and Consumer Affairs
Honolulu
Iowa
505 5 Street, Suite 729
Des Moines, 1A 50309
Polk
Idaho
12550 W. Explorer Drive, Suite 100
Boise, ID 83713
Ada
Illinois
Illinois Attorney General
500 South Second Street
Springfield, Illinois 62706
Indiana
Secretary of State
201 State House
200 W. Washington Street
Indianapolis, IN 46204
Kansas
200 SW 30 Street
Topeka, KS 66611
th
Shawnee
th
Kentucky
1051972.2
Franklin
d/b/a CSC-Lawyers Incorporating Service Co.
421 West Main Street
Frankfort, K Y 40601
Louisiana
320 Somerulos Street
Baton Rouge, L A 70802-6129
East Baton Rouge
Massachusetts
84 State Street
Boston, M A 02109
Suffolk
Maryland
Securities Commissioner
200 St. Paul Place, 20 Floor
Baltimore, Maryland 21202
th
Maine
45 Memorial Circle
Augusta, M E 04430
Michigan
Department of Commerce
Corporations and Securities Bureau
Office ofFranchise and Agent Licensing
6546 Mercantile Way, P.O. Box 30222
Lansing, MI 48910
Minnesota
Commissioner of Commerce
85 7 Place East, Suite 500
St. Paul, M N 55101-2198
Kennebec
th
Missouri
CSC-Lawyers Incorporating Service Co.
221 Bolivar Street
Jefferson City, MO 65101
Cole
Mississippi
506 South President Street
Jackson, MS 39201
Hinds
Montana
26 West Sixth Avenue, P.O. Box 1691
Helena, M T 59624-1691
Lewis and Clark
1051972.2
CSC-Lawyers Incorporating Service Co.
233 South 13 Street, Suite 1900
Lincoln, NE 68508
Lancaster
New Hampshire
d/b/a Lawyers Incorporating Service
14 Centre Street
Concord, NH 03301
Merrimack
New Jersey
830 Bear Tavern Road
West Trenton, NJH 08628
Mercer
New Mexico
125 Lincoln Avenue, Suite 233
Santa Fe, NM 87501
Santa Fe
New York
Secretary of State, State of New York
41 State Street
Albany, NY 12231
Nevada
CSC Services of Nevada, Inc.
2215-B Renaissance Drive
Las Vegas, NV 89119
Clark
North Carolina
327 Hillsborough Street
Raleigh, NC 27603
Wake
North Dakota
Securities Commissioner
600 East Boulevard, 5 Floor
Bismarck, ND 58505
Nebraska
th
th
Ohio
CSC-Lawyers Incorporating Service
(Corporation Service Company)
50 West Broad Street, Suite 1800
Columbus, OH 42315
Franklin
Oklahoma
115S.W. 89 Street
Oklahoma City, OK 73139-8511
Oklahoma
th
1051972.2
Oregon
Director, Department of Consumer & Business Services
350 Winter Street N E
Salem, OR 97301-3878
Pennsylvania
2595 Interstate Drive, Suite 103
Harrisburg, PA 17110
Rhode Island
Director, Securities Division
Rhode Island Department of Business Regulation
John O. Pastore Complex
1511 Pontiac Avenue, Building 69-1
Cranston, RI 02910
South Carolina
1703 Laurel Street
Columbia, SC 29201
South Dakota
Director, Division of Securities
Pierre, SD 57501
Tennessee
2908 Poston Avenue
Nashville, TN 37203
Texas
Travis
d/b/a CSC-Lawyers Incorporating Service Co.
211 E. 7 Street, Suite 620
Austin, T X 78701-3218
Dauphin
Richland
Davidson
lh
Utah
2180 South 1300 East, Suite 650
Salt Lake City, UT 84106
Virginia
Clerk of the State Corporation Commission
1300 E. Main Street, First Floor
Richmond, V A 23219
1051972.2
Salt Lake
Vermont
159 State Street
Montpelier, VT 05602
Washington
Director, Department of Financial Institutions
Securities Division
150 Israel Road SW
Tumwater, WA 98501
West Virginia
209 West Washington Street
Charleston, WV 25302
Wisconsin
Commissioner ofSecurities
345 W. Washington Avenue, 4 Floor
Madison, WI 53703
Kanawha
th
Wyoming
1051972.2
1821 Logan Avenue
Cheyenne, WY 82001
Laramie
EXHIBIT D
APPLICANT'S FEE LETTER AGREEMENT
Exhibit D - Applicant Fee Letter Agreement
1051973.2
STANDARD FORM APPLICANT'S FEE LETTER AGREEMENT
[Applebee's Franchisor LLC Letterhead]
Dear
This will acknowledge receipt by Applebee's Franchisor LLC (the "Company") of the amount of
$15,000 (the "Fee"), from
("Applicant"), in connection with the Applicant's
request to enter into a Development Agreement with the Company pursuant to which Applicant
would develop a specified minimum number of Applebee's Neighborhood Grill & Bar restaurants.
Applicant specifically acknowledges that acceptance of the Fee by the Company does not
constitute an offer for a franchise or any commitment or obligation by the Company to the
Applicant. No offer, commitment, undertaking, estoppel or obligation of any nature whatsoever
shall be implied in fact, law or equity unless and until the Development Agreement providing for
the transaction has been executed and delivered by all parties thereto. Notwithstanding the
acceptance of the Fee, neither party (and no person or entity related to any such party) will be
under any legal obligation to the other party other than as described in this Letter Agreement.
The Company will use the Fee to defray in part the expenses incurred by the Company in
reviewing and processing Applicant's request to become a developer of Applebee's
Neighborhood Grill & Bar restaurants. Applicant specifically acknowledges that the Fee is not
refundable under any circumstances.
Please return the countersigned original of this letter to the Company to indicate your agreement
with the terms of this letter.
Sincerely,
APPLEBEE'S FRANCHISOR LLC
By:
Agreed to this
day of
[Applicant]
By:
Exhibit D - Applicant's Fee Letter Agreement
1051973.2
, 20
.
EXHIBIT E
DEVELOPMENT AGREEMENT
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1051974.2
2014
EXHIBIT E
S T A N D A R D FORM
A P P L E B E E ' S NEIGHBORHOOD GRILL & B A R
(Name of Developer)
(Date)
(General Description of Territory)
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1051974.2
2014
SUMMARY PAGES
1.
Addresses for Notices:
Franchisor:
8140 Ward Parkway
Attn: President
Telephone Number: (913) 890-0100
Fax Number: (913) 890-9100
Developer:
Attn.:
Telephone Number:
Fax Number:
, 20.
2.
Delivery Date of Franchise Disclosure Document:
3.
Development Deposit: $10,000 per Restaurant listed on the
Schedule
4.
Development Schedule:
Development Period
Number
Date of Opening
Development
Total Number of Stores That Must
Be Open and in Operation at the
End of the Development Period
1
1
2
2
3
3
.20
5.
Effective Date:
6.
Expiration Date:
7.
Governing Law and Jurisdiction: State of Kansas and Federal Courts of the State
of Kansas (Johnson County)
8.
Initial Franchise Fee: $35,000 for each Restaurant to be developed
9.
Ownership Interests in Developer are owned by:
,20
Name
1.
2.
3.
Percentage
_
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1051974.2
2014
4.
5.
10.
Principal Shareholders):,
11.
Territory: The geographic area within which the Developer is to develop the
Restaurant required by the initial Development Schedule set forth above:
12.
Transfer Fee: $2,500 for this Agreement
The Summary Pages are provided for information purposes only and to the extent the
Summary Pages conflict with the terms of the Development Agreement, the terms of the
Development Agreement will control.
2014
1051974.2
TABLE OF CONTENTS
RECITALS
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1.
2.
3.
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4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
GRANT OF DEVELOPMENT RIGHTS
INITIAL DEVELOPMENT SCHEDULE
SUBSEQUENT DEVELOPMENT SCHEDULE;
DEVELOPMENT OBLIGATIONS GENERALLY
FRANCHISE FEE AND ROYALTY RATE
SITE APPROVALS: PLANS AND SPECIFICATIONS
FEES AND FRANCHISE AGREEMENTS
DEVELOPER ORGANIZATION, AUTHORITY,
FINANCIAL CONDITION AND SHAREHOLDERS
TRANSFER
TERMINATION
PREREQUISITES TO OBTAINING FRANCHISES
FOR INDIVIDUAL RESTAURANT UNITS
RESTRICTIONS
DEVELOPMENT PROCEDURES
NO WAIVER OF DEFAULT.....
FORCE MAJEURE
CONSTRUCTION, SEVERABILITY, GOVERNING
LAW AND JURISDICTION
MISCELLANEOUS
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E-18
E-19
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E-22
E-26
E-27
E-29
E-30
E-32
E-32
E-33
E-34
APPENDIX A:
TERRITORY
E-37
APPENDIX B:
FORM OF FRANCHISE AGREEMENT
E-38
APPENDIX C:
FORM OF FRANCHISE LEASE RIDER
E-39
APPENDIX D:
STATEMENT OF OWNERSHIP INTERESTS
E-42
APPENDIX E:
REVIEW AND CONSENT WITH RESPECT
TO TRANSFERS
E-43
CONFIDENTIALITY AGREEMENT AND
COVENANT NOT TO COMPETE
E-44
CONFIDENTIALITY AGREEMENT.
E-47
APPENDIX F:
APPENDIX G:
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1051974.2
2014
This Agreement is made this
day of
, 20_
by and between Applebee's Franchisor LLC, a Delaware limited liability company
("Franchisor),
,a
(
corporation, sole proprietorship,
partnership,
limited partnership [strike inappropriate
language]) ("Developer") and
(collectively, the "Principal Shareholders" and, individually, a "Principal Shareholder" of
Developer if a corporation or general partner of Developer is a limited partnership
having
as
its
general
partner
a
corporation)
and
("General
Partner")
of
Developer if Developer is a limited partnership).*
* (If Developer is not a corporation or a sole proprietorship, or if Developer is a
limited liability company, the parties hereto hereby agree that an Addendum shall be
attached to this Agreement so as properly to reflect the responsibilities of the partners of
any general partnership, the general partner of any limited partnership and the
shareholders of any corporate general partner of any partnership, or the members of
any limited liability company.)
WITNESSETH:
RECITALS
A.
Franchisor owns the rights to develop and operate a unique system of
restaurants which specialize in the sale of high quality, moderately priced food and
alcoholic beverages in an attractive, casual setting. Franchisor owns the service'mark
Applebee's Neighborhood Grill & Bar and variations of such mark, and other service
marks and trademarks which may be adopted for use in the future (the "Marks"),
designs, decor and color schemes for restaurant premises, signs, equipment,
procedures and formulae for preparing food and beverage products, specifications for
certain food and beverage products, inventory methods, operating methods, financial
control concepts, training facilities and teaching techniques ("the System"). Franchisor
has the right to use the Marks and the System, with the further right to offer franchises
for the use of the Marks and the System.
B.
Franchisor established, through its own development and operation, and
through the granting of franchises to develop and operate, a chain of Applebee's
Neighborhood Grill & Bar restaurants which are distinctive; which are similar in
appearance, design and decor; and which are uniform in operation and product
consistency.
C.
The value of the Marks used in the System is based upon: (1) the
maintenance of uniform high quality standards in connection with the preparation and
sale of Franchisor-approved food and beverage products, (2) the uniform high
standards of appearance of the individual restaurant units in the System, (3) the use of
distinctive trademarks, service marks, building designs and advertising signs
representing a uniformly high quality of product and services, and (4) the assumption by
Franchisor and its franchisees of the obligation to maintain and enhance the goodwill
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1051974.2
2014
andpobâcoeptanoeofêS^
sôda^sreqêdbyFraoohisor
0
Oeveloper desires to obtain the right to develop restaurant units
franohised by Franobisor within thegeographioarea speoified in Appendix^ hereto
("Territory^, for the period specified in SubseotionIBi,pursuant to the t^^
and provisions whioh are set forth in this Agreement
N O ^ T H E R E F O R E , inoonsiderationof Franchisor granting toOeveioper the
right to develop restaurant units franohised by Franchisor whioh employ the
System r e s t a u r a n t s " ) in theTerritory for suohperiod, and inoonsiderationofthe
mutual obligations whioh are provided for herein, it is hereby agreed as follows:
1
GRANT OF O E V E L O P M E N T RIGHTS
1BI
Franchisor grants Developer the right to develop Restaurants only in the
Territory foraperiodoommenoing on the date hereof and expiring on
,
20 , unless sooner terminated as hereinafter provided Developer has no rights under
thisAgreementtodevelop Restaurants outside of theTerritory or to develop restaurants
whioh d o n o t employ the System, inoludingtheApplebee'sNeighborhoodGrill^Bar
servicemark
12
During the term of this Agreement, Franchisor shall not operate a
restaurant utilizing the System or lioenseany other person to operate a restaurant
utilizing the System in theTerritory However, nothing in this Agreement shall prohibit
or infringe upon Franohisor's right to operatearestaurant or license any other person to
operate a restaurant in theTerritory which does not utilize the System or use the
Applebee's Neighborhood G r i l l ^ B a r service mark In addition,Franchisor specifically
reserves the right to operate or license any other person to operate restaurants in any
location within an airport (serviced by one or more public orcharter carrier), train
station, bus terminal, port authority, campus at any college, university or other post
secondary education institution, hospitals and other health care facilities, arena,
stadium, state or national park, or military fort, post or base, travel plaza or casino which
may be within the boundaries oftheTerritory otherwise granted to Developer Further,
Developer acknowledges and agrees that F r a n c h i s o r o r a n y one(1) or more of its
subsidiary or affiliated companies or divisions shall have the right to operate or license
any other person to operate such other restaurants which may or will compete with the
Restaurants, u n d e r a s y s t e m a n d s e r v i c e m a r k o t h e r t h a n Applebee'sNeighborhood
Grill^Bar
13
After this Agreement expires or is terminated, Franchisor shall have the
complete and unrestricted right to operate or license other persons to operate a
restaurantutilizingtheSystem in theTerritory
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^9742
2014
2
I N ^ A L OEVELOPMENT
21
Oeveloper
develop a total of
(
) Restaurants
franohised by Franchisor In theTerritory during the perlodoomrnenolngonthe date
hereof and expiring on
^ 20
, In accordance with thefollowlng
development schedule:
(a^
OurlngtheflrstlnltlalOevelopment Period under this Agreement,
Developer shall develop at least
(
) Restaurants within the
Territory, each of which shall he open foroperatlon and doing business on
,
(the end of the first Initial Oevelopment Period
under this Agreement)
(b)
During the second Initial Development Period under this
Agreement, Developer shall develop the number of Restaurants within the
Territory necessary to result In the existence of
(
) such
Restaurants developed by Developer which are open foroperatlon and doing
business on
,
(the end of the second Initial
Development Period under this Agreement)
(c)
During the third Initial Development Period under this Agreement,
Developer shall develop the number of Restaurants within the Territory
necessary to result in the existence of
(
) such Restaurants
developed by Developer whichare open for operationanddoingbusiness on
,
(the end of the third Initial Development Period
under this Agreement).
Each o f t h e periods specified in Subparagraphs (a) through (
sometimes referred to hereinafter as an "Initial Development Period "
) hereof is
22
Duringany Initial Development Period, subject tothe provisions of this
Agreement, Developer is free to develop more than the total minimum number of
Restaurants which Developer is required todevelopduring that Initial Development
Period. Any such Restaurants developed, open for operation and doing business
during an Initial Development Period in excess of the minimum number required to be
developed during that Initial Development Period shall be applied to satisfy Developer's
development obligation during the next succeeding Initial Development Period or next
succeedingSubsequentDevelopmentPeriod(asdefinedinSection3hereof),ifany,as
the case may be Notwithstanding the above, Developer shall not develop more than
the total number Restaurants approved by Franchisor for development under this
Agreement.
23
Strict compliance with the development schedule specified in
Subsection2BI hereof is of the essence of this Agreement If Developer fails to fulfill its
specified development obligation with respect to any of the Initial Development Periods
specified in Subsection2BI hereof, this Agreement shall terminate sixty (60) days after
1
The periods specified in Subsection 2.1(a)-(c) may be revised, deleted or added to in order to reflect the
number of Restaurants Developer is obligated to develop and the time in which the Developer is obligated
to open such Restaurants.
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1051974.2
the end o f t h e Initial Oevelopment Period in question, unless hy the end of suoh
sixty (60) day period Oeveioper has fulfilled the development obligation re^^
Initial Oevelopment Period
3
S 0 8 S 5 0 0 5 N T 0 E V E L O P M 5 N T S O H E 0 0 ^ OEVELOPMENT
OBLIGATIONS O E N E P A L L V
3BI
Ouring the period oommenoing on
, 20^
, and
expiring on
, 20
, Oeveloper shall develop and open for
business in the Territory, in accordance with the parameters established under
S u b s e c t i o n s , t h a t number of additional Restaurants as is reguired to achieve at the
end ofsuch period,atotalnumberofRestaurants open for business within theTerritory
which, after including the Restaurants developed during the Initial Oevelopment
Periods, will equal the Minimum Oevelopment Potential oftheTerritory (asdefined
herein below)
32
(a)
Each consecutive period of two (2) or more years, commencing
with the period beginning on
,20
, is hereafter referred to a s a
"Subsequent Oevelopment PeriodB
(b)
On or before the commencement of each Subsequent
Oevelopment Period, Franchisor shallprovideto Oeveloper in writing thenumber of
Restaurants to be developed by Oeveloper during such Subsequent Oevelopment
Period ("Subsequent Oevelopment Schedule"),together withadetailed summary of the
Minimum Oevelopment Potential calculations used to determine the Subsequent
Oevelopment Schedule. The minimum development potential ("Minimum Oevelopment
Potential") shall be determined as follows:
(i)
Each A r e a o f Dominant Influence ("AOI"), as determined
bythe1986Arbitron Ratings,comprising all oraportion of theTerritory shall be
placed intoone(1)offour(4) market categories ("Market Oategories"),identified
as e i t h e r a " S m a l l M a r k e t " , d e f i n e d a s t h o s e A O l B s containing less than one
hundred thirty five thousand (135,000) households in metropolitan counties
within the Territory with incomes greater than twenty five thousand dollars
($25,000) ("Income Qualified Metr^
those A O IBs containing one hundred thirty five thousand (135,000) to three
hundred ninety nine thousand nine hundred ninety nine (399,999) Income
Qualified Metro Households; a "Large Market", defined as those A O IBs
containing four hundred thousand (400,000) to one million three hundred ninety
nine thousand nine hundred ninety nine (1,399,999) Income Qualified Metro
Households; o r a " M e g a Market",defined as t h o s e A O I B s containing one million
four hundred thousand (1,400,000) or more Income Qualified Metro Households
(Small Market, Medium Market, Large Market or Mega Market may also be
referred to herein individually as an " A O I Market" orcollectively as " A O I
Markets" The income levelset forth above may, but need not, beadûsted
upward or downward by Franchisor once every five (5) years in order to reflect
changes in household income, such adjustments to be determined by reference
to the Llnited States Census Bureau's Median Household Income Index or if such
index no longer exists at the time it is to be used, then the index employed shall
E^
105^2
20t4
be such other generally known index used by NPD Crest or other such similar
company then used by Franchisor.
(ii)
Each county within an A.D.I. Market shall be classified as a
"Metropolitan County", those counties with a total population greater than fifty
thousand (50,000); a "Small Town County", those counties with a total population
of twenty thousand (20,000) to fifty thousand (50,000); or an "Other County",
those counties with a total population less than twenty thousand (20,000)
(Metropolitan County, Small Town County and Other County may be for
description purposes also referred to herein as a "County Type").
Each A.D.I. Market shall at that time be assigned to one of
four development groups according to the level of development penetration
which Developer has achieved in the A.D.I. Market as compared to the level of
development penetration achieved by all domestic development in the System.
The four development groups will be determined by ranking each A.D.I, in the
System within each of the Market Categories from most developed to least
developed. The A.D.I.'s in ranking order from most developed to least developed
shall then be divided into four substantially equal development groups:
"Opportunistic Group", "Second Group", "Third Group" and "Lower Limit Group".
The average number of Restaurants per Income Qualified Metro Household
developed by the top three territories in the System of the Second Group in each
A.D.I. Market category shall be the development target for each such A.D.I.
Market category ("Penetration Target").
(iv)
The total number of Restaurants to be developed by
Developer in each Metropolitan County of an A.D.I. Market shall be equal to the
number of Income Qualified Metro Households in such A.D.I. Market divided by
the Penetration Target ("Metropolitan Development Potential"). The Metropolitan
Development Potential minus the number of Restaurants in each Metropolitan
County then open and operating in said A.D.I. Market shall be the number of
Restaurants in each Metropolitan County then available for development in the
A.D.I. Market ("Metropolitan Development Balance").
(v)
The Minimum Development Potential shall be the maximum
number of Restaurants Franchisor may include on the Subsequent Development
Schedule and thus require Developer to develop in the A.D.I. Market during the
next Subsequent Development Period; subject, however, to the minimum and
maximum development criteria outlined in paragraph (c) and (d) of this
Subsection 3.2. In the event, however, a particular A.D.I. Market is in the
Opportunistic Group, Developer and Franchisor shall negotiate in good faith a
mutually agreeable Subsequent Development Schedule; provided, however, said
Subsequent Development Schedule shall not reflect a number of Restaurants
less than the remaining undeveloped portion of the Metropolitan Development
Potential, nor shall the Developer be required (without its consent) to develop
more than the remaining undeveloped portion of the Metropolitan Development
Potential.
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1051974.2
2014
(o)
Ouriog each Subsequent
lesstbaoteo (10) Restaurants open and operating i o t b e T e r ^
required to develop no more tban one (1) Restauranteaob calendar year tbattbe
numberofRestaurants in Oeveloper'sTerritorydoesnotmeetorexoeedtbe Minimum
Oevelopment Potential oftheTerritory
Ouringeaob Subsequent Oevelopment Period
that Oeveloper has ten(10) or moreRestaurants in theTerritory, Oeveloper shall be
required todevelop no more than two (2) Restaurantseaoh calendar year that the
number of Restaurants in the Territory does not meet or exceed the Minimum
Oevelopment Potential for theTerritory
(d) Notwithstanding the Minimum Oevelopment Potential for which
Oevelopermightotherwisebeobligated in order to satisfy the PenetrationTarget for the
Territory, Oeveloper shall not be required to develop more than ten (10) Restaurants in
any one calendar year in theTerritory. In the event Oeveloper holds other development
agreements with the System or the Principal Shareholders of Oeveloper are the
identical Principal Shareholders of other entities who hold other development
agreement(s) within the System (such other entities being defined hereunder as
"Affiliates"), Oeveloper, together with such Affiliates, may limit its combined
development under all such development agreements to no more than ten (10)
Restaurants in the aggregate in any calendar year. Provided, however, Oeveloper and
Principal Shareholder(s) hereby acknowledge that if Oeveloper exercises its option
under this provision to limit itscombined development with its Affiliates and after so
limited itsdevelopment, Oeveloper (together with its Affiliate) does notachieve such
aggregate development, Oeveloper shall be in default under that development
agreement (or all such development agreements as the case may be) but only such
development agreement(s) which did not meet the individual Subsequent Oevelopment
Schedule calculated and agreed to for that individual development agreement
(e)
If the Oeveloper has timely developed and opened for operation the
Restaurant called for by the Initial Oevelopment Schedule and thereafter during a
Subsequent Oevelopment Period objects t o t h e d e v e l o p m e n t o f the last Restaurant
required during that Subsequent Oevelopment Period under Article 3 hereof, then
Pranchisorherebygrants Oeveloper the right to makeawritten demand forastudy as
to whether said last Restaurant may be located in the Territory or whether said
Restaurant will at that time cannibalize thesales and traffic with respect to its other
existing Restaurants in theTerritory In the eventawritten request for suchastudy is
received by Franchisor priorto the end o f t h e Subsequent Oevelopment Period in
question and prior to any default under the Oevelopment Agreement, then in such an
event, Franchisor and Oeveloper shall in good faith attempt to resolve the issue
regarding whether the last Restaurant should or should not be developed and opened If
an agreement cannot be reached (which process may include the Franchisor and
Oeveloper o r d e r i n g a P I N study at Developer's cost), Franchisor and Oeveloper shall
submit the disagreement to the National Franchise Mediation Board ("NFMB"), as
herein defined below, for handling and disposition The submission of said
disagreementwillbeinaccordancewithsubsection32(f)(i) hereof
(f)
The following shall apply to the submission to the NFMB pursuant
to the preceding paragraph:
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^9742
2014
(i)
The disagreement
be submiêdby the Oeveloper by
w a y o f a w r l t t e n demand for mediation tendered to Franchisor
days after Franchisor has Indicated to Oeveloper than an agreement cannot be
reached
Oeveloper will deposit thirty five thousand dollars ($3^000) with
Franchisor at the t l m e o f t h e f l l l n g of Its written demandfor mediation. Ifthe
demand or the deposit or either or both of them are not so timely made, then In
such an event, the Oeveloper shall be deemed to have waived Its right to request
mediation and furthe4shall be deemed to have elected to accept the full number
of Restaurants Franchisor had determined for the Subsequent Oevelopment
Period then In question. The NFMB will determine In Its sole discretion the
procedure, tlmellmltsandaddltlonalflllng and responses required with respect to
the mediation
However, It Is understood and agreed by all parties that the
mediation Is Intended to provide a more expeditious resolution o f t h e matter
submitted to the NFM8 The mediation decision to be rendered by the NFM8 will
be blndlngupon all partlesto the mediation The party for whomafavorable
decision Is rendered shall receive from the other party reimbursement for all out
ofpocket costs and expenses, Including attorneys' f e e s l n c u r r e d a n d a n y FIN
study conducted with respect to the mediation, which are determined to be
reasonable by the NFM8
(II)
At the conclusion of the mediation, the NFMB shall Issue Its
decision either supporting Oeveloper and Indicating that the last Restaurant need
not be developed a s a p a r t of the Subsequent Oevelopment Period In question,
or conversely, supporting Franchisor and Indicating that the last Restaurant
should b e a p a r t of the development for that Subsequent Oevelopment Period If
the declslonof the NFMB supports t h e O e v e l o p e r , t h e n l n s u c h a n e v e n t , t h e
Oeveloper shall maintain Its rights to theTerrltory,and shall continue to maintain
Itsrlghttodevelopthereln In thefuture Provided, however, Franchisor may
request further development during future Subsequent Oevelopment Periods In
addition, Franchisor shall reimburse Oeveloper thethlrtyflvethousanddollars
($35,000) previously deposited at the commencement of the mediation process
(III)
If the decision of the NFMB supports the Franchisor, then In
s u c h a n e v e n t , t h e Oeveloper shall be required to construct and open the last
Restaurant, pursuant to the development schedule originally listed a s a p a r t of
the Subsequent Oevelopment Period so In question
In addition, the funds
previously deposited by Oeveloper with Franchisor shall be applied to the
Franchise Fee due for such Restaurant However,ln the event Oeveloper falls to
develop the Restaurant, the thirty five thousand dollars ($35,000) shall be
forfeited and shall become the exclusive property of Franchisor and further, the
development rights granted by the Oevelopment Agreement shall terminate and
be of no further force and effect
(Iv)
If, afteranewdeveloperhas been appointed to open the last
Restaurant, and said Restaurant has opened for operation, and within the first
twelve (12) months of operation of said Restaurant, Oeveloper believes that said
new developer's Restaurant has hadaslgnlflcantcannlballzatlon effect upon one
or more of Developer's Restaurants, then In such an event, the Oeveloper may
avail Itself of the following post Impact process ('Post Impact Process") The
2014
^9742
Post Impact Process w ^ consist of the submission o f t h e positions of the
Oevelope4 new developer and Franchisor to the NPMB for study and mediation
The Post impact Process is and shall be from time to time more fuiiy outlined in
the Manuals The NPMB shall have the right to issueanonbinding determination
as to whether or not the Developer's Restaurant or Restaurants (as the case may
be) were, in fact, significantly cannibalized as contended by Developer and if so
determined,arecommendation on whether any and what type of royalty relief or
other relief, if any,shall be granted Developer The parties agree to exhaust the
foregoing remedies and s e e k t h e mediation provided by the NPMB priorto
submitting the matter to any judicial tribunal
33
Strict compliance with the development schedule established in
accordance with Subsection32 hereof is of the essence of this Agreement
If
Developer shall fail tofulfill itsspecified developmentobligationwith respect t o a n y
Subsequent Development Period, this Agreement shall automatically terminate
sixty (60) days after the end ofthe Subsequent Development Period in question,unless
by the end of such sixty (60) day period Developer has fulfilled the development
obligation relating to such Subsequent Development Period
34
If, during the term of this Agreement, (a) Developer transfers or disposes
of any Restaurant developed hereunder in accordance with the provisions hereof, or for
any other reason ceases to operate any Restaurant developed hereunder,and(b)after
such transfer or other cessation of operation the premises no longer are utilized for the
operation of a Restaurant, Developer's development obligation in the Initial or
Subsequent Development Period in which such transfer or other cessation of operations
occurred shall increase by the number of Restaurants which Developer so transferred,
disposed oforwhich otherwise ceased to operate
35
Notwithstanding the foregoing Subsection 3 2 and in addition thereto,
Franchisor shall further dividethosecountiesidentified as SmallTownOounties and
Other Counties ("STO") and provide for the development of such counties
(a)
Franchisor shall request Developer to commit to develop and open
for operation pursuant to a pre determined development schedule the number of
Restaurants utilizingaSmallTown Restaurant prototype ("STO Restaurant") and in the
specified counties set forth on the written request tendered to Developer by Franchisor
(the "STO Notice")
The STO Notice provided Developer will further reflect the
proposed development schedule for all such STO Restaurants Within thirty (30) days
of Developer's receipt of such STO Notice, Developer shall indicate in writing whether it
desires to develop an STO Restaurant in all or a portion o f t h e counties listed
Thereafter, the development schedule suggested in the STO Notice will be adjusted by
the Franchisor, using the same pace of development as set forth in Subsection32(c)
andSubsection32(d) With respect to this process,the Franchisor and Developer will
review the development feasibility of each county listed in the STO Notice, giving
appropriate consideration to such factors as liquor license availability, proximity to
existing Restaurants, the presence or absence of competitive concepts and other such
matters as Franchisor deems appropriate Any counties removed from the purview of
the STO Notice by such negotiations will be returned to the pool of unused counties for
2014
^ 9 ^ 2
p o s s i b ^ ^ o r e development At or before the ooooloslon ofthe thirty (30)dayootloe
period, ^riless otherwise extended lowrltlri^ Oeveloper
(I)
Signify Its agreement to develop loaooordanoe with the STO
Notloe In all of the listed ooontles and In aooordanoe with the proposed
development sohedole Included with the revised STO N o t l o e a n d a s a result,
Developer's right to developRestaorants In theTerritory as previously granted
remains onaffeoted;
(II)
Signify Its agreement todevelop an STO Restaurant In a
portion of the STONotloe listed oo^ntles, and In sooh an event, Oeveloper shall
no longer have the right to develop Restaurants In the counties In whloh It ohose
not to develop the STO Restaurant and will he sohjeot to the terms set forth In
sohparagraph(o) below; or
(III)
Reject the development of an STO Restaurant In all of the
STO Notice listed counties, and In sooh an event, Oeveloper shall no longer have
the right to develop Restaurants In the coontles listed In the final STO Notice and
will be subject to the terms of subparagraph (c) below; or
(Iv)
Seek mediation of the Inclusion of one or more of the
counties In the STO Notice with the National Franchise Mediation Board In
accordance with S^bsectlon36(b); or
(v)
Fall to respond In writing to the STO Notice, In which event
the Oeveloperwlll no longer have the right to develop Restaurants In the coontles
set forth In the STO Notice and will be subject to the terms of subparagraph (c)
below
(b)
In the event the Oeveloper contests the STO Notice as referenced
In s^bsectlon36(a)(lv) above,soch disagreement shall be submitted for mediation to
the National Franchise Mediation Board, which shall be comprised oftwo (2) Individuals
appointed by Franchisor, two (2) Individuals appointed by the Franchise Business
Ootincll and one (1) Individual chosen by the foregoing fotir (4) Individuals, In
accordance with the following;
(I)
Oeveloper will deposit with Franchisor at the time of the filing
of Its written demand for mediation an amoont egoal to thirtyfive thousand
dollars ($35,000) times the number of counties aboot which Oeveloper Is
contesting development Notwithstanding the foregoing, Inno event shallless
than thirty five thousand dollars ($35,000) be so deposited If the deposit Is not
so timely made, then In st^ch an event, the Oeveloper shall be deemed to have
waived Its right to r e v e s t mediation and farther, deemed to have elected
alternative (v) as set forth In sobparagraph35(a)
(II)
The NFMB will determine In Its sole discretion the procedure;
time limits and additional filing and responses required with respect to the
mediation Flowever,lt Is understood and agreed by all parties that the mediation
F^
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is t e n d e d to p r o v i d e a m o r e ^
theNFMB
(i^
The mediation decision to bo r o n d e l by the N F M B ^
binding ^pon aii parties to the mediation
^
Theparty for whomafavorabie decision is rendered shaii
receive from the other party reimbursement for aii ot^t of pocket costs and
expenses, incioding attorneys'fees, incurred with respect to the mediation which
are determined to be reasonable by the
(v)
At the c o n c i s i o n of the mediation, the NFMBshaiiisstê its
decision either supporting Oeveloper and indicating that the coonty(ies) to which
the Oeveloper objected shall be removed from the STO Notice and returned to
the pool of t ^ s e d coonty(ies), or conversely, supporting Franchisor and
Indicating that the coonty(ies)abo^t which an objection was raised should be so
included in the STO Notice and therefore an STO Restaurant should be
developed therein
(vi)
If the decision of the NFM8 supports the Oeveloper, then in
st^ch an event, the Oeveloper shall maintain Its right to the cotmty(ies) in
question, and shall continue to maintain its right to develop therein in the fotore
In addition, the amoont deposited by Oeveloper shall be refunded to Oeveloper
(vii)
If the decision of the NFMB supports the Franchisor, then in
soch an event, the Oeveloper shall be regoired to construct the STO Restaurant
inthecoonty(ies)ingoestion, p^rstiant to the development schedule originally
listed in the STO Notice T h e f ^ n d s previously deposited by Oeveloper with
Franchisor shall be applied to the Franchise Fee doe for each of said ^nits at the
rate of thirty five thousand dollars ($35,000) per each onit
In the event
Oeveloper fails to develop some or all of the STO Restaurants in the coonty(ies)
here in goestion, any onosed deposit shall be forfeited and farther, the
Developer's rights to the coonty(ies) in which no development occurred shall be
terminated and notsobject t o a n y first rightof refusal rights, notwithstanding
anything herein to the contrary
(c)
Exceptasotherwiseprovided in subparagraph36(b) hereof, in the
event that the Oeveloper, after receiving its STO Notice, falls within the porviewof
sobsections36(a)(ii), (iii),or (v) above,the counties for which the Develop
the right to develop an STO Restaurant, Franchisor may in its discretion seek another
franchisee to develop the rejected counties or develop STO Restaurants in those
counties on its own Opon the identification o f a ^ o ^ a ^ e prospective franchisee for
those counties or ^pon the determination by Franchisor that it will develop those
counties, Franchisor shall provideDeveloperwithawritten first right of refusal n o ^
("FROR Notice"),whichFROR Notice will set forth the counties in question and the
schedule of development Developer shall have thirty (30) days within which to respond
to s o c h F R O R Notice in writing Soch response shall be solely to accept or reject in
whole its right of refusal No partial acceptances will be honored by the Franchisor In
the event the Developer f a i l s t o r e s p o n d o r responds and indicates its desirenot to
2014
^9742
develop the o o ^ e s ^ e ^ t h e n Developed right to develop s o o h o o ^ t l e s shall oo
longer be valid aodexoloslvlty rights previously granted In the Oevelopment
as to those ooontles shall he of no farther effeot, and In sooh an event the Franchisor
maygrantathlrdpartyprospeotlvefranohlseethe right to develop STO Restaurants In
thoseooontlesordevelop STO Restaurants Itself, without regard t o t h e Oeveloper
Conversely, If the Oeveloper responds to the FROR Notice In writing and Indicates Its
desire to build the STO Restaurants listed In compliance with the schedule set forth, and
at the same time tendersanonrefundable deposit In the amount of thirty five thousand
dollars ($35,000) for each of the Restaurants to be developed In the counties listed In
the FROR Notice, the Oeveloper shall have the right to develop said STO Restaurants
and shall further retain the right to develop Restaurants In the counties so listed
(d)
As to the other counties unallocated under the foregoing process
set forth In subsection (c) above, Franchisor may Issue future notices regarding
developmentof t h e s a m e STO Restaurantsforuse In s o m e o r a l l ofthecountles
Further, Franchisor may create other new smalltown prototypes using the System
developed for theRestaurants,which extend the brandname but which wouldmore
likely be adaptable to the demographics shown for some or all of the other counties
which have not been Identified for development under the preceding sentence or under
subparagraph (b) above
As each such release (which may be In one or more
Increments) Is developed by the Franchisor, the same procedures set forth In
subparagraphs (a)and(b)above shall apply
(e)
The development and o p e n l n g o f a n STO Restaurant I n a listed
county will not apply to or substitute for the development reguired under Sectlon^BI
hereof However, In the event Oeveloper falls to develop and open theRestaurants
called for under Section 3 6(a) hereof pursuant to the schedule established by
Franchisor, such default In development shall only affect the Oeveloper's right to open
and operate In the counties so listed If Oeveloper falls to open one or more of the STO
Restaurants In the total aggregate time period set forth In the schedule, then In such an
event, Oeveloper shall lose Its rights to develop any STO Restaurants In the counties
listed In the STO Notice or the FROR Notice (as the case may be) wherein no
Restaurant Is In operation andfurther, the exclusivity provided by thlsOevelopment
Agreement shall be of no further force or effect with respect to those counties listed In
said Notice (but only as to said affected counties) and Franchisor may grant
development rights toathlrd party or develop said counties Itself It Is understood that
the60dayperlod provided for In S e c t l o n 2 3 o f the Oevelopment Agreement shall apply
to all of the Restaurants to be developed under this paragraph
4
FRANCHISE FFEANO ROYALTY RATE
4BI
Oeveloper shall pay Franchisor a franchlsefee of thirty five thousand
dollars ($35,000) with respect to each Restaurant which Is developed pursuant to this
Agreementdurlng the Initial Oevelopment Periods Thereafter, Oeveloper shall pay
Franchlsorafranchlse fee In an amount whlchlsegual to the amount of the franchise
fee then In effect at the time o f t h e Issuance of thefranchlseagreementforeach
additional restaurant to be opened during any Subsequent Oevelopment Period The
amountof t h e f r a n c h l s e f e e s h a l l b e s e t forth In thefranchlsedlsclosuredocument
received by the Oeveloper from Franchisor Immediately preceding the Issuance of such
Et6
10^9742
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ânchise agreement Simoltaneoo^y with the e x e o ^
shaii pay to Franchisor, hy certified oheok, wire transfers
amount o f $
("Franchise Fee Deposits Said Franchise Fee Deposit shaii
b e e g u a i to$10,000 f o r e a c h o f t h e Restaurants to hedeveiopedduring the initial
Oevelopment Periods The remaining balance of thefranchise fees for e a c h o f the
Restaurants to he developed during theinitial Oevelopment Periods shall be paid by
certified check, wire transfer or electronic funds transfer as follows: o n e h a l f ( 1 ^ of the
balanceshallbe paid upon signingafranchise agreement for that Restaurant and the
remaining balance shall be paid fourteen (14) days priorto the scheduled opening ofthe
Restaurant
The Franchise Fee Deposit shall be proportionately allocated to the
franchise fee due with respect to each Restaurant to which it applies, provided
Developer timely opens such Restaurant The franchlsefee with respect to each
Restaurant to be developed duringaSubseguent Oevelopment Period or with respect
to any additional Restaurants developed during the Initial Development Periods shall be
paid by certified check,wire transfer or electronic funds transfer In the same manner
The Franchise Fee Deposit is nonrefundable and any amountthat has not been
applied towardafranchise fee will be forfeited
42
Developer shall have no right to recover from Franchisor, directly or
indirectly, any o f t h e franchise fees which are prepaid pursuant to Subsection41
hereof
43
As partial consideration for the rights granted to Developer pursuant to the
franchise agreements covering the Restaurants which Developer develops hereunder,
Developer (as franchisee undereach such franchise agreement) shall pay Franchisora
monthly royalty fee as determined by Franchisor Until J a n u a r y s , 2 0 2 0 , t h e monthly
royalty fee shall not exceed four percent (4^) of each calendar month's gross sales (as
that t e r m l s d e f i n e d i n t h e f o r m of franchiseagreement which isattached hereto as
Appendix 8) Thereafter,the monthly royalty fee shall be as determined by Franchisor
44
Pursuant to its obligations hereunder and under the applicable franchise
agreements, Franchisor will make various expenditures in connection with the
development of prospective Restaurant sites by Oeveloper,including expenditures for
travel, lodging, meals, obtaining of infomâtionabout prospective sites, demographic
information, traffic counts, and inquiries Into local laws and ordinances. Developer shall
promptly notify Franchisor of a decision to cease development of a prospective
Restaurant site In the event that Oeveloper fails to openarestaurant at any such site,
in lieu of the payment of the franchise fee therefor,Franchisor in its sole discretion may
require Developer to reimburse Franchisor for Franchisor's expenditures with respect to
that site Insuchevent, Franchisor shallprovide Developer with an itemized list of
Franchisor's expenditures with respect to that site after Franchisor receives notice that
Developer no longer intends to developaRestaurant at that site,and Developer shall
reimburse Franchisorfor such costs within thirty (30) days after receiving such list
5
SITEAPPROVALS:PLANSANDSP50IFIOATIONS
5BI
Developer assumes all cost, liability, expense and responsibility for
locating, obtaining, financing and developing sites for Restaurants, and for constructing
andequipping Restaurants at such sites T o a s s i s t Developer in thesiteselection
F^B
^9742
2014
process Franchisor wiii provide Oeveioper with certain demographic information
regarding the site f o r a f e e , w i i i conduct an onsite inspection (if deemed necessary hy
Franchisors and, at no additional cost, wiii review any iease or contract under
negotiation for the prospective site; provided,however,such review does not mean that
Franchisor is reguired to have an attorney review such iease The development o f a
Restaurant at any site must he approved hy Franchisor in accordance with its
thenexisting site approval procedure In connection withareguest for approval o f a
proposed siteforaRestaurant, Oeveloper shall providearelated contract of sale or
lease agreement and such other information and material as the Franchisor may
reasonably require Franchisor's approval ofaprospective Restaurant site shall not he
unreasonably withheld
Franchisor shall notify Oeveloper whether it approves a
proposed site and the related contract of sale or lease agreement within forty five (45)
days of the first date after Franchisor receives Developer's request for approval and all
of Franchisor's prerequisites to consideration o f a s i t e for approval have been satisfied.
Failure of Franchisor to so notify Oeveloper within such forty five (45) day period shall
bedeemedtobeanapprovalofsuchsiteandtherelatedcontractofsaleorlease
agreement Oeveloper acknowledges that Franchisor's approval ofaprospective site
for a Restaurant does not constitute a representation, promise or guarantee by
Franchisor that a Restaurant operated at that site will be profitable or otherwise
successful. Oeveloper shall not make any binding commitment toaprospective vendor
or lessor of real estate w i t h r e s p e c t t o a s i t e f o r a R e s t a u r a n t unless Franchisor has
approved that site in accordance with Franchisor's then existing site approval
procedure After Franchisor hasapproved a s i t e f o r a Restaurant, Oeveloper shall
provide Franchisor wlthacopy of the executed contract of sale or lease,as applicable,
relating to the site withinareasonable period of time.
52
For each Restaurant which Oeveloper develops pursuant to this
Agreement, Franchisor will make available to Oeveloper Franchisor's specifications fora
typical Restaurant
Oeveloper will obtain architectural and engineering services
independently and at its own expense Franchisor shall have the right to review all such
architectural and/or engineering plans which Oeveloper obtains and to prohibit the
implementation o f a n y p l a n , o r p a r t t h e r e o f , w h i c h Franchisor, in its sole and absolute
discretion, believes is not consistent with the best interests of the System In the event
that Franchisor desires to prohibit the implementation of any such plan, or part thereof,
Franchisor shall so notify Oeveloper within forty five (45) days of receiving such
architectural and/orengineering plansfor review. Failure of Franchisor to so notify
Oeveloper within such forty five (45) day period shall be deemed to be an approval of
such plans In the event Franchisor does object to any such plan, Franchisor shall
provide Oeveloper withareasonable detailed list of changes necessary to make such
plans acceptable to Franchisor Franchisorshall, upon resubmission ofsuch plans, with
such changesasOeveloperhas prepared,notify Oeveloper within twenty one (21)days
of receiving suchplans whether they are acceptable Failure to so notify Oeveloper
within suchtwentyone (21)day p e r i o d s h a l l b e d e e m e d t o b e a n a p p r o v a l o f s u c h
amended plans
53
If Oeveloper acquiresa leasehold interest i n a s i t e , Franchisor has the
right to review and approve the lease Franchisor may not approve any lease unless
Oeveloper and its landlord executearider to the lease in substantially the same form as
attached hereto as AppendixO The leasehold interestshallbeforatermwhich is at
F^
^9742
20t4
least as long as the term of the fo^^
Appendix^, and the lease shall provide that Oeveloper may assign the lease or
sublease the property to Franchisor or another Applebee's franchisee without the less^^
having any right to Impose conditions on such assignment or to obtain any payment In
connection therewith The lease must also contain such other provisions as may be
reguired by Franchisor's then current lease approval policy or reguired by the terms and
conditions ofFranchlsor's approval ofsuch site
6
F E E S ANO F R A N O H I S 5 A O R E E M F N T S
Not later than nlnety (90) days prior to the scheduled opening of any Restaurant
which has been developed pursuant to this Agreement, Oeveloper shall deliver to
Franchisor an executed franchise agreement substantially In the form which Is attached
hereto as Appendix 8, provided, however, that the franchise agreement which
Oeveloper executes shall regulre the payment of a franchise fee In the amount
described In Subsectlon^BI, royalty fees as described In S u b s e c t i o n s , and
advertising payments at the rates then established by Franchisor with respect to new
Restaurants, except that In no event shallsuch rates exceed flvepercent (5^) o f a
Restaurant's gross sales (as defined In S u b s e c t i o n s o f t h e form o f a franchise
agreement which Is attached hereto as Appendix 8)
7
O E V E L O F E R ORGANIZATION,AOTFIORITY,FINANOIAL
OONOITION ANO S H A R E H O L D E R S
BBI
Oeveloper a n d e a c h Principal Shareholder represent and warrant that:
(a)Oeveloperlsacorporatlondulylncorporated,valldlyexlstlng and In good standing
under the laws of the state of Its Incorporation;^) Oeveloper Is duly qualified and Is
authorized to d o b u s l n e s s a n d Is Ingood standlngasaforelgncorporatlon Ineach
jurisdiction In which Itsbuslnessactlvltlesorthenature of thepropertles owned by It
requires suchguallflcatlon; (c) the execution anddellveryof this Agreement and the
transactions contemplated hereby are within Developer's corporate power; (d)the
execution and delivery of this Agreement have been duly authorized by the Developer;
(e)the articles of Incorporation a n d b y l a w s of Developer delivered toFranchlsor are
true, complete a n d c o r r e c t , a n d t h e r e h a v e been no changes therelnslnce the date
thereof; (f)thecertlfled c o p l e s o f t h e m l n u t e s e l e c t l n g t h e o f f l c e r s of Developer and
authorizing the execution and dellveryofthlsAgreementaretrue,correct and complete,
and therehave been no changes therein slncethedate(s)thereof;(g) the specimen
stock certificate delivered to Franchisor Is a true specimen of Developer's stock
certificate; (h)the financial statement of Developer and financial statements of Its
Principal Shareholders, heretofore delivered to Franchisor, are true, complete and
correct, and fairly present the financial positions of Developer and each Principal
Shareholder, respectively, as of thedate thereof; (I) such flnanclalstatements have
been prepared In accordance with generally accepted accounting principles; and
(j) there have been no materially adverse changes In the condition, assets or liabilities
of Developer or Principal Shareholders since the date or dates thereof
72
Oeveloper and each Principal Shareholder covenant that during the term
of this Agreement: (a) Developer shall do or cause to be done all things necessary to
preserve and keep In full force Its corporate existence and shall be In good standing as
Et^
105^742
aêigncorpoônin^
the properties owned hy it requires suoh quaiifioation; (Ôeveiopershaii have the
corporate authority to oarry out theterrn^
print, inaoonspiouous fashion on aii certificates representing shares of its stoo^
issued,aiegend referring to this Agreement and the restrictions on and o h i i g a t ^
Oeveioper and Principal Shareholders hereunder, including the restrictions on transfer
of Developer's shares
73
In addition to its ohligations pursuant to Suhsection7BI hereof, Oeveloper
and Principal Shareholders shall providePranchisor with such financial informationas
Pranchisormay reasonably request from time totime, including, on an annual basis,
copies of thethenmostcurrent flnanclalstatements of Oeveloper and each Principal
Shareholder,dated as of the end of the last preceding fiscal year of the Oeveloper or
Principal Shareholder,said statements to be delivered to Franchisor no later than April
15of each year,which financial statements shall conform to the standards set forth in
Subsection7BI hereof
7.4
Oeveloper and each Principal Shareholder represent, warrant and
covenantthatalllnterests(asdefined in Subsection8.4hereto) in Oeveloper are owned
a s s e t f o r t h o n A p p e n d i x O h e r e t o , t h a t n o Interest has been pledged or hypothecated
(except In accordance with S e c t i o n ^ o f this Agreement), and that nochangewill be
made in the ownership of any such Interest other than as permitted by this Agreement,
or otherwise consented to in writing by Franchisor
Oeveloper and Principal
Shareholders agree to furnish Franchisor with such evidence as Franchisor may
request, from time to time, for the purpose of assuring Franchisor that the Interests of
Oeveloper and Principal Shareholders remain as represented herein
75
EachPrincipal Shareholder, jointly and severally,hereby personally and
unconditionally guarantees each of Developer's financial obligations to Franchisor
(including, but not limited to, all obligations relating to the payment of fees by Developer
to Franchisor) Each Principal Shareholder agrees that Franchisor may resort to such
PrincipalShareholder (or any of them)for payment of any such financial obligation,
whether or not Franchisor shall have proceeded against Developer, any other Principal
Shareholderoranyotherobligorprimarily or secondarily obligated to Franchisor with
respect to such financial obligation
Each Principal Shareholder hereby expressly
waives presentment, demand, notice of dishonor, protest, and all other notices
whatsoever with respect to Franchisor's enforcement of this guaranty In addition, each
Principal Shareholder agrees that if the performance or observance by Developer of any
term orprovision hereof is waived or the time of performance thereof extended by
Franchisor, orpaymentof any such financial obligation isaccelerated In accordance
with any agreement between Franchisor and any party liable in respectthereto or
extended or renewed, in whole or in part, all as Franchisor may determine, whether or
not notice to or consent by any Principal Shareholder or any other party liable in respect
to such financial obligations Is given or obtained, such actions shall not affect or alter
the guaranty of each Principal Shareholder described in this Subsection
75
Developer and each Principal Shareholder represent and warrant to
Franchisor that:
520
^9742
2014
^
Neither Oeveloper nor any Prinolpal Shareholder or any other
person wlthadlreot or Indirect ownership Interest In Oeveloper Is I d e n t ^
name or an alias, pseudonym or nickname, on the list of "Specially Designated
Nationals and Blocked Persons" malnta^^
of Foreign Assets Control (texts available at w v ^
Further, Oeveloper and Its FrlnclpalShareholders represent and warrant that neither
hasvlolatedand agreethat neither will vlolateany law (In effect now or which may
become effective In the future) prohibiting corrupt business practices, money laundering
or the aid or support of persons or entitles who conspire to commit acts of terror against
any person or government, Including acts prohibited by the U S Patriot Act (text
available at http^www eplc org/prlvacy/terrorlsm/hr3162 html), O S Executive Order
13244
(text
available
at
http^treasgov/offlces/enforcemen^
(b)
Oeveloper has not made, nor has any Principal Shareholder made,
any expenditures other than for lawfulpurposes or directly or Indirectly offered,gave,
promised to give or authorized the payment or the gift of any money,or anything of
value, t o a n y person orentlty, while knowing or having reason to k n o w t h a t a l l o r a
portion of such money or thing of value would be given or promised, directly or
Indirectly, to any government official, official of an International organization, officer or
employeeofaforelgngovernmentoranyoneactlng In an official capacity foraforelgn
government,for the purpose of (l)lnfluenclng any action,Inaction or decision of such
official Inamanner contrary to his or her position or creating an Improper advantage; or
(2) Inducing such official to Influence any government or Instrumentality thereof to effect
or Influence any act or decision of such government or Instrumentality.
(c)
Oeveloper nor any Principal Shareholder or any other personor
entity w h o h a s any director Indlrectownershlplnterest Is or wlllbecome directly or
Indirectly owned or controlled by governmental authorities of any country that Is subject
toaOnlted States embargo; and
(d)
Oeveloper understands andlts Principal Shareholders understand
and have been advised by legal counselon the regulrementsof the United States
Foreign
Corrupt
Practices
Act
(currently
located
at
www usdoj gov/crlmlnal/fraud/fcpa html, any local foreign corrupt practices laws and
Patriot
Act
(currently
located
at
wwweplcorg/prlvacy/terrorlsm/hr3162html,
acknowledge the Importance to Franchisor and the Restaurants and the parties^
relationship of their respective compliance with the requirements of these laws,
Including any applicable auditing requirements and any requirement to report or provide
access to Information to Franchisor or any government, that Is made part of any
applicable law, and agree to take all steps requlredby their consultants, agents and
employees to comply with such laws prior to engaging or employing any such
Individuals or entitles.
3
TRANSFER
8BI
There shall be noTransfer of any Interest of Oeveloper, or ofaPrlnclpal
Shareholders Oeveloper, In whole or lnpart(whether voluntarily or by operation of
E^l
^9742
20t4
law), d i r e c t i n d i r e c t
Sections " T r a c e r and " l ^ e ^ are d ^ o e d l o S o b s ^ ^
82
Except as provided ^ 8obsectloo83, "Transfer" shall mean any
assignment, sale, pledge, hypothecation, gift o r a n y other soch event which woold
change ownership of or createanew Interest, Including,bot not limited to:
(a)
any change In the ownership ofor rights In orto any shares of stock
or other egolty Interest In Oeveloper which woold result from the act of any shareholder
of Oeveloper ("Shareholder"), s o c h a s a s a l e , exchange, pledge or hypothecation of
shares, or any Interest In or rights to any of Developer's profits, revenues or assets, or
any soch change which wooldresolt by operation of law; and
(b)
any change In the percentage Interest owned by any Shareholder In
the shares of stock of Oeveloper,or Interests Inlts profits, revenues or assets which
woold result from any act of Oeveloper s o c h a s a s a l e , p l e d g e or hypothecation of any
Restaurant assets (other t h a n a p l e d g e of assets to secure b o ^ a ^ e loans made or
credit extended In connection with acgolsltlon o f t h e assets pledged); any sale or
Issuance of any shares of Developer's stock; the retirement or redemption of any shares
of Developer's stock; or any sale or grant to any person of any right to participate In or
otherwise to share or become entitled t o a n y part of Developer's profits, revenues,
assets or egolty
88
"Transfer" shall not Include (a)achange In the ownership of or rights to
any shares or other egolty Interest In Developer porsoant to a public offering of
Developer's securities reglsteredonder the Securities Act of 1988,or (b)achange In
the ownership of or rights to any securities or other egolty Interest In Developer
porsoant toaprlvate offering of Developer's securities exempted from registration
such Act, provided that Developer provldesEranchlsorwIthacopy of Itsprospectus
and/orofferlng memorandum ten(10)days priorto Itsflllng with theSecurltlesand
Exchange Commission or circulation to third parties so that Franchisor may comment
and, If necessary, correct any Informatlonconcernlng Franchisor and/or the System,
and further provided that after giving effect to any such public or private offering, the
Principal Shareholders, o r a n y of them, "control" Developer For purposes of this
Section 8, "control" means either (1)ownlng legal and egultable title to flftyone
percent(51^) or more ofthe outstanding voting securities of Developer, which are not
subject t o a p r o x y granted to or contract with any other person or party granting that
party the right to vote part or all o f s u c h securities, or (2) having and continually
exercising the contractual power presently to deslgnateamajorlty of the directors of
Developer
84
"Interest" shall mean; when referring to Interests or rights InDeveloper,
any shares of Developer's stock, and any other egultable or legal right In or to any of
Developer'sstock, revenues, profltsor assets; when referring to r l g h t s o r a s s e t s o f
Developer,Developer's rights under and Interest In this Agreement, any Restaurant and
Its revenues, profits and assets
85
(a)
The Interest ofaPrlnclpal Shareholder may be transferred to such
FrlnclpalShareholder'sspouseorchlldrenortoapersondeslgnated In such Principal
F-22
20t4
^19742
sharehoêBSW^ or t r u s t s
sooh Priooipal Shareholdo^ death or permanent inoapaoity, without Franohisor's
approval provided thatsooh Soooessorshaliagree to hehoond hy the restrictions
contained in this S e o t i o n ^ a n d the other agreements and covenants of the Principal
Shareholders contained in this Agreement
(h)
T h e l n t e r e s t o f a P r i n c i p a l Shareholder may not he transferred to
another Principal Shareholder without Franchisor's approval, which approval will not he
unreasonably withheld
(c)
The InterestofaSoccessormayonlyhetransferred in accordance
with S o h s e c t i o n 8 5 ( h ) o r 8 ^ r e g a r d l e s s of whether sochTransfer is for considerate^
or by gift or will or other device
86
O n t i l s o c h d a t e a s Oeveloper h a s d e v e l o p e d a n d o p e n e d for operation
forty percent ^ O ^ o f the nomber of Restaurants reguired by Sobsection^BI hereof an
the nomberofPestaorants required by Sobsection8BI hereof as said total aggregate
number Isset forth on Appendix A, Oeveloper shall have no right toTransfer this
Agreement or any rights or obligations onder this Agreement, and any franchise
agreements to be issued porsoant hereto shall be issoed solely to the Oeveloper,which
as of the date of issuance of each soch franchise agreement shall be owned by the
Principal Shareholders to the extent hereinbefore provided Any transfer or attempted
transfer in contravention of this provision shall be void and of no effect If, after the date
Oeveloper has developed and opened for continooos operation the number of
Restaurants reguired by this S o b s e c t i o n 8 6 , a n y ofthe Principal Shareholders desires
to dispose of all or substantially all of the Interests of the Principal S h a r e h o l d e r s ^
Oeveloper,or any of the Principal Shareholders (or Oeveloper) desires to dispose of all
or substantially all of Developer's Interest in this Agreementorin the assetswhich
Oeveloper has acgoired porsoanttothis Agreement, the Principal Shareholder(s)or
Oeveloper, as the case may be, shall notify Franchisor of that desire, in writing,
thirty (80) days before announcing that fact pobllcly or engaging the services ofabroker
or sales agent.
87
(a)
If at any time any of thePrincipal Shareholders or Oeveloper,as
the case may be,obtains fromathird party or third p a r t i e s a b o ^ ^ e offer (the''Offers
in writing for the purchase of all or substantially all of the Interests of the Princi^^^
Shareholders in Oeveloper or In the Restaurant assets which Oeveloper has acgoired
a s a r e s o l t of this Agreement, the Principal Shareholders or Oeveloper shall give notice
(the''Selling Notice'') to Franchisor stating that the Principal S h a r e h o ^ ^
as the case may be, have received the Offer, Identifying the prospective purchaser by
name and address,specifying the proposed purchase price and attachingatroe and
completecopy of the Offer, including all relevant materlalsregoiredfor approval by
Franchisor Notwithstanding the foregoing, however, Oeveloper and Principal
Shareholders understand andagreethat, as provided in Sobsection88hereof, ontil
soch time as Oeveloper has developed and opened foroperatlon the number of
Restaurants required b y s a i d S o b s e c t i o n 8 8 hereof, any portion of any Offer regarding
theright to developRestaorants or Oeveloper'slnterest in this Agreement shall be
invalid and of no force or effect, it being expressly understood and agreed that soch
rights may not be transferred, and any franchise agreements to be granted hereunder
F-^
1^9742
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be issued s o ^ y to O e v e l ^
as hereinbefore set forth At sooh time as Oeveloper has developed and opened for
operation the nornber of Restaurants required by Sobseofion 8.6, any portion of sooh an
Offer regarding Oeveioper's interest in this Agreement shali be effective in aooordanoe
with its terms
(b)
Franchisor shaii have an option to purchase (the "Options
exercisable withinaperiod of fortyfive (45) days after receipt of the Selling N o ^
"Option Periods soch interests at the price and on the conditions set forth in the O^^^
except that Franchisor shaii not be obligated to pay any finder's or broker's fee, and if
the Offer provides for payment of consideration other than cash, or if the Offer involves
certain Intangiblebenefits,Franchisor may elect to purchase soch Interests by offeringa
reasonable dollar valêsobstitote for the non cash/intangible benefits part of the Offer
Notwithstanding the foregoing, if Franchisor exercises the Option, Franchisor (a) will ^
entitled to receive representationsand warrantiesfrom Oeveloper and the Principal
Shareholders, jointly and severally, that are customarily received by purchasers in
similar transactions and (b) will be permitted to not close if it is not satisfied with the
results of its business, legal and financial doe diligence
(c)
The Option shall be exercisable by Franchisordeliverlng to the
F r i n c i p a l S h a r e h o l d e r s o r O e v e l o p e r , a s t h e c a s e m a y b e , w i t h i n t h e O p t i o n Period, a
notice (i) stating that the Option is being exercised, and (ii) specifying the time, date and
place at which soch purchase and sale will take place, which date shall be within forty
five (45) days after Franchisor delivers soch notice Oeveloper shall provide Franchisor
access to and copies of soch information and documentation Franchisor shall regoest
regarding the purchase prior to the start of the Option Period Theforty five(45)day
limitation for purposes of determining the sale date shall not apply if at the end of said
forty-five (45) day period the only issoe which prevents completion of the purchase and
sale is the need to effect transfers of the applicable ligoor licenses. In the event of soch
adelay, the purchase and sale shall take place within ten (10) days after those ligoor
licenses have been transferred
(d)
If the Option is not exercised, the Principal Shareholders or
Oeveloper, as the case may be, may sell the Interests in or of Oeveloper to the third
party which made the Offer, on conditions no more favorable to the third party offerer
than those set forth in the Offer, provided that Franchisor approves the proposed
transferee in accordance with the criteria set forth in A p p e n d i x F a n d provided farther
t h a t s o c h s a l e t a k e s p l a c e w i t h i n ninety (90)daysafter the expiration o f t h e O p t i o n
Period The ninety (90) day limitationdescribed in the preceding sentence shallnot
apply if at the end of said ninety (90) day period the issoe which prevents completion of
the porchaseand sale is either the need toeffecttransfersoftheapplicable ligoor
licenses or consent or approval o f t h e transaction by a state or federal regulatory
agency In the event of s o c h a d e l a y , the purchase and sale shall take place within ten
(10) days after those issoes have been resolved or waived by Franchisor In the event
of soch a transfer, Franchisor may, in its discretion, regoire an amendment to
Subsection 2.1 of this Agreement in order to increase or decrease the nomber of
restaurants regoired thereby and the dates of the Initial Oevelopment Periods referred
to therein
F24
105^2
20t4
(e)
^ the Option is not exercised, the Prinoipai Shareholders or
Oeveioper,as the case rnay he, shaliirnmediateiy notify Franchisor in w r i t ^
change in the terms of an Offer Any change in the terms of an Offer shaii caose it to he
deemed a new Offer, conferring opon Franchisor a new Option porsoant to this
S o h s e c t i o n ^ ^ t h e Option Period with respect to the new Option shaii he deemed to
commenceonthedayonwhichFranchisorreceiveswritten notice o f a c h a n g e in the
t e r m s o f t h e original Offer. Provided however, in soch an instance, Franchisor shaii
provide Franchisee its response within fifteen^5) days after Franchisor's receipt of aii
of the modified terms, oniesssoch changes are deemed material hy Franchisor and in
soch an event, Franchisorshall haveafortyfive(45)dayperiodwithinwhich to review
said changes
88
(a)
Oeveloper understands and acknowledges that the rights and
doties set forth In this Agreement are personal to Oeveloper and that Franchisor has
enteredinto this Agreement inreliance on the business skill and financial capacity of
Oeveloper,and the hosiness skill,financial capahilityandpersonal character of each
PrincipalShareholder Any transfer of Principal Shareholders'Interest in Oeveloper or
in Developer's Interest in this Agreement in contravention of this Section8shallcaose
the immediate termination of all development rights granted herein with respect to
Pestaorantsnot otherwise open for operation Except as otherwise set forth in this
Section 8, the Principal Shareholders shall at all times retain control of Oeveloper
Except as otherwise provided in this Section 8, noTransfer of any part of Developer's
Interest in thisAgreement, and noTransferofanylnterestofany Principal Shareholder
shall hecompletedexceptin accordance with this Sohsection88 In the event of soch
aproposedTransferofanypartofDeveloper'slnterestinthisAgreement,orofany
Interest of any Principal Shareholder, the party or parties desiring to effect soch
TransfershallgiveFranchisornoticeinwritlng of the proposedTransfer,which notice
shall set forth the name and address of the proposed transferee, its financial condition,
inclodingacopy of Its financial statement dated not more than ninety (90) days prior to
the date of said notice,and all the terms and conditions of the proposedTransfer Upon
receiving soch notice, Franchisor may (i) approve the Transfer, or (ii) withhold its
consent to theTransfer Franchisor shall,within forty-five (45) days of receiving soch
noticeandallthe information requested hy Franchisor regarding the proposedTransfer
and the parties thereto, advise the party or parties desiring to effect the Transfer
whether it (l)approvestheTransfer, or (2) withholds its consent to theTransfer,giving
the r e a s o n s f o r s o c h disapproval Failure of Franchisor t o s o a d v i s e said partyor
parties within thatfortyfive(45) day period shall hedeemed to he approval o f t h e
proposedTransfer AppendixEsets forth the criteria for obtaining Franchisor's consent
toaproposedTransfer
(h)
In the event that Franchisor approves the Transfer, and the
Transfer is not completed within ninety (90) days of the later of (i) expiration of the forty
five (45) day notice period, or (Ii) delivery of noticeof Franchisor's approval o f t h e
proposedTransfer, Franchisor's approval of the proposedTransfer shall automatically
he revoked The ninety (90) day limitation described in the preceding sentence shall not
apply if at the end of said ninety (90) day period the only issoe which prevents
completion o f t h e Transfer is the need to effect transfers o f t h e applicable ligoor
licenses In the event of s o c h a d e l a y , t h e T r a n s f e r shall take place within ten(10)
business days after those ligoor licenses have been transferred
Any sobsegoent
F-25
^ 9 ^ 2
2014
propose t o c o m p ^ e t h e p ^
FraochisoBsnghtof
approve as provided hereio The party which desires to effeot the proposedTraosfer
shaii immediately riotit^ Franchisor io writing of aoyohaogeio the ter^^
Any change io terms o f a T r a o s f e r prior to ciosiog shaii caose it to he d e e m e d a n e w
Transfer^revokiogaoy approval previously givenhy Franchisor a o d c o n ^
Fraochisoraoew right to approve sochTraosfer,whlch shall he deemed to commence
on the day oo which Franchisor receives written ootice of soch change in terms
89
In connection withanyregoest for Franchisor's approval o f a p r o p o s e d
TransfertothisSectlon8,the partiestothe proposedTransfer shall pay Franchisora
nonaccoontahle fee to defray the actoal cost of reviewand the administrative and
professional expenses related to the proposed Transfer and the preparation and
execution of documents and agreements of two thousand five hundred dollars ($^500)
For purposes of clarification, the transfer fee reflected In the preceding sentence relates
tothls Agreement only and d o e s n o t limit the ahility of Franchisor to c h a r g e f e e s i n
connection with otherfranchise agreements involved In theTransfer
9
TERMINATION
9BI
This Agreement shall expire on
sooner terminated pursuant to the terms hereof.
, 20
, unless
92
Franchisor s h a l l h a v e t h e r i g h t to terminate this Agreement immediately
opon written notice to Oeveloperstating the reason for soch termination, and Oeveloper
shall no longer have any ofthe rights created hy this Agreement, in the event of:
(a)
development hy Oeveloper ofaRestaorant without first obtaining
approval from Franchisor of the Restaurant site or of Developer's architectural and/or
engineering plans in accordance with Section5hereof;
(h)
any breach or default of any of the provisions of S e c t i o n s 8 a n d H
of this Agreement and Subsection 14BI of any franchise agreement entered into
porsoant to this Agreement;
(c)
the filing by Oeveloper ofapetition in bankruptcy, an arrangement
for the benefit of creditors,orapetition for reorganization; the filing against Oeveloper
a petition in bankruptcy, an arrangement for the benefit of creditors, or petition for
reorganization, not dismissed within ninety (90) days of the filing thereof; the making of
an assignment by Oeveloperforthebenefitof creditors; orthe appointment ofareceiver
or trustee for Oeveloper, which receiver or trustee shall not have been dismissed within
ninety (90) days of soch appointment;
(d)
the discovery by Franchisor that Oeveloper made any material
misrepresentation or omitted any material fact in the information which was furnished to
Franchisor in connection with this Agreement;
(e)
failure by Oeveloper to locate and employaOirector of Operations
who is approved by Franchisor in accordance with Subsection 122wlthin ninety (90)
days o f t h e date of this Agreement or, with respect to a replacement Director of
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^9742
2014
O p e ^ o o s , f a ^ r e by Oeveloper to looatesoob a replaoemeotwbo Isapproved by
Fr80oblsorloaooordaooewltbSobseotloo122wltblo
t b e d a t e o o wblob tbe last Olreotor of Operation w b o w a s approved by Franoblsor
oeased to be employed by Oeveloper lotbatoapaolty;
(f)
any part of tbls Agreement relating to tbe payment of fees to
Franoblso4ortbe preservation of any of tbe Marks,trade seorets or secret formulae
licensed or disclosed hereunder or onder any franchise agreement between Franchisor
and Oeveloper^foranyreason being declared Invalid or unenforceable;
(g)
Oeveloper or any Principal Shareholder being convicted of or
pleading ^ o c o ^ e ^ e ^ e t o a f e l o n y o r a n y c r l m e Involving moral torpltode; or
(h)
the franchisee onder any franchise agreement execotedporsoant
to this Agreement committing a default subject to Immediate termination onderthe
franchiseagreement
93
Except as provided above In Sobsectlon92, If Oeveloper defaults In the
performance or observance of any of Its otherobllgatlons hereonderor onderany
franchise agreement between Oeveloper and Franchisor, and any soch default
continues f o r a p e r l o d o f thirty (30)days after written notice toOeveloper specifying
soch default, Franchisor shall have the right to terminate this Agreement opon written
notlceto Oeveloper If Oeveloper defaoltsln the performance or observance of the
s a m e o b l l g a t l o n t w o ^ o r m o r e t l m e s w l t h l n a t w e l v e ^ ^ m o n t h period, Franchisor
shall have the right to terminate this Agreement Immediately opon commission of the
second a c t o f default, opon written notlceto Oeveloper stating the r e a s o n f o r s o c h
termination, without allowance for any coratlve period
94
This Agreement shall automatically terminate onder the conditions and at
the times specified In S o b s e c t l o n 2 3 a n d 3 3
10
F P E P E O U I S I T F S TO OBTAINING FRANCHISES F O P INOIVIOOAL
RESTAURANT ONITS
10BI Oeveloper understands and agrees that this Agreement does not confer
oponOeveloperarlght to obtalnafranchlse for any Restaurant, bot Is Intended by the
parties to set forth the terms and conditions which, If folly satisfied, shall entitle
Oeveloper to o b t a l n s o c h a f r a n c h l s e , located within theTerritory
Oeveloper forther
onderstandsthatontll the date Oeveloper opensfor operational! those Restaorants
regolredonderSobsectlon36ofthlsAgreement,soch aforesaid terms and conditions
may only be satisfied by Oeveloper (andnot an assignee or transferee thereof),who
shall remain at all times owned and controlled by the Principal Shareholders as herein
set forth
1 0 2 In the event that Oeveloper shall have obtained Franchisor's approval o f a
particular proposed site foraRestaorant, and If Franchisor, In the exercise of Its sole
discretion, has granted Oeveloper operational, financial and legal approval, then
Franchisor will grant OeveloperafranchlseforaRestaorant at the site In goestlon As
F^B
^9742
2014
osed h e r e ^ F r a n o h ^ ^
give Oeveloper "operational "finanoial" and "legal"
approval onder the following olroomstanoes:
"Operational" approval will he granted IfFranohlsor has determined,In the exerolse
of Itssoledlsoretlon, that Oeveloper Isoondooting the operation of eaoh of its
Restaurants, and Is oapahle of oondootlng the operation of the proposed
Restaurant, inolodingphysloalaspeots thereof, (a) Inaooordanoe with the terms
and conditions of this Agreement, (h)in aooordanoe with the provisions o f t h e
respective franchise agreements, and (c)ln accordance with the standards,
specifications and procedures set forth and described In the Franchise Operations
Manual and In any other materials or manuals provided or made available to
Oeveloper by Franchisor (collectlvely,the"Manoals"),as soch may be amended
from time to time
Oeveloper understands that changes In said standards,
specifications and procedures may become necessary from time to time.
Oeveloper agrees to accept said changes, and Oeveloper farther agrees that it is
within the sole discretion ofFranchisorto make said changes
"Financial" approval will be granted if (a) Oeveloper has been and isfaithfolly
performing all terms and conditions onder each of its existing franchise
agreements withFranchlsor,(b) Oeveloper or its affiliates is not in default of any
money obligations owed to Franchisor, and (c) Oeveloper is not in default of any
financial obligation to any of its suppliers, onless any soch obligation is being
disputed in good faith by the Oeveloper Oeveloper acknowledges and agrees that
It is vital to Franchisor's interest that each of Its franchisees be financially soond to
avoid failure ofafranchised business (whichwoold adversely affect the reputation
a n d g o o d name of Franchisor and theSystem) Oeveloper acknowledgesand
agrees that it is vital to Franchisor's interest and to the interests of the System that
Oeveloper (Inits capacity as franchisee) remain current in satisfylngits financial
obligations to it suppliers
"Legal" approval will be granted if Franchisor has determined, in the exercise of its
sole discretion,that Oeveloper has submitted to Franchisor,inatlmely manner as
requested, all information and documents regoested by Franchisor prior to and as
abasis for the issuance of individual franchises or porsoant to any right granted to
Franchisor by this Agreement or by any franchise agreement betweenOeveloper
and Franchisor,and has taken soch additional actions in connection therewith as
may be regoested from time to time.
10 3 It is understood and agreed that the foregoing criteria apply to the
operational, financial and legal aspects of any Restaorant franchised by Franchisor in
which Oeveloper or any Rrincipal Shareholder has any legal or egoitable interest,
including, without limitation, Indirectownership interests. It is farther onderstoodand
agreed that Oeveloper and Frincipal Shareholdershaveanongoing responsibility to
operate each Restaurant in which Oeveloper or any Frlncipal Shareholder has any legal
or egoitable interest in a manner which satisfies the foregoing regoirements for
operational, financial and legal approval
F-^
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11
RESTRIOÔNS
111 O e v e ^ p e r a n d ^ P n n o ^ S h a ^ h o ^ s a o k n o ^ ^
o f ^ A g ^ e m e ^ ^ e y a ^ ^ ^ e ^ p r o p n e ^ ^
a ^ ^ e s h a v e a o q o ^ d o r d e v e ^ p e d o v e r ^ m e a t g r e a t e x p e n ^ c o d i n g , hot oot
limited to, methods of site seôtio^markotiogm^
aod servioe methods aod skills relating to the development and operation of
Restaurants They farther acknowledge that this Information, whiohinolodes, hot is not
necessarily limited to, thatoontained In the Manoals, is notgenerally known In the
industry and is heyond their own present skills and experience, and that to develop it
themselves woold he expensive, time consoming and difflcolt Oeveloper and Principal
Shareholders forther acknowledge that soch information provides a competitive
advantage and will he valoahle to them in the development of their hoslness, and that
gaining access to it Is therefore a primary reason why they are entering into this
Agreement Accordingly, Oeveloperand Its Principal Shareholdersagreethatsoch
information, asdescrihed ahove, which may or may not he "trade secrets" onder
prevailing jodicial interpretationsor statutes, isprivateand valoahle, and constitotes
trade secrets belonging to Franchisor or Its affiliates; and in consideration of
Franchisor's confidential disclosore to them o f t h e s e trade secrets, Oeveloperand
Principal Shareholders agree as follows:
(a)
Ooring the term of this Agreement, neither Oeveloper nor any
Principal Shareholder,for so l o n g a s s o c h Principal Shareholder owns an Interest in
Oeveloper, may, withootthepriorwrittenconsentofFranchlsor,directly or Indirectly
engage In, or acgoire any financial or beneficial Interest (Inclodlng any interest In
corporations, partnerships, trosts, unincorporated associations or joint ventures) In,
advise, help, guarantee loans or make loans to, any restaorant business whose meno
or method of operation is similar to that employed by restaorantonits within the System
which Is e i t h e r ^ l o c a t e d In theTerrlto^,(il) located in the Area of O o m i n a n t l n ^
(as defined and established from time to time by Arbitron Ratings Oompany) of any
Restaorantdeveloped porsoanttothis Agreement, (III) located w i t h l n a f i v e (5) mile
radios of any restaorant onit within the System, or (iv) determined by Franchisor,
exercising reasonablegoodfaithjodgment, to beadirect competitor of the System
(b)
NeltherOeveloper,fortwo (2) years following the termination of this
Agreement, nor any Principal Shareholder,for two (2) years following the termination of
all of his or her Interest in Oeveloper or the termination of this Agreement,whlchever
occors first, may directly or indirectly engage in, or acgoire any financial or beneficial
Interest (incloding any interest in corporations, partnerships, trosts, onlncorporated
associations orjolntventores) in, advise, help, goarantee loans or make loans to, any
restaorant bosiness whose meno or method of operation Is similar to that employed by
restaorant onits within the System which is located either (i) in t h e T e r r i t o r y , ^
Area of Oominantlnfloence (as defined and established from time to time by Arbitron
Ratings Oompany) of any Restaorant developed porsoant to this Agreement, (III) within
aflve(5)mileradiosofanyrestaorantonitwithlnthe System,or (Iv) within any area for
which an active, corrently binding development agreement has been granted by
Franchisor to another franchisee as of the date of termination
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^9742
20t4
112 Neither Oeveloper nor any S ^
ose the trade seorets Incorporated
restaorant holiness which Is not within the Systern,(h)dl5olose or reveal any p o ^
the System to any person other than to Developer's employees as an Incident of their
training (c)acqolre any right to ose any name, mark or other Intellectual property r ^
which may he granted porsoant to any agreement between Franchisor and Oeveloper,
except In connection with the operatlonofaRestaorant, or (d)commonlcate,dlvolge or
ose for the benefit of any other person or entity any confidential Information, knowledge
or know how of Franchlsoror Its affiliates concerning the methods of development or
operation ofarestaorantotlllzlng the System
113 Oeveloper andPrlnclpal Shareholders agree that the provisions of this
S e c t l o n H are and h a v e b e e n a p r l m a r y l n d o c e m e n t to Franchisor to enter Into this
Agreement, and that In t h e e v e n t o f breach thereof Franchisor woold be Irreparably
Injoredandwooldbewlthootanadegoateremedyatlaw Therefore,In the event o f a
breach, orathreatenedorattempted breach, o f a n y o f s o c h provisions Franchisorshall
be entitled, In addition to any other remedies which It may have hereonder or In law or In
egolty (Inclodlng the right to terminate this Agreement), to a preliminary and/or
permanent Injonctlonandadecree for specific performance of the terms hereof wlthoot
the necessity of showing actoal or threatened damage, and wlthoot being regolred to
fornlshabond or other secorlty
114 The restrictions contained In Sobsectlon111 above shall not apply to
ownership of less than two percent (2^) of the shares ofacompany whose shares are
listed and traded on a national secorltles exchange If soch shares are owned for
Investment only, and are not owned by an officer, director, employee or consoltant of
soch pobllcly traded company
115 If any coort or other trlbonal having jorlsdlctlon to determine the validity or
enforceability of this SectlonHdetermlnes that It woold be Invalid or onenforceable as
written, then the provisions hereof shall be deemed to be modified or limited to soch
extent or In soch manner as necessary for soch provisions to be valid and enforceable
to the greatest extent possible
12
OFVFLOFMFNTFROOFOORES
121 Franchisor will ose Its reasonable efforts to fornlsh Oeveloper with advice
In developing Restaorants and In selecting sites therefor
12 2 Oeveloper shall designate an Indlvldoal employee who shall be personally
responsible for Developer's activities dorlng the term of this Agreement, and who shall
devote his or her folltlme,best efforts and constant personal attention,onadaytoday
basis,to Developer'sactlvltlesln theTerritory (the''Director of Operations'^ Developer
shall regolre that the Director of Operations maintain his or her principal personal
residence In theTerritory Franchlsorreservesthe right to regolre that, asacondltlon of
his orheremploymentwlth Developer, the Dlrectorof Operations, as w e l l a s e a c h
sopervlsory employee referred to In Sobsectlon12 3, most soccessfolly complete
Franchisor's Interview process and a psychological profile test In a manner which
satlsflesaonlform standard established by Franchisor The test shall be administered
2014
^9742
by Franobiso^ or by a t e ^ n g ageooy d e s i g n e d by Fraoobisor, at O e v e l o p e r
expose
O e v e l o p e r dosigoatioo of tbe first Oireotor of Operations, and any
sobseqoent Oireotor of Operations, sbaii be sobjeot to tbe written approval of
Franobisor,wbiob approval sbaii not be arbitrarily witbbeid, and sbaii aiso be sobjeot to
tbe time limitations desoribed in S o b s e o t i o n ^ ^ e ) hereof. Franobisor shall notify
Oeveloper in writing within twenty one (21) days of reoeipt of Developer's regoest
whether Franohisor disapproves sooh person
Failure by Franohisor to so notify
Oeveloperwithin that period shall be deemed to oonstitoteFranohisor's approval of sooh
person
12 3 In the event that Oeveloper desires to designate an employee (in addition
to the Olreotor of Operations) who will have supervisory authority over the development
or operation of more than one(1) Restaorant within the Territory, Developer's
designation of soohasopervisory employee shall be sobjeot to the written approval of
Franchisor, whioh approval shall not be arbitrarily withheld
Franohisorshall notify
Oeveloper in writing within twenty one (21) days of reoeipt of Developer's regoest
whether Franchisor disapproves sooh person
Failore by Franchisor to so notify
Oeveloperwithin that period shall be deemed to constitote Franchisor's approval of soch
person Developer shall regolre that any soch sopervlsory employee maintain his or her
principal personal residence in theTerritory.
124 Developer shall regolre the Director of Operations to execote a
confidentiality agreement and covenant not to compete in the form attached hereto as
AppendixF
In addition, at Franchisor's regoest, Developer shall obtain from the
Director of Operations an agreement verifying his or her employment statos Oeveloper
shall regolre that each other employee of Oeveloper who will have sopervlsory aothority
over the development or operation of more than one (1) Restaorant execote a
confidentiality agreement in the form attached hereto as AppendixO Oeveloper shall
be responsible for compliance of its employees with the agreements identifiedin this
Sobsection,incloding the payment ofany costs needed to enforce the obligations
125 (a)
Developer shall regolre its Dlrectorof Operationsand any other
sopervlsory employee designated porsoant to Sobsection12 3 to attend and to
soccessfolly complete to Franchisor's reasonable satisfaction an operations training
coorse provided by Franchisor If the Director of Operations or any soch sopervlsory
employee fails to soccessfolly complete Franchisor's operations training coorse,
Franchisor may regoiredesignation o f a new Dlrectorof Operations or replacement
sopervlsory employee, as the case may be, and Developershall designate a new
Director of Operations or replacement sopervlsory employee who shall be regolred to
soccessfolly complete soch training coorse.
(b)
The Director of Operations and sopervlsory employees designated
porsoant to Sobsection12 3 shall, from time to time as reasonably regoested by
Franchisor, attend and soccessfolly complete to Franchisor's reasonable satisfactiona
Franchisor provided refresher coorse in restaorant operations
12 6 With respect to each Restaorant within the Territory developed by
Developer, Developer's employees most satisfy the training regoirements described in
S e c t i o n 6 o f A p p e n d i x 8 h e r e t o After Developer opens it first Restaorant porsoant to
F31
10^9742
2014
this AgreemeoL F ^ o h i s o r may at its option and sohjeot to sooh oooditioos as
Fraoohisor deems necessary, permit Oeveioper (at Oeveioper's owo expense) to
ooodootaportioo of the r e t i r e d traioiog at ooe of Oeveioper's existing Res
in
that eveot, Oeveioper wiii he r e t i r e d to provide qoaiified persoooei to administer
training tests and to maintain reoords relating to the training and performance of
employees
13
NO WAIVER OF OEFAULT
13BI The waiver hy any party to this Agreement of any hreaoh or defaoltôr
series of breaches or defaults, of any term, covenant or condition herein, or of any same
or similar term, covenant or condition contained in any other agreement between
Franchisorandanyotherperson,shallnotbedeemedawalverofanysobsegoentor
continuing breach or default of the same or any other term, covenant or condition in this
Agreement, or in any other agreement between Franchisor and any other person
13 2 All rights and remedies of Franchisor shall be comolative and not
alternative, in addition to and not exclusive of any other rights or remedies which are
provided for herein or which may be available at law or In egolty in case of any breach,
failore or defaolt or threatened breach, failore or defaolt of any term, provision or
condition of this Agreement Franchisor's rights and remedies shall be continoing and
shall n o t b e e x h a o s t e d b y a n y o n e ( 1 ) o r m o r e o s e s t h e r e o f , and may be exercised at
any time or from time to time as often as may be expedient; and any option or election
to enforce any soch right or remedy may be exercised or taken at any time and from
time to time The expiration or earlier termination of this Agreement shall not discharge
o r r e l e a s e O e v e l o p e r o r a n y Rrincipal Shareholder from any liability or obligationthen
accroed, or any liability or obligation continoing beyond, or arising oot of, the expiration
or earlier termination of this Agreement.
14
FOROF M A J E U R E
141 As osed in this Agreement, the term "Force Majeore" shall mean any act
o f O o d , strike, lock ootorotherindostrlal distorbance, war (declared or ondeclared),
riot,epidemic,fire or other catastrophe,act of any government and any other similar
caose not within the control of the party affected thereby
14.2 If the performance of any obligation by any party onder this Agreement is
prevented or delayed by reason of Force Majeore, which cannot be overcome by ose of
normal commercial measores, the parties shall be relieved of their respective
obligations to the extent the parties are respectively necessarily prevented or delayed in
soch performance doring the period of soch Force Majeore
The party whose
performance is affected by an event of Force Majeore shall give prompt notice of soch
F o r c e M a j e o r e e v e n t t o t h e o t h e r p a r t y by facsimile, telephone or telegram(ineach
case to be confirmed in writing), setting forth the natore thereof and an estimate as to its
doration, and shall be liable for failore to give soch timely notice only to the extent of
damage actoallycaosed
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15
OONSTROOÔN, S E V E R A L
JURÔÔN
15.1 Ifany part of this Agroemoot shaii for any reason ho dooiarod invalid,
onenforoeahie or impaired in any way, the validity of the remaining portions s
in foil foroe and effeot as if this Agreement had heenexeooted with sooh invalid portion
eliminated, and it is herehy declared the intention of the parties that they woold have
exeootedtheremaining portionof this Agreement wlthoot inolodingthereinanysooh
portions whioh might he declared invalid; provided however, that in the event any part
hereof relating to the payment of fees to Franchisor,or the preservation of any of the
Marks, trade secrets or secret formolae licensed or disclosed hereonder or porsoant to
any franchise agreement between Franchisor and Oeveloper is for any reason declared
Invalid or onenforceable, then Franchisor shall have the option of terminating this
Agreement opon written notice to Oeveloper If any claose or provision herein woold be
deemed invalid or onenforceable as written, it shall be deemed to be modified or limited
tosoch extentorin soch m a n n e r a s m a y b e necessary to render the claose or provision
valid and enforceable to the greatest extent possible in light of the interest of the parties
expressed in that claose or provision, sobject to the provisions of the preceding
sentence
^ 2
O E V E L O P E R ANO PRINOIPAL S H A R E H O L D E R S A O K N O ^ L E O G E
THAT E R A N O H I S O R M A Y ENTER INTO OTHER O E V E L O R M E N T A O R E E M E N T S
THROUGHOUT THE ONITEO S T A T E S ON T E R M S ANO OONOITIONS SIMILAR TO
THOSE SET FORTH IN THIS A O R E E M E N T ^ A N O T H A T I T IS OF MUTUAL BENEFIT
TO O E V E L O P E R A N O PRINCIPAL S H A R E H O L D E R S ANO TO FRANCHISOR THAT
T H E S E T E R M S A N O O O N O I T I O N S B E U N I F O R M L Y I N T E R P R E T E D THEREFORE^
T H E P A R T I E S A G R E E T H A T T O THE EXTENT T H A T T H E L A ^ OF THE STATE OF
K A N S A S DOES NOT CONFLICT ^ I T H L O C A L FRANCHISE STATUTES^ R U L E S
ANO R E G U L A T I O N S ^ K A N S A S L A ^ S H A L L A P P L Y T O THE CONSTRUCTION OF
THIS A G R E E M E N T A N O S H A L L G O V E R N A L L QUESTIONS ^ H I C H ARISE ^ I T H
R E F E R E N C E HERETO^ PROVIDED H O ^ E V E R ^ THAT PROVISIONS OF K A N S A S
L A ^ REGARDING CONFLICTS OF L A ^ S H A L L NOT A P P L Y H E R E T O
^ 3
THE PARTIES A G R E E THAT A N Y CLAIMS C O N T R O V E R S Y OR
DISPUTE ARISING OUT OF OR RELATING T O T H I S A G R E E M E N T O R T H E
P E R F O R M A N C E T H E R E O F ^ H I C H CANNOT B E A M I C A B L Y SETTLED^ E X C E P T
A S OTHERWISE PROVIDED H E R E I N ^ I L L B E R E S O L V E D B Y A P R O C E E D I N G IN
A COURT IN J O H N S O N C O U N T S KANSAS^ AND D E V E L O P E R ANO THE
PRINCIPAL S H A R E H O L D E R S E A C H I R R E V O C A B L Y A C C E P T THE JURISDICTION
OF THE C O U R T S OF THE STATE OF K A N S A S AND THE F E D E R A L COURTS
SERVING J O H N S O N C O U N T Y ^ K A N S A S F O R S U C H CLAIMS^ CONTROVERSIES
OR DISPUTES
EACHPARTYÂIVESITSRIGHTTOAJURYTRIALINANY
COURT ACTION ARISING A M O N G THE PARTIES UNDER THIS A G R E E M E N T OR
OTHERWISE R E L A T E O T O T H I S A G R E E M E N T ^ H E T H E R M A O E B Y C L A I M ^
COUNTERCLAIMS T H I R D P A R T Y CLAIM OR OTHERWISE
T h e p a r t i e s a g r e e t h a t s e r v i c e o f p r o c e s s i n a n y proceedingarising o o t o f o r
relating to this Agreement or the performance thereof may be made as to Developer
and any Principal Shareholder by servingaperson of soitable age and discretion (soch
E ^
^9742
2014
a s t h e person in o h a r g e o f ^ e o ^ o e ^ a t t h e a d d r e s s of Oeveloper s p o o l e d Infhis
Agreement and as to Franohisor by serving tbe president or a vioe president of
FranobisorattbeaddressofFranobisororbyservingFranobisoBs registered agent
16
MiSOELLANEOOS
161 Aiinotioes and otberoommonioationsregoiredor permitted to be given
hereunder sbaii be deemed given wben delivered in person, by overnlgbt ooorier
service, faosimile transmission or mailed by registered or certified mall addressed to tbe
recipient at tbe address set fortb below, onlesstbat party sballbave given written notice
of cbange of address to tbe sending party, in wbicb event tbe new address so specified
sballbeosed
FRANOHISOR:
Applebee's FrancbisorLLO
6140 Ward Parkway
Kansas Oity,Mlssoon 64114
Attentiom President
OEVELOPER
PR^PALSHAREHOLOER^
162 ^ ^ m s o s e d i n ^ i s A g r e e m e ^
w h i c h t h e y a r e osed, s h ^ b e d e e m e d a o d c o o k e d t o ^ o d e a ^ o t h e r o o m b ^
siogo^r or p l o ^ a o d any other geode^ m a s c o t , fe^^
or sooso of this Agreement may require, the same as if soohword^
this Agreement fhemseives T h e w o r d s " i n o i o d e s ^ " i r ^
phrases " i o p a r t i o o l a ^ " s o o h a s ^ " i e B a o d "for example" wh^^
shall he interpreted and oonstroed s o a s n o t t o limit thegenerality o f t h e wordsof
general application or nature whioh precede these words and phrases The headings
Inserted in this A g r e e m e n t a r e f o r reference porposesonly and shall not affect the
construction of this Agreement or limit the generality of any of its provisions
1 6 3 This Agreement, the Franchise Olsclosore Oocomentcorrently in effect
and the documents referred to herein constitute the entire agreement between parties
with respect to the sohject matter hereof, superseding and canceling any and all prior
and contemporaneous agreements, understandings, representations, inducements and
statements, oral or written, of the parties in connection with the sohject matter hereof
16 4 Except as expressly authorized herein, no amendment or modification of
this Agreement shall he binding unless executed in writing hothhy Franchisor and hy
Oeveloper
16 5 In the event that any party to this Agreement Initiates any legal proceeding
to constroe or enforce any of the terms, conditions and/or provisions of this Agreement,
including, hot not limited to, its terminationprovisions, or to obtain damages or other
F^
20t4
105^2
r e ^ f to whioh any party may be e ^
or parties shaii ho paid its reasooahie attorneys'fees and expenses hy other party or
parties
1 6 6 Oeveioperand the Prinoipai Shareholders aoknowiedge andagreethat^)
this Agreement (and thereiationship of the parties oonternpiatedhy this Agreement)
grants Franchisor thedisoretion to make decisions, takeaotionsand/orrefrainfrom
taking actions not inconsistent with Oeveioper's explicit rights and ohiigationshereo^^
that may affect favorably or adversely Oeveloper's interests; (ii) Franchisor will ose Its
bosiness Lodgment in exercising soch discretion based on Franchisor's assessment of
its interests and the System, balancing those interests with or against the interests of
the operators of Restaorants generally (incloding Franchisor, its affiliates and other
franchisees)and specifically wlthoot considering the indlvldoal interests of any particolar
franchisee; (iii) Franchisor will have no liability to Oeveloper for theexercise of its
discretion in this manner and (iv) even if Franchisor has nomeroos motives f o r a
particolar action or decision,so long as at least one motive isareasonable bosiness
jostlfication for soch action or decision, no trier of fact in any legal action shall sobstitote
ItsiodgmentforFranchisor'sjodgmentsoexercised,and soch action ordeclsion will not
be sobject to challenge for abose of discretion If Franchisor takes any action or
chooses n o t t o t a k e a n y action in Franchisor's discretion with regard t o a n y matter
related to this Agreement and Franchisor's action or Inaction is challenged forany
reason, the partiesexpressly direct the trierof fact that Franchisor's reliance on a
bosiness reason in the exercise of its discretion is to be viewed a s a r e a s o n a b l e and
proper exercise of Franchisor's discretion, wlthoot regard to whether other reasons for
its decision may exist and wlthoot regard to whether the trier of fact woold
independently accord the same weight to the bosiness reason
IN WITNESS WFIFRFOF, the ondersigned have entered into this Agreement as of
the date first above written.
FRANOFIISOR;
AFFLFBFF'SFRANOHISORIÔ
^
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
E-35
1051974.2
2014
PRINCIPAL SHAREHOLDERS:
Name:
Name:
E-36
1051974.2
2014
APPENDIX A TO D E V E L O P M E N T A G R E E M E N T
TERRITORY
Franchisor specifically excludes from the Territory, and reserves the right to
operate or license any other person to operate restaurants in, any location within an
airport (serviced by one or more public or charter carrier), train station, bus terminal,
port authority, campus at any college, university or other post-secondary education
institution, hospitals and other health care facilities, arena, stadium, state or national
park, or military fort, post or base, travel plaza or casino which may be within the
boundaries of the Territory otherwise granted to Developer.
For purposes of Section 8.6 only, one hundred percent (100%) of the number of
Restaurants reguired by Subsections 2.1 and 3.1 is
(__)-
E-37
1051974.2
2014
APPENDIX B TO DEVELOPMENT A G R E E M E N T
FORM FRANCHISE A G R E E M E N T
(See Exhibit F to this Franchise Disclosure Document)
E-38
1051974.2
2014
A P P E N O I X C T O OEVELOPMENT A G R E E M E N T
A P P L E B E E S RESTAURANTS
PRANOHISEE L E A S E RIPER
This Lease Rider ^ s "Ride^) is executed as ofthe
day of
,
, hy and hefween
, as landlord ("Landlords and
, as tenant ( " P ^ a o o ^ s e e ^ as a Riderto
that
certain
iease
for
the
premises
located
at
(theêmlses^dated
as of
("the Leased This Rider is herehy incorporated into, and
madeapart of, the Lease
20
W H E R E A S , Franchisee has executed or intends to execute a Franchise
Agreement (the " P ^ a o c ^ s e A ^ e e m e o ^ with Appiehees Franchisor LLO,aOelawar^
limited liahility company (along with any successor franchisor of Applehee's restaurants,
"Pâochisor) for the operation of an Applehee's restaurant ("Restaurao^ a t t h e
Premises, and as a reguirement thereof, the Lease must include the provisions
contained in this Rider; and
W H E R E A S , Landlord and Franchisee agree that the terms contained herein shall
supersede any terms to the contrary set forth in the Lease;
NOW T H E R E F O R E , in consideration of mutual covenants set forthherein,the
execution and delivery of the Lease, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Landlord and Franchisee
hereby agree as follows:
1
The effectiveness of the Lease is contingent upon Franchisor's approval of the
Premises,theformofthe Lease,and Franchisee's ability to obtainallguor license for
the Premises
2
The Premises may be used, in addition to any other uses permitted under the
Lease, for the operation of an Applebee's Restaurant, with t h e s a l e a n d serviceof
alcoholic beverages foron premises consumption, and ancllla^carry out food service
Franchisee may operate Applebee's Restaurants at any other location without
Landlord's approval
3
Franchisor,its personnel or agents,foraperiod of up to thirty (30) days after the
expiration or sooner termination of the Lease or the Franchise Agreement, may enter
the Premises for itself or on behalfof Franchisee to deldentlfythePremises a s a
Restaurant, which may include the removal of signs, decor and materials displaying any
marks, designs or logos owned by Franchisor or its affiliates, provided Franchisor shall
bear the expense of repairing any and all damage to the Premises asaresult thereof
4
If Franchisee has an obligation to continuously operate its business a t t h e
Premises, Franchisee may cease operating for up to sixty (60) days, from time to time,
to perform repairs, enhancements or renovations, as reguired by the Franchise
Agreement
6^5
1^9742
20t4
5
Notw^staodiogany provision h o r o i o t o t h o o o ^ r a ^ Fraoohisooshaiihavethe
abso^rig^whoôrorôtêFôhisoois^def^
^ 0 ) d a y s prior w r i t ^ rôtiooto Laodiord, tosubie^ assigo o r o t h o r w i s e t r a r ^ e r i t s
iotorost io tho L o a s e t o Fraoohisoror F r a o o h i s o B s a ^ i i i a ^ toaoyeotity with whioh
Frariohisorrr^ymorgoorooriso^
fraoohisee of Fraoohisor operating a minimum of five (5) restaurants (eaoh, a
" P e ^ m ^ e d A s s ^ o e e ^ , without Landlords consent Foiiowing such an assignments
Permitted A s s i g n e e a i s o may suhiet, assign orotherwise transfer its interest in the
Lease to another Permitted Assignee without the consent of Landlord Therewiiiheno
fee or expense charged in connection with such transfer
Landlord and Franchisee acknowledgeand a g r e e t h a t a Permitted Assigneewill
assume all of Franchisee's ohligations under the Lease arising a s a r e s u l t of events,
acts or omissions occurring from and after the date of assignment In the event that
Franchisee Is In default of its ohligations under the Lease as of the effective date of the
assignment toaPermitted A s s i g n e e s ) the Permitted Assignee shall he ohligated to
cure such default, hut only to the extent such default accrued not more than thirty (30)
days prior to the dateFranchisorreceivednotice of such default from Landlord;and
h) Landlord maypursue,orcontinueto pursue,aclaimfordamages under the Lease
against Franchisee, hut will have no rights to terminate the lease or to disturb the guiet
possession ofthe Leased Premises by the Permitted Assignee
6
The Lease contains provisions addressing: a) the allocation of responsibility for
the presence of hazardous materials within thePremises (and the larger property of
which t h e P r e m i s e s i s a part, ifany ("Shoppm^Ceoter)); and b) to the extent the
Premises is part ofaShopping Center with common areas, the Landlord's responsibility
forcompllancewiththeAmericansWith disabilities Act of1990, as amended, within the
common areas
7
Landlord hereby representsand warrantsthat it holdsfee simple title to the
Premisesand has all reguisite right, powerand authority to lease the Premises to
Franchisee Landlord hereby agreesto obtain anondisturbance agreement for the
benefit of Franchisee: a) from the holder of any mortgage/deed of trust as of the date of
the Lease; and b)asaconditionto Franchisee's subordination to any mortgage/deed of
trust granted after the date of the Lease.
3
Intheeventthe Premises Is part o f a S h o p p i n g Center, Landlord agrees not to
construct orchange any improvements or landscaping in any manner which would
impair the visibility of or access to the Premises, or the amount of parking available for
use by Franchisee
9
Copies of allnoticesregulredor permitted by t h e L e a s e s h a l l also be sent to
Franchisor at 8140 Ward Parkway, Kansas City, Missouri 84114, Attn: Legal
Oepartment,orsuchother address as Franchisor may locate its Restaurant Support
Center, at the same time notice is provided to Franchisee Franchisor shall have the
right, but not the obligation, upon giving written notice to Franchisee and Landlord, to
cure any breach of the Lease
F-40
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2014
10.
The parties acknowledge that Franchisor is an intended third party beneficiary of
this Rider and has the right to enforce the terms of this Rider as if it was a party hereto.
11.
In the event of any conflict between this Rider and the Lease, the terms of this
Rider shall control, and the Lease may not be modified or amended in any manner
inconsistent with the terms of this Rider.
LANDLORD:
FRANCHISEE:
By:
Name:
Title:
By: __
Name:
Title:
E-41
1051974.2
2014
APPENDIX D TO D E V E L O P M E N T A G R E E M E N T
Percent of Issued and
Outstanding Shares of Developer
Shareholder
E-42
1051974.2
2014
APPENDIX E TO D E V E L O P M E N T A G R E E M E N T
REVIEW A N D C O N S E N T WITH R E S P E C T TO T R A N S F E R S
In determining whether to grant or to withhold consent to a proposed Transfer,
Franchisor shall consider all of the facts and circumstances which it views as relevant in
the particular instance, including, but not limited to, any of the following: (i) work
experience and aptitude of Proposed New Owner and/or proposed new management (a
proposed transferee of a Principal Shareholder's Interest and/or a proposed transferee
of this Agreement is referred to as "Proposed New Owner"); (ii) financial background
and condition of Proposed New Owner, and actual and pro forma financial condition of
Developer; (iii) character and reputation of Proposed New Owner; (iv) conflicting
interests of Proposed New Owner; (v) the terms and conditions of Proposed New
Owner's rights, if the proposed Transfer is a pledge or hypothecation; (vi) the adeguacy
of Developer's operation (as Franchisee) of any Restaurant and compliance with the
System and this Agreement; and (vii) such other criteria and conditions as Franchisor
shall then consider relevant in the case of an application for a new franchise to operate
a restaurant unit within the System by an applicant that is not then currently doing so.
Franchisor's consent also may be conditioned upon execution by Proposed New Owner
of an agreement whereby Proposed New Owner assumes full, unconditional, joint and
several liability for, and agrees to perform from the date of such Transfer, all obligations,
covenants and agreements contained herein to the same extent as if it had been an
original party to this Agreement and may also regulre Developer and Principal
Shareholders, including the proposed Transferor(s), to execute a general release which
releases Franchisor and its affiliates from any claims they may have had or then have
against Franchisor and its affiliates. In the event Proposed New Owner is a partnership
(including, but not limited to, a limited partnership), Proposed New Owner will also be
reguired to execute an addendum to the Agreement which amends the references to
Developer and its Principal Shareholders to include the partnership approved by
Franchisor and Proposed New Owner's general partner(s) and the principal
shareholders of the general partner(s), if the general partner(s) is a corporation. This
addendum will contain a provision including in the definition of "Transfer" the
withdrawal, removal or voluntary/involuntary dissolution (if applicable) of the general
partner(s) or the substitution or addition of a new general partner. Developer or
Principal Shareholders, as the case may be, shall provide Franchisor with such
information as it may require in connection with a reguest for approval of a proposed
Transfer.
For purposes of clarification, nothing in this Appendix E shall limit
Franchisor's discretion in granting or withholding consent to a Transfer or to regulre the
applicable parties to agree to certain terms as a condition to obtaining consent to a
Transfer.
E^3
1051974.2
2014
A P P E N O I X F T O OEVELOPMENT A G R E E M E N T
OONEIOENTIALITY A G R E E M E N T ANO
COVENANT NOTTO COMPETE
THIS A G R E E M E N T is made this
20
, hy and between
corporation ("Oeveioper"^ and
individual employed by OeveioperÊmpioyee")
day ^
,
, a
, an
WITNESSETH:
W H E R E A S , A P P L E B E E ' S PRANCHISOR LLC ("Applebees bas tbe right to
grantfranohises for all rights in and to a unigue system for the development and
operationofrestaurants(the"System^ whioh inoludesproprietaryrlghtsin valuable
trade names, service m a r k s a n d trademarks, including theservice mark Applebee's
Neighborhood G r i l l ^ S a r and variations of such mark, designs and color schemes for
restaurant premises, signs, eguipment, procedures and formulae for preparing food and
beverage products, specificationsforcertain food and beverage products, inventory
methods,operating methods,financial control concepts,atraining facility and teaching
technigues;
WHEREAS,Oeveloper is the owner ofthe right to develop restaurants franchised
by Applebee's which utilize the System ("Restaurants") for the period and in the
Territory described in the Oevelopment Agreement between Applebee's and Oeveloper
(the "Oevelopment Agreement"):
W H E R E A S , Oeveloper and Employee acknowledge that Applebee's Information
as described above was developed over time at great expense, is not generally known
in the industry and is beyond Developer's own present skills and experience, and that to
develop it itself would beexpensive, timeconsuminganddifficult, t h a t i t p r o v i d e s a
competitive advantage and will be valuable to Oeveloper in thedevelopment of its
business,and that gaining access to it was thereforeaprimary reason why Oeveloper
entered into the Oevelopment Agreement; and
W H E R E A S , in consideration ofApplebee's confidential disclosure to Oeveloper of
these trade secrets, Oeveloper has agreed to be obligated by the terms of Oevelopment
Agreement to execute,withits Director of Operations,awritten agreement protecting
Applebee's trade secrets and confidential information entrusted to Employee, and
protecting against unfair competition;
N O W , T H E R E P O R E , inconsideration of the mutual covenants and obligations
contained herein, the parties agree as follows:
(1)
The parties acknowledge and agree that Employee is or will be employed
in a supervisory or managerial capacity and in such capacity will have access to
information and materials which constitute trade secrets and confidential and proprietary
Information The parties further acknowledgeandagreethat any actual or potential
5-44
10^9742
20t4
direct or indirect o o m p e ^ ^
access to sooh trade secrets and
(2)
The parties acknowiedge and agree that the System inciodes trade
secrets and confidential information which Appiehee's has revealed or will reveal to
Developer in confidence, and that protection of said trade secrets and confidential
Informationand protection of Applehee'sagainst^nfaircompetitionfrom others who
enjoy or who havehad access to said trade secrets and confidential information are
essential forthe maintenance ofgoodwill and special valê ofthe System
(3)
Employee agrees that he or she shall not at any timeâppropriate or ose
thetradesecretsincorporated in theSystem, o r a n y p o r t i o n t h e r e o f , f o r o s e i n a n y
hosiness which is not within the Systemîi) disclose or reveal any portion of the System
t o a n y person other than to O e v e l o p e B s e m p l o y e e s a s a n incidentof their training;
(iii)acgoire anyrightto ose, o r t o license orfranchisethe ose ofany name, marker
other intellectoal property right which is or may he granted hy any franchise agreement
between Applehee'sandDeveloper; or (iv)commonlcate,divolge or ose for the benefit
of any other person or entity any confidential information, knowledge or know how
concerning the methodsof developmentoroperation o f a Restaorant which m a y b e
commonicated to Employee or of which Employee may be apprised by virtoe of
Employee's employment by Developer. Employee shall divolge soch confidential
information only to soch of Developer's other employees as most have access to that
information in order to operate a Restaorant or to develop a prospective s i t e f o r a
Restaorant
Any and all Information, knowledge and know how, incloding, wlthoot
limitation, drawings, materials, egolpment, specifications, technigoesand other data,
which Applebee's designates as confidential, shall be deemed confidential for porposes
of this Agreement
(4)
Employee agrees that for the doration of his or her employment by
Developer, and for t w o ^ ) years following termination thereof, Employee may not,
wlthoot the prior written consent ofApplebee's, directly or indirectly, for himself or
throogh, on behalf of o r i n conjonction with any person, partnershlpor corporation,
engage in or acgoire any financial or beneficial interest (incloding any interest In
corporations, partnerships, trosts, onlncorporated associations or joint ventores) in,
advise, help, goarantee loans or make loans to, any restaorant bosiness whose meno
or method of operation is the same as or similar to that employed by restaorant onits
within the System which is located either (a) in the Territory, as defined in the
Development Agreement, or (b)in the Area of Dominant Infloence (asdefined and
established from time to time by Arbitron Ratings Company) of any Restaorant
developed porsoant to the Development Agreement.
(5)
Employee forther acknowledges and agrees that any materials and
manoals provided or made available to Developer by Applebee's (collectively, the
"Manoals"),described in S e c t i o n ^ o f the form of franchise agreement which isattached
a s A p p e n d i x B t o t h e D e v e l o p m e n t A g r e e m e n t a r e loaned by Applebee's to Developer
for limited porposes only, remain the property of Applebee's, and may not be
reprodoced, in whole or in part, withoot the written consent of Applebee's
5-45
^9742
2014
(6)
Emp^yeeagreestosoênder^
every copy of the M a n o r s and any other information or maferiai in his or her
possession or control opon regoest, opon termination of empioyment, or opon
completion of the ose for which said Manoais or other information or material may have
heenfornished to Employee
(7)
The parties agree that in the event of a hreach of this Agreement,
Appiehee's woold he irreparably injored and woold he withoot an adegoate remedy at
law Therefore,in the event o f a h r e a c h orathreatenedorattempted hreach of any of
the provisions hereof, Appiehee's shall heentitled toenforce the provisionsof this
a g r e e m e n t a s a t h i r d p a r t y h e n e f l c i a r y h e r e o f a n d s h a i l h e e n t i t i e d , i n addition to any
other remedies which it may have hereonder at iaw or in egoity (incloding the right to
terminate the Development Agreement), to a temporary and/or permanent injonction
and a decreeforspecificperformance o f t h e terms hereof withoot the necessityof
showing actoai or threatened damage,and withoot being regoired to fornishahond or
other secority
(8)
The restrictions inSobsection (4) hereof shailnot apply to ownership of
less than two percent (2%) of the shares o f a c o m p a n y whose shares are traded o n a
national secorities exchange if soch shares are owned for investment only, and are not
owned by an officer,director,employee or consoltant of soch pobiiciy traded company.
(9)
if any coort or other tribonai having jorisdiction to determine the validity or
enforceability of this Agreement determines that it woold be invalid or onenforceable as
written, the provisions hereof shaii be deemed to be modified or limited to soch extent or
in soch manner necessary for soch provisions to be valid and enforceable to the
greatest extent possible
(10)
In the event that any party to this Agreement or Applebee's initiates any
legal proceeding to constroe or enforce any of the terms, conditions and/or provisions of
this Agreement, or to obtain damages or other relief to which any party may be entitled
by virtoe of this Agreement, the prevailing party or parties shaii be paid its/their
reasonable attorneys'fees and expenses by other party or parties.
IN WITNESS W H E R E O F , the ondersigned have entered into this Agreement as
of the date first above written
OEVELOPER:
EMPLOYEE:
^
Name:
Title:
By:^
Name:
5^6
^9742
20t4
A P P E N O ^ G T O OEVELOPMENT A G R E E M E N T
OONEIOENTIALITY A G R E E M E N T
THIS A G R E E M E N T Is made this
20
, hy and between
corporation ("Oeveloper^ and
Indlvldoal employed by Oeveloper ("Employees
day ^
,
, a
, an
WITNESSETH:
W H E R E A S , A P P L E B E E ' S P R A N O H I S O R L L O ( " A p p l e b e e s bas tbe rlgbt to
grant franchises for all rights In and to a onlgoe system for the development and
operatlonofrestaorants(the"System^ which Inclodesproprletaryrlghtsln valuable
trade names, service marks and trademarks, Incloding the service mark Applebee's
Neighborhood G r l l l ^ B a r and variations of soch mark,designs and color schemes for
restaorant premises, signs, egolpment, procedores and formolae for preparing food and
beverage prodocts, speclflcatlonsforcertalnfood and beverage prodocts, Inventory
methods,operating methods,financial control concepts,atraining facility and teaching
technlgoes;
W H E R E A S , Oeveloper Is the owner of the right to develop restaorants
franchised by Applebee's which otlllze the System (''Restaorants'') for the period and In
the territory described In the Oevelopment Agreement between Applebee's and
Oeveloper (the "Oevelopment Agreement"); and
W H E R E A S , Oeveloper acknowledges that Applebee's Information as described
above was developed over time at great expense, Is not generally known In the Indostry
a n d l s b e y o n d O e v e l o p e r ' s o w n present skills and experlence,and that to develop It
Itself woold be expensive, tlmeconsomlng and dlfflcolt,that It provldesacompetltlve
advantage and will be valoable to Oeveloper In the development of Its bosiness, and
that gaining access to It was thereforeaprlmary reason why Oeveloper entered Into the
Oevelopment Agreement; and
W H E R E A S , In consideration of Applebee's confidential dlsclosore to Oeveloper
of these trade secrets, Oeveloper has agreed to be obligated by the terms of
Oevelopment Agreement to execote, with each employee of Oeveloper who will have
sopervlsory aothority over the development or operation of more than one Restaorant In
theTerritory described In the Oevelopment Agreement,awrltten agreement protecting
Applebee's trade secrets and confidential Information entrosted to Employee;
N O W , T H E R E P O R E , In consideration of the motoal covenants and obligations
(1)
The parties acknowledge and agree that Employee Is or will be employed
In a sopervlsory or managerial capacity and In soch capacity will have access to
Information and materials which constltote trade secrets and confidential and proprietary
Information Thepartles forther acknowledge andagreethat any actoalor potential
5^7
10^9742
20t4
direot or induct c o m p e l
aoooss to sooh trade s e c r e t and
(2)
The parties aokoowiedge aod agree that the System inoiodes trade
seorets and oorîdentiai formation whioh Appiehee's has reveaied to Oeveioperio
ooofideôe, arid that proteotioo of said trade seoretsaodoonfideotiaiioforma
proteotioo of Appiehee'sagaiosto^fair competition from others who e^joy or who h
had aooess to said trade seorets and oonfidentiai information are essential for the
maintenance of goodwill and special vaioe of the System
(3)
Employee agrees that he or she shall not at any timeâppropriate or
ose the trade secrets incorporated in the System, or any portion thereof, for ose in any
hosiness which is not within the Systemîi) disclose or reveal any portion ofthe System
to any person other than to Developer's employees as an incident of their training;
(iii) acgoire any right to ose, or to license or franchise the ose of any name, mark or
other inteliectoai property right which is or may he granted hy any franchise agreement
hetweenAppiehee's and Oeveloper; or (iv)commonicate, divolge or ose for the benefit
of any other person or entity any confidential information, knowledge or know-how
concerning the methods of development or operationofa Restaorant whichmay he
commonicated to Employee or of which Employee may he apprised hy virtoe of
Employee's employment hy Oeveioper. Employee shall divolge soch confidential
information only to soch of Developer's other employees as most have access to that
information in order to operate a Restaorant or to deveiopa prospective s i t e f o r a
Restaorant
Any and information, knowledge and know how, incloding, withoot
limitation, drawings, materials, egolpment, specifications, technigoesand other data,
which Applebee's designates as confidential, shaii he deemed confidential for porposes
of this Agreement
(4)
Employee forther acknowledges and agrees that any materials or
manoals provided or made available to Oeveloper by Applebee's (collectively, the
"Manoals"), described in Sections o f t h e applicable franchise agreement between
Applebee'sandOeveloper,are loaned by Applebee's to Developer for limited porposes
only,remain the property of Applebee's,and may not be reprodoced,in whole or in part,
withoot the written consent of Applebee's
(5)
Employee agrees to sorrender toOeveloper or to Applebee's each and
every copy of the Manoals and any other information or material in his or her
possession or control opon regoest, opon termination of employment or opon
completion of the ose for which said Manoals or other information or material may have
been fornished to Employee
(6)
The parties agree that in the event of a breach of this Agreement,
Applebee's wooldbe irreparably injoredand woold be withoot an adegoate remedy at
law Therefore,intheeventofabreach orathreatenedorattempted breach of any of
the provisions hereof, Applebee's shall be entitled toenforce the provisions of this
Agreementasathirdpartybeneficiaryhereofand shall be entitled,in addition to any
other remedies whichit may havehereonder at law or in egoity (incloding the right to
terminatethe Development Agreement), toatemporaryand/orpermanentinjonction
20t4
^9742
and a decree for specific performance of the terms hereof without the necessity of
showing actual or threatened damage, and without being reguired to furnish a bond or
other security.
(7)
If any court or other tribunal having jurisdiction to determine the validity or
enforceability of this Agreement determines that it would be invalid or unenforceable as
written, the provisions hereof shall be deemed to be modified or limited to such extent or
in such manner necessary for such provisions to be valid and enforceable to the
greatest extent possible.
IN WITNESS W H E R E O F , the undersigned have entered into this Agreement as
of the date first above written.
DEVELOPER
By:
Name:
Title:
EMPLOYEE
:
By:
Name:
E-49
1051974.2
2014
ADDENDUM TO D E V E L O P M E N T A G R E E M E N T
[Limited Liability Company]
THIS ADDENDUM TO D E V E L O P M E N T A G R E E M E N T ("Addendum") is entered
this
day of
, 20
, by and between Applebee's
Franchisor
LLC, a
Delaware
limited
liability
company
("Franchisor"),
, a
limited liability company ("Developer"), whose
members are
, a
("
") and
("_
")
and
individually referred to as "Member" and collectively as "Members"),
sole
shareholder
of
and
")
and
,
sole
shareholder
of
("
individually
") (Members,
and
("
referred to as "Principal Shareholder" and collectively as "Principal Shareholder").
WITNESSETH:
W H E R E A S , contemporaneous with the execution of this Addendum, Franchisor
and Developer are executing an Applebee's Neighborhood Grill & Bar Development
Agreement ("Development Agreement") granting Developer certain rights regarding
the Territory therein described; and
W H E R E A S , the same parties desire to amend the Development Agreement to
reflect accurately the identity and nature of the parties to the Development Agreement
as a result of Developer's form of business as a limited liability company.
NOW, T H E R E F O R E , the Development Agreement is hereby amended as
follows:
1.
Subsections 7.1, 7.2 and 7.6 of Section 7, entitled "DEVELOPER
ORGANIZATION, AUTHORITY, FINANCIAL CONDITION AND SHAREHOLDERS", are
hereby amended by deleting the same as each now appears and inserting the following
in its respective place and stead:
"7.1 Developer and the Principal Shareholders represent and warrant that:
(a) Developer is a limited liability company, validly existing and in good
standing under the laws of the state of its organization; (b)
and
are each a corporation, validly existing and in good
standing under the laws of the state of their incorporation; (c) Developer is
duly gualified and is authorized to do business and is in good standing in
each jurisdiction in which its business activities or the nature of the
properties owned by it reguires such gualification; (d) _ _ _ _ _ _ _ _ and
are each duly gualified and authorized to do business and
are in good standing in each jurisdiction in which their respective business
activities or the nature of the properties owned by each reguired such
qualification; (e) the execution and delivery of this Agreement and the
transactions contemplated hereby are within Developer's power under its
articles of organization and operating agreement; (f) the execution and
E-50
1051974.2
2014
deêôfÂgêmeot^
withio
and
'spower onder their respe^ve
articles of incorporations
Agreement have been doiy authorized hy the Oeveloper; (h) the e x e c ^
and delivery of this Agreement has heen duly authorized hy
and
;(i) the operating agreement, articles
of organization and certificate of organization of Oeveloper delivered to
Franchisor are true, complete and correct, and there have heen no changes
therein since the date t h e r e o f ; ^ t h e articles of incorporation, hyiaws and
certificate of incorporation of
and
delivered to Franchisor are true, complete and correct, and there have heen
no changes therein since the date t h e r e o f ; ^ t h e specimen certificate of
shares provided to Franchisor, if any,representing the memher's ownership
interestin Oeveloper i s a t r u e specimen of OevelopeBs certificate of shares;
(l)the financial statement of Oeveloper and financial statements of its
Frincipal Shareholders, heretofore delivered to Franchisor, are true,
complete and correct, and fairly present the financial positions of Oeveloper
a n d e a c h Frincipal Shareholder, respectively, as of the date thereof; (m)
such financial statements have heen prepared in accordance with generally
accepted accounting principles; and (n) there have heen no materially
adverse changes in the condition, assets or liahilities of Oeveloper or
Frincipal Shareholders since the date or dates thereof "
^ 2 Oeveloper and each Frincipal Shareholder covenant that during the
termof this Agreement: (a) Oeveloper shall d o o r c a u s e t o h e d o n e a l l
things necessary to preserve and keep in full force its existence asalimited
liahility company and shall he in good standing in each jurisdiction in which
its business activities or the nature of the properties owned hy it reguires
such gualification; (h) Oeveloper shall have the authority under its articles of
organization and operating agreement to carry out the terms of this
Agreement; and (c) Oeveloper shall print, inaconspicuousfashion on all
certificates, if any, evidencing membership interest in Oeveloper when
issued, a legend referring to this Agreement and the restrictions on and
obligations of Oeveloperand FrincipalShareholdershereunder, including
the restrictions on transfer of Oeveloper's membership interests "
"7 6 Frincipal Shareholders, jointly and severally, hereby personally and
unconditionally guarantees each of Oeveioper's financial obligations to
Franchisor (including, but not limited to, all obligations relating to the
payment of fees by Oeveloper to Franchisor) Frincipal Shareholders agree
that Franchisor may resort to either or any of them for payment of any such
financial obligation, whether or not Franchisor shall have proceeded against
Oeveloper, any other Frincipal Shareholder or any other obligor primarily or
secondarily obligated to Franchisor with respect to such financial obligation
Fach Frincipal Shareholder hereby expressly waives presentment, demand,
notice of dishonor,protest and all other notices whatsoever with respect to
Franchisor's enforcement of this guaranty
In addition, each Frincipal
Shareholder agrees that if the performance or observance by Oeveloper of
F-^
20^
10^9742
any term or provision h e r ^
extended by Franobisor, or payment of any suob finanoiai o b l a t i o n is
aooeierated in aooordanoe witb any agreement between Franobisor and any
party iiabie in respeot thereto or extended or renewed, in wboie or in part, aii
as Franobisor may determine, whether or not notioe to or consent by any
Prinoipai Shareholder or any other party iiabie in respect to suoh financial
obligations isgiven orobtained, such actionsshall n o t a f f e c t o r a l t e r t h e
guaranty of any Principal Shareholder described In this SubsectionB
2
Subsections 8BI, 8 ^ a ) , 8 ^ b ) , 8 3 and 8 4 of Section 8, entitled
" T P A N S P E P " , a r e h e r e b y a m e n d e d b y deleting the same as eachnow appears and
inserting the following in its respective place and stead:
"8BI There shall be no Transfer of any Interest of Oeveloper, or of a
Principal Shareholder in Oeveloper, in whole or in part (whether voluntarily
or by operation of law), directly, indirectly or contingently, except in
accordance withthe provisions of this Section8"Transfer"and"lnterest"
are defined in S u b s e c t i o n s 8 2 , 8 8 a n d 8 4 B
82
"(a)
any change in the ownership of or rights in or to any
membership Interest or other eguity interest of any of the Principal
Shareholders in Oeveloper which would result from the act of such Principal
Shareholder of Oeveloper, such as a sale, exchange, pledge or
hypothecation of the membership interest in or rights to any of Oeveloper's
profits, revenues or assets, o r a n y such change which would result by
operation of law; and
(b)
any change in the percentage interest owned by any of the Principal
Shareholders in their membership interest or other eguity interests in
Oeveloper's profits, revenues or assets which would result from any act of
Oeveloper such as a sale, pledge or hypothecation of any Restaurant
assets (other t h a n a p l e d g e of assets to secure ^ a ^ e loans made or
credit extended In connection with acguisition of the assets pledged,
provided that immediately before and after such transaction the net worth of
Oeveloper satisfies the applicable liguid asset reguirement described in
Subsection 7.8 of this Agreement; any sale or issuance of any of
OevelopeBs membership interests or other eguity interests); the retirement
or redemption of any membership interest in Oeveloper; or any sale or grant
to any person of any right to participate in or otherwise to share or become
entitled to any part of Oeveloper's profits, revenues, assets or eguityB
"88
"Transfer"shallnotlnclude(a)achange in the ownership of or rights
to any shares or other eguity interest in Oeveloper under the Securities Act
of 1988,or (b)achange in the ownership of or rights to any securities or
other eguity Interest in Oeveloper pursuant to a private offering of
Developer's securities exempted from registration under such Act, provided
that Oeveloper, provides Pranchisorwith a c o p y o f ItsprospectusandBor
offering memorandum ten(10) days prior to Its filing with the Securities and
5^2
^9742
2014
Exchange Commission
oommont and, if nooossaôorreot any information oonoeming Franchisor
andôrfhe System, and forther provided that aftergiving effect to soch
pohiicorprivateoffering, the Frincipai Sharehoiders"controi" Oeveioper
For porposes ofthis Section 8, "control means either: (downing iegai and
egoitahietitie to f i f t y o n e p e r c e n t ^ % ) or more ofthe ootstanding voting
interests of the Oeveioper, which are notsohjectto proxygranted t o o r
contract with any other person or party granting that party the right to vote
part or aii of soch secorities, s h a v i n g and continoaiiy exercising the
contractoai power presently to designateamajority of the directors of the
Oeveloper, or s h a v i n g and continoaiiy exercising the right, powerand
aothority t o a c t o n hehaifof, manage, operateandotherwiseohiigateor
hind Oeveloper in the condoct of Oeveioper'shosinessB
" 8 4 "Interest" shall mean: when referring to interests or rights in
Oeveloper, the membership interest of the Frincipal Shareholders in
Oeveloper and any other egoitahle or legal right in or to any of the Frincipal
Shareholders' Interest in Developer's revenoes, profits or assets; when
referring to r l g h t s o r a s s e t s o f Oeveloper, Oeveloper'srlghtsonderand
interest in this Agreement, any Restaorant and its revenoes, profitsand
assets"
8
AppendixO to Oevelopment Agreement, entitled "STATEMENT OF
OWNERSFIIF INTERESTS" shall he amended t o ^ d e l e t e the word'Shareholder''and
insert the word "Member" in lieo thereof,^
and Ootstanding Shares of Oeveloper" and insert the phrase "Percent of Oontribotions
to and Ownership Egoity in Oeveloper" in lieo thereof
4
The first paragraph of AppendixE to Oevelopment Agreement, entitled
"OONFIOENTIALITY A G R E E M E N T ANO COVENANT NOT TO O O M F E T E " , i s hereby
amended by deleting the same as it now appears and inserting the following in its place
and stead:
"THIS A G R E E M E N T is made this
day of
,
20
,
by
and
between
,
a
limited
liability
company
("Developer"),
and
, an individual employed by Developer
("Employee")."
5.
The first paragraph of Appendix F to Development Agreement, entitled
"CONFIDENTIALITY A G R E E M E N T " , is hereby amended by deleting the same as it now
appears and inserting the following in its place and stead:
20
,
by
and
between
limited liability
day of
,
a
company ("Developer"), and
, an individual employed by
,
Developer ("Employee")."
E-53
1051974.2
2014
6
The C o c h i s e agreement which is a r c h e d as Appendix^ tc
Oeveicpmeot Agreement (the " F r a o c h ^ e A g r e e m e n t a^d aii agreements entered
pursuant to such Franchise Agreement hetween the parties hereto under this
Oeveiopment Agreement shaii he amended as set forth in the foiiowingparagraphs^
t h r o u g h ^ and shaii he interpreted and governed in accordance with this Addendum
Any future amendment or modification to the Franchise Agreement and aii agreements
entered pursuant to such Franchise Agreement under the Oeveiopment Agreement
shaii not affect this Addendum uniess such amendment or modification expressiy refers
to this Addendum
7
The first paragraph on F a g e l o f the Franchise Agreement is amended hy
deleting the same as it now appears and inserting the foiiowing in its piace and stead:
"This Appiehee's Neighborhood Griii ^ Bar Franchise Agreement (the
"Franchise A g r e e m e n t is made this
day of
,
20
, h y and between Appiehee's Franchisor LLC, aOeiaware limited
liability company ("Franchisors
, a
limited liability company ("Franchisees whose members
are ("Members^ (Members,
and
shall
be individually referred to herein as the "Principal Shareholder" and
collectively as the "Frincipal Shareholders") "
8
S u b s e c t i o n s 1 1 B I , H 2 a n d 1 1 5 o f S e c t i o n s , entitled "FPANCFIISF
ORGANIZATION,AOTHO^^
hereby amended by deleting the same as it now appears and inserting the following in
its place and stead:
" U BI Franchisee and each Frincipal Shareholder represent and warrant
that: (a) Franchisee is a limited liability company, validly existing and in
good standing under the laws of its state of organization; (b)
and
are each a corporation, validly
existing and in good standing under the laws of the state of their
incorporation; (c) Franchisee is duly gualified and is authorized to do
business and is in good standing in each jurisdiction in which its business
activities or the nature of the properties owned by it reguires such
gualification; (d)
and
are each duly
gualified and authorized to do business and are in good standing in each
jurisdiction in which itsrespectivebusiness activities or thenature of the
properties owned by It reguired such gualification; (e)theexecution and
delivery of this Agreement and the transactions contemplated hereby are
within Franchisee's power under its articles of organization and operating
B agreement; (f) the execution and delivery of this Agreement and the
transactions contemplated hereby are within
and
's power under their respective articles of incorporation and
bylaws; (g)the execution and delivery of this Agreement has been duly
authorized by the Franchisee; (h) the execution and delivery of this
Agreement have been duly authorized by
and
; (i) the operating agreement,articles of organizationand
F-54
^9742
2^4
cert^cateof o r g a o ^ i o o of F r a o o h i s e e d e ^ e r e d t o Fraoohisoraroôe,
oomplofoaodooôoL and fhoro have been oo ohaogosfhere^
date thereof; ^ the arfioles of iooorporafio^ hylaws aod oerfifioafe of
iooorporafioo of
aod
delivered to
Fraoohisor are true, oomplefe arid oorreot, and there have heeri oo ohaoges
therein G o e t h e date fhereof;^fhafaoyspeoimeooerfifioateev^
memhership interest in Franchisee delivered to Franchisor porsoant to
S o h s e c t i o n ^ ^ e ) hereof is a troespecimen of Franchlsee'scertiflcate
evidencingarnernhershlp interest in sochllrnitedliahilifycompany;(l)t^^
most recent balance sheet of Franchisee b a l a n c e S h e e t s and the most
recent balance sheets of its Frincipal Shareholders heretofore delivered to
Franchisor, are troe, complete and correct, and fairly present the financial
positions of the Franchisee and each Frincipal Shareholder, respectlvely,as
of the date or date thereof; (m) the Balance Sheet and each soch balance
sheet have been prepared in accordance with generally accepted
accoonting principles; and(n) there have been no materially adverse
changes in the condition, assets or liabilities o f t h e Franchisee or the
respective Frincipal Shareholders since the date or dates thereof "
"112 Franchisee and each Frincipal Shareholder covenant that doring the
termof this Agreement: ( a ) F r a n c h i s e e s h a l l d o o r c a o s e t o b e d o n e a l l
things necessary to preserve and keep In foil force Its existence asallmited
liability company and shall be in good standing in each jorisdlctlon in which
its bosiness activities or the natore of the properties owned by It regoires
soch goallfication;(b)Franchisee shall have the aothority onder its articles
of organization and operating agreement to carry oot the terms of this
Agreement; (c) Franchisee shall print, in a conspicooos fashion on all
certificates, if any, evidencing membership Interest in Franchisee when
Issoed, a legend referring to this Agreement and the restrictions on and
obligations of Franchisee and Frincipal Shareholders hereonder, incloding,
therestrictions on transfer of Franchisee's membership lnterests;and(d)
shall print, In a consplcooosfashion on all certificates
evidencing shares In soch respective company when Issoed, a legend
referring to this Agreement and the restrictions on and obligations of soch
Frincipal Shareholders hereonder, Incloding therestrlctlons on transfer of
soch Frincipal Shareholder's shares Forther,Franchisee shall deliver to
Franchisor prior to the aothorized change of any membersatroe specimen
certificate evldencingmembership interest In the limited liability company,
bearing the legend described hereinB
"115Frincipal Shareholders,jointly and severally,hereby personally and
oncondltionally goarantees each of Franchisee's financial obligations to
Franchisor (incloding, hot not limited to, all obligations relating to the
payment of fees by Franchisee to Franchisor) Fach Frincipal Shareholder
agrees that Franchisor may resort to soch Frincipal Shareholder (or any of
them) for payment of any soch financial obligation, whether or not
Franchisorshall have proceeded against Franchisee, any other Frincipal
Shareholder or any other obligor primarily or secondarily obligated to
^55
^9742
2014
Franchisor with respect to soch financiai chiigaticn
Each Frincipai
Shareholder herehy expressly waives presentment, demand, notice of
dishonor, protest, and all other notices whatsoever with respect to
Franchisor's enforcement of this guaranty
In addition, each Frincipal
Shareholder agrees that If the performance or ohservancehy Franchisee of
any term or provision hereof Is waived or the time of performance thereof
extended hy Franchisor, or payment of any soch financial ohligation is
accelerated In accordance with any agreement hetween Franchisor and any
party liahle in respect thereto or extended or renewed, in whole or in part, all
as Franchisor may determine, whether or not notice to or consent hy any
Frincipal Shareholder or any other party liahle inrespect to soch financial
ohligations is givenor obtained, soch actions shallnot affect or alter the
goaranty of any Frincipal Shareholder described in this SohsectionB
9
Sobsections 12 ^ a ) and (b), 12 3 and 12 4 of Section 12, entitled
"TRANSFER", are hereby amendedby deleting the same as eachnow appears and
Inserting the following In its respective place and stead:
12 2 "(a) any change in the ownership of or rights In or to any membership
interest or other egoity Interest of any Frincipal Shareholder In Franchisee
which woold resoltfromtheactofsoch Frincipal Shareholder ofFranchisee,
soch as a sale, exchange, pledge or hypothecation o f t h e membership
Interest in, or any Interest In or rights to any of Franchisee's profits,
revenoes or assets, or any soch change which woold resolt by operation of
law; and
(b)
any change in the percentage interest owned by any of the Frincipal
Shareholders in their membership interest or other egoity interest in
Franchisee's profits, revenoes or assets which woold resolt from any act of
Franchisee soch as a sale, pledge or hypothecation of any Restaorant
assets (other t h a n a p l e d g e of assets to s e c o r e ^ a ^ e loans made or
credit extended In connection with acgoisitlon of the assets pledged,
provided that immediately before and after soch transaction the net worth of
Franchisee shallnot b e l e s s t h a n t h e a m o o n t which i s r e f l e c t e d o n t h e
Balance Sheets referred to In S o b s e c t i o n 1 1 1 o f this Agreement); any sale
orissoance of a n y o f Franchisee's membershiplnterests or other egoity
interests; the retirement or redemption of any membership Interests In
Franchisee; or any sale or grant to any person of any right to participate in
or otherwise to share or become entitled to any part of Franchisee's profits,
revenoes, assets or egoity "
"123 "Transfer" shallnotlnclode(a)achange in the ownership of or rights
to any shares or other egoity interest in Franchisee onder the Secorltles Act
of 1933,or (b)achange In the ownership of or rights to any secorltles or
other egoity interest In Franchisee porsoant to a private offering of
Franchisee's secorltles exempted from registration onder soch Act, provided
that F r a n c h i s e e p r o v l d e s F r a n c h i s o r w i t h a c o p y o f i t s p r o s p e c t o s a n d ^ o r
offering memorandomten(IO) days priorto Itsfllingwiththe Secorltles and
F-^
2014
^9742
Exchange Oommissioo or
^
comment and, if necessary, correct any information concerningFranchisor
andôrthe System, and forther provided that aftergiving effect to soch
change of ownership or private offering, the Principal Shareholders "control
Franchisee
For porposes of this S e c t i o n s , "controis" means either:
(downing iegaiand egoitahie titie to fiftyone percent (51%)or more of the
ootstanding voting interests o f t h e Franchisee, which are not sohjectto
proxy granted to or contract withany other personor party granting that
party the right to vote part or aii of soch secorities, s h a v i n g and
continoaiiy exercising the contractoai power presently to designate a
majority o f t h e directors o f t h e Franchisee, o r ^ h a v i n g a n d continoaiiy
exercising the right, power and aothority to act on hehaif of, manage,
operate and otherwise ohiigate or hind Franchisee in the condoct of
Franchisee's hosinessB
"12 4 "interest" shall mean: when referring to interests or rights in
Franchisee, the membership interest of any Principal Shareholder in
Franchisee and any other egoitahie or iegai right in or to any of the Principal
Shareholders' interest in Franchisee's revenoes, profits orassets; when
referring torights or assets of Franchisee, Franchisee'srightsonderand
interest in this Agreement, the Pestaorant and its revenoes, profits and
assets"
10
Sohsection 144 of Section 14, entitled "INSPFOTiONS", is hereby
and stead:
"144 Franchisee shall maintain anaccorateregister of its certificates of
membership interest ("Membership Register") In the event that the
beneficial ownership of Franchisee differs in any respect from record
ownership, Franchisee also shall maintainalist of the names,addresses
and interests of aii beneficial owners Franchisee shall prodoce its
Membership Register and any list of beneficial owners certified by the
corporation's secretary to be correct, at its principal execotive offices opon
ten(10)
days prior written regoest by Franchisor Franchisor's
representatives s h a l l h a v e t h e r i g h t to examine theMembershipRegister
and any list of beneficial owners, and to reprodoce all or any part thereof
Forther,opon ten (10) days written notice,Franchisor may regoestacopy of
the i i s t o f a i l m e m b e r s a n d t h e i i s t o f o w n e r s of beneficial o w n e r s t o b e
forwardedto it at Franchisor's principal office "
11
Appendix A to Franchise Agreement, entitled "STATEMENT OF
OWNERSHIP iNTERESTS",shaii be amended to: (i) delete the word "Shareholder" and
insert the word "Members" in iieo thereof; (ii) delete the phrase "Percent of issoed and
Ootstanding Shares of Franchisee"and insert the phrase "Percent of Oontribotions to
Franchisee" in iieo thereof
F^B
^9742
20t4
12.
The first paragraph of Appendix C to Franchise Agreement, entitled
day of
,
20
,
by
and
between
, a
limited
liability
company
("Franchisee"),
and
, an individual employed by Developer
("Employee")."
13.
Each of the terms and provisions of this Addendum is deemed
incorporated by reference into the Development Agreement and the Franchise
Agreement, exhibits and appendices attached thereto as if fully set forth therein. When
a conflict exists between the subsections amended hereby and those contained in the
Development Agreement, Franchise Agreement, and exhibits and appendices attached
thereto, this Addendum shall control the construction and interpretation of such
document.
14.
No amendment or modification of this Addendum shall be binding unless
executed in writing by Franchisor, Oeveloperand Principal Shareholders.
15.
Any capitalized term not otherwise defined in this Addendum shall have
the meaning as set forth in the Development Agreement, Franchise Agreement, and
exhibits and appendices attached thereto, respectively.
IN WITNESS W H E R E O F , the undersigned have entered into this Addendum to
the Development Agreement as of the date first above written.
FRANCHISOR:
A P P L E B E E ' S FRANCHISOR LLC
By:
Name:
Title:
DEVELOPER:
LLC
By:_
Name:
Title:
E-58
1051974.2
2014
PRINCIPAL SHAREHOLDERS:
By:_
Name:
Title:
Name:
Name:
E-59
1051974.2
2014
AOOENOOM TO O E V E L O P M E N T A G R E E M E N T
[Limbed P a ^ n e r s h ^
T H I S A O O E N O O M T O O E V E L O P M E N T A G R E E M E N T ^ d e n d o m ^ is m ^ a n d
entered into as of the
day of
, 20 , hy and hetween
Appiehee's Franchisor LLO, a Oeiaware limited iiahiiity oompany ( " P r a n o ^ s o r ^
,
a
limited
partnership
("Oeveloper
^General
Partner
and
(together with General Partner, individually,a"Prmoipa1
S h a r e h o l d e r and oolleotively,the"Prmoipal S h a r e h o l d e r ^
WITNESSETH
W H E R E A S , contemporaneous with the execution of this Addendum, Franchisor,
Oeveloperand Principal Shareholders will execute an Applehee'sNelghhorhoodGrill^Bar
Oevelopment Agreement("OeveIopment A g r e e m e n t granting Oeveloper certain rights
regarding theTerritory; and
W H E R E A S , the same parties desire to amend the Oevelopment Agreement to
reflect accurately the identity and nature of the parties to the Oevelopment Agreement a s a
result of Oeveloper's form of business asalimited partnership
NOW, T H E R E F O R E , the Oevelopment Agreement is hereby amended as
follows:
1
S e c t l o n B A m e n d e d SectionsBBI a n d ^ 2 o f t h e O e v e l o p m e n t Agreement
are hereby amended by deleting said sections in their entirety and replacing them with the
following:
"71 Oeveloper and each PrincipalShareholder represent and warrant that:
(a) Oeveloper isalimited partnership duly formed,validly existing and in good
standing under the laws of
; (b)the General Partner is a limited
liability company duly organized, validly existing and in good standing under the
laws of the state of
;(c) Oeveloper Is duly gualified and is authorized
to do business and is in good standing in each jurisdiction in which its business
activities or the nature of the properties owned by it reguires such gualification;
(d) the General Partner is duly gualified and is authorized to do business and is
In good standing asaforeign company in each jurisdiction In which its business
(e) the execution and delivery of this Agreement and the transactions
contemplated hereby are within Oeveloper's power under its limited partnership
agreement; (f)the execution and delivery of this Agreement and the
transactions contemplated hereby are within the General Partner's power under
its articles of organization and operating agreement; (g)the execution and
delivery of this Agreement has been duly authorized by the Oeveloper; (h)the
execution and delivery of this Agreement has been duly authorized by the
General Partner; (i)the limited partnership agreement and the certificate of
limited partnership of Oeveloper delivered to Franchisor are true, complete and
FÔ
2014
^9742
coêoL and there have been no c ^
articles of organization and operating agreement of the Generai Partner
delivered to Pranohisor are true, oompiete and oorreot, and there have heen no
ohangesthereinsinoe the date thereof; (^the most reoenthaianoe sheet of
Oeveloper and the most reoenthalanoe sheet (oolieotivei^ âianoe Sheets")
of eaoh of thePrlnoipal Shareholders and
("Ooarantor")
heretofore delivered toPranohiso4aretroe,oompleteandoorreot,and fairly
present theflnanolalpositlonsof the Oeveloper, Prinolpal Shareholdersand
Guarantor, respeotively, as of the date or dates thereof; (I) the Salanoe Sheets
have heen prepared In aooordanoe with generally aooepted aooounting
principles; (m) there have heen no materially adverse ohanges In the oondition,
assets or liahilities of the Oeveloper, Prinolpal Shareholders or Guarantor sinoe
the date or dates thereof; (n)that any specimen certificate evidencing
ownership Interest In the limited partnership delivered to Franchisor pursuant to
Subsection 7 2(e) hereof is a true specimen of Oeveloper's certificate
evidencing ownership interest in the limited partnership; (o)the General
Partner's specimen membership certificatedelivered to Franchisor is a true
specimen ofthe General Partner's membership certificate; and (p)Oeveloper
and the General Partner have andBor will comply with all applicable rules,
regulations and statutes governing the sale of partnership interests, including,
but not limited to, the Securities Act of 1933, as amended; the Securities and
Exchange Act of 1934, as amended; and all applicable state securities rules,
regulations and statutes
72
Oeveloper and Principal Shareholders covenant that during the term of
this Agreement: (a) Oeveloper shall do or cause to be done all things
necessary to preserve and keep In full force its existence as a limited
partnership and shall be in good standing in eachiurisdiction in which its
business activities or thenature of thepropertles ownedby it reguires such
gualification; (b)theGeneralPartner shall do or cause to be done all things
necessary to preserve and keep in full force its existence and shall be in good
standing as a foreign company In each jurisdiction in which its business
(c) Oeveloper shall have the authority under its limited partnership agreement
to carry out the terms of this Agreement; (d) the General Partner shall have the
authority pursuant to its operating agreement to carry out t h e t e r m s o f this
Agreement; (e)Oeveloper shall print, in a conspicuous fashion on all
certificates evidencing ownership interest in the limited partnership when
issued, a legend referring to this Agreement and the restrictions on and
obligations of Oeveloper and the Principal Shareholders, including, but not
limited to, the restrictions on transfer or removal of any interest of the Principal
Shareholders in or of Oeveloper Further,Oeveloper shall deliver to Franchisor
priortothesaleofanypartnershipunitsatrue specimen certificate evidencing
ownership interest in the limited partnership, bearing the legend described
herein and shall certify to Franchisor that any existing certificates now bear the
legend described herein; and (f)the General Partner shall print, in a
conspicuousfashion on all certificates representing membership interests, a
legend referring to this Agreement and the restrictions on and obligations of the
6^1
^9742
2014
P r i n c e Sharehoêrs hereuode^ ioc^diog the restriotioos oo traosfer of
memhership interests io the G e o e ^ P a r t o e r
2
S e o t i o o ^ A m o o d e d S o o t i o o s 8 2 84oftheOevelopmeotAgroomootare
horohy amoodod hydeletiogsaid seotioosio their ootirotyaod repiaoiog them with the
foliowiog:
"82
Except as provided io Sohseotioo88, "Transfer" shaii meao aoy
assigomeot^saie, piedge, hypotheoatioo, gift or aoy other sooh event whioh
wooid change ownership of or change or oreateanew interest, inoiodiog,hut
not limited to:
(a)
any change in the ownership of or rights in or to the partnership interests
or other egoity interests of Oeveloper which wooidresoit from the act of the
PrincipalShareholders,soch a s a s a i e , e x c h a n g e , p l e d g e or hypothecation of
the partnership interest in or rights to any of OevelopeBs profits, revenoes or
assets, or any soch change which woold resolt hy operation of law;
(h)
any change in the percentage interest owned hy any Principal
Shareholder in the partnership interests or other egoity interests of Oeveloper,
or interests in Oeveloper's profits, revenoes or assets which woold resolt from
any act of Oeveloper soch a s a s a l e , p l e d g e or hypothecation of any Restaorant
assets (other thanapledge of assets to s e c o r e ^ o ^ a ^ e loans made or credit
extended in connection with acgoisitlon o f t h e a s s e t s pledged); any s a l e o r
issoance of any partnership interest or other egoity interest in Oeveloper; the
retirement or redemptionof any Interest inOeveloper;or any sale or grant to
any person of any right to participate in or otherwise to share or hecome
entitled to any part of Oeveloper's profits, revenoes, assets or egoity; and
(c)
the removal of the General Partner andôr the sohstitotion or addition of
a n e w general partnerto the Oeveloper
88
"Transfer" shall not i n c l o d e ( a ) a c h a n g e i n the ownership of or rights to
any partnership interest orotheregoity interest in Oeveloper porsoant to a
pohlic offering of Oeveloper's secorities registered onder the Secorities Act of
1 9 8 8 , o r ( h ) a c h a n g e in the ownership of or rights to any secorities or other
egoity interest in Oeveloper porsoant to a private offering of Oeveloper's
secorities exempted from registration onder soch Act, provided that Oeveloper
provides Franchisor w i t h a c o p y of its prospectosandôr offering memorandom
ten (10) days prior to its filing with the Secorities and Exchange Oommission or
circolation to third parties so that Franchisor may comment and, if necessary,
correct any information concerningFranchisorandôr the System,and forther
provided that after giving effect to soch pohlic or private offering, the General
Partner "controls" Oeveloper
For porposes of this Section 8, "control"
means having and continoaiiy exercising the right, power and aothority to act
on hehaif of, manage, operate and othenîse ohiigate or hind Oeveloper in the
condoct of Developer's hosiness
2014
^9742
8.4
"Interest" shall mean: when referring to interests or rights in Developer,
the partnership interests of the Principal Shareholders in Developer and any
other egultable or legal right in or to Developer's revenues, profits or assets;
when referring to rights or assets of Developer, Developer's rights under and
interest in this Agreement, any Restaurant and its revenues, profits and
assets."
Notwithstanding the terms of Section 8.7 of the Development Agreement, the proposed
sale of an Interest owned by the General Partner will be subject to all of the terms thereof.
3.
Appendix D Amended. Appendix D, entitled "STATEMENT OF OWNERSHIP
INTERESTS", shall be amended to remove the phrase "Shareholder" and the phrase
"Partner" shall be inserted in lieu thereof. The phrase "Percent of Issued and Outstanding
Shares of Developer" shall be amended and replaced by the phrase "Percent of Interest
Owned in Developer". Appendix D shall further be amended to add two new columns as
follows:
Percent of Interest
Partner
Owned in Developer
General Partner-
0
Limited Partners -
0
/c
/c0
"%
4.
Appendix F Amended.
The first paragraph of Appendix F, entitled
"CONFIDENTIALITY A G R E E M E N T AND COVENANT NOT TO COMPETE", is hereby
and stead:
day of
20
, by and between
limited partnership ("Developer"), and
an individual employed by Developer ("Employee")."
,
, a
,
5.
Appendix G Amended.
The first paragraph of Appendix G, entitled
day of
20
, by and between
partnership ("Developer"), and
individual employed by Developer ("Employee")."
, a
'
limited
, an
6.
General Partner: Legal Status. Nothing contained in this Addendum will be
construed to limit any liability that General Partner may incur as a result of its legal status
as a general partner of Developer under applicable law.
E-63
1051974.2
2014
7
Govemioo Law
Addendum w ^ he governed
law" provision or rule
The i ^ e ^ e t a ^ o ,
c o o s ^ o ^ o o and vanity of this
8
No Further Amendment
No further amendment or modifioation of the
Oevelopment Agreement s h a l l h e hlndlng unless executed In writing hy Franchisor and
Oeveloper or their authorized successors or assigns No course of conduct or course of
performance under this o r a n y other agreement hetween the parties will he deemed to
modify this Addendum Except as expressly set forth In this Addendum, the Oevelopment
Agreement remains In full force and effect
9
Entire Agreement This Addendum and the agreements, documents
Instruments referenced herein constltutetheentlre agreement hetween thepartles
respect tothesuhject matter hereof, superseding and cancelling a n y a n d all prior
contemporaneous agreements, understandings, representations, Inducements
statements, oral or written, of the parties In connection with the suhject matter hereof
and
with
and
and
10
Fleadlngs
The section headings are Inserted a s a m a t t e r of convenience
and In no way define, limit or describe the scope of such section or affect the Interpretation
of this Addendum.
11
Oounteroarts
This Addendum may heslgned In counterpartsand each
counterpart wlthahandwrlttenslgnature, whether anorlglnal or an electronic datatext
(Including telegram, telex, facsimile, electronlcdata Interchangeand electronlcmall) Is
considered an original and all counterparts constitute one and the same Instrument.
12
Miscellaneous Each o f t h e terms and provisions of this Addendum Is
deemed Incorporated hy reference Into the Oevelopment Agreement When a conflict
exists hetween this Addendum and the Oevelopment Agreement, this Addendum shall
control Any capitalized term not otherwise defined In this Addendum shall have the
meaning as set forth In the Oevelopment Agreement If any provision of this Addendum Is
found to he unenforceable,theremalnlngprovlslons will continue to he In full force and
effect This Addendum will be binding upon and Inure to the benefit of the parties, their
successors and permitted assigns No waiver of any provision of this Addendum will be
enforceable agalnstaparty unless It Is In writing and signed by such party No waiver by
anypartyofanyprovlslonsofthlsAddendumwIllbedeemedtobeorconstltuteawalverof
any other provision hereof (whether or not similar), nor will such waiver constitute a
continuing waiver unless othen^lse expressly provided
IN WITNESS W H E R E O F , the parties have executed this Addendum as of the date
first written above
FRANCHISOR:
A F F L E B E E ' S FRANCHISOR LLC
^
Name:
Title:
F-^
10^742
2014
DEVELOPER:
By:
Its General Partner
By:_
Name:
Title:
PRINCIPAL S H A R E H O L D E R S :
Name:
Name:
E-65
1051974.2
2014
EXHIBIT F
FRANCHISE AGREEMENT
F-1
I051975.2
.
2014
EXHIBIT F
S T A N D A R D FORM
FRANCHISE A G R E E M E N T
(Location Address)
(Franchisee Name)
(Date)
F-2
1051975.2
2014
SUMMARY PAGES
1.
Addresses for Notices:
Franchisor:
8140 Ward Parkway
Attn: General Counsel
Telephone Number: (913) 890-0100
Fax Number: (913) 890-9100
Franchisee:
Attn.:
Telephone Number:
Fax Number:
2.
Commencement Date:
, 20
3.
Delivery Date of Franchise Disclosure Document:
4.
Development Agreement: The Development Agreement between Franchisor and
Franchisee dated
, 20
5.
Effective Date:
6.
Governing Law and Jurisdiction: State of Kansas and Federal Courts of the
State of Kansas (Johnson County)
7.
Initial Franchise Fee: $35,000
8.
Insurance: See Section 16
9.
Internet/World Wide Web: Franchisee has no right, license or authority to use
any of the Marks on or in connection with the Internet, except as stated in and
permitted by Section 18.5.
10.
Interference with Employment Relations: If Franchisee seeks to employ a person
employed by another franchisee or Franchisor in a managerial position presently
or during the past 6 months without written consent of the employer, Franchisee
must pay 3 times the annual salary plus reimbursement of costs to employer.
11.
Local Ad Expenditure: % (.5)% of each calendar month's Gross Sales
12.
Monthly Advertising Fee: 3.25%
, 20
F-3
1051975.2
, 20
2014
13.
Ownership Interests in Franchisee are owned by:
Name
Percentage
1.
2.
3.
4.
5.
14.
Principal Shareholders):,
15.
Renewal: Four 5-year terms at 10% of the then-current Franchise Fee for each
renewal period. Franchisee must notify Franchisor 7-12 months before
agreement expires if wish to renew.
16.
Restaurant Location:
17.
Restricted Area: The lesser of (a) a three (3) mile radius of the Restaurant within
an international border or (b) a radius from the Restaurant that includes either a
daytime or residential population of forty thousand (40,000) or more people.
18.
Royalty Rate: 4% through January 1, 2020
19.
Term: The period commencing on the Effective Date and ending 20 years from
the Commencement Date, subject to earlier termination in accordance with the
terms of this Franchise Agreement
20.
Training: Franchisor will provide at its expense up to a maximum of 6 training
persons for approximately 8 days before the opening of the Restaurant and
the first 6 days that the Restaurant is open for business
21.
Transfer Fee: $2,500 for this Franchise Agreement
The Summary Pages are provided for information purposes only and to the extent the
Summary Pages conflict with the terms of the Franchise Agreement, the terms of the
Franchise Agreement will control.
F-4
1051975.2
2014
TABLE OF CONTENTS
RECITALS
F-6
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
F-7
F-9
F-9
F-10
F-10
F-13
F-14
F-15
F-18
F-20
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
FRANCHISE GRANT AND TERM
UNIFORM STANDARDS
COMPLIANCE WITH THE SYSTEM
GENERAL SERVICES OF FRANCHISOR
RESTAURANT SYSTEM AND PROCEDURES
TRAINING
RESTAURANT MAINTENANCE
ADVERTISING
FEES
RECORDKEEPING
FRANCHISEE ORGANIZATION, AUTHORITY,
FINANCIAL CONDITION AND SHAREHOLDERS
TRANSFER
CONFIDENTIALITY; RESTRICTIONS
INSPECTIONS
RELATIONSHIP OF PARTIES AND INDEMNIFICATION
INSURANCE
DEBTS AND TAXES
TRADE NAMES, SERVICE MARKS AND TRADEMARKS
EXPIRATION AND TERMINATION; OPTION TO
PURCHASE RESTAURANT; ATTORNEYS' FEES
NO WAIVER OF DEFAULT
«
CONSTRUCTION, SEVERABILITY,
GOVERNING LAW AND JURISDICTION
INTERFERENCE WITH EMPLOYMENT RELATIONS
LIQUOR LICENSE
FORCE MAJEURE
MISCELLANEOUS
ACKNOWLEDGMENTS
F-21
F-24
F-28
F-30
F-31
F-33
F-35
F-35
F-37
F-42
F-42
F-43
F-44
F-44
F-45
F-47
EXHIBIT 1:
ROYALTY FEE
F-49
APPENDIX A:
F-5O
APPENDIX B:
REVIEW AND CONSENT WITH
RESPECT TO TRANSFERS
F-51
APPENDIX C:
CONFIDENTIALITY AGREEMENT
F-52
APPENDIX D:
EFT WITHDRAWAL AUTHORIZATION
F-55
F-5
1051975.2
2014
FRANCHISE AGREEMENT
This Agreement is made this
day of
20
, by and between Applebee's Franchisor LLC, a Delaware limited liability
company ("Franchisor"),
;
, a
(
corporation, sole proprietorship,
partnership,
limited partnership [strike inappropriate language])
("Franchisee")
and
(collectively, the "Principal Shareholders" and, individually, a "Principal Shareholder" of
Franchisee if a corporation or general partner if Franchisee is a limited partnership
having
as
its
general
partner
a
corporation)
and
("General Partner"
of Franchisee if Franchisee is a limited partnership).*
*
(If Franchisee is not a corporation or a sole proprietorship, or if Franchisee is
a limited liability company, the parties hereto hereby agree that an Addendum shall be
attached to this Agreement so as properly to reflect the responsibilities of the partners of
any general partnership, the general partner of any limited partnership and the
shareholders of any corporate general partner of any partnership, or the members of
any limited liability company.)
WITNESSETH:
RECITALS
A.
Franchisor owns the rights to develop and operate a unigue system of
restaurants which specialize in the sale of high guality, moderately priced food and
alcoholic beverages in an attractive, casual setting. Franchisor owns the service mark
Applebee's Neighborhood Grill & Bar and variations of such mark, and other names,
service marks and trademarks which may be adopted for use in the future (the "Marks"),
designs, decor and color schemes for restaurant premises, signs, eguipment,
procedures and formulae for preparing food and beverage products, specifications for
certain food and beverage products, inventory methods, operating methods, financial
control concepts, training facilities and teaching technigues ("the System"). Franchisor
has the right to offer franchises for the use of the Marks and the System.
B. Franchisor established, through its own development and operation, and
through the granting of franchises, a chain of Applebee's Neighborhood Grill & Bar
restaurants which are distinctive; which are similar in appearance, design and decor;
and which are uniform in operation and product consistency.
C. The value of the Marks used in the System is based upon: (1) the
maintenance of uniform high guality standards in connection with the preparation and
sale of Franchisor-approved food and beverage products, (2) the uniform high
standards of appearance of the individual restaurant units in the System, (3) the use of
distinctive trademarks, service marks, building designs and advertising signs
representing a uniformly high guality of product and services, and (4) the assumption by
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1051975.2
2014
Franchisor a n d i t s ^ a n c ^
and puhiic acceptance of the
standards required hy Franchisor
0
Franchisor, Franchisee and the Frincipai Shareholders have entered intoa
Oevelopment Agreement dated
, 20
("Oevelopment
Agreement"^relating to the development hy Franchisee of Applehee'sNeighhorhood
G r i l l ^ B a r restaurants
F. Franchisee desires to use the System in connection with the operation of an
Applehee's Neighhorhood O r i l l ^ B a r r e s t a u r a n t a t t h e location which isspecified in
SuhsectionlBI of this Agreement, pursuant to the terms, conditions and provisions
hereinafter set forth
N O W , T H F R F F O R F , in consideration ofthe mutualohligationscontained herein, It is
herehy agreed as follows:
1
FRANOFIISF G R A N T ANO T F R M
1BI Franchisor grants Franchisee,for the term stated helow,the right, license and
privilege:
(a) to use the System incident to the operation of an Applehee's
NeighhorhoodOrillÔar restaurant at
(the "Restaurants
(h) to use the Marks which Franchisor shall from time to time designate as
part of the System, hut only in connection with the sale at the Restaurant of those
products which Franchisor has designated and approved; and
(c)
to hold itself out to the puhlicasaFranchisee of Franchisor
1 2 The term of the franchise shall commence as of the OommencementOate, as
hereinafter defined, and shall end twenty (20) years thereafter, unless this Agreement is
terminated prior to that date in accordance with its provisions "OommencementOate,"
as usedherein, shall mean the date upon which the Restaurant opens for business
The parties agreethatFranchlsor,withoutohtaining the signature of Franchisee,may
affix to this Agreement an addendum expressly setting forth the OommencementOate,
which,when so affixed,shall hecomeapart of this Agreement.
1 3 A t t h e expiration o f t h e term hereof, Franchisee shall have an option to
operate the Restaurant for four (4) successive terms of five (5) years (unless the
franchise agreement with respect to that additional temi is sooner terminated in
accordance with its provisions), provided that immediately prior to each such five (5)
year term (a) Franchisee satisfies the regulrements which Franchisor then imposes on
its new franchisees, (h)all other restaurant units within the System whichFranchisee
thenoperatessuhstantiallycomply, in the opinion of Franchisor,with Franchisor's then
current standards, specifications, reguirements and instructions, and (c) Franchisee
FBB
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executes the form of ^ a o c h i ^
newrosfauraofswifhio f h o S y s f e m , w i f h f h e a m o u n f of royalty and advortisingfoos
payable at the rates thoo prevailiog under the fraoohiso agree
then using for new restaurants w ^
eaoh of said f i v e - y e a r perlodsafranohlse fee egual to ten peroent^0%) of the
prevailing franchise fee paid hy new franchisees at that time Any franchise agreement
which Franchisee executes for such additional term will aiso contain options to obtain
an assignment of Franchisee's iease with a third party andBorto purchase certain
property or to purchase or ieasetheRestaurant premises exercisable by Franchisor
upon termination thereof and an option to purchase or iease the Restaurant premises
exercisable by Franchisor upon expiration of the renewal term (subject to any
then existing renewal rights of Franchisee) Such options will contain provisions
substantially similar to the provisions of Franchisor's options described in
Subsection194hereof Franchisee shall give Franchisor written notice of its desire to
exercise its option to operate the Restaurant f o r a n additional term noearlierthan
tweive(12) months, and no later than seven (7) months,prior to expiration of the initial
term
if Franchiseegives that notice, Franchisor, in its soiediscretion, reasonably
exercised, shaii determine whether Franchisee has satisfied the foregoing
reguirements
Within forty five(45) days of receiving the notice described above,
Franchisorshall notify Franchisee in writing whether or not Franchiseeiseligibieto
exercise the option described in this Subsection
1 4 During the period from the date of this Agreement to the expiration or earlier
termination of this Agreement,Franchisor shall not estabiisharestaurant unit u t i l i z e
theSystem, o r i i c e n s e a n o t h e r f r a n c h i s e e t o e s t a b i i s h a restaurant unitutilizing the
System,at any location within the lesser ofathree (8) mile radius of the Restaurant o r a
radiusfromtheRestaurantwhich includes eitheradaytime or residential population of
forty thousand (40,000) or more people; provided,however,the three (8) mile radius will
be reduced to the extent it would extend over an international border. Notwithstanding
the foregoing, Franchisor may estabiisharestaurant unit or may iicensearestaurant
u n i t t o a t h i r d party within thegeographic area set forth in theprecedingsentence,
providedthat(i)suchrestaurant isiocatedwithin an airport (serviced by one or more
publioor charter carrier), train station, bus terminal, port authority, campus at any
college, university o r o t h e r p o s t s e c o n d a r y education institution, hospitaisand other
health care facilities, arena, stadium, state or national park, or military fort, post or base,
travelplaza or casino, (ii) is located across an international border, o r ( i i i ) d o e s n o t
utilize the System or utilize the Applebee's Neighborhood G r i i l ^ B a r service mark
1 5 Franchisee, in consideration of the benefits and privileges provided to it hy
this Agreement, agrees to operate the Restaurant and perform as reguired hereunder
for the full term of this Agreement
1 6 This Agreement isentered i n t o p u r s u a n t t o a n d subjectto the termsand
conditions which are set forth in the Development Agreement
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2
ONÔRMSTANOAROS
2.1 The System isacompreheosive restaurant system for the re^^
uniform and quality food and heverage products (including alcoholic heverages),
emphasizlngavariedmenuofhighquality, moderately priced food products (including
appetizers,creative sandwiches,dinner entrees and dessertsâselection of alcoholic
and other heverages,and prompt and courteous service inaclean,wholesome,casual
atmosphere The foundation ofthe System is the estahlishment and maintenance o f a
reputation among the puhlic for the operation of high guality restaurant units A
fundamental reguirement o f t h e System, this Franchise Agreement and franchises
which Franchisor will grant to o t h e r s i s a d h e r e n c e h y all franchisees to Franchisor's
standards and policies providing for the uniform operation of all restaurant units within
the System, including, hut not limited to, (a) selling only those products which
Franchisor has designated and approved, (h)using only Franchisor's prescribed
building layout and designs, eguipment, signs, interior and exterior decor items, fixtures
and furnishings, (c) adhering strictly to Franchisor's standards and specifications
relating to the selection,purchase,storage,preparation,packaging,service and saleor
all food and beverage products being sold at theRestaurant, and(d) satisfying all of
Franchisor's prescribed standards of guality,service and cleanliness Compliance by all
franchisees with the foregoing standards and policies in conjunction with the use of the
Marks provides the basis for the wide public acceptance of the System and its valuable
goodwill Accordingly,strlct adherence by all franchisees to all aspects of the System is
reguired at all times
2 2 The provisionsof the Agreement shall be interpreted togiveeffect tothe
intent of the parties stated in this Section2to assure that Franchisee shall operate the
Restaurant in conformity with the System, through strict adherenceto Franchisor's
standards and policies as they now exist and as they may be modified from time to time
8
COMRLIANCFWITFITFIF S Y S T E M
Franchisee acknowledges that every component of the System is important to
Franchisor, to all franchisees and t o t h e operation ofthe Restaurant, including the
reguirements (a) that only those products designated and approved by the Franchisor
are sold a t t h e Restaurant, and (b)thatthere is uniformity of food and beverage
specifications, preparationmethods, guality, appearance, building andinterior design,
color anddecor, landscaping,facilities andservice among allrestaurantunitslnthe
System Accordingly, Franchiseeagrees to andshall comply with all aspects of the
System(as it now exists a n d a s i t may be modified from time to time) Franchisee
recognizes and agrees that Franchisor may prohibit the use of the System and Its trade
names, notwithstanding the granting of this Agreement, If Franchisee falls to design,
construct, equip, furnish or operate its Restaurant in compliance with the specifications
designated by Franchisor, unless prior written approval has been received from
Franchisor
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4
G E N E R A L S E D G E S OF F R A N O H ^ O R
4 1 E r a o c h ^ s h ^ advise and oooso^ with F r a o c h i s ^
with the operation of the Restaorant, and at other r e a s o o a h i e t ^
r e v e s t Franchisor wiii provide to Frano^
technigoesand improvements inareas of restaorant design, management,foodand
heverage preparation, saies promotion and service concepts as may he pertinent fo the
construction and operation of the Restaorant onder the System Franchisor may provide
the foregoing information (a)hy sending representatives to visit the Restaorant, (h)hy
providing written or other material, (c)at meetings or seminars, and (d) at training
sessions at Franchisor's training facility andôr soch other locations as may he selected
hy Franchisor from time to time Franchisor also shall make availahle to Franchisee all
additional services, facilities, rights and privilegeswhich Franchisor makes availahle
from time to time to its franchisees of the System generally
4 2 F o r a p p r o x i m a t e l y e i g h t ^ d a y s p r i o r t o t h e o p e n i n g ofthe Restaorant and
t h e f i r s t s i x ^ d a y s t h a t t h e Restaorant is open for hosiness,Franchisor shall provide
Franchisee,at Franchisor's expense,with the services of op toamaximom of s i x ^ o f
Franchisor'straining personnel tofacilltate properoperation ofthe kitchen, h a r a n d
dining room areas doring that period and to assist in correcting any operational
prohlemswhich may arise. Franchiseeshall reimhorse Franchisor for any additional
training sopport regolred or regoested
4 3 From time to time doring the term of this Agreement, Franchisor will develop
and test new meno items The meno consists of approved national food and heverage
selections Franchisee shall comply with all meno changes which generally occor every
s i x ^ m o n t h s The meno may he modified toreflect food and heverage items pecoliar
to Franchisee's local area, sohject to Franchisor's testing and approval
5
RESTAORANT S Y S T E M ANO F R O G E O O R E S
51 Franchisor shall fornish Franchisee with advice and assistance in managing
and operating the Restaorant, and Franchisor's representatives will visit the Restaorant
periodically
Franchisor will assist Franchisee in coordinating the Restaorant's
preopeningactlvities, and asnoted moreparticolarly in Sohsection42hereof,shall
provideFranchiseewiththe services of certain of Franchisor'spersonnel to facilitate
properoperation ofthe Restaorant when It opens for hosiness
5 2 Franchisee shall designate an employee who will sopervise the Restaorant,
and devotehls or her foil time, hesteffortsandconstant personal attentiontothe
daytodayoperation ofthe Restaorant (the "General Manager") Franchisee also shall
designate an employee who will sopervise the Restaorant kitchen, and devote his or her
foil time, hest efforts and constant personal attention to the day to day operation of the
Restaorant kitchen (the"Kitchen Manager") andanappropriatenomher of Assistant
Managers
5 3 Franchisee shall regolre thatthe General Manager, the Kitchen Manager and
each of Franchisee's employees who serve as Assistant Managers to maintain his or
F-tO
^9752
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her priooipa! persona! residence within a osoai driving time of not more than
approximated o n e ^ ) hoor from the Restaorant
Franchisor reserves the right to
regoire that, as a condition of his or her empioyment, the General Manager most
soccessfoiiycompiete Franchisor's interview process andapsychoiogicai profile test in
a manner which satisfiesaoniform standard established hy Franchisor The test shall
headministered hy Franchisor, o r h y a t e s t i n g agency designated hy Franchisor, at
Franchisee's expense
5 4 Unless Franchisor shall have given its prior written approval, Franchisee shall
keep theRestaorant open for hosiness only doringthehoors which are specifiedhy
Franchisor in the Franchise Operations Manoai or in soch other materials or manoals
p r o v i d e d o r m a d e a v a i i a h l e h y Franchisor to Franchisee (collectively the"Manoals"),
provided that soch hoors do not conflict with state laws or local ordinances relating to
the sale of alcoholic beverages or governing the hoors doring which restaorant
establishments may be open for bosiness In addition, Franchisee expressly agrees to:
(a) operate the Restaorant i n a c i e a n , safe and orderly manner, providing
coorteoos, first ciass service to the pobiic;
(b) diligently promote and make every reasonable effort to increase the
bosiness of the Restaorant:
(c) advertise the bosiness of the Restaorant by the ose of the Marks and
soch other insignia, slogans, emblems, symbols, designs and other identifying
characteristics as may be developed or established from time to time by Franchisor
and incioded in the Manoals,sobject to the limitations of S o b s e c t i o n s 8 4 a n d 8 5
hereof;
(d) prohibit and,to the best of Franchisee's ability,prevent the ose of the
Restaorant for any immoral or illegal porpose, or for any other porpose, bosiness
activity, ose orfonction which is not expressly aothorized hereonderor in the
Manoals; and
(e) comply folly with ail applicable laws andregolations, incloding, hot not
limited to, those relating to boilding constroction, maintenance and safety,
environmental, fire prevention, food safety, pobiic access and the sale of alcoholic
beverages
5 5 Franchisee hereby acknowledges receipt and loan o f a c o p y of the Manoals
heretofore or hereinafter fornished toFranchisee,and agrees to faithfoily,completely
and continooosiy perform, folfiil, observe and follow all instroctions, regoirements,
standards, specifications, systems and procedores contained therein, incloding
(a) those relating to the constroction, design, decor, boilding and egoipping o f t h e
Restaorant, (b)those relating to the selection, porchase, storage, preparation,
packaging, service and sale of all prodocts being sold a t t h e Restaorant, (c) those
relating t o t h e m a i n t e n a n c e a n d repair of Restaorant boilding, groonds, egolpment,
signs, interior and exterior decor items, fixtores and fornishings, and (d) those relating to
employee oniforms and dress, accoonting, bookkeeping, record retention, andother
F-H
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^ 5 ^ 2
bosiness systems prooedores and o p e ^ i o n s Tbe M a n o r s are incorporated herein by
referenoeand hereby made partof this Agreement Franohiseeaoknowiedgesand
agrees that the materials contained in the Manoais are integral necessary and material
elements of the System
5 6 Franchisee understands, acknowledges and agrees that strict conformity with
the System, incloding the standards, specifications, systems, procedores, regoirements
and instroctions contained in this Agreement and in the Manoals, is vitally important, not
only to the soccess of Franchisor,bot to the collective soccess of all of Franchisor's
other franchisees, by reason of the benefits which Franchisor and all of its franchisees
will derive from oniformity in prodocts sold, identity, goality, appearance, f a c i l i ^ ^
service amongall restaorant onits which arepart of the System Withoot limiting the
generality of the foregoing provisions, Franchisee agrees to adhere strictly to the
regoirements in the Manoals relating (a) to the constroction, design, decor, boilding and
egoippingof the Restaorant, (b)to the maximom permissible ratio of sales of alcoholic
beverages to sales of food at the Restaorant, and (c) to the limitations on the nomber of
video games or similar devices which may be placed on the Restaorant premises Any
failore to adhere to the standards, specifications, systems, regoirements or instroctions
contained in this Agreement or in the Manoals shall constitoteamaterial breach of this
Agreement
5 7 Franchisor shall have the right, at any time and from time to time, in the good
faith exercise of its reasonable bosiness Lodgment, consistent with the overall best
interests of the System generally, having doe regard for the financial borden which may
be placed opon its franchisees, to revise, amend, delete from and add to the System
and the material contained in the Manoals Franchisee expressly agrees to comply with
all soch revisions, amendments, deletions and additions
5 6 Franchisee shall offer for sale from theRestaorant,at all times when the
Restaorant is open for bosiness, only the prodocts which are expressly designated in
t h e M a n o a l s , e x c e p t , a s noted moreparticolarly i n S o b s e c t i o n 4 3 , t o the extent that
Franchisee hasobtained Franchisor's prior written consent t o a modification of that
regoirement No prodoct shall be offered or sold at or from the Restaorant onder, or in
connection with, any trademarkorservice markotherthan Franchisor's designated
Marks withoot Franchisor's prior written consent
5 9 Franchisorshall havethe right to establish ortodesignateagroopporchasing
program from time to time (which may inclodeaporchasing or distribotion cooperative),
with respect to egolpment, sopplies, inventory and services osed in or by the
Restaorant Promptly opon notice thereof from Franchisor,Franchisee shall execotea
participation agreement in the form approved by Franchisor for the groopporchasing
program and participate therein Franchisor may modify or discontinoe the groop
porchasing program at any time opon thirty (30) days priorwritten notice to Franchisee
5B10Franchisee shall obtain all food andbeverage prodocts,egoipments,signs,
interior and exterior decor items, fixtores,fornishings, sopplies, and other prodocts and
materials regoired for the operation of or sold at the Restaorant solely from soppiiers
(incloding manofactorers, distribotors and other soorces) who demonstrate, to
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FranohisoBscooôing r e a s o n a b ^ s a ^ a ^ o o , ^
coêot staodards aod speoôatioos f o r s o c h item^ who possess adeqoato qoa^y
oootrois and oapaoity to sopp^Franohisee's needs p r o m p t and ^
heen approved in writing hyFranohisor and not t h e r e a ^ e r d i s a p p r o ^ TheManoais
oontainaiist of approved soppiiers if Franchisee desires to porohase any items from
an unapproved soppiier, Franohiseeshaiisohmitto Franohisorawritten regoest for
soohapprovai, whioh approval shaii not he onreasonahiy withheld, or shaii regoest the
sopplieritselftodoso. Franchisor shall have the right to inspect the sopplieBs facilities,
and to regoire that samples from the sopplier he delivered, at Franchisor's option, either
to Franchisor or to an independent, certified laboratory designatedhy Franchisor for
testing Franchisee or the soppiier shall pay the costs of any soch test Franchisorshall
notify Franchisee in writing within sixty (60) days of receiving any soch regoest whether
itdisapprovesthesopplier Failore hy Franchisor to sonotify Franchisee withinthat
period shall he deemed to constltote Franchisor's approval of soch soppiier Franchisor
reserves the right, at its option, to reinspect the facilities and retest prodocts of any soch
approved soppiier at any time and to revoke its approval opon the sopplier's failore to
continoe to meet any of Franchisor's criteria
Notwithstanding the foregoing, any
soppiier of goods which willhear any of theMarks shall not he approved tosopply
Franchisee soch goods ontil soch soppiier has entered a written agreement with
Franchisor or its affiliated companies regarding the prodoction, ose and sale of soch
goods
5 B l 1 N o f o o d or beverage prodoct, interior or exterior decor item, sign, itemof
egolpment, fixtores,fornishings or sopplies, or other prodoct or material regoired for the
operation of the Restaorant, which bears any of the Marks, shall be osed or sold in or
opon the Restaorant premises onless the same shall have heen first sobmitted to and
approved in writing by Franchisor
5 1 2 T h e Manoals and all related materialfornished to Franchisee hereonder are
andshall remain the property of Franchisor,and most be retorned to Franchisor,along
with any copies made thereof, immediately opon regoest or opon the expiration or
earlier termination of this Agreement
6
TRAINING
6Bl Franchisor shall make its operations training coorse available to the General
Manager, the Kitchen Manager, and Franchisee's Assistant Managers and other
Restaorant managers.
6 2 Beforethe Restaorant opensfor bosiness, and thereafteras replacement
personnel are employed by Franchisee, the GeneralManager,theKitchen Manager
and each Assistant Manager shall attend Franchisor'soperationstrainingfacility for
soch period of time as Franchisor shall deem reasonably necessary, and shall
soccessfolly complete that coorse to Franchisor's reasonable satisfaction ifthe General
Manager, Kitchen Manager or an Assistant Manager fails to soccessfolly complete
Franchisor's operations training coorse, Franchisor may regoire designation o f a n e w
GeneralManager, Kitchen Manager o r A s s i s t a n t M a n a g e r , a s the case may be,and
F ^
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Fraochisee s h ^ i designate a new Genera! Manager, Kitchen Manager cr Assistant
Manager, who sha!! he regoired to s o c c e s s ^
6 8 T h e G e n e r a i Manager, the Kitchen Manager and each Assistant Manager
shaii, from tirne to t ^
ccmpiete to Franchisor's reasonable s a t i s f a c t i c n a F r a n c h i s c r ^ ^ ^
in restaorant operations.
6 4 Franchisee shaii he responsihie for the Restaorant's compiiance with the
operating standards, methods, technigoes and material taoght at Franchisor's
operations training coorse, and shall c a o s e t h e e m p l o y e e s o f t h e Restaorant to he
trained in sochstandards, methods and technigoes as are relevant to the performance
of their respective doties
6 5 AttendanceoftheGeneralManager,the Kitchen Manager and each Assistant
Manageratany ofFranchlsor's training coorses shall he toitionfree Franchiseeshall
pay all other costs and expenses relating to the attendance of Franchisee's personnel at
any of Franchisor's training coorses, incloding, withoot limitation, the cost of travel,
lodging, meals, and other related and incidental expenses
B
RFSTAORANTMA1NTFNANGF
7B1 Franchisee shall, at Franchisee's sole cost and expense, maintain the
Restaorant in conformity with the standards, specificationsand regoirementsof the
System, as the same may he designated hy Franchisor from time to time Franchisee
specifically agrees to repair or replace, at Franchisee's cost and expense, egolpment,
signs, interior and exterior decor items, fixtores, fornishings, sopplies, and other
prodocts andmaterialsregoired for the operationoftheRestaorantasnecessary or
desirable, and to obtain, at F r a n c h i s e e ' s c o s t a n d expense, any new or additional
egolpment, signs, interior and exterior decor items, fixtores, fornishings, sopplies, and
other prodocts and materials which may be reasonably regoired by Franchisor for new
prodoctsor procedores
Except as m a y b e expressly provided in the Manoals, no
alterations or improvements, or changes of any kind in design, egolpment, signs, interior
or exterior decor items, fixtores or fornishings shall be made in or aboot the Restaorant
or Restaorant premises withoot the prior written approval of Franchisor in each
instance
7 2 in order to assore the continoedsoccess of the Restaorant, Franchisee most,
at any timefrom time totime after the six(6) year anniversary of the date of this
Agreement as reasonably regoired by Franchisor (taking into consideration the cost and
then remaining term of this Agreement), modernize the Restaorant premises,
egolpment, signs, interior and exterior decor items, fixtores, fornishings, sopplies, and
other prodocts and materials regoired for the operation of the Restaorant, to
Franchisor's then corrent standards and specifications, provided that at the time
Franchisor regoires Franchisee to so modernize the Restaorant premises at least
twentyfivepercent(26%)ofthe Restaorants owned and operated by Franchisor or its
affiliates meet soch standards and specifications Franchisee's ohligations onder this
20t4
10^9752
Sobseoôareioaddi^
obâtioos onder this
7 3 ifFraoohisee is or heoomesaiessee of the Restaorant premise^^
shaii have i o o i o d e d i n t h e i e a s e provisions expressiy permitting hoth Franohiseeand
Franchisor to take aii aotioos and make aii alterations referred to onder Sohseotion^
and72hereof,regoiring the lessor thereonder to give Franchisor reasonahienotioe of
any oontemplated termination, and providing that Franchisee has the onrestrioted right
to assign the lease to Franchisor, Franchisor's affiliates or approved franchisees of
Franchisor withoot the lessor having any right to impose conditions on soch assignment
or to ohtain any payment in connection therewith Franchisee shall not, withoot the prior
writtenconsentofFranchisor,execoteanyleaseorotheragreementwhich imposes, or
porports to impose, any limitations on the ahility of Franchisee andôr of Franchisor or
its affiliates to operate additional restaorants at any particolar location heyond the
geographic limitation set forth in Section14hereof, or any lease the term of which is
shorter than the term of this Agreement For porposes of clarification, Franchisor may
regoire the iease to contain soch other provisions as may he specified in Franchisor's
thencorrent lease approval policy or the terms and conditions of Franchisor's approval
of the site for the Restaorant
8
AOVFRTISING
8Bl Franchisor shall develop and administer advertising, pohlic relations and
sales promotion programs designed to promote and enhance the collective soccess of
all restaorant onits in the System it is expressly onderstood, acknowledged and agreed
that in all phases of soch advertising and promotion, incloding, withoot limitation, type,
goantity, timing, placement and choice of media and mediom, market areas, advertising
agencies andpohlic relations firms, Franchisor's decisions shall he final and hinding
Franchisee shall have the right to participate actively in all soch advertising, pohlic
relations and sales promotion programs, hot only in foil and complete accordance with
soch terms and conditions as may he established hyFranchisor for each soch program
8 2 Franchiseeshallpaytheamoontsdescrihed in this S e c t i o n s , i n the manner
described in Section^hereof
(a) Franchisee shall pay to Franchisoraminimom dollar amoontegoal to
three and twenty five hondredths percent (3 25%) of Franchisee's gross sales, as
defined in Sobsection9.3 hereof. Soch fonds shall become the sole and absolote
property of Franchisor, to be allocated t o a s e p a r a t e "advertising accoont" established
by Franchisor (the "Fond")
Franchisor shall ose soch fonds for market stodies,
advertising andmarketingstodies or services, prodoction of commercials, advertising
copy andlayoots,traffic costs,agency fees, marketingpersonnel,or any other costs
associated with the development, marketing and testing of advertising, and for the
porchase of advertising time, space or materials in national, regional or other
advertising media,inamannerdeterminedbyFranchisorin its sole discretion; provided,
however,that all interest earned on soch fonds shall be Franchisor'sor its affiliate'ssole
property. Within six (8) months following the end of Franchisor's fiscal year,Franchisor
Ft5
^9752
20t4
sh^p^de^ânchisees^
expended by F r a n c h i s o r s ^
(b) In addibon,Franchisee shall expendarninirnom dollar arnoonteqoai to
onehalf percent(5%) of Franchisee's gross sales, for local promotional activities,
subject to the provisions of S o b s e c t l o n s 8 8 , 8 5 a n d 8 6 h e r e o f Franchisor shall have
the right at all times to review Franchisee's books and records, and to regolre
Franchisee to prodoce evidence of Its gross sales and local promotional activities, to
ensore Franchlsee'scompllance with this Section Any amoont determined by said
aodlt to be doe Franchisor as part of the advertising fee will be paid to Franchisor by
Franchisee within t e n ^ O ) days thereafter
(c) At any time after execotlon of this Agreement, Franchisor may in its sole
discretion Increase,toamaxlmom of foor percent (4%) of gross sales,the percentage
of gross sales which Franchisee shall be regolred to pay to Franchisor for allocation to
the Fond porsoant to Sobsectlon82 Franchisor shall ose the fonds paid porsoant to
that Increased percentage regoirement solely for the porchase of advertising time,
space or materials in national, regional or other advertising media, in a manner
determined by Franchisor In Its sole discretion, provided that In each calendar year (or
other twelve (12) month period established by Franchisor) In which Franchisor makes
expendltores for advertising from the Fond, so long as Franchisee is in compliance with
its obligations hereonder, Franchisor's expendltores for advertising In the Territory
encompassed by the Oevelopment Agreement (Incloding expehdltoresfornatlonalor
regional advertising Inmedla which reach thatTerrltory) shall be o n a b a s l s w h l c h l s
rooghly proportional to Franchisee's contrlbotlon to the Fond doring that calendar year
orothertwelve(12)month period; provided that, Franchisor does not goarantee that the
benefits of soch advertising will be egoal to or comparable to the benefits of advertising
received by other Applebee's Neighborhood OrlllÔarfranchlsees
(d) Franchisor also may Increase the percentage of gross sales which
Franchisee shall be regolred to spend for local promotional activities, provided however,
that In no event shall Franchisee be regolred to make payments porsoant to
Sohsection 8 . 2 l n a n a g g r e g a t e dollar amoont in excess of five percent (5%) of gross
sales
For porposes of clarification, Franchisor may also decrease the amoonts
regolred to be paid or expended by Franchisor porsoant to this Sobsectlon82.
8 3 Franchisor may deslgnateany geographic area in which two (2) or more
Restaorants are locatedand owned bydlfferent parties a s a reglonfor porposes of
establishing an advertising cooperative (a cooperative")
(a) IfaOooperatlve Is established,the members of the Cooperative for that
region will consist of all Restaorants whether operated by Franchisor, Its affiliated
companies,or franchisees Franchlsorwllldetermlne In advance how each Cooperative
will be organized and governed and when It most start operation Fach Cooperative will
be governed b y a c o o p advertising policy, which will be provided to all members of the
Cooperative opon regoest
Once the Cooperative Is established, members o f t h e
Cooperative may not dissolve,merge or change the stroctoreofaCooperatlve wlthoot
theprlor written consentof Franchisor Fach Cooperatlvewlll b e o r g a n l z e d f o r t h e
FD^
^9752
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exo^siveporposesofadmi^
F r a n c h i s o r approval promotional materials for ose hy the memhers in Looal
Advertising. If a Cooperative has heen estahllshedforageographloarea wherethe
Restaorant is located when the Franchise Agreement Is signed, or if any Cooperative is
estahlished doring the term o f t h e Franchise Agreement, Franchisee most sign ail
docoments Franchisor regoests and hecomeamemher of the Cooperative according to
the terms o f t h e docoments
Franchisor will provide to Franchisee a copy o f t h e
Cooperative docoments applicahle to the geographic area in which the Restaorant will
he located opon Franchisee's regoest
(h) Franchisee most contrihote to the Cooperative the amoonts regoired hy
the docoments governing the Cooperative, sohject to the maximom contrihotions
described in Section82(h)ahove Franchisee's payments to the Cooperative will apply
toward satisfaction of Franchisee's Local Advertising regoirement Franchiseeagrees
to sohmit to Franchisor and the Cooperative any reports that Franchisor or the
Cooperative regoires All contrihotions to the Cooperative will he maintained and
administeredaccording to the Cooperative governing docoments Franchisor retains
the right to approve all expendltores made hy the Cooperative The Cooperative will he
operated solely a s a m e a n s for the collection and expenditore of the Cooperative fees
for the porposes ootlinedahove No advertising or promotional plans or materials may
he osed hy the Cooperative or fornished to its memhers withoot first obtaining
Franchisor's approval
8 4 Franchisee shall sohmit to Franchisor, for Franchisor's approval, an
advertising campaignplan relating to the promotion of the opening of the Restaorant
which is sofficientto meetthe needs o f t h e market. The Manoals contain a Fress
Release kit to assist Franchisee in this regard Franchisee shall condoct the approved
advertising campaign and make all expendltores for advertising to promote the opening
of the Restaorant no later than sixty (80) days after the Restaorant opens for bosiness
Franchisorwillreimborse fifty percent (80%) of Franchisee's oot of pocket advertising
expendltores op to a maximom of two thoosand five hondred dollars ($2,800), If
Franchisee meets the following criteria:
(a) Franchisee's opening advertising expendltores are made, and the
approved advertising campaignhas been condocted,within sixty (80) days after
the opening ofthe Restaorant;
(b)
Franchisee sobmits to Franchisorwithin one hondred twenty (120)
days after the opening of the Restaorant docomentationforthe opening advertising
expendltores, soch as paid invoices from soppiiers of goods or services evidencing
expenditore on the opening advertising promotion; and
(c) Franchisee's opening advertising expendltores are made porsoant
t o t h e approved advertising campaign plan and in accordance with the Grand
Opening Reimborsement Program FolicyGoidelines set forth in the Manoals
8 5 Nothing in the foregoing Sobsections shall be deemed to prohibit Franchisee
from making additional expendltores for local promotional activities
All of the
2014
^9752
Franchisees icca! prcmcticna! a e r i e s shall utilize approved advertising media
"Approved advertising media" are limited to the following:
(a)
Newspapers, magazines and other sooh periodicals;
(h)
Radio and television;
(c)
Outdoor advertising hy signs displayed on hlllhoards or holldlngs; and
(d)
sandhills, flyers, door hangers and direct mall
I n t h e e v e n t F r a n c h l s e e w a n t s t o o s e a f o r m of advertising mediom not set forth
ahove, Franchisee shall sohmit a description of soch mediom and advertising to
Franchisor Franchisor shallnotlfy Franchisee whether It approves the ose of soch
mediom within thlrtyÔ) days of Franchisee's regoest Failore hy Franchisor to so
notify Franchisee within that period shall he deemed to constltote Franchisor's approval
of soch regoest. Goldellnes for local promotional activities are contained In the
Manoals, Incloding Franchisee's regolredpartlclpatlon Inany cooperative marketing
program.
8 6 All advertising copy and other materlalsemployed hy Franchisee In local
promotional activities shall he In strict accordance and conformity with the standards,
formats and specimens contained In the Manoals and shall receive the prior approval of
Franchisor In the event Franchisee wishes to deviate from the materials contained In
the Manoals, Franchisee shall sohmit, In each Instance, the proposed advertising copy
andmaterlalsto Franchisor for approvallnadvance of pohlicatlon Franchisorshall
notify Franchisee in writing, within f i f t e e n s ) days of soch sohmission, whether
Franchisor disapproves soch advertising copy and materials Failore hy Franchisor to
so notify Franchisee within that period shall he deemed to constitote Franchisor's
approval of soch advertising copy and materials In no event shall Franchisee's
advertising contain any statement or material which may he considered (a) in had taste
or offensive to the pohlic or to any groop of persons,(h)defamatory of any person or an
attack on any competitor, (c) to infringe opon the ose, withoot permission, of any other
persons'trade name, trademark, service mark or identification, or (d) inconsistent with
the pohlic image ofFranchisor or of the System
9
FFFS
9BI As partial consideration for the rights granted hereonder,Franchisee shall pay
Franchisor;
(a) an
initial
franchise
fee
of
dollars ($
_), to be paid in the manner prescribed in Subsection 4.1 of the
Development Agreement as payment for the grant of the franchise;
(b) a monthly royalty fee as determined by Franchisor, not to exceed five
percent (5%) of each calendar month's gross sales, as provided in Subsection 4.3
F-18
1051975.2
2014
oftheOevôpmentAgreeme^
operate the Reâurant as part of the
(o) a months advertisingfee equal to sooh peroeotageofeaoh calendar
month's gross sales asFranohlsor may require pursuant to Sohseotlon82hereof
9 2 ThefeesreferredtolnSuhseotlons9l(h)and(o)(the"Fees^shallhepaldon
or hefore the tweltfh day of the next full month Immediately following the month to whl^^
the Fees relate Any Fees, Including the lnltlalfranohlsefee,whloh are not pald when
d u e s h a l l h e a r Interest fromand after the due datesthereof at therate of eighteen
percent^8%) per annum or the highest rate permitted hy applicable law,whlchever Is
less
9 3 (a) Except for t h e s a l e of a g l f t c a r d (on which royalty shall h e d u e a n d
payable upon redemption of the gift card and as provided In Suhsectlon93(h) hereof,
the term "gross s a l e s B a s used In this Agreement, shall mean all receipts (cash, cash
egulvalents or credit) or revenues from sales from all business conducted upon or from
the Restaurant premises, whether evidenced by check, cash, credit, debit card, charge
account, exchange or otherwise, Including, but not limited to, amounts received from the
sale of goods, wares and merchandise (Including sales of food, beverages and
tangible property of every kind and nature, promotional or otherwise), from all services
performed from or at the Restaurant premises, and from all orders taken or received at
the Restaurant premises, regardless of where such orders arefllled (Including any
payments received from the sale of meals to employees) Gross sales shall not be
reduced hy any deductions for cash shortages Incurred In connection with the
transaction of business with customers, credit card company charges or theft which Is
reimbursed by Insurance or Is not reported to the appropriate police authorities Each
charge or sale upon Installment or credit shall be treated a s a s a l e for the full price In
the month during which such charge or sale shall be first made, Irrespective of the time
when Franchisee shall receive payment (whether full or partial) therefor
(b) Gross sales shall not Include: (I) the sale of merchandise for which cash
has been refunded or, except as provided In the second sentence of Suhsectlon93(a),
not received, or allowances made for merchandise, If the sales of any such returned or
exchanged merchandise shall have been previously Included In gross sales, (II) the
amount of any sales tax Imposed by any federal, state, municipal or other governmental
authority directly on sales and Intended to be collected from customers, provided that
the amount thereof Is added to the selling price and actually paid by the Franchisee to
such governmental authority, (III) the sale of merchandise for which a gift card Is
redeemed, If the Initial sale of the gift card shall have been previously Included In gross
sales, (Iv)the sale of waste products o f t h e Restaurant, (v) telephone, game and
vendlngmachlnerevenues,(vl) the sale of nonfood Items or beverages atadlscount In
connection with a promotional campaign, (vll) one time sale of furniture, fixtures or
eguipment, and (vlll) theft which Is notcovered by Insuranceand Is reported tothe
appropriate police authorities In addition, Franchisor may, from time to time, In writing,
permit or allow certain other Items to be excluded from gross sales ^ny such
permission or allowance may be revoked orwlthdrawn at Franchisor's discretion
F-tO
^9752
20t4
9 4 Franohisee agrees tha^ subject to the provisions of this Seotion94,
Franohisoror its designee may withdrawfondsfrom Franohisee'sdesignated hank
aoooonthyeieotronio funds transfer ( " E ^
payahie to Franchisor under this Agreement Franchisor or its designee wiii make eaoh
FFT withdrawal o f t h e royalty feesdescrihed in Section9BI(h) and advertisingfees
descrihed in Section9^(c) on the dates such payments are due. Franchisor or its
designee may withdraw any other payments owed to Franchisor pursuant to, o r i n
connection with,this Agreement if such payments hecome more than 10days past due
Franchisee's designated hank account for FFT withdrawals shall at all times he
maintained in the United Statesand such account shallpermitFFTwithdrawals hy
Franchisororitsdeslgneewithoutapproval of, or involvement hy,agovernment agency
or authority If Franchisee has not suhmittedamonthly Restaurant report as reguired
hySection102(a) hereof, Franchisor or its designee may make an FFTwithdrawal for
overdue royalty fees hased on a good faith estimate o f t h e Gross Sales for the
applicable month
After the applicahle monthly Restaurant report Is submitted,
Franchisor or its designee will make an appropriate credit to Franchisee for any
overpayment or will invoice Franchisee for any underpayment, as applicable
9 5 Franchiseewill,upon execution ofthisAgreement,executeadocument in the
form of AooendixO.orantino to Franchisor or its designee the authority to process FFTs
from Franchisee's designated bank account From time to time at Franchisor's reguest,
Franchisee will execute any additional documents necessary to confirm or update this
authority Franchisee willbe r e s p o n s i b l e f o r a n y F F T transfer fee or similar charge
imposed by Franchisee's bank, and for any service charges incurred by Franchisor or
ItsdesigneeandôrimposedbyFranchisee'sbankshould any F F T n o t b e honored by
Franchisee's bank for any reason Throughout the term of this Agreement, Franchisee
will maintain a minimum balance sufficient to satisfy all of Franchisee's obligations
under this Agreement. It will beamaterial event of default of Franchisee if Franchisee
closes the account without Franchisor's consent, or closes the account with
Franchisor's consent,hutfailsto promptly establish another account and execute all
documents necessary for Franchisor or its designee to process all payments by FFT
from the new account
10
R F G G R O K F F F I N G ; A G G F S S TO INFORMATION
10BI
Franchisee shall employapoint of sale system approved by Franchisor,
without modification, in connection with thebusiness of the Restaurant Franchisee
shall use such bookkeepingand recordkeeping forms as shall be prescribed In the
Manuals
10 2
Franchisee shall complete and submit to Franchisor, on a regular,
continuous basis,each ofthe following reports,in the form specified in the Manuals:
(a) monthly Restaurant reports, on or before the twelfth day of each
calendar month following the month to which the report relates;
(b)
annual Restaurant reports, on or before the fifteenth day of April of each
year;
FÔ
^9752
2014
(o) weekly gross sales reports, on or before fbe Tuesday following fbe
calendar week fowblobfbe report relates; and
(d)
suob additional reports as tbe Franoblsorsball reguest
103
Tbe annual Restaurant reports referred to above sballlnoludeabalanoe
sbeet dated as of tbe end of Franoblsee's fiscal year or calendar year andaproflt and
loss statement for sucb year, togetberwltb sucb addltlonalflnanclal Information as
Francblsor may reasonably reguest. Sucb balance sbeet and profit and loss statement
sball be prepared In accordance wltb generally accepted accounting principles, certified
as correct and complete by Francblsee's cblef executive officer, president, cblef
financial officer or controller and reported on and reviewed by an Independent
state llcensed certified public accountant If Francblsee falls to provide Francblsorwltb
sucb balance sbeet and profit and loss statement, Francblsorsballbavetberlgbtto
bave an Independent audit made of Francblsee's books and records,andFrancblsee
sball promptly reimburse Franchisor for tbe cost tbereof
104
Facb of tbe reports referred to In tblsSectlonlOsball be completed by
Franchisee or Its accountant In tbe respective specimen forms, and In accordance wltb
tbe Instructions,contained In tbe Manuals Subsection 103notwltbstandlng,time Is of
tbe essence wltb respect to tbe completion and submission of eacb sucb report.
10 5
Franchisee shall Install and maintain such eguipment, make such
arrangements and follow such procedures as Franchisor may regulre In the Manuals or
othen^lse In writing (Including the establishment and maintenance of Internet, Intrane
extranet access or such other means of electronic communication, as specified by
Franchisor from time to time) to permit Franchisor to access, download, andretrleve
electronically, by telecommunication or other designated method, any Information stored
In Franchisee's electronic cash registers or on Franchisee's computer systems,
Including Information concerning the gross sales o f t h e Restaurant, and to permit
Franchisor to upload and for Franchisee to receive and download Informatlonfrom
Franchisor with or without Franchisee's prior consent Franchisee further agrees that
Franchisor will have and be afforded access to such Information at the times and In the
manner that Franchisor may specify from time to time, Including extracting Information
by electronic, digital or other means.
11
FRANOHISFF ORGANIZATION, AUTHORITY, FINANCIAL CONDITION ANO
SHAREHOLOFRS
111
Franchisee and each Principal Shareholder represent and warrant that:
(a)Franchlseelsacorporatlon duly Incorporated,validly existing and In good standing
under the laws of the State of Its Incorporation;^) Franchisee Is duly gualified and Is
authorized to do business a n d l s In good standlngasaforelgncorporatlon In each
jurisdiction In which Its business activities or the nature of the properties ownedby It
reguires suchguallflcatlon; (c) the execution anddellveryof this Agreement and the
transaction contemplated hereby are within Franchisee's corporate power; (d)the
execution and delivery of this Agreement has been duly authorized by the Franchisee;
(e)the articles of Incorporation and by laws of Franchisee delivered to Franchisor are
F-^
^9752
2014
^ u ^ c o m p ^ e a o d ooêo^ a o d t h e r e h a v e h e e o no changes herein siocethe date
thereof ^ t h e c e r t ^ e d c o p i e s of the minutes electing the o
authonzing the execution and delivery of this Agreement are true, c o ^ ^
and therehave h e e n n o changes thereinsincethedate(s)thereof;(g) the specimen
stock certificate delivered to Franchisor Is a true specimen of Franchisee's stock
certificate; (h)the most recent halance sheet of Franchisee ("Balance Sheets and the
most recent balance sheets of its Frincipal Shareholders heretofore delivered to
Franchlsor,are true, complete and correct, and fairly present the financial positions of
Franchisee and each Frincipal Shareholder,respectlvely,as of the dates thereof; (i) the
Balance Sheet and each such balance sheet have heen prepared in accordance with
generally accepted accounting principles, a n d ^ t h e r e have been no materially adverse
changes in the condition, assets or liabilities of Franchisee or Frincipal S h a r e h o ^ ^
since the date or dates thereof
112
Franchiseeand each FrincipalShareholder covenant that during the
term of this Agreement: (a) Franchisee shall do or cause to be done all things
necessary to preserve and keep in full force its corporate existence and shall be in good
standing asaforeigncorporatlonin each iurisdictioninwhlchits business activities or
the nature of the properties owned by it reguires such gualification; (b)Franchisee shall
have the corporate authority to carry out the terms of this Agreement; and
(c) Franchisee shall print, In a conspicuous fashion on all certificates representing
shares of its stock when issued, a legend referring to this Agreement and the
restrlctionson and obligations ofFranchisee and FrincipalShareholders hereunder,
including the restrictions on transfer ofFranchisee's shares
113
In addition to the financial information which Franchisee is reguired to
provide to Franchisor under Suhsections10 2 and 111 hereof, Franchisee and
Frincipal Shareholders shall provide Franchisor with such other financial information as
Franchisor may reasonably reguest from time to time, Including, on an annual basis,
copies of thethenmostcurrent financial statements of Franchisee and each Frincipal
Shareholder, dated as of the end of the last preceding fiscal year of the Franchisee or
Frincipal Shareholder, said statements t o b e delivered to Franchisor no later than
April15of each year, which financial statements shall conform to the standards setforth
inSubsection111hereof
114
Franchisee and each Frincipal Shareholder represent, warrant and
covenant that all Interests (asdeflned in Subsection 124 hereto) in Franchlseeare
owned as setforth on AppendixA hereto, that no Interest has been pledged or
hypothecated (except in accordance with S e c t i o n 1 2 o f t h i s Agreement), and that no
change will be made in the ownership of any such Interest other than as permitted by
this Agreement,or otherwise consented to in writing by Franchisor Franchiseeand
Frincipal Shareholders agreetofurnish Franchisor with such evidence asFranchisor
may reguest, from time to time, for the purpose of assuring Franchisorthat the Interests
ofFrancbiseeand Frincipal Shareholdersremain as represented herein
115
Fach Frincipal Shareholder,jointly and severally, hereby personally and
unconditionally guarantees each of Franchisee's financial obligations to Franchisor
(Including, but not limited to, all obligations relating to the payment of fees by
F ^
10^9752
2014
Fraochisee to Fraoohiso^ Eaoh Pnnoipa! Sharehoôragroosthat Eraoohisormay
resort to suohPrinoipal S h a r e d
ohâtion, whethoror oot Eranohisor shall have proooodod against Fraoohlsoe, any
other Prlnolpal Shareholder or any other ohllgor primarily or s o o o n ^
Franchisor with respeot to suohflnanolal obligation Eaoh Principal Shareholder hereby
expressly waives presentment, demand, notice of dishonor, protest, and all other
notices whatsoever with respect to Franchisor's enforcement of this guaranty. In
addition,each Principal Shareholder agrees that if the pertormance or observanceby
Franchisee of any term or provision hereof is waived or the time of performance thereof
extended by Franchisor, or payment of any such financial obligation isaccelerated in
acoordancewith anyagreement between Franchisorandany party liable in respect
thereto or extended or renewed, in whole or in part, all as Franchisor may determine,
w h e t h e r o r n o t n o t i o e t o o r c o n s e n t b y a n y Principal Shareholder or any other party
liable in respect to such financial obligations is given or obtained, such actions shall not
affect or alter the guaranty of each Principal Shareholder described in this Subsection
116
Franchisee and each Principal Shareholder representand warrant to
Franchisorthat:
(a) Neither Franchiseenor any Principal Shareholder or any other person
withadirect or indirect ownership interest inFranchisee is identified,either by
name or an alias, pseudonym or nickname, on the list of "Specially Designated
Nationaisand Blocked Persons" maintained by t h e U S Treasury Department's
Office
of
Foreign
Assets
Control
(texts
available
at
wwwtreasoovôfficesênforcementôfac^ Further,Franchisee and its Principal
Shareholders representand warrant that neither has violated and agree that
neither will violate any law (in effect now or which may become effective in the
future) prohibiting corrupt businesspractices, money laundering o r t h e a i d or
support of persons or entities who conspire to commit acts of terror against any
person or government, including acts prohibited by the U.S. Patriot Act (text
available at htto^www.epic.or^privacv^terrorism^hr3162.html), U.S. Executive
Order
13244
(text
available
at
htto^treasgovBofficesBenfo^
(b) Franchisee has not made, nor has any Principal Shareholder made, any
expenditures other than for lawful purposes or directly or indirectly offered, gave,
promised to give or authorized the payment or the gift of any money, or anything
ofvalue, to any person or entity, while knowing or having reason to know that aii
oraportion of such money or thing of value would be given or promised,directly
or indirectly, t o a n y government official,officialofaninternationai organization,
officer orempioyee o f a foreign government or anyone acting in an official
capacityforaforeign government, f o r t h e p u r p o s e o f ( l ) influencing any action,
inaction or decision of such official i n a m a n n e r contrary to his or her position or
creatingan improper advantage; or (2) inducingsuchofficiaitoinfiuenceany
government or instrumentality thereof to effect or influence any act or decision of
such government or instrumentality
F-^
^9752
^014
(c) F r a n o h i s e e o o r a o y P n n c ^
w h o h a s any d o c t o r i o d ^ o t o w n e r s h i p ^ ^
indiroo^y owned or o o o ^ o d h y g o v o m m e ^ a i a u t h o ^ ^ ^ ^
suhjeottoaUnited States embargo; and
Franohisee understands and its P r i ^
advised hy iegaioounsei on the reguirementsofthe United States Foreign Corrupt
Praotioes Aot (ourrentiy iooated at www usdoi goôrimina^raudôoa htmi^ any iooai
foreign corrupt practices iaws and the Patriot Act (currently located at
wwweoicoroBorlvacy^^
and the Restaurants and the parties'relationship oftheir respective cornpilance with the
reguirements of these iaws, including any appiicahieauditing reguirementsand any
reguirement to report or provide access to information to Franchisor or any government,
that is made part of any applicahle law, and agree to take all steps reguired hy their
consultants, agents and employees to comply with such laws priorto engaging or
employing any such individuals or entities
12
TRANSFER
12BI
There shall he noTransfer of any Interest of Franchisee,or ofaPrincipai
Shareholder inFranchisee, in whole or in part (whether voluntarily or hy operation of
law), directly, indirectly or contingently, except in accordance with the provisions of this
S e c t i o n s 'Transfer" and "Interest" are defined in S u h s e c t i o n s 1 2 2 , 1 2 3 a n d 124
Any proposed Transfer aiso shall he suhject to the provisions ofthe Oevelopment
Agreement, which are incorporated herein hy reference
12 2
Except as provided in Subsection 12 3, "Transfer" shall mean any
assignment,saie, pledge, hypothecation,gift or any other event which would change
ownership ofor change or createanew Interest, including,but not limited to;
(a) any change in the ownership of or rights in or to any shares of stock or
other eguity interest in Franchisee which would result from the act of any
shareholderofFranchisee ("Shareholder"),sucb a s a s a l e , e x c h a n g e , p l e d g e or
hypothecation of shares, or any interest in or rights to any of Franchisee's profits,
revenues or assets, o r a n y s u c h c h a n g e w h i c h w o u i d r e s u l t b y o p e r a t i o n o f law;
and
(b) any change in the percentage interest owned by any Shareholder in the
shares of stock of Franchisee, or interests in its profits, revenues or assets which
would resultfromanyactofFranchiseesuch a s a s a l e , p l e d g e or hypothecation of
any Restaurant assets (other t h a n a p i e d g e of assets to secure b o ^ a ^ e loans
made or credit extended in connection with acguisition ofthe assets pledged,
provided that immediately before and aftersuch transaction the net worth of
Franchisee shallnot be less than the amount whichis reflected on the Balance
Sheet referred to in Subsection111 of this Agreement); any sale or issuance of
any shares of Franchisee's stock; the retirement or redemption of any shares of
Franchisee's stock; or any sale or grant to any person of any right to participate in
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1^9752
2014
or otherwise to share or heoome entitled to any part of Franohisee's profits,
revenoes, assets or equity
123
"Transfer" shaii not inoiude(a)aohange in the ownership of or rights to
any shares or other equity interest in Franchisee pursuant to a puhiio offering of
Franchisee's securities registered undertheSecuritiesAotof 1 9 3 3 , o r ( h ) a o h a n g e i n
the ownership of or rights to any securities or other eguity interest in Franchisee
pursuant to a private offering of Franchisee's securities exempted from registration
under such Act, provided that Franchisee provides Franchisor with a copy of its
prospectus andôr offering memorandum ten (10) days prior to its filing with the
Securities and Exchange Commission or circulation to third parties so that Franchisor
may comment and, if necessary, correct any information concerning Franchisor andôr
the System, and further provided that after giving effect to such puhiio or private
offering, the Frincipal Shareholders, o r a n y o f t h e m , "control" Franchisee For purposes
of this Section 12,"control" means either (l)owning legal and eguitahle title to fifty^
percent (51%) or more of the outstanding voting securities of Franchisee, which are not
s u h j e c t t o a p r o x y granted to or contract with any other person or party granting that
party the right to vote part or ail o f s u c h securities, or (2) having and continually
exercising the contractual power presently to designateamaiority of the directors of
Franchisee
12 4 "interest" shall mean: when referring to interests or rights in Franchisee,
any shares of Franchisee's stock and any other eguitahie or legal right in or to any of
Franchisee's stock, revenues, profits or assets; when referring torights or assets of
Franchisee, Franchisee's rightsunderandinterest in this Agreement,theRestaurant
and its revenues, profits and assets
12.5
(a) The interest ofaFrincipai Shareholder may he transferred to such
Frincipal Shareholder's spouse or children or t o a p e r s o n d e s i g n a t e d i n s u c h F r i n c i p a l
Shareholder's will or trust(individuallyandcollectiveiy referred to a s a " S u c c e s s o r " ) ,
upon such Frincipal Shareholder's death or permanent incapacity,without Franchisor's
approval, provided thatsuch Successor shall agreeto hehound hy the restrictions
contained in this Section 12, and the other agreements and covenants of the Frincipal
Shareholders contained in this Agreement
(h)
T h e l n t e r e s t o f a F r i n c i p a l Shareholder may not he transferred to
another Frincipal Shareholder without Franchisor's approval, which approval shall not
he unreasonably withheld
(c)
The Interest o f a S u c c e s s o r may only he transferred in accordance
withSuhsection125(h), 1 2 5 , 12B7or 123,regardless of whether suchTransfer is for
consideration or hy gift orwill or other device
12 5 if at any time any of the Frincipal Shareholders desires to dispose of all or
substantially all of the Interests of the Frincipal Shareholder(s) in Franchisee, or any of
the FrincipalShareholders (or Franchisee)desires to dispose of ail or substantially all of
Franchisee's interest in this Agreement or in the assets which Franchisee has acguired
a s a r e s u l t of this Agreement, the Principal Shareholder(s) or Franchisee, as the case
F25
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^9752
may be, sbaii notify Franobisor of fbaf desire, in writing, tbirty(30) days before
announcing tbatfaotpobiioiy or engaging tbe services ofabroker or saies agent
12B7
(a) i f a t a n y t i m e a n y o f t b e P r i n c i p a i S b a r e b o i d e r s o r F r a n c b i s e e , a s
tbe case may be,obtains fromatbird party or t b i r d p a r t i e s a b o ^ a ^ e offer (tbe
in writing for tbe purcbaseof aiiorsobstantiaiiy a i i o f t b e interestsoftbe Principal
Sbareboiders in Prancbisee, o r o f Prancbisee's interest in tbis A g r e e m e n t o r i n tbe
assets wbicb Prancbisee bas acguired as a resoitoftbis Agreement, tbe Principal
Sbareboiders or Prancbisee sbaii give notice (tbe " S e ^
tbat tbe Principal Sbarebolders or Prancbisee, as tbe case may be, bave received tbe
Offer, identifying tbe prospective porcbaser by name and address, specifying tbe
proposed porcbasepriceandattacbingatroeand complete copy of tbe Offer, incloding
all relevant materials regoired for approval byPranobisor
(b)
Prancbisor sbaii bave an option to porcbase (tbe "Options,
exercisable witbinaperiod of fortyfive (45) days after receipt of tbe Selling Notice
"Option Period"), socb interests at tbe price and on tbe conditions set fortb in tbe Offer,
except tbat Prancbisor sbaii not be obligated to pay any finder's or broker's fee, and if
tbe Offer provides for payment of consideration otbertbancasb, or if tbe Offer involves
certain intangibiebenefits,Prancbisor may elect to porcbasesocb Interests by offeringa
reasonable dollar valoesobstitote for tbe non casbîntangibie benefits part of tbe Offer
Notwitbstanding tbe foregoing, if Prancbisor exercises tbe Option, Prancbisor (a) will be
entitled toreceive representationsand warrantiesfrom Prancbiseeandtbe Principal
Sbareboiders, jointly and severally, tbat are costomariiy received by porcbasers in
similar transactions and(b) wili be permitted to not close if it is not satisfied witb tbe
resoits of its bosiness, iegai and financial doe diligence.
(c)
Tbe Option sbaii be exercisable by Prancbisordeiivering to tbe
Principal Sbareboiders or Prancbisee, as tbe case may be, witbin tbe Option Period, a
notice (i) stating tbat tbe Option is being exercised, and (ii) specifying tbe time, date and
place at wbicb socb porcbase and sale wili take place, wbicb date sbaii be witbin
fortyfive(45) days after Prancbisordeiivers socb notice
Prancbisee sbaii provide
Prancbisoraccess t o a n d c o p i e s o f socb information anddocomentation Prancbisor
sbaii regoest regarding tbe porcbase priorto tbe start of tbe Option Period Tbe
forty five (45) day limitation for porposes of determining tbe sale date sbaii not apply if
at tbe end of said forty five (45) day period tbe only issoe wbicb prevents completion of
tbe porcbase and sale is tbe need to effect transfers of tbe applicable ligoor licenses in
t b e e v e n t o f s o c b a d e i a y , tbe porcbase and sale sbaii take place witbin ten (10) days
after tbose ligoor licenses bave been transferred
(d)
if tbe Option is not exercised, tbe Principal Sbareboiders or
Prancbisee, as tbe case may be, may sell tbe interests in or of Prancbisee to tbe tbird
partywbicbmadetbeOffer, on conditions no more favorable to tbe tbird party offerer
tban tbose setfortb in tbe Offer, provided tbat Prancbisor approves tbe proposed
transferee in accordancewitbtbecriteriasetfortb in AppendixBand provided fortber
tbat socb saietakes place witbin ninety (90)days after tbeexpiration o f t b e O p t i o n
Period Tbe ninety(90) day limitation described in tbe preceding sentence sbaii not
apply if at tbe end of said ninety (90) day period tbe issoe wbicb prevents completion of
F ^
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20t4
the porcbaseand sale i s e ^ e r t b e need t o e ^ e ^ ^ n s f e ^ o f ^ e a p ^ o a ^ e ligoor
licenses or consent or approval of tbe transaction by a state or federal regolatory
agency In tbe event of s o c b a d e i a y , tbe porcbase and sale sball take place witbin ten
(10) days aftertboseissoes bave been resolved orwaived by Prancbisor
(e)
If tbe Option is not exercised, tbe Principal Sbarebolders or
Prancbisee, as tbe case rnay be, sbaii irnrnediately notify Prancbisor in writing of any
cbange in tbe terms of an Offer Any cbange in tbe terms of an Offer sbaii caose it to be
deemed a new Offer, conferring opon Prancbisor a new Option porsoant to tbis
S o b s e c t i o n 1 2 ^ t b e O p t i o n Period witb respect to tbe new Option sbaii be deemed to
commence on tbe day on wbicb Prancbisor receives written notice o f a c b a n g e i n tbe
termsoftbeoriginalOffer. Provided bowever, in socb an instance, Prancbisor sball
provide Prancbisee its response witbin fifteen (15) days after Prancbisor's receipt of all
of tbe modified terms, oniess socb cbanges are deemed material by Prancbisor and in
socb anevent,Prancbisorsballbaveafortyfive (45) day period witbin wbicb to review
said cbanges
12 8
(a) Prancbisee onderstands and acknowledges tbat tbe rigbts and
doties setfortb in tbis Agreement are personal to Prancbisee and tbat Prancbisor bas
enteredinto tbis Agreement inreiiance on tbe bosiness skill and financial capability of
Prancbisee,and tbe bosiness skill,financial capability andpersonaicbaracter of eacb
Principal Sbarebolder Except as otbenîse provided in tbis S e c t i o n s , tbe Principal
Sbarebolders sball at all times retain control of Prancbisee Except as otherwise
provided in tbis Section 12, n o T r a n s f e r o f any partof Prancbisee's interest in tbis
Agreement or in tbe Pestaorant, and no Transfer of any interest of any Principal
Sbarebolder,sball be completed except in accordance witb tbis Sobsection128 in tbe
event of socbaproposedTransfer of any part ofPrancbisee's Interest in tbis Agreement
or in tbe Pestaorant, or of any Interest of any Principal Sbarebolder,tbe party or parties
desiringtoeffectsocbTransfersballgivePrancbisornoticeinwriting of tbe proposed
Transfer, wbicb notice sball setfortb tbe name and address of tbe proposed transferee,
its financial condition,inciodingacopy of its financial statement dated not more tban
ninety (90) days prior to tbe date of said notice, and all tbe terms and conditions of tbe
proposed Transfer
Opon receiving socb notice, Prancbisor may (i) approve tbe
Transfer, or (ii)witbbold its consentto tbe Transfer
Prancbisor sball, witbin forty
five (45) days of receiving socb notice and aii of tbe information regoested by
Prancbisorregarding tbe proposedTransferandtbepartiestbereto, advise tbe partyor
parties desiring to effect tbe Transfer wbetber it (1)approves tbe Transfer, or
(2)witbboids its consent to tbe Transfer, giving tbe reasons for socb disapproval
Paiiore of Prancbisor to s o a d v i s e said party orparties witbin tbat fortyfive (45) day
period sball b e d e e m e d t o b e a n approval of tbe proposedTransfer AppendixBsets
fortb tbe criteria for obtaining PrancbisoBs consent toaproposedTransfer
(b)
in tbe event tbat Prancbisor approves tbe Transfer, and tbe
Transfer is not completed witbin ninety (90) days of tbe later of (i) expiration of tbe forty
five (45) day notice period, or (ii) delivery of notice of Prancbisor's approval of tbe
proposedTransfer, Prancbisor's approval of tbe proposedTransfer sbaii aotomaticaily
be revoked Tbe ninety (90)day limitation described in tbe preceding sentence sball not
apply if at tbe end of said ninety (90) day period tbe only issoe wbicb prevents
F ^
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2014
comp^bon o f t h e T r a o ^ i s the need to eêottranêrs o f t h e apîoahie ligoor
iioenses in the event of soohadelay, theTransfer shall take plaoewith^
after those ligoor licenses have heen transferred Any sohsegoent proposal to complete
theproposedTransfer shall hesohêotfo FranchlsoBsrightofapprovaiasprovided
herein The partywhichdesiresto effect the proposedTransfer shall irnmediateiy notify
Franchisorinwriting of any change in the terms ofaTransfer Any change in the terms
ofaTransfer prior to closing shaii caose it to he deemedanewTransfer, revoking any
approval previoosiy given hy Franchisor and conferring opon Franchisoranew right to
approve sochTransfer, which shall h e d e e m e d tocommence on the day on which
Franchisor receives written notice of soch changes in terms.
1 2 9 inconnectionwithany regoest for Franchisor's approval o f a p r o p o s e d
Transferporsoanttothis S e c t i o n s , the parties to the proposedTransfer shall pay
Franchisor a non accoontahle fee to defray the actoal cost of review and the
administrative and professional expenses related to the proposed Transferand the
preparation and execotion of docoments and agreements of two thoosand five hondred
dollars ($2,500) For porposes of clarification, the transfer fee reflected in the preceding
sentence relates to this Agreement only and does not limit the ability of Franchisor to
chargefeesinconnectionwithotherfranchiseagreements involved in theTransfer.
13
OONFIOFNTIALIT^RFSTRIOTIONS
131 Franchisee and its Principal Shareholders acknowledge that over the term
of this Agreement they aretoreceiveproprietary information which Franchisor or its
affiliates haveacgoired or developed o v e r t i m e a t g r e a t e x p e n s e , incloding, hot not
limited to, information regarding the System, methods of site selection, marketing and
pohlic relations methods, prodoct analysis and selection, and service methods and skills
relating to the development and operation of restaorants They forther acknowledge that
this information, which inciodes, hot is not necessarily limited to, that contained in the
Manoais, is not generally known in the indostry and is heyond their own present skills
and experience, and that to develop it themselves woold he expensive, time consoming
anddifficoit Franchisee and its Principal Shareholders forther acknowledge that soch
information provides a competitive advantage and will he valoahle to them in the
development of their hosiness, a n d t h a t g a i n i n g a c c e s s t o i t is thereforeaprlmary
reason why they are entering into this Agreement Accordingly, Franchisee and its
Principal Shareholders agree that soch information, as descrihed ahove, which may or
may not he "trade secrets" onder prevailing iodiciai interpretations or statotes, is p ^ ^
and valoahle, and constitotes trade secrets belonging to Francbisororits affiliates
Accordingly, inconsiderationof Franchisor's confidential d i s c l o s o r e t o t h e m o f these
trade secrets, Franchisee and Principal Shareholders agree as follows (sobêct to the
provisions of the Development Agreement and any other franchise agreement between
Franchisor and Franchisee):
(a) Doring the term of this Agreement, neither Franchisee nor any Principal
Shareholder, for so long as socb Principal Shareholder owns an Interest in
Franchisee, may, withoot the prior written consent of Prancbisor, directly or
indirectly engage in, or acgoire any financial or beneficial interest (incloding any
interest in corporations, partnerships, trosts, onlncorporated associations or
F-^
^9752
2014
v e n u e s ) ^ advise, help, guarantee ioaos or make ioans to, any restaorant
bosiness whose meno or method of operation is simiiar to that employed hy
restaorant onits within theSystem w h i o h i s e i t h e r ^ i o o a t e d i n t h e T e r r i t o r y , a s
defined in the Oevelopment Agreement, (ii) iooated in the Area of Dominant
Infloenoe (as defined and established from time to time by Arbitron Ratings
Oompany) of any restaorant developed porsoant to the Oevelopment Agreement,
(iii) iooatedwithinafive(5)miie radios of any restaorant onit within tbe System,or
(iv) determined by Franohisor, exercising reasonable good faith Lodgment, to b e a
direct competitor of the System
(b) Neither Franchisee, for two (2) yearsfoilowing the termination of this
Agreement, nor any Principal Shareholder, for two (2) years following the
termination of a l l o f his or her interest in Franchisee or tbetermination of this
Agreement, whichever occors first, may directly or indirectly engage in, or acgoire
any financial or beneficial interest (incloding any interest in corporations,
partnerships, trosts, onlncorporated associations orôintventores) in, advise, help,
goarantee loans or make loans to, any restaorant bosiness whose meno or method
of operation is simiiar to that employed by restaorant onits within the System which
is located either(i)in theTerritory, as defined in the Development Agreement,
(ii) in the Area of Dominant infloence (as defined and established from time to time
by Arbitron Ratings Oompany) of any restaorant developed porsoant to the
Development Agreement, (iii) within a f i v e ( 5 ) mile radios of any restaorantonit
within theSystem, o r ( i v ) w i t h i n a n y a r e a f o r w h i c h a n a c t i v e , corrently binding
development agreement has been granted by Franchisor to another franchisee as
of tbe date of the termination
(c) Neither Franchisee nor any Shareholder shall at any time (i) appropriate
or ose the trade secrets incorporated in tbe System, or any portion thereof, in any
restaorant bosiness which is not within the System, (ii) disclose or reveal any
portion of the System to any person, other than to Franchisee's Restaorant
employees as an incident of their training, (iii) acgoire any right to ose any name,
mark or other inteliectoai property right which is or may be granted by this
Agreement, except in connection with the operation of tbe Restaorant, or
(iv)commonicate, divolge or ose for the benefit of any other person or entity any
confidential information, knowledge or know how of Franchisor or its affiliates
concerning the methods of development or operation ofarestaorantotiiizing the
System
132 Franchiseeand Principal Shareholders agree that the provisions of this
S e c t i o n 1 3 a r e a n d h a v e b e e n a p r i m a r y i n d o o e m e n t t o F r a n c h i s o r to enter intotbis
Agreement,and that in the event of hreach thereof Franchisor woold be irreparably
inôred and woold be withoot adegoateremedy at law Therefore, in the event o f a
breach,orathreatenedorattempted b r e a c h , o f a n y o f s o c h provisions Franchisorshall
he entitled, in addition to any other remedies which it may have hereonder or at law or
in egoity (incloding the rightto terminate this Agreement), t o a preliminary andBor
permanent inunction a n d a d e c r e e for specific performance of tbe terms hereof withoot
the necessity of showing actoal or threatened damage, and withoot being regoired to
fornishahond or other secority
F29
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^9752
133
T h e ^ ^ o n s c ^ ^
app^toowne^pof^ss^^
shares are l ^ e d and traded o n a o a b o ^ s e o o r ^
for investment
and are not owned hy an o^cer, d i r e c t
of soohpohiioiy traded oompany
13 4 if any ooort or other trihona! having ^risdiotion to determine the v a ^ ^
enforoeahiiity of this Seotion13determines that it wooid heinvalid or onenforoeahle as
written, then the provisions hereof shaii he deemed to he modified or limited to sooh
extent or in sooh manner as neoessary for sooh provisions to he valid and enforoeahie
to the greatest extent possible
13 5 Franchisee shall regoire the General Manager, the Kitohen Manager and
eaoh of its Restaorant managers to exeootea confidentiality agreement in theform
attached hereto as AppendixO Franchisee shall he responsible for compliance of its
employees with the agreements identified in this Sohsection
14
INSRFOTIONS
141 Franchisor shall have tbe right at any time, and from time to time, to bave
its representatives enter the Restaorant premises withoot noticefor the porpose of
inspecting tbe condition thereof and the operation of the Restaorant in order to
determine whether Franchisee is in compiiance with the standards, specifications,
regoirements and instroctions contained in tbis Agreement and in the Manoals, and for
any other reasonable porpose connected with tbe operation of the Restaorant
14 2 Withoot limiting the generality of Sohsection 1 4 1 , a representative of
Franchisor shall be present in the Restaorant to consolt witb Franchisee or its General
Manager from time to time and,at least semiannoally,arepresentative shall condoct
an inspections consoitation at the Restaorant (which may be condocted with or withoot
notice) Ooring soch inspection, Franchisor's representative will inspect the condition of
the Restaorant and observe procedores and operations at the Restaorant Also doring
the inspectionBconsoitation, Franchisor's representative will meet with the General
Manager and sochother Restaorant employees asFranchisor'srepresentativemay
designate, for the porpose of evaioating the condition and operation of the Restaorant
and seeking to maintain or achieve compliance with tbe standards, specifications,
regoirements and instroctions contained in this Agreement and in tbe Manoals
1 4 3 Withoot
limiting the generality of Sohsection 1 4 1 , Franchisor's
representatives shall have the right at ail times doring normal bosiness boors to confer
with Restaorant employees and costomers, and to inspect Franchisee's hooks, records
and tax retorns, or soch portions thereof as pertain to the operation of tbe Restaorant
Ail soch books, records and tax retorns shall be kept and maintained at the principal
execotive offices of Franchisee or soch other place as may be agreedopon by the
parties in writing if any inspection reveals that the gross sales reported in any report or
statement are less than the actoal gross sales ascertained by soch inspection, then tbe
Franchisee shall immediately pay Franchisor tbe additional amoont of fees owing by
FÔ
10^9^
2014
reason ofthe o o d e ^ a t e m e ^ ^
as provided in Sohseotion92 in the event that any report or statement understates
gross s a i e s h y more than three percent (8%) of the aotoai gross saies ascertained hy
Franchisor's inspection, Franchisee shaii, in addition to making the payment p r o v ^
for in the immediately preceding sentence, pay and reimhorse Franchisor for any and aii
expenses incurred in connection with its inspection, incioding, hot not limited to,
reasonable accoonting and legal fees Soch payments shall he withoot preôdice to any
other rights or remedies which Franchisor may have onder this Agreement or otherwise
if any inspectionreveals that the gross sales reported in any report or statement are
greater than the actoal gross sales ascertained hy soch inspection, and that Franchisee
thereby has made an overpayment of fees, the amoont of the overpayment (withoot
interest) shall be offset against fotore fees owing by Franchisee to Franchisor
14 4 Franchisee shall maintain an accorate stock register In the event tbat the
beneficial ownership ofFranchisee's stock differs in any respectfrom record ownership,
F r a n c h i s e e a i s o s b a i l maintain a list of tbe names, addresses and interestsofall
beneficial owners of its stock Franchisee shall prodoce its stock register,and any list of
beneficial owners certified by tbe corporation's secretary to be correct, at its principal
execotive offices opon ten (10) days prior written regoest by Franchisor Franchisor's
representatives shall h a v e t h e rightto examine thestock registerand any list of
beneficial owners, and to reprodoce all or any part thereof Forther, opon ten (10) days
written notice,Franchisor may regoestacopy of the list of stockholders and owners of
beneficial interests to be forwarded to it at Franchisor's principal office
15
RELATIONSHIP O F P A R T I F S ANO INOFMNIFIOATION
151
Franchisee is not, and sball not represent or hold itself oot as, an agent,
legal representative, ôintventorerBpartner, employee or servant of Franchisor for any
porpose whatsoever and, where permitted by law to do so, shall file a bosiness
certificate to soch effect with the proper recording aotborities
Franchisee is an
independent contractor and is not aothorized to make any contract, agreement,
warranty or representation on behalf of Franchisor,or to create any obligation,express
or implied, on behalf of Franchisor Franchisee agrees that Franchisor does not have
any fidociary obligation to Franchisee Franchisee shall not ose the name Applebee's
Neighborhood O r i i l ^ Bar (other than in connection with the operation of the
Restaorant),orAppiebee's, or any similar words as part of or in association with any
trade name of any bosiness entity which is, directly or indirectly, associated with
Franchisee
15 2
Franchisee shall indemnify and hold harmless Franchisor and its
officers, directors, employees, agents, affiliates, soccessors and assigns from and
against (a)any and all claims based opon, arising oot of, or in any way related to the
operation or condition of any part ofthe Restaorant or Restaorant premises,tbe condoct
of hosiness thereat, the ownership or possession of real or personal property, and any
negligent act, misfeasance or nonfeasance by Franchisee or any of its agents,
contractors, servants, employees or licensees (incloding, withoot limitation, the
p e r f o r m a n c e b y F r a n c h i s e e o f any act regoired by, or performed porsoant to, any
provision of tbis Agreement),and (b)any and ail fees (incloding reasonable attorneys'
F^t
^975^
2014
fees^ costs and other expenses inoorred hy or on hehaif of Franchisor in the
investigation of or defense against any and aii soch ciaims Withoot limiting the
generality o f t h e foregoing, Franchisee will satisfy the ohligations set forth in this
paragraph withoot regard to any acts or omissions, real or alleged, of Franchisor or its
officers, directors, employees, agents, affiliates, soccessors and assigns
15.3
In addition to, and not in limitation of, any sohsection hereof, Franchisee
specifically covenants, represents and warrants that Franchisee is in compliance in ail
material respects with aii federal, state, monicipal and local laws governing the
generation, ose or disposal of hazardoos waste or hazardoos materials, and any and all
other laws designed to protect the environment and that:
(a) There have heen no past, and there are no corrent or anticipated,
releases or sohstantiai threats ofareieaseofahazardoossohstance,poilotant or
contaminant from or onto the Restaorant or real property opon which the
Restaorant is located andreferred to in this Agreement ("Fremises^whichis or
may he sohêct to regolation onder the Comprehensive Environmental Response,
Compensation and FiahiiityAct (42 U . S . C 9501,e^se^.) or other iaws designed
to protect the environment;
(h) The Premises have not previoosiy heen osed, are not now heing osed
and are not contemplated to he osed for the treatment, collection, storage or
disposal of any refose or ohêctionahie waste so as to regoireapermit or approval
from the FnvironmentaiRrotection Agency porsoant to the Flazardoos and Solid
WasteAmendmentsof1934(95Stat 3221)or any other federal,state,coonty or
monicipal agency charged with the responsihiiity of protecting the environment;
(c) The Premises have not previoosiy heen osed, are not now heing osed,
and are not contemplated to he osed, for the generation, transportation, treatment,
storage or disposal of any hazardoos waste;
(d) No portion ofthe Premisesare located on or overa"sanitary landfill" or
an "open domp" within the meaning of the Resoorce Conservation and Recovery
Act ( 4 2 U S C 5941 e ^ s e ^ a s a m e n d e d h y t h e F l a z a r d o o s and Solid Waste
Amendments of1984 (95 Stat 3221);
(e) No ashestosfihers or materials or polychlorinatedhiphenyis(PC^s) are
on or in the Premises;
(f) There havenot heen, norarethere presently pending, any federal or
state enforcement actions against the Premises, nor is the Franchisee or its
Landlord, i f a n y , s o h ^ e c t t o a n y ootstandingadministrativeorderswhich regoire
ongoing compiiance efforts in connection with compiiance with iaws designed to
protect the environment;
(g) The Franchisee has not entered into any consent decrees or
administrative consent orders with any agency charged with the responsihility of
protecting the environment;
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(h) There have not heen any notices of violation sent to the Franchisee
onder the Citizens Soit Provisions of any statute;
(i)
The Franchisee has not received any reqoesf for information, notice or
demand letters for administrative inqoiries from any governmental entity with
regard to its environmental practices;
(i)
The Franchisee has maintained aii regoired records onder each and
every applicahle environmental statote and is in foil compiiance with ail
environmental permits issoed to it hy any governmental or regoiatory agency;
(k) The Franchisee maintains ail insorance policies as may he regoired hy
any applicahle law governing the environment;
(i)
The Franchisee has no reason to helieve that any operation of
egolpment on or at the Premises may he the caose ofafotore spill or release o f a
poiiotant;
(m) The Franchisee has not in the past, nor is it presently, generating,
transporting
or disposing of a hazardoos sohstance as defined hy
Section 9 6 0 1 ^ o f C F P C L A ; and
(n) The Franchisor shaii have the right, at Franchisee's expense, to regoire
an environmental aodit of the Premises fromacompany or companies satisfactory
to Franchisor
16
iNSOPANCF
161
Franchisee shaii procore hefore the commencement of Pestaorant
operations, and shall maintain in foilforce and effectdoring theentire term of this
Agreement, at its sole cost and expense, an insorancepoiicyor policies protecting
Franchisee and Franchisor and their respective officers, directors and employees
against any a n d a i i c i a i m s , loss, liahility or expense whatsoever, a r i s i n g o o t o f o r i n
connection with the condition, operation, ose or occopancy of the Pestaorant or
Pestaorant Premises Franchisee shaii procore workers'compensation coverage for
each of its empioyeesnoiater than the first date of soch employee's employment
Franchisee shaii aiso insore the Pestaorant hoiiding and other improvements,
egoipment,signs, interior and exterior decor items, fornishings and fixtores, and any
additions thereto, in accordance withstandard fire and extended coverage insorance
policies then in effect for simiiar hosinesses Franchisor and soch ofFranchlsor's
affiliates as may he specifiedhy Franchisor from time to time shall he namedas an
additional insored in aii soch policies, workers' compensation excepted, and the
certificate or certificates of insorance shall state that the policy or policies shall not he
sohêct to cancellation or alteration withoot at least thirty (30) days prior written n o ^
Franchisor Soch policy or policies shall he written hyaresponsihle insorance oompany
or companies satisfactory to Franchisor,andshail he in soch form and contain soch
limits of liahility and other regoired insorance as shall he satisfactory to Franchisor from
F-^
^ 9 7 ^
2014
time^me
loaoyeve^sochpoôr^
the year 2014:
KÔOF^SORANCE
M^MOMOM^SOFLÔTY
Workers Compensation
Statutory
Empioyer'sLiahiiity
$500,000 hodiiyiôryhyaooident
$500,000 hodiiyio^ryhy disease
GeneraiPohiioLiahiiity,
inoiodingProdootLiahiiity,
inôry and Ligoor Liahiiity
$1,000,000 eaoh person,
$1,000,000 eaoh incident
$2,000,000 aggregate
Fire and Extended Coverage
incioding (a) Bosiness interruption
and (h) Service interroption
Foii replacement vaioe
Foiicy limits per occorrence,
except service interroption;
24 hoorwaiting period; $250,000 limit
Omhreiia Liahility Insorance
$30,000,000
Franchisee shall provide certificates of soch insorance to Franchisor prior to the
opening o f t h e Restaorant and a t t h e t i m e of each policy renewal Opon regoest,
Franchisee shall provide copies of each insorance policy to Franchisor The insorance
afforded hy the policy or policies respecting pohlic liahility shall not he limited in any way
hy reason of any insorance which may he maintained hy Franchisor or its affiliates The
insorance provisions of this Agreement may he soppiemented from time to time throogh
written notice hy Franchisor
15 2
Within sixty (50) days after the execotion of this Agreement, hot in no
event later thanthe day heforetheRestaorant opens for hosiness, Franchiseeshall
sohmit to Franchisor for approval certificates of insorance showing compliance with the
regoirements of Sohsection151 Notwithstanding the foregoing, Franchisee shall
sohmit to Franchisor for approval certificates of insorance showing compiiance with the
worker's compensation regoirements set forth in Sohsection 151prior to the training of
any Franchisee e m p i o y e e a t a Restaorantoperated hy Franchisor Maintenance of
soch insorance and the performance hy Franchisee of its ohligations onder this
Section 15 shaii not relieve Franchisee of liahility onder the indemnity provisions of this
Agreement, and shall not limit soch liahility
15 3 Shoold Franchisee, for any reason, fail to procore or maintain the
insorance coverage regoired hy this Section, then Franchisor shall have the right and
aothority to immediately procore soch insorance coverage and to charge the cost
thereof to Franchisee, which amoonts shall he paid immediately opon notice and shall
he sohêct to charges for late payments in the manner set forth in Sohsection92
154
No later thanthirty (30) daysfollowing Franchisee'sreceiptofsame,
Franchisee shall sohmit to Franchisora copy of any written report relating t o t h e
^84
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oondônoftheRest^
prospeoê iosorer or hy a represontabve o f a federal sfafo or looa! govoromonf
ageooy, provided that if any sooh report oonfaiosoommoots or
^
maferiaiiyaoddefrimenfaiiyaffeof fhe Restaorar^sooh report s h a i i h e s o h m i f t e d f o
Franohisorwifhinfhree^daysfoiiowingFraoohisee^reo
17
Franohisee shaii pay or oaose fo he paid prompfiy when doe aii ohiigafioos
inoorred, direofiy or indireotiy, in ooooeofion wifh the Restaorant and its operation,
inoioding, withoot iimitation, (a) aii taxes and assessments that may he assessed
against the Restaorant iand, hoiiding and other improvements, egoipment, fixtores,
signs,fornishings, and other property; (h)aiidehts or other somsseooredhyiiens and
enoomhranoes of every kind and oharaoteroreated or piaoedopon or against any of
said property, and; (o) aii aoooonts and other indebtedness of every kind and character
incorred hy or on hehaif of Franchisee in the condoctof the Restaorant hosiness
Notwithstanding the foregoing, Franchisee wiii not he in defaoit of this Agreement a s a
resoitofanonpayment or nonperformance of the foregoing so iong as it dispotes said
dehtoriien and is,in the soie opinion ofFranchisor,vaiidiy and in good faith porsoinga
resoiotion of said ciaim or iien and has reserved sofficientsoms to pay the deht^ciaim as
is agreed to hy Franchisor
18
T R A O F N A M F S , S F R V i O F M A R K S ANO TRAOFMARKS
181
Franchisee acknowledges the soie and exciosive right ofFranchisor and
its affiliates (except for rights granted onder existing and fotore franchise agreements) to
ose the Marks in connection with the prodocts and services to which they are or may he
applied hy Franchisor or its affiliates, and represents, warrants and agrees that
Franchisee shall not, either doring the term of this Agreement, or after the expiration or
other termination hereof,directiy or indirectiy,contest or aid in contesting the validity,
ownership or ose thereof hy Franchisor or its affiliates, or take any action whatsoever in
derogation ofthe rights claimed herein hy Franchisor or its affiliates
18 2
The right granted to Franchisee onder this Agreement to ose the Marks
is nonexciosive, and Franchisor and its affiliates, in its or their sole discretion, sohêct
onlytothelimitationscontained in S o h s e c t i o n 1 4 o f this Agreement, have the right to
grant other rights in,to andonder those names and marks in addition to those rights
already granted, and to develop and grant rights in other names and marks on any soch
terms and conditions as Franchisor or its affiliates deem appropriate
The rights
granted onder this Agreement do not inciode any right or aothority of any kind
whatsoever to pre package or sell pre packaged food prodocts, onder any of the Marks,
or any meno items approved for sale at the Restaorant, whether at the Restaorant, on
the internet, or at any other location, incloding grocery stores
18 8
Franchisee onderstands and acknowledges and agrees that Franchisor
hastheonrestricted right, sohêct only to the limitations contained in Sohsection14of
this Agreement, to engage, directly and indirectly, throogh its employees,
representatives, licenses, assigns, agents, affiliates, sohsidiaries and others, at
F^5
20t4
who^sa^ââodothe^^
onder the Marks or other names or marks, (h)the ose, in oonneotion with sooh
prodootion, distrihotion and saie, of any and aii trademarks, trade names, service
marks, iogos, insignia, siogans, emhiems, symhois, designs and other identifying
oharaoteristios as may he deveiopedor osed,from time to time, hy Franchisor or its
affiliated companies with respect to the System or otherwise, and (c) the prodoction,
distrihotion and saie of prodocts throogh another restaorant or restaorants which do not
otiiize the System or the Appiehee's Neighborhood G r i i i ^ B a r service mark and which
otherwise compete or might compete with the Restaorant. Forther, Franchisee agrees
that ownership of any trademarks, service marks or other insignia, symbols, designs or
slogans osed in development and promotion of any prodocts or meno items, incloding
any generalpromotionor concept not tied t o a s p e c i f i c p r o d o c t , a n d a l l r e c i p e s and
copyrighted material, whether soch development was institoted at tbe regoest or
soggestionofFranchiseeor Franchisor,and whether soch development was done in
collaboration with Franchisor or done independently by Franchisee, shall, as between
Franchisor and Franchisee, be the sole and exclosive property of Franchisor Any
goodwill engendered by the trademarks, service marks, insignia, symbols, designs or
slogans osed shall inore to the benefit of Franchisor and its affiliated companies whose
ownership shall he sole and exclosive
18 4
Nothing contained in this Agreement shall be constroed to vest in
Franchisee any right, title orinterest in ortoanyofFranchisor's names orthe Marks,the
goodwill now or hereafter associated therewith, or any right in tbe design of any
restaorant boiidingor premises, o r t h e d e c o r o r t r a d e d r e s s o f t h e R e s t a o r a n t , o t h e r
tban the rights and license expressly granted herein for tbe term hereof Any and all
goodwill associated with or identified by any of Franchisor's names or tbe Marks shall
inore directiyandexclosiveiytothebenefit of Franchisor andits affiliates, incloding,
withoot limitation, any goodwill resolting from operation and promotion of the
Restaorant, provided that this Sohsection shall not be constroed to entitle Franchisor to
receive any portion of the consideration paid to Franchisee andBor any Frincipal
SbareholderasaresoltofaTransferofan Interest porsoant to Section12hereof
188
F r a n c h i s e e s b a i l a d o p t a n d o s e e a c h o f t h e M a r k s o n i y in a manner
expressly approved by Franchisor,and shall not ose any of the Marks inconnection
with any statement or material which may,in the Lodgment ofFranchisor,he in bad taste
or inconsistent with Franchisor's pobiic image, or tend to bring disparagement, ridicole
or scorn opon Franchisor, any o f t h e Marks, o r t h e goodwill associated therewith
Franchisee shall not adopt, ose or register as its corporate name (by fiiingacertificate
or articles of incorporation or otherwise) any trade or bosiness name, style or design
which inciodes, or is simiiar to, any of Marks, logos, insignia, slogans, emblems,
symbols, designs or other identifying characteristics Franchisee has no right, license or
aothority to ose any of the Marks on or in connection with tbe internet, except as stated
in and permitted by this Section18 8 Withoot limiting the foregoing, Franchisee shall
n o t o s e a n y o f t h e M a r k s i n a n y Internetdomain name or O R F o r ose any Internet
domain name or ORFthat may be confosingly similar to one or more of theMarks
Franchisee shall not display or ose any of the Marks or other ofFranchlsor's inteliectoai
property in connection with,or associate the System with (tbrooghaiink or otherwise)
any web site advertising, address, or listing on the World Wide Web or any other portion
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ofthe internet withoot Franohiso^s prior written oonsent. Franohisee shaii sohmit for
Franohisor's approval any internet domain name, ORL or internet e maii address
Franchisee intends to ose in oonneotion with the Restaorant
18 6
Franchisor shaii have the right, at any time and from time to time, opon
notice to Franchisee, to make additions to, deletions from and changes in any of the
Marks,or all of them, all of which additions,deietions and changes shall he made in
good f a i t h , o n a r e a s o n a h i e h a s i s and w i t h a v i e w toward the overall hest interests of
theSystem
18 7
Franchisee agrees to notify Franchisor promptly in writing of any soit or
claim for infringement relating to the marks Sohêct to the terms and conditions of this
Sohsection 18 7, Franchisor and its affiliates shall have the sole right to defend or settle
any soch soit or claim of infringement at Franchisor's or its affiliates' expense
Franchisee, at Franchisee's expense, shall have the right to he represented hycoonsei
Franchisor or its affiliates shall, however, retain control of any negotiations with respect
to soch claim or of any litigation involving soch soit Franchisee agrees to cooperate
with Franchisor and its affiliates and to assist Franchisor and its affiliates'whenever
reasonably regoested hy them, at Franchisor's and its affiliates'expense, in the defense
of any soch infringement soit or claim
188
Franchisor represents that it is the soie owner o f t h e service mark
Applebee's Neighborhood G r i l l ^ B a r
19
FXFiRATiONANOTFRi^
ATTORNEYS'FFFS
191
Franchisor shaii have tbe right to terminate this Agreement immediately
opon written notice to Franchisee stating the reason for soch termination:
(a) in the event of any hreach or defaoit of any of the provisions of
Sobsection91,Sections12or18,Sohsection 1 4 1 o r Section 28;
^
(b) ifapetition in bankroptcy,an arrangement for tbe benefit of creditors,or
apetitionfor reorganization isfiled by Franchisee,oris fiiedagainst Franchisee
and not dismissed within ninety (90) days from the filing thereof, or if Franchisee
shall make any assignment for the benefit of creditors,or ifareceiver or trostee is
appointedfor Franchisee and is notdismissed within ninety (99) days of soch
appointment;
(c) if Franchisee ceases to operate the Restaorant withoot tbe prior written
consent of Franchisor or loses its right to possession of the Restaorant premises;
provided however,this provision will not apply if Franchisee ceases to operate the
Restaorant or loses its right to possession ofthe Restaorant premises by reason of
Force Maêore and Franchisee complies witb the regoirements of Section 24 of this
Agreement;
F^7
105^2
2014
(d) if Franchisor discovers that Franchisee has made any material
misrepresentation or omitted any material fact in the information which was
fornished to Franchisor in connection with this Agreement;
(e) if any part of this Agreement relating to the payment of fees to
Franchisor, or the preservation of any o f t h e Marks, trade secrets or secret
formoiae licensed or disclosed hereonder is, for any reason, declared invalid or
onenforceahle;or
(f)
if Franchisee or any Frincipal Shareholder is convicted of or pleads ^ o
c o ^ e ^ e ^ e t o a f e l o n y o r a n y c r i m e involving moral torpitode.
If Franchisee defaoits in the performance orohservance of any of its other
ohligations hereonder, and soch defaoit continoesforaperiod of sixty (60) days after
written notice to Franchisee specifying soch defaoit, Franchisor shaii have the right to
terminate this Agreement opon thirty (30) days written notice to Franchisee
if
Franchisee defaoits in the performance or observance of the same ohligation two (2) or
more times within a t w e l v e s ) month period, Franchisor shall have the right to
terminate this Agreement immediately opon commission of the second act of defaoit,
opon thirty (30) days written notice to Franchisee stating the reason for soch
termination, withoot allowance for any corative period
The foregoing provisions ofthis Sohsection 19BI are sohiectto the provisions of
any local statotes or regolationswhichiimit the groonds opon which Franchisor may
terminate this Agreement,or which regoire that Franchisor give Franchisee additional
prior written notice of termination and opportonity to core any defaoit
19 2
Opon the termination of this Agreement hy Franchisor, Franchisee may
not remove any property from the Restaorant premisesfor thirty (30)days after the
termination Opon the expiration or earlier termination of this Agreement for any reason:
(a) Franchisee shall immediately discontinoe its ose of the System and its
ose ofthe Marks and other identifying characteristics;
(h) if theRestaorant premises are owned hy Franchisee or leased froma
thirdparty, Franchiseeshall,opon demand hyFranchisor,remove (at Franchisee's
expense) the Marks, sign facia, and other identifying characteristics from ail
premises, and paint ail premises and other improvements maintained porsoant to
t h i s A g r e e m e n t a d e s i g n and colorwhich is basically different from Franchisor's
aothorized design and color If Franchisee shall fail to make or caose to be made
any soch removalor repainting within thirty (30) daysafter written notice, then
Franchisor shall have the right to enter opon the Restaorant premises, withoot
being deemed goilty of trespass or any tort (or Franchisee shall caose Franchisor
to be permitted on the premises as necessary), and make or caose to be made
soch removal, alterations and repainting at tbe reasonable expense of Franchisee,
which expense Franchisee shall pay to Franchisor immediately opon demand; and
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(c) Franchisee sha^not t h e r e a t ^
trade name, service mark, iogo, insignia, slogan, e m ^
identifying characteristic that is in any way associated with F ^
those associated with Franchisor, or ose any food or proprietary meno item, recipe
or method of food preparation or operate or do hosiness onder any name or in any
manner that might tend to give the pohiic the impression that Franchisee is or was
aiicensee or franchisee of, or othenîse associated with,Franchisor or its affiliated
companies
19 3
in the event that any party to this Agreement initiates any legal
proceeding to constroe or enforce any of the terms, conditions andôr provisions of this
Agreement, incloding, hot not limited to, itstermination provisions and itsprovisions
regoiring Franchisee to make certain payments to Franchisor incident to the operation
of the Restaorant, or to ohtain damages or other relief to which any soch party may he
entitled hy virtoe of this Agreement, the prevailing partyor partiesshailhe paid its
reasonable attorneys'fees and expenses hy the other party or parties If Franchisee
fails to comply withawritten notice of termination sent hy Franchisor a n d a c o o r t later
opholds soch termination of this Agreement, Franchisee's operation of the Restaorant,
from and after the date of termination stated in soch notice, shall constitote wiiifoi
trademark infringement and onfair competition hy Franchisee, and Franchisee shall he
liable to Franchisor for damages resolting from soch infringement in addition to any fees
paid or payable hereonder,incloding,withoot limitation, any profits which Franchisee
derived from soch posttermination operation ofthe Restaorant
19 4
(a) With respect to Restaorant premises owned by Franchisee, in the
event of termination of this Agreement, Franchisor shall have, for thirty (30) days after
thetermination is effective, an option, exercisabieopon written notlceto Franchisee
witbin soch thirty (30) day period, to elect to porchase the Restaorant premises from
Franchisee for the fair market vaioe of the land and boiidings, fornishings and
egolpment located therein
(b)
in addition to the option described above, Franchisor shaii have an
option, exercisable opon written notice to Franchisee, to elect to porchase tbe
Restaorant premisesfrom Franchisee oponexpirationof this Agreement for thefair
market vaioe o f t h e land and boiidings, fornishings, and egolpment located therein
sobêct to Franchisee's option to operate tbe Restaorant for an additional term onder
Sobseotion13 hereof
if Franchisee does not notify Franchisor, porsoant to
Sobsection13hereof,ofadesire to operate the Restaorant for an additional term,then
Franchisor shall provide the written notice described in the preceding sentence witbin
thirty (30) days after the latest date hy which Franchisee is regoired by Sobsection13
to advise Franchisor of sochadesire; if Franchisee does notify Franchisor ofadesire to
operate the Restaorant for an additional term and Franchisor determines that
Franchisee is not eligible to do so, Franchisor shall provide the written notice descrihed
in tbe preceding sentence within thirty (30) days of its written notice to Franchisee that
Franchiseeis not eligihleto operate theRestaorant for soch additional term With
respect to the option to porchase opon expiration of this Agreement, this option shall not
apply if priorto thirty (30) days before said expiration, Franchisee enters into an
agreement to sell socb Restaorant premises toathirdparfy opon the expiration of the
F^
2014
^ 9 ^ 2
Franchise Agreement provided that Franchisee's agreement with the purchaser
inciodesaccvenant hy the purchaser, which is expressiyenfcrceahiehy Franchiser as
a thirdparty heneficiary thereof porsoant tcwhich the p o r c h a s e r a g r e e s t h a t , f c r a
period of t w e i v e ^ ^ m c n t h s after the expiration of this Agreement, the porch
not ose soch premises for the operation o f a restaorant hosiness whose meno or
method of operation is simiiar to that employed hy restaorant onits within the System
(c)
ifFranchisee receives approvaito operate the Restaorant premises
f o r a n additional term in acoordancewith Sohsection13 hereof, Franchisee will he
regoired to execote the thenexisting form of franchise agreement,which shall contain
an option toohtain assignment of Franchisee's iease with a third party andBor to
porchase certain property, exercisahiehy Franchisor opon termination thereof, and an
option to porchase the Restaorant premises, exercisahiehy Franchisor opon expiration
of the additional term (sohêct to any thenexisting rights to renew ofFranchisee) Soch
options shall he sohstantiailysimiiarto the provisions descrihed in this S o h s e c t i o n l ^
(d)
If the parties cannot agree on the porchase price or other terms of
porchase within thirty (30) days following Franchisor's exercise of its option porsoant
Sohsection 19 4(a) and (h), the price ordispoted terms ofporchase shall he determined
hy three (3) appraisers, witheach party selecting one (1) appraiser a n d t h e two (2)
appraisers, so chosen, selecting the third appraiser in the event of soch an appraisal,
each party shall hear its own legal and other costs and shall split egoally the appraisal
fees The appraisers'determination of the price and other dispoted terms of porchase
shall he final and hinding
(e)
If Franchisor elects to exercise its option to porchase opon
termination of this Agreement, the porchase price shall he paid within thirty (30) days of
t h e d e t e r m i n a t i o n o f t h e p o r c h a s e p r i c e a n d other terms of porchase if Franchisor
elects to exercise its option to porchase opon expiration of this Agreement, the
porchase price shall he paid within thirty (30) days ofthe later of (a) the determination of
the porchase price and other terms of porchase,or (h)expiration of this Agreement if
the Franchisor does not elect to exercise its option to porchase the Restaorant
premises, the Franchisee may sell soch premises to a third party, provided that
Franchisee's agreement with the porchaser inciodes a covenant hy the porchaser,
which is expressly enforceahle hy Franchisor as a third party heneficiary thereof,
porsoant to which the porchaser agrees t h a t i t s h a i l not o s e s o c h premisesforthe
operation ofarestaorant hosiness whose meno or method of operation is similar to that
employed hy restaorant onits within the System foraperiod of tweive(12) months after
the termination or expiration of this Agreement
(f)
Ifthe Restaorant premises are leased hy Franchisee fromathird
party, soch lease most allow Franchisee to assign the lease to Franchisor Opon
termination of this Agreement for any reason, Franchisor has the right, exercisahle opon
written notice to Franchisee within thirty (30) daysafter termination iseffective, to
regoire Franchisee to assign ail Franchisee's rights and ohligations onder the lease to
Franchisor and to immediately sorrender possession o f t h e premises, incloding all
fixtores and leasehold improvements, to Franchisor The lessor may not impose any
assignment fee or other simiiar charge on Franchisor in connection with soch
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assignmeof ^Franchisorexercises that
within thirty (30) days after taking possession o f t h e premises, to porchase aii of
Franchisee's egoipment,signs, decor items,fornishings,soppiies and other prodocts
and materials at their then fair market vaioe if the parties cannot agree on the price,
the price wiii he determined in the manner set forth in connection with
Franchisee owned Restaorant premises if Franchisor elects not to porchase the items
mentioned ahove, Franchisee shall, at Franchisee's own expense and onder
Franchisor's sopervision removethose itemsfromthe premises within ten (10) days
after soch final election, or ten (10) days after expiration of the option period, whichever
is earlier. IfFranchisee fails to remove all soch property from the premises within soch
period,Franchisor shall he entitled to do so,or to aothorizeathird party to do so, all at
Franchisee's expense
195
in addition to the provisions contained in Sohsection194hereof:
(a) With respect to Restaorant premises owned hy Franchisee, in the event
of termination of this Agreement and Franchisor's exercise of its option to porchase
the Restaorant premises porsoant to Sohsection194(a)hereof,Franchisee shall
have, for ten (10) days after its receipt ofwritten notice of Franchisor's election to
porchase,an option,exercisahle opon written notlceto Franchisor,to lease said
premisesto Franchisor, porsoant t o a i e a s e which provides for rental a t a r a t e not
in excess of six percent (5%)of gross sales and triple net terms Said iease shall
provide f o r a l e a s e term of at least ten (10) years with two (2) five (5)year options
to renew, and for primary annoai rent of not in excess of the nomher derived from
moitipiying six percent (5%) times the gross sales reported hy Franchisee to
Franchisor for which Franchisee has paid a royalty f e e f o r the next preceding
calendar year times eighty percent (30%)
(h) In addition to the option descrihed ahove, Franchisee shaii have an
option, exercisahle opon written notice to Franchisor, to elect to lease the
Restaorant premises to Franchisor opon expiration of this Agreement and
Franchisor's exercise of its option to porchase the Restaorant premises porsoant
to Sohsection19 4(h) hereof, porsoant to the same terms set forth in Sohsection
195(a) ahove, sohiectto Franchisee'soption tooperatethe Restaorant for an
additional term onder Sohsection 1 3 hereof
if (i) Franchisee does not notify
Franchisor, porsoant to Sohsection13 hereof, of a desire to operate the
Restaorant for an additional term, or (ii) Franchisee doesnotify Franchisor o f a
desire to operate the Restaorant for an additional term and Franchisor determines
that Franchiseeis not eligihleto do so, and Franchisor exercises its option to
porchase the Restaorant premises, then Franchisee shall provide the written notice
descrihed in the preceding sentence within ten (10) days after its receipt ofwritten
noticeof Franchisor's election to porchase Withrespect to the option to iease
opon expiration of this Agreement, this option shall not apply if prior to thirty (30)
days hefore said expiration, Franchisee enters intoan agreement to sell soch
Restaorant premises to a third party opon the expiration of the Franchise
Agreement,provided that Franchisee's agreement with the porchaser inciodesa
covenant hytheporchaser, which isexpresslyenforceahle hy Franchisor a s a
third party heneficiary thereof, porsoant to which the porchaser agrees, at
F^l
20t4
10^9752
F^nohisoBsopt^
forth i o S o b s e o t i o o l ^
expônoffhisAgroome^fheporohasersh^^
operation ofarostaoraofhosioess whoso meno or method of o
that employed hy restaorant onits within the System
(o) if Franohisee receives approval to operate the Restaorant premises for
an additionalterminaooordanoewlthSohseotion18hereof, Franchisee will he
regoired t o e x e c o t e t h e t h e n e x i s t i n g f o r m o f franchiseagreement which shall
c o n t a i n a n o p t i o n t o o h t a i n assignmentof Franchisee'sleasewithathird party
andôr to lease certain property, exercisahle hy Franchisor opon termination
thereof, and an option to iease the Restaorant premises, exercisahle hy Franchisor
opon expiration oftheadditionaiterm(sohiecttoanythen existing rights to renew
of Franchisee) Soch options shall he sohstantiaily simiiar to the provisions
descrihed in this Sohsection19 5
20
NOWAiVFROFOFFAOFT
20BI
The waiver hy any party to this Agreement of any hreach or defaoit, or
series of breaches or defaoits, of any term, covenant or condition herein, or of any same
or similar term, covenant or condition contained in any other agreement hetween
Franchisor and any franchisee, shallnot he d e e m e d a w a i v e r of any sohsegoent or
continoing hreach ordefaoit of the same o r a n y other term, covenantorcondition
contained in this Agreement,or in any other agreement hetween Franchisor and any
franchisee
20 2
Ail rights and remedies of the parties hereto shall he comolativeand not
alternative, in addition to and not exciosive of any other rights or remedies which are
provided for herein or which may he available at law or in egoity in case of any hreach,
failore o r d e f a o l t o r threatened b r e a c b , f a i i o r e o r d e f a o l t o f any term, provision or
condition of this Agreement Tbe rightsand remedies of thepartles heretoshailbe
continoing and shall not be exhaosted by any one ^ ) o r more oses thereof, and may be
exercised at any time or from time to time as often as may be expedient; and any option
or election to enforce any soch right or remedy may be exercised or taken at any time
and from time to time The expiration or earlier termination of this Agreement shall not
discharge or release Franchisee or any Frincipal Shareholder from any liability or
obligation then accroed, or any liability or obligation continoing beyond, or a r i s ^
tbe expiration or earlier termination of the Agreement.
21
OONSTROOTION,SFVFRASI^^
21BI
If any part of this Agreement shall for any reason be declared invalid,
onenforceable or impaired in any way, tbe validity of the remaining portions shall remain
in foil force and effect as if the Agreement had been execoted witb socb invalid portion
eliminated, and it is hereby declared tbe intention of the parties tbat they woold bave
execoted the remaining portion of this Agreement withoot incloding therein any soch
portions which might be declared invalid; provided however, that in tbe event any part
hereof relating t o t h e p a y m e n t o f f e e s t o F r a n c h i s o r , o r the preservationof any of
F ^
^9752
2014
FranobisoBs Marks, t r a d e s ^
for any reason declared iova!^
ferrninafe this Agreement opon wriffen notice foFranohisee. If any claose or provision
herein woold he deemed invalid or onenforceahie as written, it shall he deemed
modified or limited to soch extent or In soch manner as may he necessary to render the
claose or provision valid and enforceahle to the greatest extent possihie in light of the
interest of the parties expressed in that claose or provision, sohêct to the provisions of
theprecedingsentence
212
PRANOHÊEANOPRÔÂLSHAREHOLOERSAOKNOWLEOOE
THATPRANOHiSOR M A Y O R A L
UNITEO S T A T E S ON T E R M S A N O OONOiTIONSSiMiLAR TO T H O S ^
IN THIS A G R E E M E N T ^ A N O THAT iT IS OE MOTOAL BENEEiT TO ERANOHiSEE
ANO RRiNOIRAL S H A R E H O L D E R S ANO TO ERANOHiSOR THAT T H E S E TERMS
A N O O O N O I T i O N S B E O N i E O R M L Y i N T E R R R E T E O . THEREFORE^ THE RARTiES
A O R E E THAT TO THE EXTENT THAT THE LAW OE THE STATE OE K A N S A S
OOES NOT OONELIOT WITH LOOAL ERANOHiSE STATUTES^ ROLES ANO
REOOLATiONS^ K A N S A S L A W S H A L L A R R L Y T O THE OONSTROOTiONOE THIS
A G R E E M E N T A N O S H A L L G O V E R N A L L QUESTIONS WHiOH A R i S E WiTH
R E E E R E N O E HERETO^ RROVIOEO HOWEVER^ THAT R R O V i S I O N S O E K A N S A S
L A W R E O A R O i N O O O N E L i O T S O E L A W S H A L L NOT A R R L Y H E R E T O .
2 1 S THE R A R T i E S A G R E E THAT A N Y OLAiM^ OONTROVERSY OR
OiSROTE A R i S i N G O O T O E O R R E L A T i N G T O T H i S
AGREEMENTORTHE
R E R E O R M A N O E T H E R E O E W H i O H O A N N O T B E AMiOAOLV SETTLED^ EXOERT
A S O T H E R W i S E RROViOEO H E R E i N W i L L B E R E S O L V E D B Y A R R O O E E O i N G i N
A O O O R T i N J O H N S O N O O O N T ^ KANSAS^ AND ERANOHiSEE AND RRiNOiRAL
S H A R E H O L D E R S EAOH i R R E V O O A B L Y A O O E R T THE J O R i S D i O T i O N O E THE
O O O R T S O E THE STATE OE K A N S A S A N D THE E E D E R A L O O O R T S SERVING
J O H N S O N OOONTY^ K A N S A S EOR SOOH OLAiMS^ OONTROVERSiES OR
DiSROTES EAOH R A R T V W A i V E S i T S R i G H T T O A J O R Y TRIAL i N A N V O O O R T
AOTiON ARISING A M O N G THE PARTIES UNDER THIS A G R E E M E N T OR
OTHERWISE R E L A T E D TO THIS A G R E E M E N T ^ W H E T H E R MADE B Y O L A I M ^
OOONTEROLAIM^ T H I R D P A R T Y OLAIM OR OTHERWISE
The parties agree that service of process in any proceeding arising o o t o f o r
relating to this Agreement or the pertormance thereof may he made as to Franchisee
and any Principal Shareholder hyservingaperson of soitahie age and discretion (soch
as the person in charge of the office) at the address of Franchisee specified in this
Agreement and as to Franchisor hy serving the president or a vice president of
Franchisor at the address ofFranchisor or hy serving Franchisor's registered agent
22
INTERFFRENOEWITH E M P L O Y M E N T RELATIONS
Doring the term of this Agreement, neither Franchisor nor Franchisee shall
employ or seek to employ inamanagerial position ( i e , i n a p o s i t i o n a t a p a y grade at
or ahove that of Assistant Restaorant Manager or Kitchen Manager), directly or
indirectly, any person who is a t t h e t i m e or was at any time doring theprior six (6)
F ^
^9752
months empioyedby the
franchisee in the System This section shaii not he violated if, at the time Franchisor or
Franchisee employs or seeks to employ soch person, soch former employer has given
its written consent and is compensated hy receiving fifty percent (50%) of the
employee's annoai salary from the other party Notwithstanding any other provision of
this Agreement, thepartles hereto acknowiedgethat if this Section is violated, soch
former employer shall he entitled toligoidateddamages egoal to three (3)times the
annoai salary of the employee involved, plosreimhorsement of all costs and attorneys'
fees incorred
in addition to the rights granted to the parties hereto, the parties
acknowiedgeand agree thatanyfranchiseefrom which an employeewas hired hy
either party to this Agreement in violation ofthe terms ofthis Section shall he deemed to
he a thirdparty heneficiary of this provision and may soe and recoveragainstthe
offending party the iigoidated damages herein set forth; provided however, the failore hy
Franchisortoenforcethis Section shall nothedeemedtoheaviolation of this Section
23
FIQOORFIOFNSF
Thegrant of the rights which are the sohêctof this Agreement isexpressiy
conditioned opon the ahiiity o f t h e Franchisee to ohtain and maintain any and ail
regoiredstateandôriocallicensespermitting the saie of ligoor hy the drinkon the
Restaorant premises, and Franchisee agrees to ose its hestefforts to ohtain soch
licenses After obtaining the necessary state or local ligoor licenses, Franchisee shall
thereafter comply with all applicable laws andregolations relating to the sale of ligoor on
the Restaorant premises If, doring any twelve (12) month period doring the term of this
Agreement, Franchisee is prohibited for any reason from selling ligoor on tbe
Restaorant premises for more than thirty (30) days becaoseofavioiation or violations
of state or local ligoor iaws, then at the option of Franchisor this Agreement may be
terminated forthwith by Franchisor opon written notice to Franchisee
24
FOROFMAJFORF
24BI
As osed in this Agreement, the term "Force Maêore" shall mean any act
of God, strike, i o c k o o t o r other indostriaidistorhance,war (declared or ondeclared),
riot, epidemic, fire or other catastrophe, act of any government and any other simiiar
caose not within the control of the party affected thereby
242
Ifthe performance of any obligation by any party onderthis Agreement is
prevented or delayed hy reason of Force Maêore, which cannot he overcome hy ose of
normal commercial measores, the parties shall be relieved of their respective
obligations to tbe extent the parties are respectively necessarily prevented or delayed in
soch performance doring the period of soch Force Maêore The party whose
performance is affected by an event of Force Maêore shall give prompt notice of soch
ForceMaêore event t o t h e other party by facsimile, telephone or telegram (ineach
case to be confirmed in writing), setting forfh the natore thereof and an estimate as to its
doration, and shall be liahle for failore to give soch timely notice only to the extent of
damage actoallycaosed.
F^4
^9752
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243
Notw^ândingthe^
i ^ a s a resoôfao
event of Force Maieore ( c o d i n g ooodemoation^^
to operate the Restaorant or loses the
Fraoohisee shall apply within thirty (30) days after the event of Foroe Maêore for
FranohlsoBsapprovalto relocate andBor reoonstrootthe Restaorant If relocation Is
necessary, Franchisor agrees to ose Its reasonable efforts to assist Franchisee In
locating an alternative site In the same general area where Franchisee can operatea
Restaorantwlthln the System for the balance ofthe term ofthe Franchise Agreement If
Franchisor so assists Franchisee, Franchisee sball reimhorse Franchisor for Its
reasonable ootofpocket expenses Incorred a s a r e s o l t thereof (This provision shall
not be constroed to prevent Franchisee from receiving the foil amoont of any
condemnatlonaward of damages relating t o t h e closlngof tbe Restaorant; provided
however, that If F r a n c h l s o r o r a n affiliate Is tbe lessorof the Restaorant premises,
Franchisee specifically waives and releases any claim It may have for tbe vaioe of any
boilding,fixtores and other Improvements ontbe premises,whether or not Installed or
paid for by the Franchisee, and Franchisee agrees to sohordlnate any claim It may bave
to Franchisor's claim for soch Improvements ) Selection of an alternative location will be
sobêct to the site approval procedores set forth In Sections of the Oevelopment
Agreement For porposes ofclanficatlon, If Franchisee doesnot have development
rights,Franchisor does not have any obligation to approveanew site Once Franchisee
has obtained Franchisor's approval to relocate andBor reconstroct the Restaorant,
Franchisee most diligently porsoe relocation andôrreconstroctlonontll tbe Restaorant
Is reopened for bosiness
25
MISOFFFANFOOS
25BI
All notices and other commonlcatlons regolred or permitted to be given
hereonder shall be deemed given when delivered in person, hy overnight coorler
service, facsimile transmission or mailed by registered or certified mall addressed to tbe
recipient at tbe address set forth below, oniess that party shall have given written notice
of change of address to the sending party,ln which event tbe new addressso specified
sball be osed
FRANOFllSOR:
Applebee's Franchisor LLO
3140 Ward Farkway
Kansas Olty,Mlssoorl 54114
Attention; President
FRANOFllSFF;
25.2
All terms used in this Agreement, regardless of the number and gender
in which they are used, shall be deemed and construed to include any other number,
F^5
1051975.2
2014
sioguôrôândaoyo
or sense of this Agreement may
this Agreement themselves The w o r d s ^ o i o d e s ^ " i n o ^ ^
phrases "in parfiooiar,"sooh a s ^ ^ i e B a n d "for exampie^w^
shaii he interpreted and oonstroed s o a s n o t t o limit thegeneraiity o f t h e wordsof
general applioation and natore whioh preoede these words and phrases The headings
Inserted In this Agreement a r e f o r reference porposes only and shall not affect the
constroction of this Agreement or limit the generality of any of Its provisions
25 3
Franchisee shall, at its own cost and expense, promptly comply with all
laws, ordinances, orders, roles, regolations and regoirements of all federal, state and
monicipal governments and appropriate departments, commissions, hoards and offices
thereof Wlthoot limiting the generality of the foregoing, Franchisee shall ahidehy all
applicahle roles andregolations of any pohlic health department
25 4
In the event that Franchisor or its affiliates have leased the Restaorant
premisesto Franchlseeporsoanttoawrittenleaseagreement(the"Fease^,the Lease
is herehyincorporatedin this Agreement hy reference, and any failore on the part of
Franchisee (Lessee therein) to perform, folfiil or observe any of the covenants,
conditions or agreements contained in the Lease shall constitoteamaterial hreach of
this Agreement It is expressly onderstood, acknowledged and agreed hy Franchisee
that any termination of the Fease shall resolt in aotomatlc and immediate termination of
this Agreement withoot additional notice to Franchisee
25 5
This Agreement and the docoments referred to herein constitote the
entire agreement hetween the parties, soperseding and canceling any and all prior and
contemporaneoos agreements, onderstandings, representations, indocements and
statements, oral or written, of the parties In connection with the sohêct matter hereof
FRANOHISFFFXFRFSSFYAOKNO^
FRANOFIISF A G R F F M F N T A S A RFSLILT OF ITS OWN INOFFFNOFNT
I N V F S T I O A T I O N A N O A F T F R OONSOFTATION WITH ITS OWN A T T O R N F Y , A N O
NOTASARFS0FTOFANYRFFRFSFNTATIONSOFFRANOFIISOR,ITSAOFNTS,
OFFIOFRS OR F M F L O Y F F S , F X O F F T A S OONTAINFO FIFRFIN ANO IN
FRANOHISOR'S FRANOHISF OISOLOSORF OOOLIMFNT, H F R F T O F O R F MAOF
AVAILABLE TO FRANOHISFF Nothing in this Agreement will disclaim or regoire
Franchisee to waive reliance on any representation that Franchisor made In the most
recentdisclosoredocoment(incloding Itsexhihitsand amendments) that Franchisor
delivered to Franchisee or its representative
25 5
Except as expressly aothorized herein, no amendment or modification of
this Agreement shall he hinding oniess execoted In writing hothhy Franchisor and hy
Franchisee and Frincipal Shareholders
25 7 Franchisee and the Frincipal Shareholders acknowledge and agree that (i)
this Agreement (and the relationship of the parties contemplated hy this Agreement)
grants Franchisor thedlscretion to make decisions, take actions andBor refrain from
taking actions not inconsistent with Franchisee's explicit rights and ohligations
hereonder that may affect favorably or adversely Franchisee's interests; (Ii) Franchisor
F^
2014
^ 9 ^ 2
w ^ ose its hosioessôdgmeot
exercising soch discretion hased cn Franchiser's
assessment of its interests and the System, haiancing these interests with or against
the interests ofthe operators of Restaorants g e n e ^ ^
andother franchisees)andspecificaiiy withoot considering theindividoaiinterests of
any particoiar franchisee; (iii) Franchisor wiii have no iiahiiity to Franchiseeforthe
exercise of its discretion in this manner and (iv) even if Franchisor has nomeroos
motives for a particoiar action or decision, so iong as at ieast one motive is a
reasonahie hosiness iostification for soch action or decision, no trier of fact in any iegai
action shaii sohstitote its Lodgment for Franchisor's Lodgment so exercised, and soch
action or decision wiii not he sohêct to chaiienge for ahose of discretion if Franchisor
takes any action or chooses not to take any action in Franchisor's discretion with regard
to any matter related to this Agreement and Franchisor's action or inaction is chaiienged
for any reason, the parties expressly direct the trier of fact that Franchisor's reliance on
ahosinessreason in the exercise of its discretion is to he viewed asareasonahle and
proper exercise of Franchisor's discretion, withoot regard to whether other reasons for
its decision may exist and withoot regard to whether the trier of fact woold
independently accord the same weight to the hosiness reason
26
AOKNOWFFOGMFNTS
Franchisee and Frincipal Shareholders acknowledge that:
(a) Franchisee has received a copy of this Agreement and has had an
opportonity to consolt with its attorney with respect thereto at ieast sevendays
prior to execotion of this Agreement;
(h) No representation has heen made hy Franchisor as to the fotore
profitahility of the Restaorant;
(c) Friorto theexecotion of this Agreement, Franchisee has had ample
opportonity to contact Franchisor's existing franchisees, if any, and to investigate
all statements made hy Franchisor relating to the System;
(d) This Agreement establishes the right to constroct and operate a
Restaorant only at the location specified in SohsectionlBl hereof; and
(e) Franchisor is the sole owner o f t h e service marks identified in this
Agreement, and of the goodwill associated therewith, and Franchisee acgoires no
r i g h t , t i t l e o r i n t e r e s t i n t h o s e n a m e s a n d marks other than the right to ose them
only in the manner and to the extent prescribed and approved hy Franchisor
F^
10^9752
20t4
IN WITNESS W H E R E O F , the undersigned have entered into this Agreement as of the
date first above written.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By: _
Name:
Title:
PRINCIPAL SHAREHOLDER(S):
Name:
Name:
F^8
1051975.2
2014
EXHIBIT 1 TO FRANCHISE A G R E E M E N T
ROYALTY FEE
The monthly royalty fee to be paid by Franchisee shall be four percent (4%) of
each calendar month's gross sales until January 1, 2020. Thereafter, a monthly royalty
fee shall be determined by Franchisor in its sole discretion.
F-49
1051975.2
2014
APPENDIX A TO FRANCHISE AGREEMENT
Percent of Issued
and Outstanding
Shares of Franchisee
Shareholder
F-50
1051975.2
2014
APPENOÔTOERANOHÊAOREEMENT
REVIEW ANO O O N S E N T W I T H R E S P E O T T O T R A N S F E R S
lo determining whether to
^
Franchisor shaii consider aii of the facts and oiroumstanoes whioh it views as
the particolar instance, incloding, hot not limited to, any of the following: (i^work
experience and aptitode of Proposed New Owner andôr proposed new management (a
proposed transferee ofaRrincipal Shareholder's Interest andôraproposed transferee
o f t h i s A g r e e m e n t l s referred to as^Rroposed New O w n e r ^ ( i i ) financial hackgroond
and condition of Proposed New Owner, and actoal and pro forma financial condition of
Franchisee: (III) character and repotation of Proposed New Owner: (iv) conflicting
interests of Proposed New Owner; (v)the terms and conditions of Proposed New
Owner's rights,if the proposedTransfer i s a p l e d g e or hypothecation: (vi) the adegoacy
of Franchisee's operation of any Restaorant and compliance with the System and this
Agreement; and (vii) soch other criteria and conditions as Franchisor shall then consider
relevant in the case of an application f o r a n e w franchise to operatearestaorant onit
within theSystem hy an applicant that is not then corrently doing so Franchisor's
consent also may he conditioned opon execotion hy Proposed New Owner of an
agreement wherehy Proposed New Owner assomes foil, onconditional, ioint and
several liahility for,and agrees to perform from the date of sochTransfer,all ohligations,
covenants and agreements containedhereln to the same extent as if it had heen an
original party to this Agreement and may also regoire Franchisee and Principal
Shareholders,incloding the proposedTransferor(s),to execoteageneral release whioh
releases Franchisor and its affiliates from any claims they may have had or then have
against Franchisor and its affiliates In the event Proposed New Owner isapartnership
(incloding,hot not limited to,alimlted partnership), Proposed New Owner will also he
regoired to execote an addendom tothe Agreement whiohamendsthereferencesto
Franchisee and its Principal Shareholders to inciode the partnership approved hy
Franchisor and Proposed New Owner's general partner(s) and the principal
shareholders of the general partner(s),if the general partner(s)isacorporation This
addendom will contain a provision incloding in the definition of "Transfer" the
withdrawal, removalor volontaryînvolontarydissolotion (if applicahle)of the general
partner(s) o r t h e sohstitotion or addition o f a new general partner
Franchisee or
Principal Shareholders, as the case may he, shall provide Franchisor with soch
informationasit may regoireinconnectionwitharegoest for approval ofaproposed
Transfer
For porposes of clarification, nothing in this Appendix S shall limit
Franchisor'sdiscretion in granting or withholding consent toaTransfer or to regoire the
applicahle parties to agreeto certalnterms a s a c o n d l t l o n to obtaining consent t o a
Transfer.
F-^
^9752
2014
APPENDIX C TO FRANCHISE A G R E E M E N T
CONFIDENTIALITY A G R E E M E N T
THIS A G R E E M E N T is made this
20
, by and between
corporation ("Developer"), and
individual employed by Developer ("Employee").
day of
, an
WITNESSETH:
W H E R E A S , A P P L E B E E ' S FRANCHISOR LLC ("Applebee's") has the right to
grant franchises for all rights in and to a unigue system for the development and
operation of restaurants (the "System"), which includes proprietary rights in valuable
trade names, service marks and trademarks, including the service mark Applebee's
Neighborhood Grill & Bar and variations of such mark, designs and color schemes for
restaurant premises, signs, eguipment, procedures and formulae for preparing food and
beverage products, specifications for certain food and beverage products, inventory
methods, operating methods, financial control concepts, a training facility and teaching
technigues;
W H E R E A S , Developer is the owner of the exclusive right to develop restaurants
franchised by Applebee's which utilize the System ("Restaurants") for the period and in
the territory described in the Development Agreement between Applebee's and
Developer (the "Development Agreement"); and
W H E R E A S , Developer acknowledges that Applebee's information as described
above was developed over time at great expense, is not generally known in the industry
and is beyond Developer's own present skills and experience, and that to develop it
itself would be expensive, time-consuming and difficult, that it provides a competitive
advantage and will be valuable to Developer in the development of its business, and
that gaining access to it was therefore a primary reason why Developer entered into the
Development Agreement; and
W H E R E A S , in consideration of Applebee's confidential disclosure to Developer
of these trade secrets, Developer has agreed to be obligated by the terms of
Development Agreement to execute, with each employee of Developer who will have
supervisory authority over the development or operation of more than one Restaurant in
the Territory described in the Development Agreement, a written agreement protecting
Applebee's trade secrets and confidential information entrusted to Employee;
NOW, T H E R E F O R E , in consideration of the mutual covenants and obligations
(1)
The parties acknowledge and agree that Employee is or will be employed
in a supervisory or managerial capacity and in such capacity will have access to
information and materials which constitute trade secrets and confidential and proprietary
information. The parties further acknowledge and agree that any actual or potential
F-52
1051975.2
2014
direct or i n d u c t c o m p e t e
access to such trade secrets and ^
(2)
The parties acknowiedge and agree that the System includes trade
secrets and confidential information whioh Applehee's has revealed to Oeveloper in
confidence, and that protection of said trade secrets and confidential information and
protection of Applehee's against unfair competition from others who enôy or who have
had access to said trade secrets and confidential information are essentialforthe
maintenance ofgoodwill and special value ofthe System
(3)
Employee agrees that he or she shall not at any timeâppropriate or use
thetradesecretsincorporated in the System, o r a n y portion thereof,for use inany
business which is not within the Systemîi) disclose or reveal any portion of the System
t o a n y person, other thanto Developer's employees as an inoidentof their training;
(iii) acguire any right to use, or toiicense or franchise the use of any name, mark or
other intellectual property right which is or may he granted hy any franchise agreement
hetween Applebee's and Oeveloper; or (iv) communicate, divulge or use for the benefit
of any other person orentlty any confidential information, knowledge or knowhow
concerning the methods of development or operationofa Restaurant wbichmay he
communicated to Employee or of which Employee may be apprised hy virtue of
Employee's employment hy Oeveloper
Employee sball divulge sucb confidential
information only to such of Developer's other employees as must have access to that
information in order to operate a R e s t a u r a n t o r t o d e v e l o p a p r o s p e c t i v e s i t e f o r a
Restaurant
Any and information, knowledge and know how, including, without
limitation, drawings, materials, eguipment, specifications, techniguesandother data,
which Applebee's designates as confidential, shall be deemed confidential for purposes
of this Agreement.
(4)
Employee further acknowledges and agrees that any materials or manuals
provided or made available to Developer by A p p l e h e ^
described in S e c t i o n ^ o f the applicable franchise agreement hetween Applebee's and
Deveioper,are loaned by Applebee's to Developer for limited purposes only,remain the
propertyof Applebee's, a n d m a y not he reproduced, in whole or in part, without the
written consent of Applebee's
(5) ^ Employee agrees to surrender toOeveloper or to Applebee's eacband
every copy of the Manuals and any other information or material in his or her
possession or control upon reguest, upon termination of employment or upon
completion of the use for which said Manuals or other information or material may have
been furnished to Employee
(6)
The parties agree that in the event of a breach of tbis Agreement,
Applebee's would be irreparably injured and would he without an adeguate remedy at
law Therefore,in the event o f a b r e a c h o r a t h r e a t e n e d or attempted breach of any of
tbeprovisionshereof, Applebee's sball he entitled to enforcetheprovisions of tbis
Agreement a s a t h i r d p a r t y beneficiary hereof and shall be entitled,in addition to any
other remedies wbicb it may have hereunder at law or in eguity (including tbe right to
terminatethe Development Agreement), toatemporaryandôr permanent injunction
2014
^9752
and a decreefor s p e c i e pertormaoceof t h e r m s hereof without the oeoessity of
showing aotuai or threatened damage, and without h e i o g r e q ^ ^
other security
(7)
if any court or other trihunai having jurisdiction to determine the validity
enforceahiiity of this Agreement determines that it wouid he invalid or unenforceahie as
written, the provisions hereof shaii he deemed to he modified or limited to such extent or
in such manner necessary for such provisions to he valid and enforceahle to the
greatest extent possible
IN WITNESS W H E R E O F , the undersigned have entered into this Agreement as
of the date first ahove written
OEVELOPER
EMPLOYEE
By:
Name:
Title:
By:^
Name:
2^4
^9752
APPENDIX D
EFT WITHDRAWAL AUTHORIZATION
A P P L E B E E ' S S E R V I C E S , INC. ("COMPANY")
ID NUMBER:
The undersigned ("DEPOSITOR") authorizes COMPANY to initiate debit entries
to the Checking Account indicated below at the DEPOSITORY named below, and
authorizes DEPOSITORY to debit to such account all entries COMPANY initiates.
DEPOSITORY
NAME
CITY
CHECKING A C C O U N T NO.
ROUTING NUMBER
BRANCH
STATE
DEPOSITOR agrees that this authorization will remain in full force and effect
until DEPOSITOR has given C O M P A N Y written notice of its revocation in such
time and in s u c h manner as to afford C O M P A N Y and DEPOSITORY a reasonable
opportunity to act on the notice.
DEPOSITOR'S
NAME
ID NUMBER
DEPOSITOR'S SIGNATURE
NAME AND TITLE OF P E R S O N SIGNING (if signed in a representative capacity)
DATE
NOTE:
ALL WRITTEN DEBIT AUTHORIZATIONS MUST PROVIDE THAT THE
DEPOSITOR MAY R E V O K E THE AUTHORIZATION ONLY BY NOTIFYING THE
DEBIT ORIGINATOR
(COMPANY) IN THE MANNER SPECIFIED IN THE
AUTHORIZATION.
F-55
1051975.2
2014
WÔHTWATCHERSRIOERTO
ERANOHISE A G R E E M E N T
THISRIOERtoêApp^bee^Ne^
^ " R i d e r ) is m a d e e ^ o b v e ^ e
dayof
,20
, between
Applebee's Eranobisor LLC, a O e i a w a r e i i m i t e d i ^ ^
â
corporation ("Eranobêe") Aiioapitaiized terms
o s e d i n tbis Rider but not definedberein sbaii bave tbe meaning as o o n ^
Eranobise
Agreement
for
tbe
Restaorant
iooated
at
(tbe "Eranobise A g r e e m e n t between
Franobisorand Eranobiseetowbiob tbis Rider is attaobed, o r i n tbe Endorsement
Agreement (as defined beiow)
W H E R E A S , Weigbt Watobers international Ino ("Welgbt Watobers") is a
worldwide bosiness offering servioes and prodoots to belp individuals safely lose weigbt
andmaintalnabeaitbyweigbt;and
W H E R E A S WeigbtWatobers I s t b e o w n e r o f t b e ' W e i g b t W a t o b e r s ^ a n d
^RointsRIos^" trademarks for weigbt loss and weigbt maintenance programs and
services (tbe "WWI Marks") wbiob are inoorpor^^
oommonloate tbat Weigbt Watobers endorses an item (tbe "Endorsement loon");
W H E R E A S , Applebee's Services, Inc ("ASI") and Weigbt Watcbers bave
enteredinto an endorsement agreement ("Endorsement Agreement"),as amended,
wberebyASI sball bave tbe rigbt to ose tbe Endorsement loon on Menos in Restaorants
solely in connection witb tbe s a l e i n Restaorants of certainMenoitems ("Endorsed
Menu Items"); and
W H E R E A S , Erancbisee desires tbe rigbt to ose, and ASI is willing to soblicense
to Erancbisee tbe rigbt to ose, tbe Endorsement Icon for ose on Menos in Erancbisee's
Restaorants solely In connection witb tbe sale oftbe Endorsed Meno Items, sobêct to
tbe terms and conditions of tbis Rider.
N O W ^ T H E R E E O R E ^ in consideration oftbe motoal covenants, conditions and
agreements set fortbbereln and otber good and valoable consideration, tbe receipt and
adegoacyofwbiob is berebyacknowledged,tbe parties agree as follows;
L
Definitions.
1BI
Êndorsement Icon" means Weigbt Watcbers trademark forweigbt
loss and weigbt maintenance programs and services, togetberwltb tbe Program
Information Weigbt Watcbers deems belpfol to consomers (e g , ^RointsRIos^
valoes), as amended by Weigbt Watcbers from time to time
12
" E n d o r s e d M e n u ltems"meansWeigbtWatcbers'goidelinesfor
tbeapprovalofEndorsed Meno Itemsassetfortb In ScbedoleO,as amended by
Weigbt Watcbers in Its sole discretion from time to time
13
^9752
"Main Menu" means tbe primary meno osed at Erancbisee's
^
Re5taoran^
14
"Menu" means tbe Main Menu and aii otber menus offered at
Franobisee's Restaurants
15
"Plate Presentation" means written standards for preparation,
oooking, presentation, protoooi, safety and quaiityoontroi and tbe Peoipe for an
Endorsed Menu item, inoiudingwitbout limitation standards and oontrois relating
to ASI, tbe Restaurant Operating Subsidiaries and tbe PartioipatlngPranoblsees
and Pranobisees'suppliers
15
"Program Information" means tbe terminology used In oonneotion
witb any tben ourrent Weigbt Watobers program as It may exist from time to time
in tbeTerritory wbiob Weigbt Watobers deems relevant tofood and beverage
products, reoipes and menu items.
17
"Restaurants" sball mean restaurants under tbe"Applebee's" or
"Applebee's NeigbborboodOrill^Bar" trademark
15
"Specifications" means specificatlonsfor Endorsed Menu Items
including, witbout limitation, recipes, formulation, caloric and nutritional values,
ingredients, sizes, sbapes, tastes and preparation and presentation guidelines
19
"Weigbt Watcbers Program" means tbe welgbt loss and
maintenance regimes designed, defined, marketed and adopted by Weigbt
Watcbers, as amendedby Weigbt Watcbers in its sole discretion from time to
time
2
Amendment to PrancblseAoreement
Tbis Rider sball amend tbe Prancblse Agreement Any conflict between
tbis Rider and tbe Prancbise Agreement sball be governed and controlled by tbe
terms of tbis Rider
3
WeiobtWatcbersBAoplebee'sServicesÎnc
31
Weiobt Watcbers Rlobts Prancbisee expressly acknowledges tbat
Weigbt Watcbers isatbirdparty beneficiary of tbis Rlder,andasabeneficiary,in
addition to Prancbisor's rigbts to enforce tbe provisions of tbis Rider, may take
action to enforcetbeprovlsionsof tbis Rider Prancbiseeacknowledgestbat
Weigbt Watcbers, after giving Prancbisor tbe first rigbt to investigate and take
corrective action in consultation witb Weigbt Watcbers, bas tbe rigbt to take
action to Insure compliance by Prancbisee of tbe terms and conditions contained
berein and Prancbisee waives any defense or claims tbat Weigbt Watcbers Is not
entitled or bas no standing as a tbird party beneficiary to protect its rigbts
hereunder
32
Weiobt Watcbers N o t a P a r t v Nothing contained berein sball be
construed as creating any obligation or legal duty upon Weigbt Watcbers or its
affiliates with respect to Franchisee Franchisee shall look solely to Prancbisor
for any and all obligations, liabilities, claims or duties with respect to the
^9752
operation of F r a o o h i s e e ' s R e s ^
offer and saie of Endorsed Mono items Weight Watohers'rigbts hereonder to
enforce or terminate the Eranohisee's rights onder this Rider shaii not oreate any
doty,privity of contract relationship,or ohiigation on Weight Watchers to take any
action and the failore of Weight Watchers to take any action shaii not he deemed
awalver of any soch third party heneficiary rights
32
Weioht Watchers N o t a R a r t y Nothing contained herein shall he
constroed as creating any ohligation or legal doty opon Weight Watchers or its
affiliates with respect to Eranchisee Eranohisee shall look solely to Franchisor
for any and all ohligations, liahilities, claims or doties with respect to the
operation of Franchisee's Restaorants, the ose of the Endorsement Icon or the
offer and sale of Endorsed Meno Items Weight Watchers'rights hereonder to
enforce or terminate the Franchisee's rights onder this Rider shall not create any
doty,privity of contract relationship,or ohligation on Weight Watchers to take any
action and the failore ofWeightWatchers to take any action shall not he deemed
awaiver of any soch third party heneficiary rights.
33
Aoolehee'sServlcesÎnc Franchisee expressly acknowledges that
A S I i s a t h i r d p a r t y heneficiary of this Rider, and asaheneficlary,in addition to
Franchisor's rightstoenforcethe provisions ofthisRider,ASI may take action to
enforce the provisions of this Rider Franchisee acknowledges that ASI has the
right to take action to insore compliance hy Franchisee of the terms and
conditions contained herein andFranchisee waives any defense or claims that
A S l i s not entitled or has no standing a s a t h i r d p a r t y heneficiary to protect its
rights hereonder
4
Grant andTerm of Rider
4BI
Grant
Sohêct to the terms and conditions of this Rider,
Franchisee is hereby granted a non transferable, non soblicensable, non
assignable and nonexclosive right, and Franchisee ondertakesthe obligation,
doring tbe term ("Term") of this Rider to ose the Endorsement Icon on Menos in
Franchisee's Restaorants solely in connection with the sale of Endorsed Meno
Items to consomers in Franchisee's Restaorants porsoant to this Rider
42
Term T b e T e r m o f t h i s R i d e r s h a l l commence on the date hereof
and shall terminate no earlier than November 1, 2014 and no later than
November 30, 2014, oniess terminated sooner in accordance with tbe Franchise
Agreement or oniess sooner terminated by Franchisor in accordance with
Section 16bereonder
5
Limitation of Rights
51
General All rigbts granted to Franchisee hereonder are limited to
the ose of the Endorsement Icon on Menos In Franchisee's Restaorants solely in
connection with the sale of Endorsed Meno Items to consomers in Franchisee's
Restaorants in accordance with tbe terms and conditions contained herein and
Franchisee has no right to ose the Endorsement Icon or tbe WWI Marks for any
other porpose whatsoever
10^9752
5 2
Sale of Endorsed Meno Items
Eranohlsee shall not offer the
Endorsed Meno Items, for sale or distrihotion, or othen^lse ose the Endorsement
loon or the WWI Marks ootslde of Eranohlsee's Restaorants or offer the
Endorsed Menoltems to persons who Intend or are likely to dlstrlhote or resell
them In anyarea ootslde ofEranohlsee's Restaorants
5 3
Endorsement Franchisee shall not ose the Endorsement loon as
an endorsement of any prodoot or service of Franchisee, Franchisor or any third
party,otherthantheEndorsed Meno Items
54
Ose on Internet. In Electronic Mediom Except for Endorsed Meno
Item descriptions and Images on wehsltes oremall marketing campaigns (In
each case as approved hy Weight Watchers), Franchisee shall not ose the
Endorsement Icon or WWI Marks on the Internet or any other Electronic Mediom
Ey way of example, and wlthoot limiting the generality of the foregoing,
Franchisee shall not (I) promote, display, provide Information ahoot or offer to sell
Endorsed Meno Items or otherwise display or dlstrlhote any WWI Marks via the
Internet or any other Electronic Mediom (except as approved hy Weight
Watchers, In Weight Watchers'sole discretion) or (II) own or operate any wehslte
thatosesanyWWIMarksas,oraspartof,adomalnname.
55
Packaging or Containers.
Franchisee may not ose the
Endorsement Icon on any packaged food prodoct or on any packaging or
containers, Incloding wlthoot limitation, those osed to store or "take oot" any food
or heverages to he consomed off the premises of Franchisee's Restaorants hy
consomers
55
5
INTENTIONAFFYOELETEO
Endorsement Icon
5BI
Ownership
Franchisee acknowledges and agrees that Weight
Watchers owns excloslvely all the rights, title and Interest In and to the
Endorsement Icon and WWI M a r k s a n d thegoodwlll pertaining thereto, and
agrees that Its rights to ose the Endorsement Icon and WWI Marks derives solely
from the Rider Franchisee acknowledges the vaioe and goodwill associated with
the Endorsement Icon and WWI Marks and agrees that It will ose the
Endorsement Icon and WWI Marks solely In connection with the sale of
Endorsed Meno Itemstoconsomers In Franchisee's Restaorants In a manner
designed to protect and enhance the repotation and Integrity of the Endorsement
Icon and WWIMarks and theWelght Watchers Program Franchisee shall not
exercise the rights granted onder this Agreement In any manner that woold have
atendencytodllote, denigrate orothen^lsedlmlnlshthevaloe, the goodwill or
the repotation associated with the ose of the Endorsement Icon or WWI Marks
and shall not,dorlngtheTerm or thereafter,ose any Mark confoslngly similar,
deceptive or misleading with respect to the Endorsement Icon or WWI Marks or
which dllotes, denigrates or otherwise diminishes the vaioe of the Endorsement
Icon or WWI Marks
^ 2
10^9752
Meno
In accordance with and sohêct to the terms of the
^
Endorsement Agreement, Franchisee agrees that all references to the Endorsed
Menu Items in Franchisee's Restaurant Menu shall conform to the reguirements
established by Franchisor or Weight Watchers from time to time.
6.3
Cooperation. Franchisee shall cooperate fully and in good faith for
the purpose of securing, preserving and protecting Weight Watchers' rights, as
applicable, in and to the Endorsement Icon.
6.4
Corporate Name. Franchisee shall not change its name to or
operate under any name incorporating the Endorsement Icon or, any mark based
upon, derived or translated from, identical or confusingly similar to the
Endorsement Icon.
7.
Weight Watchers Royalties.
In addition to the monthly royalty or other fee reguired under the terms of Section
9.1 of the Franchise Agreements, Franchisee shall pay to Franchisor an
additional monthly royalty fee of two and one-half percent (2.5%) ("Weight
Watchers Royalty") on the Gross Sales of all Endorsed Menu Items in the
Restaurants. The Weight Watchers Royalty shall be due and payable in
accordance with the terms of Section 9.2 of the Franchise Agreements. For the
avoidance of doubt, sales shall be calculated based on the Gross Sales, as
defined in Section 9.3(a) and (b) of the Franchise Agreements, of actual
individual unit sales (as opposed to estimated sales) of all Endorsed Menu Items
in Franchisee's Restaurants. Notwithstanding the foregoing, for purposes of
calculating the monthly royalty fee due to Franchisor, the Weight Watchers
Royalty shall be excluded from Gross Sales under the provisions of Section
9.3(b) of the Franchise Agreement.
8.
Plate Presentations.
Franchisee shall at all times prepare, cook, distribute and serve any and all
Endorsed Menu Items in compliance with the Plate Presentations, the
Specifications, all applicable laws and in accordance with the terms and
conditions of this Rider. Franchisee acknowledges and agrees that ASI or
Weight Watchers may amend or modify the Plate Presentations from time to
time. Franchisee agrees to comply with all other directions as to guality control
and levels of variance, if any, as may be reasonably reguired and modified from
time to time by Franchisor, such levels of variance as set forth in the Plate
Presentations. Franchisee shall employ its best (e.g., most current) technology
and manufacturing, preparation, cooking and presentation practices in the
preparation, cooking and presentation of the Endorsed Menu Items.
9.
Specific Menu Reguirements.
At any given time, Franchisee shall use its best efforts to have a minimum of five
(5) Endorsed Menu Items on its Restaurants' Menu as set forth by ASI in
1051975.2
acoordaooe with the E o d o ^
Endorsed Menu items on the Restaurant Menu o f a limited unit ("Speoiaiiy
Designated Onit") shaii he hased on eaoh unit's unigue size, iooation andBor
kitohen oapaoity and shaii he approved hy Weight Watohers The Endorsed
Menu items shaii he presented af ieast as prominently as simiiar Menu items that
are listed on Eranohisee's Restaurant Menu hutdo not use the Endorsement
loon
10
Consumer Inouiriesômolaints
Eranohlsee shall he responsihle for taking any and all aotion at its expense in
respeotof complaints m a d e h y third partiesrelatingto Endorsed Menu Items
offered or sold at Eranohisee's Restaurants ÎnguiriesBComplaints"), whether
madetoEranohisee, Franchisor or Weight Watchers Any such action taken hy
Franchisee shall a t a m l n i m u m comply withtheStandardsandGuidelines for
Consumer InguiriesBComplaints agreed to hy Weight Watchers and ASI, as
determined from time to time, as set forth in the Manuals
11
Food Comoliance Audits
Opon prior written notice from Weight Watchers or ASI and as reasonably
reguired hy Weight Watchers without unreasonably interfering with Franchisee's
business, Franchisee shall permit Weight Watchers or its designee, during
regular business hours to visit and to Inspect all areas used for the preparation,
cooking, storage, distribution, serving and sale ofthe Endorsed Menu Items
12
Soot Checks
Franchisee also acknowledges that Weight Watcbers or its designee shall have
the right to make both unannounced and anonymous and unannounced and un
anonymous visits to Franchisee's Restaurantsforthe purpose of conducting
routine "spot checks" of such facilities to confirm compliance with Weight
Watchers' standards and practices, all applicable laws and tbe terms and
conditions of this Rider
13
Reports
131 Weekly Franchisee shall furnish to ASI, on or hefore five o'clock
p m ^ 0 0 p m ) C e n t r a l T i m e o n t h e Monday followingthecalendar week to
whioh the report relates, and in addition to Itsregular weekly salesreport as
reguired hy Section 102(o)of the Franchise Agreements,areport of total Cross
SalesofEndorsedMenu Items, includingadetallbyEndorsed Menu Item of total
sales indollars, total unit sales, and other similar informationto be mutually
agreed upon by tbe parties Any adjustments for the fiscal month to which the
weekly reports relate shall be included in the final weekly report for each fiscal
month submitted to Franchisor
1 3 2 Annual CualitvControlStatements
Franchisee shallprovideto
ASI on an annual basis,on or before the seventyfifth(75th)day after tbe end of
^9752
e 8 0 h ^ 0 8 ! y e a 4 t W O ^ C O p i e S ^
ofFraoohiseeoertôgt^
qoa^yoo^ândoooform^tothePêF^^
setforth in this Rider a o d ^ a p ^ i o a ^ e laws Ail suoh annual reports shaii he
retained hyFranohlsee during the
years thereafter
13 3 Annual Finanolal Statement FranohiseeshallfonârdtoASI,onor
hefore the seventyfifth^5th) day after the end of eaoh flsoalyearâstatement
verifying the aoouraoyoftheweekly sales reports suhmitted to ASI,oertifiedhya
senior financial offloer of Franohisee, showing the volume, sales prioe and
aggregate sales revenue relating to the Endorsed Menu Items for that year.
14
Elnanoial Audits
Eranohlsee shall preserve all financial hooks and reoords relating to distrlhution,
serving, s a l e a n d marketing of Endorsed Menu Items during t h e T e r m o f this
Rider and for t w o ^ a d d i t i o n a l years thereafter
15
Termination
151 Que to Eranohlsor's Loss of Riohts In the event the Endorsement
Agreement expires or terminates for any reason, this Rider shall automatically
terminate.
152 Events ofTerminatlon Franchisor shall have the right to terminate
all rights and privileges arising under and hy virtue of this Rider if Franchisee:
(a)
fails to suhmit any reports, statements, samples orother
information reguired to he suhmitted within the time periods speclfiedln
this Rider and this default is not cured within thirty (30) business days after
notice from Franchisor of such default;
(h)
offers for sale, sells, advertises, distributes or promotes any
EndorsedMenultems or uses any Endorsement Icon or WWI Marks, in
advertising and promotional materials without having first obtained the
reguisiteapproval of Franchisoror Weight Watchers In acoordancewith
the terms and conditions of this Rider;
(c)
fails to comply with any of the obligations, duties or
conditions contained in this Rider or otherwise breaches any
representation, warranty, covenant o r a n y otber provision of tbis Rider
(including without limitation, any laws or Elate Rresentations), where such
breach is notcured within thirty (30) business daysafter noticefrom
Franchisor;
(d)
becomes insolvent or any resolution or proceedings for
bankruptcy or liguidation (voluntary or involuntary) are instituted hy or
against Franchiseeor in t h e e v e n t o f the appointment, wither without
consent, of an administrator,assignee or agent for the benefit ofacreditor
^9752
or c r e d o s or o f a r e c e ^ ^ ^ e F ^ n c h ^ e ^
(o)
makes anuoaoôrizodassigorneoLtransfer or s o h ^ ^ ^
of its r^htsooder this Rider; or
(f)
15
ioses its right to operate as aoAppiehee'sfraoohisee
EffeotofTermioatioo
Franchisee agrees that, ^pon the termination or expiration of this Rider,
Franchisee wiii discontinue aii ^se ofthe Endorsement ioon and WWi Marks,and
shaii destroy (as appiicahie and as directed hy Weight Watchers in Weight
Watchers'soiediscretion)aiiMenoscontainingthe Endorsement icon andôr the
WWi Marks and any other materials containing the Endorsement icon andôr the
WWi Marks, and wiii not in any way use the Endorsement icon, the WWi Marks
or any other mark confusingly simiiar to soch marks
17
Insorance; Release; Indemnification
in addition to those doties and ohligations assumed hy and imposed opon
Franchisee in the Franchise Agreement pertaining to insorance and
indemnification,Franchisee shall,concorrently with execotion of thisRider,name
Weight Watchers or caose Weight Watchers to he named an additional insored
party onder all general liahility and omhrella liahility insorance policies pertaining
to the Restaorants Franchisee shall indemnify, defend and hold harmless ASI,
FranchisorandWeightWatchersandtheiraffiliates,officers,directors,agents,
employees, partners, memhers and controlling persons from and against and in
respect of any and all losses, claims, caoses of action, demands, damages,
ohligations, penalties, fines, soits, assessments, Lodgments, liahilities, costs or
expenses whatsoever (incloding reasonable attorney's fees and dishorsements),
to the follest extent permitted hy law for which they or any of them may hecome
liahle, arising oot of or resolting from (a) the prodoction, manofactore, sale,
preparation, cooking, presentation, serving, distrihotion, marketing, promotion,
labeling, packaging, handling or consomption o f t h e Endorsed Meno items;
(h)the hreach hy Franchisee of any warranty, representation or covenant
contained in this Rider; and (o)any ose o f t h e Endorsement icon and WWI
Marks Ey Franchisee's execotion hereof, Franchisee releases Weight Watchers
from any and all damages incorred hy Franchisee arising onder the certain
Endorsement Agreement hetween Weight Watchers and A S i , h y virtoe of which
the rights to ose the Endorsement Icon are granted to Franchisee, incloding soch
damages as may resolt from the termination of soch agreement.
15
Confidential Information
151 Generally Each party acknowledges that all information relating to
the hosiness and operations of the other party which is disclosed to it or which it
acgoires doring the term of this Rider, incloding withoot limitation, the data,
records, papers, docoments, goestions, goides, transcripts, findings, stodies,
databases, sorveys, resolts, presentations, reports, analyses, oser information,
^9752
expenence,formolae,method
valoable,proprietary^^
For porposes of tbis Seotloo 18Bl,allreolpes,formolatlons,speolfloatloos,oosts,
expenses, promoted and aotoal sales, oommooloatlons, advertising and
promotional strategies for marketing tbe Menos and tbe Endorsed Menolterns
developed by ASI, Weigbt Watobers or by Franoblsee Independently or onder tbe
goldanoe of ASI or Weigbt Watobers In contemplation of and doring tbe
oontlnoanoeoftbls Rider, sball beoonsldered Confidential Informatlonof ASI
andBor Weigbt Watobers Eaobparty acknowledges tbe need to preservetbe
secrecy and confidentiality of tbe Confldentlallnformatlon, doring and after tbe
termination or expiration of tbis Rider and eacb party sball not disclose or ose tbe
Confidential Information for any porpose otber tban tbe performance of Its
obligations onder tbls Rider Tbe obligation of confidentiality set fortbbereln sball
not apply to Information wbicb (a) was pobllcly available at tbe time of tbe
dlsolosoretotbe receiving party; (b) sobsegoently becomespobllclyavallable
tbroogb no faolt of tbe receiving party;(c) Is rlgbtfollyaogolred by tbe receiving
party from a tbird party wbo Isnot In breacbof a confldentlalobllgatlon witb
regard to socb Information; (d)ls Independently known by tbe receiving party
wbetberprlortoordorlngtbeTerm;or(e)lsdlsclosedwltb tbe written consentof
tbe party wbo owns tbe Confidential Information
18 2 RoblloAnnooncements. Except as regolred by any applicable law
o r o r d e r o f any governmental aotborlty, In no eventsball tbere be any pobllc
annooncements or press releases by Erancbisee relating to tbls Agreement, tbe
Menos oslng tbe Endorsement loon, tbe Endorsed Meno Items or tbe
transactions contemplated berebywltbootErancblsor's or ASl's written approval
In tbelr sole discretion
19
Noncompetition
191 Oorlng tbe term of tbls Rider, eacb of Erancbisee and Its affiliates
wlllnot prepare,sell (or license for sale), dlstrlbote or market any prodocts or
services f o r , o r l l s t a M e n o Item In Erancblsee's Restaorants otlllzlng tbe marks of
a ' C o m p e t l t o r B " C o m p e t l t o r " s b a l l m e a n a p e r s o n o r entity offerlngprodocts or
services as or In connection wltbawelgbt management program or system (e.g.,
Slim East, Jenny Craig, Sootb Beacb) o r a weigbt management brand ( e g ,
FlealtbyCbolce,Snackwell's, Lean Colslne or Balance) Eor tbe avoidance of
doobt,"Competltors" do not Inciode ASl's ose of generic words or pbrases or Its
own m a r k s o r l c o n s t o Identify notrltlon andôr bealtbcbaracterlstlcsof Meno
Items (e g , low calorie, low fat, low salt, beart bealtby)
In addition,
"Competltors"do not inclodebetterforyoo branded itemstbatare not weigbt
managementbrands(e g , Baked Fays, OletRepslandElellmann's Reduced Eat
Mayonnaise)
20.
Transfer; Successors. Assigns. Entire Agreement.
The rights, privileges, duties and obligations granted to Franchisee pursuant to
this Rider shall not be assignable or assigned separately and apart from the
1051975.2
Fraoohise Agreement This Rider shaii inore to the benefit of any and aii
soooessors and assigns of Franchisor
This Rider contains the entire
understanding hetween the parties relating to the sohêct matter hereof and none
of the provisions of this Rider may he altered, modified or amended in any way
except hy an instrument in writing signed hy the parties thereto This Rider may
he e x e c u t e d i n o n e or more counterparts, e a c h o f w h i c h s h a l l he deemedan
original hut a l l o f which shall constitute o n e a n d thesame instrument If any
provision o f t h e Rider or the application thereof to any person or entity or
circumstance shall he invalid, illegal or unenforceable to any extent, the
remainder ofthis Rider and the application thereofshall not be affected and shall
be enforceable to the fullest extent permitted by law
21
Survival
Sections 3, 5, 14, 16, 1B, 18, 20, and 21, shall survive the termination or
expiration of this Agreement
THIS RIDER is executed as of the
day of
, 20.
FRANCHISEE:
By:_
Name:
Title:
Not binding without execution by an authorized officer of Franchisor.
By:_
Name:
Title:
1051975.2
10
ADDENDUM TO FRANCHISE A G R E E M E N T
[Limited Liability Company]
THIS ADDENDUM TO FRANCHISE A G R E E M E N T ("Addendum") is entered this
day of
, 20
, by and between Applebee's Franchisor LLC,
a Delaware limited liability company ("Franchisor"),
,a
limited
liability company ("Franchisee"), whose members are
, a
("
")
and
,
a
("
") (
and
shall be
individually
referred to as "Member" and collectively as "Members") and
("
"), sole shareholder of
and
("
"), sole shareholder of
(Members,
and
shall be individually referred to as "Principal Shareholder" and
collectively as "Principal Shareholders").
WITNESSETH:
W H E R E A S , contemporaneous with the execution of this Addendum, Franchisor and
Franchisee will execute an Applebee's Neighborhood Grill & Bar Franchise Agreement
("Franchise Agreement") granting Franchisee certain rights therein described; and
W H E R E A S , the parties desire to amend the Franchise Agreement to reflect
accurately the identity and nature of the parties to the Franchise Agreement as a result of
Franchisee's form of business as a limited liability company.
NOW, T H E R E F O R E , the Franchise Agreement is hereby amended as follows:
1.
Section 11 Amended. Subsections 11.1 and 11.2 of Section 11, entitled
"FRANCHISE
ORGANIZATION, AUTHORITY,
FINANCIAL CONDITION AND
S H A R E H O L D E R S " , is hereby amended by deleting the same as it now appears and
inserting the following in its place and stead:
"11.1 Franchisee and each Principal Shareholder represent and warrant that:
(a) Franchisee is a limited liability company, validly existing and in good standing
under the laws of its state of organization; (b)
are each a
corporation, validly existing and in good standing under the laws of the state of
their incorporation; (c) Franchisee is duly gualified and is authorized to do
business and is in good standing in each jurisdiction in which its business
(d)
are each duly gualified and authorized to do business and
are in good standing in each jurisdiction in which its respective business activities
or the nature of the properties owned by it reguired such gualification; (e) the
execution and delivery of this Agreement and the transactions contemplated
hereby are within Franchisee's power under its articles of organization and
operating agreement; (f) the execution and delivery of this Agreement and the
transactions contemplated hereby are within
's power under
their respective articles of incorporation and bylaws; (g) the execution and
delivery of this Agreement has been duly authorized by the Franchisee; (h) the
execution and delivery of this Agreement have been duly authorized by
1051975.2
1
; (i) the operating agreement, artioies of organization and
oertifioate of organization of Franchisee delivered to Franchisor are true,
compiete and correct, and there have heen no changes therein since the date
t h e r e o f ; ^ t h e articles of incorporation,hyiaws and certificate of incorporation of
delivered to Franchisor are true, complete and correct, and there have
heen no changes therein since the date t h e r e o f ; ^ t h a t any specimen certificate
evidencing membership interest inFranchisee delivered to Franchisor porsoant
to S o h s e c t i o n H 2 ( e ) hereof is a troe specimen of Franchisee's certificate
evidencingamemhership interest in soch limited liahility c o m p a n y ; ^ t h e most
recent balance sbeet of Franchisee ^Balance Sheets, and the most recent
balance sheets of its Principal Shareholders heretofore delivered to Franchisor,
are troe, complete and correct, and fairly present the financial positions of
Franchisee and each PrincipalShareholder, respectiveiy,as of the dates thereof;
(m) the O a l a n c e S b e e t a n d e a c b s o c b balancesheet havebeen prepared in
acoordancewith generally accepted accoonting principles; and (n) tbere have
been no materially adverse changes in the condition, assets or liabilities of
Franchisee or Principal Shareholders since the date or dates thereof "
" 1 1 2 Franchisee and each Principal Shareholder covenant that doring the term
of this Agreement; (a) Franchisee shall do or caose to he done all things
necessary to preserveand k e e p i n foil forceits existence a s a i i m i t e d liahility
company and shall be in good standing in each jorisdiction in which its hosiness
activities or the natore of the properties owned by it regoires sooh goalification;
(h) Franchisee shall have the aothority onder its articles of organization and
operating agreementtocarry oot t h e t e r m s o f this Agreement; (c) Franchisee
shall print, in a conspicooos fashion on ail certificates, if any, evidencing
membership interest in Franchisee when issoed, a legend referring to this
Agreement and the restrictions on and obligations of Franchisee andPrincipal
Shareholdershereonder, incloding, therestrictionsontransfer of Franchisee's
membership interests; and (d)
shall print, in a conspicooos
fashion on ail certificates evidencing shares in sochrespective company when
issoed, a legend referring to this Agreement and the restrictions on and
obligations of sochPrincipal Shareholders hereonder, incloding the restrictions
o n t r a n s f e r o f e a c h soch PrincipaiShareholder's shares Forther, Franchisee
sball delivertoFranchisorpriortotheaothorized change of any membersatroe
specimen certificate evidencing membership interest in the limited liability
company,bearing the legend described herein"
2
Section 12Amended S o b s e c t i o n s 1 2 2 ( a ) a n d ( b ) , 1 2 3 a n d 1 2 4 of Section
12,entitled " T P A N S F F P " , a r e hereby amendedby deleting the same as each now appears
and inserting the following in its respective place and stead:
12 2 "(a) any change in tbe ownership of or rights in or to any membership
interest or other egoity interest of any Principal Shareholder in Franchisee which
woold resolt from tbe act of any Principal Shareholder of Franchisee,soch a s a
sale, exchange, pledge or hypothecation of the membership interest in, or any
interest i n o r rights to any of Franohisee'sprofits, revenoes or assets,or any
soch change whioh woold resolt hy operation of law; and
^9752
(b)
any change in the percentage interest cwned hy any Principal
Shareholder in the memhership interest cr ether egoity interest in Franchisee's
profits,revenoes or assets which woold resolt from any act ofFranchisee soch
a s a s a l e , p l e d g e or hypothecation of any Pestaorant assets (other thanapledge
of assets to s e c o r e b o ^ a ^ e loans made or credit extended in connection with
acgoisitlon o f t h e a s s e t s pledged, provided that Immediately heforeand after
soch transaction the net worth of Franchisee shall not he less than the amoont
which is reflected on the Balance Sheets referred to In Sohsection^BI ofthis
Agreements any sale or issoance of any ofFranchisee'smemhership interests or
other egoity interests; the retirement or redemption of any membership interests
in Franchisee; or any sale or grant to any person of any right to participate in or
otherwise to share or hecome entitled to any part of Franchisee's profits,
revenoes, assets or egoityB
"123 "Transfer"shall not Inciode (a)achange in the ownership of or rights to
any shares orotheregoity interest in Franchisee onder the Secorities Act of
1933, or ( h ) a c h a n g e i n t h e o w n e r s h i p of or rightsto any secorities or other
egoity interest in Franchisee porsoant to a private offering of Franchisee's
secorities exempted from registration onder soch Act, provided that Franchisee
provides Franchisor with a c o p y of itsprospeotosandôr offering memorandom
ten (10) days prior to its filing with the Secorities and Exchange Commission or
clrcolatlontothird parties so that Franchisor may comment and, if necessary,
correct any information concerning Franchisor andBor theSystem, and forther
provided that after giving effect to soch change of ownership or private offering,
the Principal Shareholders "control" Franchisee For porposes ofthis Section 12,
"controls" means either: (downing legal and egoitahie title to flftyone
percent ( 5 1 % ) o r m o r e o f the ootstanding voting secorities of the Franchisee,
which are not sohject to proxy granted to or contract with any other person or
party granting that party the right to vote part or all of sooh secorities, (2) having
and continoaiiy exercising the contractoai power presently to designateamajority
of the directors of theFranchisee, or (3) having andcontinoally exercising the
right,power and aothority to act o n h e h a l f o f , m a n a g e , operate and othenîse
ohiigate or hind Franchisee In the condoct ofFranchisee's hosiness"
"12 4 "Interest" shall mean: when referring to interests or rights in Franchisee,
the memhershlp interestof any Principal Shareholder in Franchisee and any
other egoitahie or legal right in or to any of the Principal Shareholders'interest in
Franchisee'srevenoes, profits or assets; when referring to r l g h t s o r a s s e t s o f
Franchisee, Franchisee's rights onder and interest In this Agreement, the
Pestaorantand its revenoes, profitsand assets"
3
Section 14 Amended
Sohsection 144 of Section 14, entitled
"INSPFCTICNS", is hereby amended hy deleting the same as it now appears and inserting
the following in its place and stead:
^14 4
Franchisee shall maintain
membership interest ("Membership
ownership of Franchisee differs
Franchisee also sball maintainalist
105^2
an accorate register of its certificates of
Register") In the event that the beneficial
in any respect from record ownership,
of the names, addresses and interests of all
^
h e n e ^ ^ owners F r a o c h ^
of benefioi^ owners o e r t i f ^
prinoipal exeoofive offices opon t e n ^ O ) d a y s ' p r i o r w ^
Franchisor's represenfafives shaii havefhe righf fo examinefhe Membership
Register and any iisf of heneficiai owners, and to reprodoce aii o r a n y part
thereof Forther, opon t e n ^ O ) days'written notice, Franchisor may regoesta
copy of the iist of aii memhers and theiistofowners of heneficiai interest to he
forwarded to itat Franchisor's principal office "
4
Appendix A Amended
Appendix A to Franchise Agreement, entitled
^TATFMFNTOFOWNFRSFII^
"Shareholder" and insert the word "Members" In lieo thereof; (ii) delete the phrase "Percent
of Issoed and Ootstanding Shares of Franchisee" and insert the phrase "Percent of
Oontribotlons to Franchisee" in lieo thereof
5
AppendixO Amended Thefirstparagraphof A p p e n d i x O t o F r a n c h l s e
Agreement, entitled " O O N P I O F N T I A ^
the same as it now appears and inserting the following in its place and stead:
"TFIIS A O P F F M F N T is made this
day of
20
,by and between
lim^d^b^ycom^
an individoa! employed by Franchisee ("Employee^^
,
,a
,
6.
Governing Law.
The interpretation, oonstrootion and validity of this
Addendom wiii he governed hy the iaws of the state of Kansas, except as to any "ohoioe of
iaw" provision or roie
7
No Forther Amendment
No forther amendment or modification of the
Franchise Agreement shaii he hinding oniess execoted in writing hy Franchisor and
Franchisee or their aothorized soccessors or assigns No coorse of condoct or coorse of
performanceonder this or anyother agreement hetweenthepartieswiiihe deemed to
modify this Addendom Except as expressly set forthin this Addendom,theFranchise
Agreement remains in foil force and effect
8.
Entire Agreement. This Addendom and the agreements, docoments and
instroments referenced herein constitote theentire agreementhetween the partieswith
r e s p e c t t o t h e s o h j e c t matter hereof, soperseding and canceilingany and all prior and
9
Fleadings Thesection headings are inserted asamatter of convenience and
in no way define, limit or describe the scope of soch section or affect the interpretation of
this Addendom
10
Goonteroarts
This Addendom may heslgned in coonterpartsand each
coonterpartwitba handwrittensignatore,whether anorlglnal or an electronic data text
(incloding telegram, telex, facsimile, electronlcdata interchangeand electronicmail) is
considered an original and ail coonterparts constitote one and the same instroment
^9752
^
11.
Miscellaneous. Each of the terms and provisions of this Addendum is
deemed incorporated by reference into the Franchise Agreement. When a conflict exists
between this Addendum and the Franchise Agreement, this Addendum shall control. Any
capitalized term not otherwise defined in this Addendum shall have the meaning as set
forth in the Franchise Agreement. If any provision of this Addendum is found to be
unenforceable, the remaining provisions will continue to be in full force and effect. This
Addendum will be binding upon and inure to the benefit of the parties, their successors and
permitted assigns. No waiver of any provision of this Addendum will be enforceable
against a party unless it is in writing and signed by such party. No waiver by any party of
any provisions of this Addendum will be deemed to be or constitute a waiver of any other
provision hereof (whether or not similar), nor will such waiver constitute a continuing waiver
unless otherwise expressly provided.
IN WITNESS W H E R E O F , the parties have executed this Addendum as of the date
first written above.
FRANCHISOR:
By:
i
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051975.2
AOOENOOMTOERANOHÊAOREEMENT
[Limbed P a ^ n e r s h ^
THÂOOENOOMTOFRANCHÊAGREEMENT^^^
dayof
, 2 0 , by and between A p p ^ b e e ^ F ^ c h ^
a
Delaware
limited
liability
oompany
ânobiso^
, a
limited
partnership
("Eranobêe^,
,
^General
Partner
and
(togetberwltb General Partner, tbe
"PrmoipalSbarebolde^
^
LLO,
WITNESSETH
W H E R E A S , oontemporaneous witb tbe execution of tbls Addendom, Eranoblsor
and Eranoblsee will exeoote an Applebee's Eranoblse Agreement ("Eranobise
A g r e e m e n t granting Eranoblsee certain rigbts therein described; and
W H E R E A S , the same parties desire to amend the Franchise Agreement to
reflectaccoratelytheldentltyandnatoreofthe parties to the Franchise Agreement a s a
resolt ofEranchlsee's form of bosiness asallmlted partnership;
NGW, T H E R E F O R E ; the Franchise Agreement Is hereby amended as follows:
1
S e o t l o n ^ A m e n d e d . S e c t l o n s H B I a n d H 2 o f the Franchise Agreement
are hereby amended by deleting said sections In their entirety and replacing them with
the following;
" U BI Franchisee and each Principal Shareholder represent and warrant that:
(a) Franchisee Isallmlted partnership,validly existing and In good standing
onder the laws of
;(b)the General Partner Isallmlted liability oompany
doly organized, validly existing and In good standing onder the laws of
;
(c) Franchisee I s d o l y g o a l l f l e d a n d Isaothorlzed t o d o h o s l n e s s a n d Isln
good standing In each jorlsdlctlon In which Its bosiness activities or the natore
of the properties owned by It regoires socb goalification; (d)the General
Partner Is doly goallfled and Isaothorlzed t o d o hoslnessand Is In good
standing as a foreign company In each jorlsdlctlon In which Its bosiness
activities or the natore of the properties owned hy It regoires soch
goalification; (e)the execution and delivery of this Agreement and tbe
transactions contemplated hereby are within Franchisee's power onder Its
limited partnership agreement; (f)the execotlon and delivery of this
Agreement and the transactions contemplated hereby are within the General
Partner'spower onder Itsartlclesoforganlzatlon andoperatlngagreement;
(g) the execotlon and delivery of this Agreement has heen doly aothorlzedhy
the Franchisee; (h)the execotlon and delivery of this Agreement has been
doly aothorlzed by the General Partner; (I) the limited partnership agreement
and the certificate of limited partnership of Franchisee delivered to Franchisor
are troe, complete and correct, and there have been no changes therein since
the date t h e r e o f ; ^ t h e articles of organization and operating agreement of
the GeneralPartner delivered to Franchisor are troe,complete and correct,
^9752
^
and there have been no cbanges
recent balance sheet of Franchisee and the most recent balance sheet
(collectively " B a l a n c e S h e e t s ^ o f e a c h of theFrlnclpal Shareholders and
("Guarantors heretofore delivered to Franchisor, are troe,
complete and correct, and fairly present the financial positions of the
Oeveloper,Frlnclpal Shareholders and Guarantor,respectlvely,as of tbe date
or dates thereof;(l) the Balance Sheets have been prepared In accordance
with generally accepted accounting principles; (m) there have been no
materially adverse cbanges In tbe condition, assets or liabilities of the
Oeveloper, Principal Shareholders or Guarantor since the date or dates
thereof (n)that any specimen certificate evidencing ownership Interest In the
limited partnership delivered to Franchisor pursuant to SubsectlonH2(e)
hereof Is a true specimen ofFranchisee's certificate evidencing ownership
Interest In the limited partnership; (o)tbe General Partner's specimen
memhershlp certificate delivered to Franchisor Is a true specimen of the
General Partner's membership certificate; and (p)Franchlsee and the
General Partner have andôr will comply with all applicable rules, regulations
and statutes governing the sale of partnership Interests, Including, but not
limited to, the Securities Act of 1933, as amended; the Securities and
Exchange Act of 1934, as amended; and all applicable state securities rules,
regulations and statutes.
1 1 2 Franchisee and each PrincipalShareholder covenant that during the
term of this Agreement: (a) Franchisee shall do or cause to he done all things
necessary to preserve and keep In full force Its existence as a limited
partnershlpand shall be Ingood standing In each jurisdiction In which Its
business activities or the nature of the properties owned by It reguires such
gualification; (b)the General Partner shall do or cause to be done all things
necessary to preserve and keep In full force Its existence and shall he In good
standing as a foreign company In each jurisdiction In which Its business
activities or the nature of the properties owned hy It reguires such
gualification; (c) Franchisee shall have the authority under Its limited
partnership agreement to carry out the terms of this Agreement; (d)the
General Partner shall have the authority to carry out the terms of this
Agreement; (e) Franchisee shall print, In a conspicuous fashion on all
certificates evidencing ownership Interest In tbe limited partnership when
Issued, a legend referring to tbls Agreement and the restrictions on and
obligations of Franchisee and the Principal Shareholders, Including, hut not
limited to, tbe restrictions on transfer or removal of any Interest of tbe
Principal Shareholders In or of Franchisee Further, Franchisee shall deliver
to Franchisor priorto tbe sale of any partnership units a true specimen
certificate evidencing ownership Interest In the limited partnership, bearing the
legend descrihed herein; and (f)the General Partner sball print, In a
conspicuous fashion on all certificates representing membership Interest
when Issued,alegend referring to this Agreement and therestrlctlons on and
obligations ofthe Principal Shareholders hereunder, Including tbe restrictions
on transferofmembershlp Interests In the General Partner "
10^9752
2
Seotioo12 Amended S e ^ o n s 1 2 2 1 2 4 o f the Franchise Agreement
are hereby amended by deleting said sections in their entirety and
thefoiiowing:
"122 Except asprovided in Subsection 123, "Transfer^shaii mean any
assignment, saie, pledge, hypothecation, gift or any other event which wouid
change ownership of or change or createanewlnterest,including, but not
limited to:
(a)
any change in the ownership of or rights in or to the partnership
interest or other eguity interests ofEranchisee which would result from the act
of the principal Shareholders, such as a sale, exchange, pledge or
hypothecation of the partnership interest in or rights to any of franchisee's
profits, revenues or assets, or any such change which would result by
operation of law;
(b)
any change in the percentage interest owned by any Principal
Shareholder in the partnership Interests or other eguity interests of
Prancbisee, or interests in the Prancbisee's profits, revenues or assets which
would result from any act of Prancbisee such as a sale, pledge or
hypothecation of any Restaurant assets (other than a pledge of assets to
secure b o ^ a ^ e loans made or credit extended in connection with acguisition
o f t h e assets pledged, provided that immediately before and after such
transaction thenet worth of Prancbisee shallnot b e l e s s than theamount
which is reflected on the Balance Sheets referred to in Subsection111of tbis
Agreements any sale or issuance of any partnership Interest or other eguity
interest in Prancbisee; the retirement or redemption of any Interest in
Franchisee; or any sale or grant to any person of any right to participate In or
otherwiseto share orbecomeentitled t o a n y partofPranchlsee's profits,
revenue, assets or eguity; and
(c)
the removal of the General Partner andôr the substitution or addition
o f a n e w general partner to the Franchisee
1 2 3 "Transfer" shall not include (a)achange in the ownership of or rights to
any partnership interest or otber eguity interest inFranchisee pursuant t o a
puhiio offering of Franchisee's securities registered under the Securities Act
o f 1 9 3 3 , o r ( h ) a c h a n g e in the ownership of or rights to any securities or other
eguity interest in F r a n c h i s e e p u r s u a n t t o a p r i v a t e o f f e r i n g o f Franchisee's
securities exempted from registration under such Act, provided that
Franchisee provides Franchisor w i t h a c o p y of its prospectus andôr offering
memorandum ten (10) days prior to its filing with the Securities and Exchange
Gommissionor circulation tothird parties so that Franchisor may comment
and, if necessary,correct any information concerningPranchisorandôr the
System, and further provided that after giving effect to such puhlic or private
offering, the General Partner "controls" Franchisee and the Principal
Shareholder "controls" the General Partner For purposes of this Sectlon12,
"control" means: having and continually exercising the right, power and
^9752
aôo^toaotonbehaô^m^
Franchisee in the conduct o f F ^ o c h i s e e ^ business
12 4 "interest" shaii mean: when referring tc interest cr rights in Franchisee
the partnership interests cf the Principal Sharehciders in Franchisee and any
ether egoitahie cr iegai right in or to any cf revenues, profits cr assets; when
referring to rights or assets ofFranchisee, Franchisee's rights under and
interest in this Agreement, the Restaurant and its revenues, profits and
assets
Notwithstanding the terms of Section12B7of the Franchise Agreement,the proposed
saie of an interestowned h y t h e G e n e r a i P a r t n e r wiii he subject to aii of theterms
thereof
3
Section 13 Amended Section 131(c) o f t h e Franchise Agreement is
hereby amended hy deleting said section in its entirety and replacing it with the
following:
"(c)
Neither Franchisee, Principal Shareholders nor any otber owner of
Franchisee shall at any time (i) appropriate or use the trade secrets
incorporated in the System, or any portion thereof, in any restaurant business
which is not within the System, (ii) disclose or reveal any portion o f t h e
System to any person, other than to Franchisee's Restaurant employees as
an incident of their training, (iii) acguire any right to use any name, mark or
other intellectual property right which is or may be granted by this Agreement,
except in connection with the operation of the Restaurant, or
(iv) communicate, divulge or use for the benefit of any other person or entity
any confidential information, knowledge or know how concerning the methods
of development or operation ofarestaurant utilizing the System,which may
be communicated hy Franchisor in connection with the franchise granted
hereunder.
4
Section 14 Amended
Subsection 144 of Section 14, entitled
"INSPFOTIONS", is hereby amended hy deleting the s a m e a s it nowappears and
inserting the following in its place and stead:
"14.4 Prancbisee shall maintain an accurate register of its certificates
oflimitedpartnershipinterest("Fimited Partnership Register") and General
Partner shall maintain an accurate register of its memhers and membership
interests (^Membership Register") in the event that the heneficiai ownership
of Franchisee or of General Partner's membership interest differs in any
respect from recordownership, Franchisee andGeneral Partner also shall
maintainaiistofthenames,addresses and interests of all beneficial owners
Franchisee shall produce its Fimited Partnership Register and General
Partner shall produce its Membership Register, and any list of beneficial
owners certified hy the company's secretary to be correct, at itsprincipal
executive offices upon ten (10) days prior written reguest hy Franchisor
Franchisor's representatives shall have the rigbt to examine the Limited
Partnership Register and the Membership Register and any list of beneficial
10^752
^
owners and to r e p r o d o c e ^ o r any part hereof Fortho^ upon tonÔ) days'
wntton notion Franohisor may roqoostaoopy of tho list of mom^
list of owners of benefloial interests to beforwarded to it at Franohisor's
prinoipaioffioeB
5
Appendix A Amended
Appendix A, entitled "STATEMENT OE
OWNERSHIP I N T E R E S T S ^
t h e p h r a s e " E a r t n e r " s h a l l b e inserted in lieo thereof The phrase"Eeroent of Issoed
and Ootstanding Shares of Eranohisee" shall he amended and replaced hy the phrase
"Percent of interest Owned in Eranohisee" AppendixAshallfortherhe amended to add
two new colomns as follows:
Percent of Interest
Owned in Eranchisee
Partner
General Partner
%
Limited Partners
%
6
Appendix 0 Amended The first paragraph of Appendix 0, entitled
"OONPlOENTlALlTYAOPEEMENTîsherehyamendedhydeletingthesameasitnow
day of
20
, hy and hetween
êdpartne^pânchêeând
aoind^doêmpêdbyF^nohêÊm^
, a
,
7
Genera P a r t n e r Leoa! Statos Nothing oootained in this Agreement w^
he oonstroed to iimit any iiahiiity that Generai Partner may i n o o r a s a r e ^
statosasageneraipartnerofPranohisee onder appiioahie law
8
Governino Law
The interpretation, oonstrootion and validity of this
Addendom will he governed hy the laws of the state of Kansas, exoept as to any "ohoioe
of law" provision or role
9
No PortherAmendment
Nofortheramendmentormodifioationofthe
Pranohise Agreement shall he hinding oniess exeooted in writing hy Pranohisorand
Pranohisee or their aothorizedsoooessors or assigns Noooorseofoondootorooorse
of performance onder this or any other agreement hetween the parties will he deemed
to modify this Addendom
Pxoept as expressly set forth in this Addendom, the
Pranohise Agreement remains in foil foroe and effeot
10
Entire Agreement This Addendom and the agreements, doooments and
instroments referenced herein oonstitote the entire agreement hetween the parties with
respect to the sohjeot matter hereof, soperseding and oanoelling any and all prior and
^97^
5
11.
Headings.
The section headings are inserted as a matter of
convenience and in no way define, limit or desorihe the soope of sooh section or affeot
the interpretation ofthis Addendom
12
Ooonteroarts
This Addendom may he signed in coonterparts and each
coonterpartwithahandwrittensignatore,whether an original or an eiectronic data text
(incloding telegram, telex, facsimile, electronic data interchange and electronic mail) i^
considered an original and ail coonterparts constitote one and the same instroment
13
Miscellaneoos Eaoh o f t h e t e r m s a n d provisions of this Addendomis
deemed incorporated hy reference into the Franchise Agreement When a conflict
exists hetween this Addendom and the Franchise Agreement, this Addendom shall
control Any capitalized term not othenîse defined in this Addendom shall have the
meaning as set forth in the Franchise Agreement If any provision of this Addendom is
foond to he onenforceahie, the remaining provisions wili continoe to he in foil force and
effect This Addendom will he hinding opon and inore to the henefit of the parties, their
soccessors and permitted assigns No waiver of any provision of this Addendom will he
enforceahle againstaparty oniess It is in writing and signed hy soch party No waiver
h y a n y p a r t y o f a n y p r o v i s i o n s o f t h i s A d d e n d o m w i l l hedeemed to he or constitotea
waiver of any other provision hereof (whether or notsimilar), nor will soch waiver
constitoteacontinoing waiver oniess otherwise expressly provided
IN WITNESS W F I F F F O F , t h e parties have execoted this Addendom as of the
date first written ahove.
ERANOHISE
AFFFEBEE'SFRANOHISORFLG
^
Name:
Title:
FRANCHISEE:
By:
General Partner
By:_
Name:
Title:
Name:
1051975.2
Name:
1051975.2
EXHIBIT G
MANUALS' TABLES OF CONTENTS
Beverage R e c i p e M a n u a l I 10.2013
Applebees
T a b l e of C o n t e n t s
1. S t a n d a r d D r i n k s
Alabama Slammer (SEE ALSO Shooters)
Amaretto Sour - SEE Sours
Apple Bay Breeze
Bahama Mama
Bahama Mama/Mucho
Bailey's Frozen Cappuccino (Blender)
Bailey's Frozen Cappuccino (Ice Cream Machine)
Banana Banshee - Screaming (Blender)
Banana Banshee - Screaming (Ice Cream Machine)
Banana Banshee - Up
Banana Daiquiri - SEE Daiquiri
Bay Breeze
Black Russian
Blended Beverages (No Island Oasis Machine)
Bloody Caesar
Bloody Maria
Bloody Mary
Bloody Mary - Applebee's Classic
Bloody Mary - Applebee's® Classic/Mucho
Blue Seas
Blue Skies
Brandy Alexander-Up
Burnt Almond - Frozen (Blender)
Burnt Almond - Frozen (Ice Cream Machine)
Burnt Almond - Rocks
Burnt Almond/Toasted - Rocks
Cape Codder
Chee Chee - SEE Pina Colada
Chocolate Mint Cookie (Blender)
Chocolate Mint Cookie (Ice Cream Machine)
Cola/Bourbon or Rum
Collins/John
8
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1•
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Collins/Tom
6
Colorado Bulldog
Cosmopolitan - SEE Martini/Cosmo
Daiquiri/Apple - Frozen
;
6
6
6
Daiquiri/Flavored
6
Daiquiri/Flavored - Applebee's*
Daiquiri/Flavored - Applebee's*/Mucho
Daiquiri/Swirl - Applebee's®
Daiquiri/Swirl - Applebee's*/Mucho
Fuzzy Navel - SEE Screwdriver
6
7
7
7
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Gibson
;
7
0
Gibson - Applebee's Rocks
Gibson - Applebee's* Up
Gibson - Up
Gimlet
Gimlet-Applebee's* Rocks
Gimlet-Applebee's" Up
Gimlet-Up
©2013 Applebee's International, Inc.
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Table of Contents • Page i
Applebee's
B e v e r a g e R e c i p e Manual I 10.2013
Godchild
Godfather
Godmother
Grasshopper (Blender)
Grasshopper (Ice Cream Machine)
Grasshopper/Screaming - Frozen (Blender)
Grasshopper/Screaming - Frozen (Ice Cream Machine)
Greyhound
'.
Hairy Navel - S E E Screwdriver
Harvey Wallbanger - S E E Screwdriver
Hurricane
Hurricane/Mucho
ice Cream Sandwich (Blender)
Ice Cream Sandwich (Ice Cream Machine)
Ice Cream Sandwich (Island Oasis)
Jamaica Freeze
Jamaica Freeze/Mucho
Key Lime Pie (Blender)
Key Lime Pie (Ice Cream Machine)
Key Lime Pie/Mucho (Blender)
Key Lime Pie/Mucho (Ice Cream Machine)
Limeade (Mature)
Lime-a-Rita
Long Beach/Island Iced Tea - S E E Teas
Lynchburg Lemonade
M&M
Madras - S E E Screwdriver
Mai-Tai
Manhattan/Applebee's® - Perfect
Manhattan/Applebee's® - Rocks
Manhattan/Applebee's® - Up
Manhattan/Dry - Rocks
Manhattan/Perfect - Rocks
Manhattan/Rocks
Margarita/Applebee's® Top S h e l f - Frozen
Margarita/Applebee's® Top Shelf - Rocks
Margarita/Applebee's® Top Shelf - Frozen/Mucho
Margarita/Applebee's® Top Shelf - Rocks/Mucho
Margarita/Blue Coconut - Rocks
Margarita/Blue Coconut - Rocks/Mucho
Margarita/Cadillac - Frozen (Island Oasis)
Margarita/Cadillac - Frozen (Marg. Machine)
Margarita/Cadillac - Frozen/Mucho (Island Oasis)
Margarita/Cadillac - Frozen/Mucho (Marg. Machine)
Margarita/Cadillac - Rocks
Margarita/Cadillac - Rocks/Mucho
Margarita/Corona Rita - Frozen (Island Oasis)
Margarita/Corona Rita - Frozen (Marg. Machine)
Margarita/CoronaRita - Rocks
Margarita/Dos Rita - Frozen (Island Oasis)
Margarita/Dos Rita - Frozen (Marg. Machine)
Margarita/Dos Rita - Frozen/Mucho (Island Oasis)
Margarita/Dos Rita - Frozen/Mucho (Marg. Machine)
Margarita/Dos Rita - Rocks
Margarita/Dos Rita - Rocks/Mucho
Margarita/Flavored - Rocks
Margarita/Gold - Frozen
P a g e ii • T a b l e of C o n t e n t s
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^
Beverage R e c i p e Manual I 10.2013
Maâ^Go^-Froze^MÔ
Ma^n^Go^-Rooks
Margan^Go^-Roc^Mooho
Margaâ/Green A p p l e - R o c k s
Margeâ/Guest Choice
Marga^House-Frozen
Margan^HouseZ-Frozenêwtos
Margan^Hoose-ôzen/Mocho
Marga^Hooseâvored-Frozen
Margan^House/Flevored-Frozen/Brew^s
Ma^^Hooseâvored-Frozen/Mocho
Margaâ/Hoose-Rocks
Margan^Hoose-Rocks/Brew^s
Marge^Hoose-Rocks/Mocho
M a r g a n ^ ^ i a n - F r o z e n (Island Oasis)
Margarlta/ltallan-Froên (Marg. Machine)
Margarlta/ltallan-Frozen/Mocho (Island Oasis)
Margarita/ltalian-Frozen/Mocho (Marg.Machine)
Margarlta/ltalian-Rocks
Margarita/ltalian-Rocks/Mocho
M a r g a r i t a / M a i n S t r e e ^ R i t a ^ - F r o z e n (Island Oasis)
M a r g a r l t a / M a i n S t r e e ^ R l t a ^ - F r o z e n (Marg.Machine)
Margarita/MainStree^Rita^-Frozen/Mocho (Island Oasis)
M a r g a r i t a / M a i n S ^ e e ^ R i t a ^ - F r o z e n / M ^ c h o (Marg.Machine)
Margarita/MainSêefRlta®/Flavored-Erozen (Island Oasis)
M a r g a n t a / M a i n S ^ e e l ^ R i t a ^ F l a v o r e d - ^ r o z e n (Marg.Machine)
Margarita/MainStreefRita^Flavored-Prozen/Mucho (Island Oasis)
Margarita/MainSêefRlta®/Flavored-Frozen/Mocho (Marg.Machine)
Margarita/MainStree^Rita^-Rocks
Marganta/MalnSêe^Rita®-Rocks/Mocho
Margarita/MalnSêe^Rita^Swirl-Applebee's® (Island Oasis)
Margarita/MainStree^Rita^SwirlÂpplebee's®(Marg. Machine)
M a r g a r i t a / M a i n S t r e e ^ R i t a ^ S w i r l - A p p i e h e e ^ M u c h o (Island Oasis)
Marganta/MainSêe^Rita®Swirl-Appiehee's®/Mucho (Marg.Machine)
Margarita/Moonlight-Frozen (Island Oasis)
Margarita/Moonlight-Frozen (Marg. Machine)
Margarita/Moonlight-Frozen/Mucho (Island Oasis)
Margarita/Moonllght-Frozen/Mucho (Marg Machine)
Margarita/Moonlight-Rocks
Margarita/Moonlight-Rocks/Mocho
Margarita/Rerêct
Margarita/Reêc^Flavored
Margarita/Rerfect Apple
Margarita/ReêctRaôn
Margarita/RaspherryMeltdown-Prozen (Island Oasis)
Margarita/RaspberryMeltdown-Prozen (Marg. Machine)
^
Margarita/RaspberryMeltdown-Prozen/Mucho (Island Oasis)
Margarita/RaspberryMeltdown-Erozen/Mocho (Marg.Machine)
Margarita/RaspberryMeitdown-Rocks
Margarita/RaspberryMeltdown-Rocks/Mocho
Margarita/Red Apple R i t a - R o c k s
Margarita/Red Apple R i t a - R o c k s / M u c h o
Margarita/SkinnyBee^
Martini/Applebee's® Cosmopolitan
Martlni/Applebee's^ôdkawithAhsolut
Martini/AppleBeeTini
Martini/CaramelAppletini
©2013Applebee's Internationa Ino.
App^bees
^
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T a b l e of C o n t e n t s ^ P a g e ^
*
Applebees
B e v e r a g e R e c i p e Manual | 10.2013
Martini/Chocolate
Martini/Dirty
Martini/Green Apple
Martini/House - Rocks
Martini/House - Up
Martini/Italian
Martini/Lemon Drop
Martini/Lemon Drop/Flavored
Martini/Mango
Martini/Melon
Martini/Mochatini
Martini/Orange Dream
Martini/Pineapple Upside Down Cake
Martini/Raspberry
Martini/SKYY Blue
•
Martini/Sour Apple
Melonball - S E E Screwdriver
Mocha Freeze - Frozen (Blender)
Mocha Freeze - Frozen (Ice Cream Machine)
Mojito
Mojito - Mucho
Mojito/Flavored
Mojito/Flavored - Mucho
Mojito/SkinnyBee™
Mud Slide - Frozen (Traditional) (Blender)
Mud Slide - Frozen (Traditional) (Ice Cream Machine)
Mud Slide - Frozen/Mucho (Traditional) (Blender)
Mud Slide - Frozen/Mucho (Traditional) (Ice Cream Machine)
Mud Sltde/Applebee's® (Blender)
Mud Slide/Applebee's® (Ice Cream Machine)
Mud Slide/Applebee's®/Mucho (Blender)...
Mud Slide/Applebee's®/Mucho (Ice Cream Machine)
Nutty Irishman
Old-Fashioned/Rocks
Old Fashioned/Up
Orange Dream (Blender)
Orange Dream (Ice Cream Machine)
Pearl Harbor
Pina Colada - Frozen
Pina Colada - Rocks
Pina Colada/Applebee's® - Frozen
Pina Colada/Applebee's® - Frozen/Mucho
Pina Colada/Applebee's® - Flavored/Swirl
Pina Colada/Applebee's® - Flavored/Swirl Mucho
Pina Colada/Chee Chee - Frozen
Planter's Punch
Rob Roy - Rocks
Rob Roy/Dry - Rocks
Rob Roy/Perfect - Rocks
Rum R u n n e r - F r o z e n
Rusty Nail
Salty Dog
Screwdriver
Screwdriver/Applebee's®
Screwdriver/Fuzzy Navel
Screwdriver/Hairy Navel
Screwdriver/Harvey Wallbanger
P a g e iv » T a b l e of C o n t e n t s
:
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_t3
Beverage R e c i p e M a n u a l I 10.2013
Screwdriver/Madras
Screwdriver/Melonball
Screwdriver/Sloe Comfortable
Screwdriver/Sloe Comfortable Against the Wall
Sea Breeze
Sea Breeze/Apple bee's®
Sex On The Beach #1 - S E E Shooters for more
39
39
39
40
40
40
40
Sloe Gin Fizz
40
Sours/Am aretto
SoursA/odka
Southern Punch
Southern Punch/Mucho
Strawberry Daiquiri - S E E Daiquiri
Strawberry Shortcake (Blender)
Strawberry Shortcake (Ice Cream Machine)
Summer Squeeze® - Frozen
Summer Squeeze® - Frozen/Flavor
Summer Squeeze® - Frozen/Mucho
Summer Squeeze® - Frozen/Flavor/Mucho
Teas - Long Beach Iced Tea
Teas - Long Beach Iced Tea/Mucho
Teas - Long Island Iced Tea
Teas - Long Island Tea/Brewtus
Teas - Long Island Tea/Mucho
Teas - Long Island teed Tea/Flavored
Teas - Long Island Iced Tea/Flavored/Mucho
Teas - Long Island Iced Tea/SkinnyBee™
Teas - Texas Beach Tea
Teas - Texas Beach Tea/Mucho
T e a s - T e x a s Tea
Teas - Texas Tea/Mucho
Teas - Tropical Tea
Teas - Tropical Tea/Mucho
Teas - Top Shelf Long Beach Iced Tea
Teas - Top Shelf Long Beach Iced Tea/Mucho
Teas - Top Shelf Long Island Iced Tea
Teas - Top Shelf Long Island Iced Tea/Mucho
Teas - Top Shelf Long Island Iced Tea/Flavored
Teas - Top Shelf Long Island Iced Tea/Flavored/Mucho
Teas - Top Shelf Texas Beach Tea
Teas - Top Shelf Texas Tea
Teas - Top Shelf Tropical Tea
Tequila Sunrise
Toasted Almond - S E E Burnt Almond
Tom Collins - S E E Collins
Tonics/Applebee's® Classic
Tonics/Gin or Vodka
White Russian
^
Applebees
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Shoots
After Dinner Mint
Alabama Summer
Bubble Gum
Buttery Nipple
Comfortable S e ^ In G B X
^
49
4^
^9
^g
^g
^9
T a b l e of C o n t e n t s • P a g e v
B e v e r a g e R e c i p e Manual 1 10.2013
#
Dr. Pepper
Dream side
Fruit Cocktail
Grateful Dead
Hollywood
JagerBomb
Jager Bomb (shot glass drop)
Jiggle Shots
Jiggle Shots/Bahama Mama
Jiggle Shots/Berry Blue
Jiggle Shots/Cosmopolitan
Jiggle Shots/Fuzzy Navel
Jiggle Shots/Hurricane
Jiggle Shots/Lemon Drop
Jiggle Shots/Margarita
Jiggle Shots/Margarita Melon
Jiggle Shots/Strawberry Daiquiri
Jiggle Shots/Watermelon Tea
Jolly Rancher
Kamikaze
Koolaid
Lemon Drop #1
Lemon Drop #2
Liquid C
Melon Ball
Mind Eraser
Mud Slide
Orgasm
Orgasm/Multiple
Orgasm/Multiple Screaming
Pineapple Upside Down Cake
Purple Hooter/Old Grape Crush
Red Headed
Red Snapper
Red Velvet Cake
Root Beer Shooter
Russian Quaalude
Sex On The Beach #1
Sex On The Beach #2
Sex On The Beach #3
Sex on the Beach/Dirty
Silk Panties
Slippery Nipple
Tootsie Roll
Watermelon #1
Watermelon #2
Week at the Beach
."
,
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3. Hot Drinks
Almond Mocha
Black Magic
Cafe Gates
Cafe Magic
Cafe Navan
Cafe Nelson
Hot Toddy
P a g e v l • T a b l e of C o n t e n t s
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Beverage R e c i p e Manual I 10.2013
Applebees
Irish Coffee
Keoki Coffee
Peppermint Patty
Ultimate Irish Coffee
Uncle Jimmy
62
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63
4. Wine Drinks
Kir
65
Mimosa
Mimosa/Grand
Sangria/Apple/Mucho
Sangria/Apple/Pitcher
Sangria/Berry/Mucho
Sangria/Berry/Pitcher
Sangria/Kiwi-Melon/Mucho
Sangria/Kiwi-Melon/Pitcher
Sangria/White Peach/Mucho
Sangria/White Peach/Pitcher
65
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Wine (6 oz.)
Wine (8or9oz.)
Wine Cooler
Wine Spritzer
;
"
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5. N o n - A l c o h o l l c
Apple Berry Twist
Apple Breeze
Banana Berry Smoothie
Coffee
Fountain Soft Drinks
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68
68
68
68
Fruit Fizzers
68
Hot Tea
Hot Chocolate/Hot Apple Cider
Iced Tea
Iced Tea/Arnold Palmer
Iced Tea/Flavored
Iced Tea/Sweet
Lemonades
Lemonades - Flavored
Lemonades - Frozen
Lemonades - Frozen/Flavored
Limeade/Cherry
Limeade/Strawberry
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70
Milk
71
Milk/Chocolate
Mango Banana Smoothie
Roy Rogers
Shake/Caramel (Blender)
Shake/Caramel (Ice Cream Machine)
Shake/Chocolate (Blender)
Shake/Chocolate Ice Cream Machine)
Shake/Chocolate Malt (Blender)
Shake/Chocolate Malt (Ice Cream Machine)
Shake/Flavored (Blender)
Shake/Flavored (Ice Cream Machine)
Shake/Oreo Cookie (Blender)
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Table of Contents • Page vii
Applebee's
B e v e r a g e R e c i p e Manual I 10.2013
Shake/Oreo Cookie (Ice Cream Machine)
Shake/Vanilla (Blender)
Shake/Vanilla (Ice Cream Machine)
Shirley Temple
Strawberry Coco Frost Smoothie
Virgin Bahama Mama
Virgin Bloody Mary
Virgin Daiquiri/Flavored
Virgin Daiquiri/Strawberry Mango
Virgin Key Lime Pie (Blender)
Virgin Key Lime Pie (Ice Cream Machine)
Virgin Margarita/Lime
Virgin Margarita/Flavored
Virgin Margarita/Wild berry Mango...
Virgin Mudslide (Blender)
Virgin Mudslide (Ice Cream Machine)
Virgin Orange Dream (Blender)
Virgin Orange Dream (Ice Cream Machine)
Virgin Pina Colada
Virgin Pina Colada/Strawberry
Virgin Pina Colada/Wildberry Mango
Virgin Strawberry Shortcake (Blender)
Virgin Strawberry Shortcake (Ice Cream Machine)
Water/Bottled
Water/Tap
;
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6. Kid's
Kid Lemonades/Flavored
Kid Shake/Caramel (Blender)
Kid Shake/Caramel (Ice Cream Machine)
Kid Shake/Chocolate (Blender)
Kid Shake/Chocolate (Ice Cream Machine)
Kid Shake/Flavored (Blender)
Kid Shake/Flavored (Ice Cream Machine)
Kid Shake/Oreo (Blender)
Kid Shake/Oreo (Ice Cream Machine)
Kid Shake/Vanilla (Blender)
Kid Shake/Vanilla (Ice Cream Machine)
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7, Bar Mixes
Lemonade - Sun Orchard
Margarita/Main Street 'Rita® - Blender Mix
Margarita/Main Street 'Rita® - Machine Mix
Margarita/Main Street 'Rita® - Rocks Mix
Sweet & Sour Mix
Sweet Tea
P a g e v i i i • T a b l e of C o n t e n t s
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B e v e r a g e R e c i p e M a n u a l I 10.2013
Applebees
8. G a r n i s h e s
Apple Balls Speared
Celery Stalks
Cherry, Leaf, Pineapple Spears
Lemon Twists
Lemon and Lime Wedges
Mint Handling
How to Muddle
Orange Wedges
Pineapple Wedges
85
86
87
88
89
90
90
91
92
9. Shelf Life a n d C o l o r C o d e s
Bar Shelf Life
Color Code Chart
10. Beverage Making
;
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94
Techniques
Build
95
Chill
95
Float
Frozen (Ice Cream/Blender)
Frozen (10) Island Oasis
Layering
95
95
96
96
Mixing
97
Muddle
Pre-Heat
Salt Rim
Shake and Strain
Slush (Island Oasis)
Stir and Strain
Top
97
98
98
98
99
99
99
11. Bar Tricks
Super Straw
Three Way Coin
Cherry and Snifter
Tri-Square
Math for Bartenders
Push Bottle
Dollar of Steel
Mis-Guided Tins
The Contortionist
The Grizzly Drop
Tricky Triangles
Bottle for a Dollar
Fork Bridge
Free the Dollar
Ten Point Star
Disappearing Shot
Four Quarters for a Dollar
Field Goal
:
,
101
101
102
102
103
103
104
104
105
105
106
106
107
107
108
108
109
109
T a b l e of C o n t e n t s • P a g e ix
Applebee's
The information contained in this Manual is the exclusive property ofApplebee's International, Inc. and may not
be disclosed or reproduced in whole or in part without prior written authorization from the Operations or Training
Departments ofApplebee's Services, Inc. The holder ofthis guide must return it on termination of employment.
Applebee's Services, Inc.
8140 Ward Parkway
© 2014 Applebee's International, Inc. All rights reserved.
1:
Appetizers
Appetizer Sampler (5/13)
Boneless Wings (2/13)
Brew Pub Pretzels & Beer Cheese Dip (5/13)
Brew Pub Pretzels (Refill 2) (11/12)
Chicken Quesadilla Grande (and Quesadilla Grande) (11/13)
Chips & Salsa and Refills (11/13)
Classic Chicken Wings (2/13)
Crunchy Onion Rings (6/11)
Green Bean Crispers (11/12)
Mozzarella Sticks (6/11)
:
Nachos - Chili Cheese (5/13)
Nachos - Spicy Chili Cheese (5/13)
Potato Twisters (5/13)
Queso Blanco (and Queso Blanco with Chili) (5/13)
Spinach & Artichoke Dip (5/13)
Steak Quesadilla Towers (11/12)
Wonton Taco (5/13)
Trios - Boneless Wings (2/13)
Trios - Brew Pub Pretzels & Beer Cheese Dip (5/13)
Trios - Classic Chicken Wings (2/13)
Trios - Mozzarella Sticks (6/11)
Trios - Queso Blanco (5/13)
Trios - Sliders - Cheeseburger (5/13)
Trios - Spinach Artichoke Dip (5/13)
Trios - Steak Quesadilla Towers (11/12)
Trios - Wonton Taco (5/13)
2:
Salads
Applebee's House Salad (5/13)
House Caesar Salad - Side (7/12)
Fiesta Chicken Chopped Salad (7/12)
Fiesta Chicken Chopped Salad (Bulk) (11/12)
Fried Chicken Salad - Half (5/13)
Fried Chicken Salad (5/13)
Green Goddess Wedge Salad (5/13)
Grilled Chicken Caesar Salad - Half (7/12)
Grilled Chicken Caesar Salad (5/13)
Grilled Shrimp'N Spinach Salad - Half (11/13)
Grilled Shrimp'N Spinach Salad (11/13)
Oriental Chicken Salad - Half (7/12)
Oriental Chicken Salad (5/13)
Pecan Crusted Chicken Salad - Half (7/12)
Pecan Crusted Chicken Salad (5/13)
3:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Steaks
Applebee's House Sirloin (2/14)
Applebee's 7 oz. House Sirloin (2/14)
Bourbon Street Steak (8/12)
Bourbon Street Steak (7 oz.) (2/13)
Chicken Fried Steak (7/12)
Citrus Lime Sirloin - 7 oz. (2/14)
Citrus Lime Sirloin - 9 oz. (2/14)
| ©2014 APPLEBEE'S INTERNATIONAL, INC.
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2014.2 PRESENTATION MANUAL
T O C PG, 1 |
Marsala Mushroom Sirloin - 7 oz. (2/14)
Marsala Mushroom Sirloin - 9 oz. (2/14)
New York Strip or Ribeye (2/14)
Shrimp N Parmesan Sirloin (2/14)
Sizzling Double Barrel Whisky Sirloins (7/12)
Steak & Fried Shrimp (2/14)
Steak & Grilled Shrimp (2/14)
Steak & Honey BBQ Chicken (2/14)
Steak & Riblets (2/14)
Topper - Crispy Onion (7/12)
T o p p e r - G r i l l e d Onions (7/12)
Topper - Sauteed Garlic & Mushroom (7/12)
Topper - Shrimp N Parm (8/12)
4:
.....8
9
10
11
12
13
14
15
16
17
18
19
20
Pastas
4-Cheese Mac with Honey Pepper Chicken Tenders (8/13)
Cajun Shrimp Pasta (5/13)
Chicken & Broccoli Pasta Alfredo Bowl (5/13)
Lemon Shrimp Fettuccine (5/13)...,
Three Cheese Chicken Penne Pasta (11/13)
Three Cheese Chicken & Sundried Tomato Penne (2/14)
5:
Seafood
Applebee's Fish & Chips (Pre-Battered) (5/13)
Baked Haddock (11/12)
Blackened Tilapia (7/12)
Double Crunch Shrimp (11/13)
Hand-Battered Fish & Chips (5/13)
Hand-Breaded Fish & Chips (5/13)
6:
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2
3
4
5
6
1
2
3
4
5
6
Chicken
Bourbon Street Chicken & Shrimp (8/12)
Chicken & Shrimp Tequila Tango (11/13)
Chicken Fried Chicken (7/12)
Chicken Tenders Basket (6/11)
Chicken Tenders Platter (11/12)
Crispy Orange Chicken (7/12)
Fiesta Lime Chicken® (11/13)
Honey Pepper Chicken & Shrimp (11/13)
Smothered Grilled Chicken (5/13)
1
2
3
....A
5
6
7
8
9
7: R i b s & F a j i t a s
Applebee's Riblets (2/13)
Baby Back Rib Platter (2/13)
Half Rack Baby Back Rib Platter (2/13)
Riblet Basket (2/13)
Riblet & Chicken Tenders Basket (2/13)
Riblet & Chicken Tenders Platter (2/13)
Sizzling Fajitas (Rice) - Shrimp, Chicken, Steak, Combo (2/13)
Sizzling Fajitas (No Rice) - Shrimp, Chicken, Steak, Combo (11/13)
I ©2014 APPLEBEE'S INTERNATIONAL, INC.
2014.2 P R E S E N T A T I O N M A N U A L
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2
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5
6
7
8
T O C P G . 2"
8: B u r g e r s & S a n d w i c h e s
American BLT (5/13)
Applebee's Reuben (5/13)
Artisan Grilled Chicken Ciabatta (2/14)
Battered Fish Sandwich (5/13)
Burger - Bourbon Black and Bleu (2/13)
Burger - Cowboy (2/13)
Burger-Philly (11/12)
Burger - Plain, Cheese or Bacon Cheese (11/12)
Burger - Quesadilla (11/12)
Burger - Southwest Jalapeno (11/12)
Burger - Veggie (7/12)
Chicken Fajita Rollup (5/13)
Classic Turkey Breast Sandwich (5/13)
Clubhouse Grille (5/13)
Four Cheese Grille (5/13)
Oriental Chicken Salad Rollup (5/13)
Roast Beef, Bacon & Mushroom Melt (5/13)
Sliders - Cheeseburger (5/13)
Turkey, Bacon & Avocado Sandwich (2/14)
9: U n d e r 550 C a l o r i e s & Weight Watchers®
(550) Napa Chicken & Portobellos (11/13)
(550) Savory Cedar Salmon (11/13)
(550) Signature Sirloin with Garlic Herb Shrimp (8/13)
WW Creamy Parmesan Chicken (2/12)
WW Lemon Parmesan Shrimp (11/12)
WW Roma Pepper Steak (11/13)
10:
11:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
1
2
3
4
5
6
Desserts
Apple Chimi Cheesecake (2/13)
Blue Ribbon Brownie (5/12)
Blue Ribbon Brownie Bite (5/13)
Chocolate Chip Cookie Sundae (11/13)
Maple Blondie (7/12)
Triple Chocolate Meltdown® - Manufactured by Alden (11/13)
Triple Chocolate Meltdown® - Manufactured by Lone Star (11/13)
Shooter - Chocolate Mousse (7/12)
Shooter - Hot Fudge Sundae (2/13)
Shooter - Strawberry Cheesecake (7/12)
1
2
3
4
5
6
7
8
9
10
Add-ons
Add-On Shrimp (Grilled or Fried) (8/12)
Baked Potato (Regular & Loaded) (5/13)
Chicken Tortilla Soup (11/12)
Chili (5/13)
Chili Cheese Fries Side (11/12)
Crispy Red Potatoes (5/13)
Fiesta Corn Chowder (5/13)
French Fries (Basket/Side) (11/12)
French Onion Soup (5/13)
Fruit Side (5/13)
Garlic Broccoli (5/13)
Garlic Mashed Potatoes - Regular and Loaded (5/13)
Seasonal Vegetables (5/13)
Side Vegetable #5 - Broccoli Crown (7/12)
Signature Cole Slaw Side (11/12)
Soup of the Day (5/13)
Toasted Garlic Bread - Ciabatta Breadstick (Basket/Side) (7/12)
Tuscan Bean Soup with Chicken & Sausage (5/13)
1
2
3
4
5
.6
7
8
9
10
11
12
13
14
15
16
17
18
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2014.2 PRESENTATION MANUAL
TOCPG.3
12:
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
Kid's
13:
Menu
Cheesy Bread Pizza (Full) (11/13)
Cheesy Bread Pizza (Half) (11/13)
Cheesy Grilled Chicken (11/13)
Chicken Grillers (11/13)
Chicken Mac n Cheese (11/13)
Chicken Tenders (11/13)
Corn Dog (11/13)
Fried Shrimp (11/13)
Grilled Cheese - Tuscan Bread (11/13)
Hot Dog (11/13)
Kraft Macaroni & Cheese (11/13)
Mini Cheeseburger (1) (11/13)
Mini Cheeseburgers (2) (11/13)
Quesadilla - Cheese (11/13)
Quesadilla - Chicken (11/13)
Steak 4 oz. (2/14)
Side - Apple Dippers with Yogurt (11/13)
Side - Baby Carrots & Ranch (11/13)
Side - Broccoli (11/13)
Side - Caesar Salad (11/13)
Side - French Fries (11/13)
Side - Garlic Mashed Potatoes (11/13)
Side - House Salad (2/14)
Side - Mozzarella Sticks (11/13)
Side - Squeeze Applesauce (11/13)
S i d e - V a n i l l a Yogurt with Strawberries (11/13)
Side - White Rice (11/13)
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2
3
4
5
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7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
Lunch
Lunch Combo Plating (5/13)
4-Cheese Mac with Honey Pepper Chicken Tenders (Lunch) (8/13)
American BLT (Lunch) (5/13)
Artisan Grilled Chicken Ciabatta - Lunch (2/14)
Caesar Salad (Lunch) (5/13)
Cajun Shrimp Pasta (Lunch) (5/13)
Chicken Fajita Rollup (Lunch) (12/10)
Chicken Tortilla Soup (Lunch) (2/13)
Chili (Lunch) (2/13)
Classic Turkey Breast Sandwich (Lunch) (5/13)
Clubhouse Grille (Lunch) (5/13)
Fiesta Chicken Chopped Salad (Lunch) (5/13)
Fiesta Chicken Chopped Salad (Bulk) (Lunch) (5/13)
Fiesta Corn Chowder (Lunch) (2/13)
Four Cheese Grille (Lunch) (5/13)
French Onion Soup (Lunch) (2/13)
Fried Chicken Salad (Lunch) (5/13)
Grilled Shrimp'N Spinach Salad (Lunch) (11/13)
Honey Pepper Chicken Tenders (Lunch) (8/13)
House Salad (Lunch) (5/13)
Lemon Shrimp Fettuccine (Lunch) (5/13)
Oriental Chicken Salad (Lunch) (5/13)
Roast Beef, Bacon & Mushroom Melt (Lunch) (5/13)
Santa Fe Chicken Salad (Lunch) (5/13)
Spinach Salad (Lunch) (5/13)
Three Cheese Chicken Penne Pasta (Lunch) (8/13)
Turkey, Bacon & Avocado Sandwich (Lunch) (2/14)
Tuscan Bean Soup with Chicken & Sausage (Lunch) (2/13)
2014.2 PRESENTATION M A N U A L
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5
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7
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28
TOCPG.4
w
Applebee's
Departments of Applebee's Services, Inc. The holder ofthis guide must return it on termination of employment.
8140 Ward Parkway
1: Fry
Avocado Handling & Pre Cut, Fresh (2/14)
Bagging and Portioning (5/13)
BBQ Bacon Ranch Dressing (11/12)
Beer Cheese Base (11/12)
Bruschetta Mix (10/09)
Chimichurri Sauce (2/12)
Chopped Red Peppers/Red Onions (4/09)
Chopped Roasted Apples (2/13)
Chopped Salad Mix (2/12)
Chunky Roma Pepper Relish (4/11)
Cilantro Lime Glaze (4/09)
Cinnamon Sugar (2/13)
Citrus Holding Mixture (4/09)
Cranberry Pecan Portioning (4/09)
Dessert - Blue Ribbon Brownie Prep (4/09)
Dessert - Cheesecake Pre-Set (4/09)
Dessert - Chocolate Chip Cookie Prep (4/09)
Dessert - Chocolate Mousse Pre-Set (4/09)
Dessert - Crumbled Graham Crackers (4/09)
Dessert - Ice Cream Portioning (4/09)
Dessert - Maple Pecan Blondie Prep (5/12)
Dessert - Strawberry Sauce (4/09)
Fiesta Chicken Chopped Salad Veg Mix Bulk (11/12)
Fish & Chips Breading (Hand-Breaded) (4/09)
Fish & Chips Breading Procedure (12/09)
Fish & Chips Dry Seasoned Batter Mix (Hand-Battered) (4/09)
Fish & Chips Seasoned Flour (Hand-Breaded) (10/09)
Fish & Chips Wet Batter (Hand-Battered) (4/09)
Granny Smith Apple Prep (4/09)
Granny Smith Apple Wedges (11/13)
Grape Tomato Halves (5/13)
Guacamole (4/10)
Hot Bacon Vinaigrette Holding (4/09)
Jalapeno Dressing (2/12)
Lettuce Wedges (5/13)
Oriental Salad Mix (4/09)
Pico de Gallo (5/12)
Potato Soak (12/10)
Pre-Packaged Hot Fudge Holding (4/11)
Red Potato Chunks (1" x 1") (8/12)
Salad Mix (8/10)
Sauces Portioning (5/13)
Sliced Strawberry Prep (7/12)
Spinach Prep (10/09)
Steak Quesadilla Tower Prep (11/12)
Tri-Color Corn Tortilla Strips (4/09)
Twirled Potatoes (12/10)
White Corn Tortilla Chip Cooking (2/13)
Whole Head Romaine (4/09)
Wing Blanching (4/09)
Wing Blanching (Alternative Steamer Method) (4/11)
Wonton Shell (12/09)
2014.2 RECIPE M A N U A L
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2
3
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5
6
7
8
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10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
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42
43
44
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46
47
48
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50
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T O C PG. 1
2: Mid
Alfredo & Cheese (11/10)
Artichoke Spread (11/13)
Asian Vegetable Set (6/11)
Bok Choy Prep (6/10)
Broccoli Sets (4/09)
Cajun Alfredo Sauce (2/11)
1
2
3
4
5
6
Chili (11/12)
7
Chipotle Lime Salsa (8/10)
Chopped Cilantro (6/10)
Club Set (5/13)
Corn & Vegetables (2/12)
Crushed Croutons (10/09)
Diced Pasta Vegetables (2/11)
Four Cheese Mac Sauce (8/13)
French Onion Soup Crouton (5/12)
Fresh Portobello Slices (11/10)
Garlic Broccoli Sets (2/14)
Garlic Thyme Spread - Half Portion (2/11)
Garlic Thyme Spread Heating (8/10)
Gremolata (7/12)
High Volume Alfredo - Hot Hold (7/12)
Iceberg Lettuce Cups for Garden (4/09)
Kosher Salt & Pepper Seasoning (6/10)
Parmesan Topping (4/09)
Pre-Scooping Burger Prep (11/12)
Quesadilla Filling (12/09)
Queso Dip (8/10)
Roasted Garlic Alfredo Sauce (8/12)
Rough Chopped Artichokes (7/12)
Sandwich Romaine (3"x 4") (5/13)
Sauteed Diced Onions (4/09)
Seasoned Onions (2/13)
Seasoned Peppers (2/13)
Shaved Ribeye Portion (5/12)
Shaved Ribeye for Towers (11/12)
Side Vegetable #1 (11/10)
Side Vegetable #2(11/10)
Side Vegetable #3(11/10)
Side Vegetable #4 (11/10)
Side Vegetable #5 (Broccoli Crown) & Broccoli Florets (11/10)
Signature Cole Slaw (2/13)
S l a w - D r y Mix (7/09)
Smoky Mayo (5/13)
Spinach & Artichoke Dip Prep (4/09)
Three Cheese Blend (5/13)
Turkey, Oven Roasted - Handling (5/13)
Vegetable Set for Tortilla Soup (11/12)
White Queso Dip (8/12)
Zucchini Slicing (2/12)
,
^
2014.2 RECIPE MANUAL
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9
10
11
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27
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.
TOC P G . F ]
3 : 6 ^
^ ^ G ^ o M ^ o a d e ^ ^
(550)PortoôCap^^
App^wood Smoked B a o o o H a o ^ o g ^ ^
Applewood Smoked Baooo P r e p ^ t )
AuJos-New^^
Baby Baok Rib Preppiog (Cooked by M a o o ^ o t o r e ^ ^ O ^
Baby Baok Rib Rreppiog (Raw) ( ^ 1 )
Baby Baok Rib Sea5ooiog(12^9)
BaoooRieoe5Heatiog(^1)
Baked Rotato Hot Hoidiog(HotWeii) (^09)
Baked Rotate R r e p ( M i o r o w a v e - ^ 2 o r 3 p o t a t o e ^ (6^1)
BakedRotatoRrep(Cve^(4^
Baked RotatoRrep(Steamer) (4/09)
Braising Liquid tor C o o k i o g R i b i e t s - N e w (5/13)
Chiokeo C ^ i o g - S t r i p s (2/14)
Chopped Rarsiey (3/10)
Combo Baby Back Ribs Cutting^Rortioning (4/09)
Country Cravy Mix (4/09)
Crumbs^Rarsiey(2/13)
OioedCriiiedCbioken(2/12)
Fajita Marinated Steaks (5/10)
Creen Bean Side (5/13)
CriiiedAsparagus (11/13)
CriiiedChioken Breast Rrep (12/09)
Criiied Red Cnions (5/13)
HaitRrotein Cutting (2/12)
HoagieCutting(10/09)
House Sidoin Steak Rre Cooking (2/10)
LowVoiume Heating and Handling ot Soup (2/12)
MaoSauee(2/10)
Rarmesan Cream Riee Set (11/13)
Rasta Cooking (3/13)
Rasta Cooking, Cavatappi (3/13)
Rotatoes-BoiiedNew(4/09)
Rotatoes-Cariio Mashed (2/12)
Rotatoes-CariioMashed-HotHoid(2/12)
Rotatoes-Steamed New(5/10)
Rre-CookedRibietsHandiing/Thawing(4/09)
Rrimavera Vegetable Set (2/14)
Red Wine Mushrooms (2/12)
Riblet Rreparation-Applewood (Raw) (5/13)
Rioe-AlmondRioeRilat(4/11)
Rioe-MexiRiee(4/11)
Rioe-WhiteRioe(4/11)
Signature S a u o e - S o r a t o h (11/12)
Spioy Asian Chioken (12/09)
Spring Vegetables(11/13)
FeguilaAvooadoOressing(11/13)
Whisky Cnions and Mushrooms (2/13)
4^ W e i g h t
^
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t2
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Watched
W W ^ ( 5 5 0 ) Portioning (2/14)
W W B i a e k B e a n ^ C o r n Salsa (4/09)
W W C a r i i o Herb Sauoe (2/13)
W W Herbed Potatoes (4/09)
W W Pineapple Wedge Cutting (4/09)
W W Potato Portion(11/13)
W W Sauteed Side Vegetable(11/12)
^©2014Apê^s^RNAôî^
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2014.2 REOIPEMANUA^
TCCpo.3
5: S O P
A P P B Standards - Line Check & Shelf Life (2/14)
A P P B Standards - Slicing, Dicing and Wedging (5/13)
Chill Bag Procedure (4/08)
Flash Heating (7/12)
H a n d l i n g - B r e a d (5/13)
Handling - Chicken Breast (4/09)
Handling - Fresh Cilantro (4/09)
Handling - Fresh Ground Beef (4/09)
Handling - Frozen Ground Beef for Chili (2/12)
Handling - Packaged Ribeye & Strip (4/09)
Handling - Packaged Steak (7/12)
Handling - Raw Rib (10/09)
Handling - Seafood (5/13)
H a n d l i n g - W h o l e Fruit, Vegetables and Mushrooms (7/12)
Heating Procedures for Hot Products in a Steamer (2/13)
Hot Well Set Up & Shut Down (4/09)
Ice Water Bath (7/12)
Lime & Lemon Zest - S O P (5/13)
Job Aid - Burger Cooking (11/12)
Job A i d - G r i l l i n g (7/12)
Job Aid - Properly Cooked Pasta (11/12).
Job Aid - Seasoning Chart (7/12)
Job Aid - Shrimp Grilling (5/13)
Job Aid - Steak Blooming & Sorting (11/12)
Job Aid - Steak Doneness (11/12)
Soup Heating & Handling (2/12)
Squeeze Bottles (5/13)
Prep Sink Cleaning & Sanitizing (10/05)
Template - Expediter Line Check
Template - Freezer Pull
T e m p l a t e - L i n e Check
6:
:
1-6
7-12
13
14
15
16
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26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
Reference
3 Tong Set-Up & Procedure (4/08)
Bacon Cooking Job Aid (6/11)
Baked Potato Cooking Chart (9/07)
Chill Bags Best Demonstrated Practices (4/10)
LDIRTS Labeling Process (12/09)
Measurement Conversion Chart (9/03)
Skillet Cleaning Job Aid (6/10)
Skillet Heating Job Aid (5/13)
©2014 A P P L E B E E ' S INTERNATIONAL, INC.
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2014.2 R E C I P E M A N U A L
T O C PG. 4
w
Applebee's
Departments ofApplebee's Services, Inc. The holder of this guide must return it on termination of employment.
8140 Ward Parkway
Page(s)
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Chart
Should be posted here:
Meat Temping Chart (7/12)
Expediter Soup Garnish List (2/13)
To Go "Rules of Thumb" (5/13) (Eng/Sp)
Handling Procedure for Fresh Cut Produce (4/06) (Eng/Sp)
Fry Chart (2/14) (Eng/Sp)
Microwave Chart (2/14) (Eng/Sp)
Grill Chart (2/14) (Eng/Sp)
Temperatures for Food Safety (8/12) (Eng/Sp)
©2014 APPLEBEE'S INTERNATIONAL, INC.
2014.2 CHART
PACKAGE
Line, Expo (2 copies)
Expo
Walk-In Door
Fry Station
Line (3 copies)
Broil Station
TOC P G . 1
Restaurant
Operations Manual
Applebee's
8140 Ward Parkway
©2014 Applebee's International, Inc. All rights reserved.
R e s t a u r a n t O p e r a t i o n s M a n u a l | Table of Contents
Applct)CCS*
1: S a f e t y a n d S e c u r i t y
First Aid and Emergency Information
Burn Safety
Cut Prevention
Broken Glass
Slip Zones
Guest Safety
Opening and Closing the Restaurant
Door Security
Robbery
Trash Removal
1
2
3
4
5
6-7
8-9
10
11-12
13
2: Personal Hygiene/Food Safety
Hand Washing
Personal Hygiene
Food Handler Gloves
Illness Reporting and Exclusion
Time and Temperature
Prevent Cross Contamination
Eating and Drinking
1-2
3-4
5-6
7-8
9-11
12
13
3: S e a t i n g
Greeting the Guest - Door
Proper Station Rotation
Wait List
Large Parties
Seating Guests
Pre-Bus Tables
Two-Minute Table Turn
Thanking Guests
Host Area Opening
Host Area Closing
1
2
3-4
4
5-6
7
8
9
10
11
LEMEMn O/tdMtitLffl&Wt
1.2014 | P a g e 1
&
Applghotfr
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4: S e r v i c e
Basic Service Steps
10-Point Station Check
Food Sensitivities/Allergens/Consumer Advisory
Responsible Service of Alcohol (RSOA)
Telephone Calls
Processing Orders
Serving Beverages
Serving Food
Guest Birthdays
Guest Complaints/LA.S.T
Wrapping Leftovers
Check Delivery
Guest Survey Invitations
Gift Cards
Bar Guest Tab
Transfer a Check
Manual Check Writing
Roll Silverware..
Service Opening
Service Closing
1-5
6
7
8-9
10
11
12-13
14-15
16
17
18
19-20
21
22-23
23
24
24
25
26
26
5 : C a r s i d e T o Go®
Basic Service Steps - Carside Specialist
Accurate Quote Time
Carside To Go® Safety
Carside Area Opening
Carside Area Closing
1-3
4
5
6
6
6: B e v e r a g e P r o d u c t i o n
Garnishes
Glassware and Straws
Beverage Recipes
Beverage Preparation Order
Liquor Portions
1
2-4
5
6
7
Beer
Wine
8-9
10
Bar Set Up
Bar Line Check
Bar Engagement
Daily Bar Log
Consolidated Issues Log
Bar Area Opening
1.2014
| Page 2
11-16
17
18
19
20
21
LEAQNIHG < W B E l f l E l # R 3 E N T
a
| Table of Contents
Bar Area Shift Change
Bar Area Pre-Closing
Bar Area Closing
Applebee's
22
23
24
7: F o o d P r o d u c t i o n
Receiving Deliveries
Food Storage
Produce Washing
Preparing Cold Food
Freezer Pull
Thawing Food
Prep Sheet
Scales
Waste Control
Cooling Food
Holding Food
Reheating Food
Hot Food Hot/Cold Food Cold
Line Check
Expedite Orders
Kitchen Display System (KDS)
Manual Ticket Process
Fire Up/Fire Down Equipment
Kitchen Opening
Kitchen Closing
Expo Area Opening
Expo Area Closing
1-3
4-6
7
7
8
9-10
11
12
13
14-16
17
18
19
20
21
22-25
26
26
27-28
29-30
31
31
8: F a c i l i t y / C l e a n i n g
Cleaning and Sanitizing
Chemicals
Flatware and Cooking Utensils
Food/Non-Food C o n t a c t S u r f a c e s
Counters/Stainless Steel Prep Tables/Hot Windows
Kitchen Ceiling TilesAfents/Diffusers/Wal Is/She Ives
Shrouds/Cold Rails
Three Compartment Sink
Pest Control
LEAQfMG /WDE#EIJQPRnIEMT
1-2
3-4
5
6-8
9-11
12-13
1.2014 | Page 3
m
R e s t a u r a n t O p e r a t i o n s M a n u a l | Table of Contents
Applebees
14-35
Line Equipment
Line Refrigeration Unit/Reach-In/Lowboy
Heat Lamps
Cutting Boards and Chef Boards
Microwave Ovens
Hot Well
Skillets
Wooden Underliners for Skillets
Can Openers
Pots and Pans
Scales
Vegetable Cutter/Chopper/Slicer
Bag Sealer
Steamer
Bake Ovens
Grill (Charbroiler)
Range Hoods
Hood Filters (Removable)
Bun Toaster
Flattop Grill (Griddle)
Cheese Welter
Deep Fryers
Fry Bin/Fried Food Holder/Fry Warmers
Warming/Chip Drawer
Ice Cream Freezer
General Kitchen, Prep and G U
Dish Machine
Dish Machine - High Temperature
Dish Machine - Low Temperature
Dish Washing
Walk-in Cooler/Beer Cooler/Freezer
36-45
Prep Sink
Hand Sinks
Rubber Floor Mats
Tile Floors
Trash Cans/Mop Buckets
46-51
Expo Front Line
Coffee Decanters - Glass
Coffee Machines
Ice Machines
Iced Tea Machines
Soda Dispenser
52-66
Dining R o o m
Brass and Chrome
Menus
Wood Surfaces
Tables
Chairs/Barstools
High Chairs/Booster Seats
Booth/Benches
Hanging Lights
Pictures/Artifacts
Table Top Caddies/Menu Marketing Materials
Windows/Blinds
Walls
Rails
Ceiling Tiles/Vents
Floors/Carpets/Drains
TVs and Music System
POS Terminals/Printers
Telephones/Phone Book
67-76
Bar
Bar Glass Washing Machine
Bar Ice Bin
Blender
Frozen Drink Machine
Mug Chiller
Soft Serve Machine
Island Oasis Machine
Soda Gun
Spindle Mixer
77-80
Restrooms
Restrooms
Restroom Checklist
Restroom Countertops
Restroom Mirrors
Toilet Bowls and Urinals
81-87
Exterior
Landscaping
Awning
Benches
Doors
Signage
1.2014 | P a g e 4
Lights
Rain Gutters
Building Exterior
Back Dock Dumpster Area
Parking Lot/Concrete Patio/Sidewalks
LEABNING ^//OEVELOPMENT
a"
9: Shift
| Table of Contents
Applebee's
Management
Food Safety
Ambiance
Floor Plans
Labor Card
Engaged with Guests
Guest Recovery
Critical Path
Responsible Service of Alcohol (RSOA)
Crash Kit
Shift Communication
Food Pars
'.
Prep List
Line Check
Kitchen/Dining Room Communication
Product Orders
Physical Inventory
Sensitive Item Inventory
Freezer Pull
Beer/Wine Liquor Order
Daily Liquor Perpetual
Liquor Inventory
Bar and Carside Drawer
Licenses/Permits/Posters
Ansul System/Fire Extinguishers
Charts/Job Aids
Point of Purchase (POP) Materials
Team Member Check Out
Manager Opening
Manager Shift Change
Manager Closing
©2014 Applebee's International. Inc.
LEflfiMIftG M d W t l i W f M U T
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2-3
3
4
5
6
7
8-9
10-11
12-13
14
14
15-16
17
18
19
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20
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22
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23
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25
26
27
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29
1.2014 | P a g e 5
Team Member Training Program
Process Guide
Tab 1 - Overview
Tab 2 - Neighborhood Expert Training Camp Leader's Guide
Neighborhood Expert Training Camp Participant Guide
Tab 3 - Neighborhood Expert Assessment
Tab 4 - Team Member Training
Applebee's
MROG
M a n a g e r ' s Restaurant
Opening Guide
Manager's Restaurant Opening Guide
Applebee's
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Table of Contents
mHVtt&tig-
Overview
Keys to Success
Opening Day Criteria
Operations Readiness
Operations Readiness Checklist
Contact Worksheet
Acronyms used in this Guide
GM's Checklist GM's Checklist
How to Begin
^
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J
-
i
^
5
6
7
8
9-10
11
12
13-21
*
Administration Task Details and Best Practices
22-31
Facility ,
" Hiring
Task Details and Best Practices
32-35
36-41
Marketing
42-44
Pre-Training
45-47
Vendors
48-50
3.2013
Page 3
Applebee's Brand Assessment
Evaluation Guide
January 2014
Created by and for
H
Applebees
The standards set forth in this Evaluation Guide are not intended to be comprehensive and
do not contemplate every scenario. The overall guiding principles set forth must be used
in conjunction with good judgment and discretion appropriate for each situation.
For updates or revisions, please contact:
Sandy Hamilton
January 2014
[email protected]
Table of Contents
ABA Section
Sub-Section
Page
Hospitality
Host/Hostess Behaviors
Server Behaviors
Bartender Behaviors
Carside/To Go Behaviors
Cook Behaviors
Manager Behaviors
Performance
GEM
Expo
ABA Activity
Guest ASI Contacts
Administration
Neighborhood Expert/MOD
Administration
Neighborhood Expert Certification
Exterior
Dining Room
Restrooms
Bar
Beverage Area
Line Equipment
Dish Area
Walk-In Refrigeration
Serv Safe Certification
Chemicals, Handling & Storage
Ware Washing
Wiping Cloth Sanitizer
Team Hygiene & Health
Bare Hand Contact
Time & Temperature
Cross Contamination
Cold Holding
Hot Holding
Food Items
New Items
Beverage items
Dessert Items
WW & Under 550 Items
2
2
4
5
6
7
9
10
11
11
12
12
15
16
16
18
20
25
25
26
27
30
30
31
31
31
32
32
33
34
34
35
35
37
37
38
39
40
Management Effectiveness
Training
Facilities & Maintenance
Food Safety
Food & Beverage Quality
January 2014
EXHIBIT H
LIST OF FRANCHISEES AND FRANCHISE OUTLETS
EXHIBIT H
LIST OF F R A N C H I S E E S A N D FRANCHISE OUTLETS
As of December 31, 2013, the franchisees listed below had a Franchise Agreement for each of the
outlets identified in the United States.
AIG TN Holding, L L C
Andy Patel
1503 Belvedere Road
West Palm Beach, Florida 33406
(561)242-4907
209 West Service Road, West Memphis, Arkansas 72301 (870) 735-4029
105 Potomac Boulevard, Mt. Vernon, Illinois 62864 (618) 244-7510
1125 East Main, Carbondale, Illinois 62901 (618) 529-5715
2712 West DeYoung Street, Marion, Illinois 62959 (618) 997-9436
120 North Central Street, West City, Illinois 62812 (618) 435-3023
3990 Hinkleville Road, Paducah, Kentucky 42003 (270) 575-3675
816 North 12 Street, Murray, Kentucky 42071 (270) 759-5551
7515 Goodman Road, Olive Branch, Mississippi 38654 (662) 893-7555
1931 West Jackson Avenue, Oxford, Mississippi 38655 (662) 234-2308
710 Desoto Cove, Horn Lake, Mississippi 38637 (662) 772-5914
202 South Broadview, Cape Girardeau, Missouri 63703 (573) 334-6830
1260 South Main, Sikeston, Missouri 63801 (573) 472-3111
930 South Westwood Boulevard, Poplar Bluff, Missouri 63901 (573) 785-0163
1101 West Reelfoot Avenue, Union City, Tennessee 38261 (731) 886-0085
2700 Lake Road, Dyersburg, Tennessee 38261 (731) 287-1607
2114 Union Avenue, Memphis, Tennessee 38104 (901) 725-7136
2890 Bartlett Road, Bartlett, Tennessee 38134 (901) 213-5034
8572 Highway 51, Millington, Tennessee 38053 (901) 872-4444
1571 Sycamore View, Bartlett, Tennessee 38134 (901) 377-3973
1617 US Highway 51 South, Covington, Tennessee (901) 475-0666
155 Stonebrook Place, Jackson, Tennessee 38305 (731) 256-7277
1220 Paris Road, Mayfield, Kentucky 42066 (270) 804-4303
th
A p p l e of North Alabama, Inc.
Fred W. Gustin
601 Vestavia Parkway, Suite 1000
Birmingham, Alabama 35216
(205) 824-5060
Outlets:
579 Brookwood Village, Homewood, Alabama 35209 (205) 879-5673
3028 S. Memorial Parkway, Huntsville, Alabama 35805 (256) 881-8111
1700 Rainbow Drive, Gadsden, Alabama 35901 (256) 546-7774
62 McFarland Boulevard, Northport, Alabama 35476 (205) 345-4505
2041-A Beltline Road S.W., Decatur, Alabama 35601 (256) 340-0114
302 Hughes Road, Madison, Alabama 35758 (256) 772-3441
3001 Carter Hill Road, Montgomery, Alabama 36111 (334) 264-9064
360 Cahaba Valley Road, Pelham, Alabama 35124 (205) 982-1022
1917 Cobbs Ford Road, Prattville, Alabama 36066 (334) 361-8899
3195 Taylor Road, Montgomery, Alabama 36116 (334) 274-0009
2271 Florence Boulevard, Florence, Alabama 35630 (256) 764-7644
5050 Academy Drive, Bessemer, Alabama 35022 (205) 424-5255
4711 Norell Drive, Trussville, Alabama 35173 (205) 661-0718
1331 Highway 72 East, Athens, Alabama 35611 (256) 233-4430
1701 McFarland Boulevard East, #187, Tuscaloosa, Alabama 35404 (205) 633-0900
11950 Highway 431 South, Guntersville, Alabama 35976 (256) 878-9903
3150 Memorial Parkway N.W., Huntsville, Alabama 35810 (256) 859-4200
2933 John Hawkins Parkway, Hoover, Alabama 35244 (205) 444-1102
6601 Atlanta Highway, Montgomery, Alabama 36117 (334) 396-0500
1600 Huffman Road, Center Point, Alabama 35215 (205) 853-3200
2246 Bessemer Road, Birmingham, Alabama 35207 (205) 451-1031
1250 Boots Boulevard, Fultondale, Alabama 35043 (205) 380-8282
Apple A B Enterprises, Inc.
Joseph K. Wong
930 Executive Way, Suite 200
Redding, California 96002
(530) 222-1311
Outlets:
1801 Hilltop Drive, Redding, California 96002 (530) 221-1888
2030 Business Lane, Chico, California 95928 (530) 343-6888
1388 Biddle Road, Medford, Oregon 97504 (541) 770-1188
2750 Campus Drive, Klamath Falls, Oregon 97601 (541) 850-1080
3197C Highway 97, Bend, Oregon 97701 (541) 318-5720
2846 Broadway, Eureka, California 95501 (707) 269-0533
250 NE Agnes Avenue, Grants Pass, Oregon 97526 (541) 956-8652
1201 Airport Park Boulevard, Ukiah, California 95481 (707) 462-7010
220 Antelope Boulevard, Red Bluff, California 96080 (530) 527-6164
3807 Southwest 2 1 Street, Redmond, Oregon 97756 (541) 923-4777
2160 Feather River Boulevard, Oroville, California 95965 (530) 534-4500
st
Apple American Group L L C
Gregory G. Flynn
6200 Oak Tree Blvd., Suite 250
Independence, Ohio 44131
(216) 525-2775
Outlets:
909 N. DuPont Highway, Dover, Delaware 19901 (302) 741-2292
900 Churchman Road, Christiana, Delaware 19713 (302) 454-9277
630 Suburban Drive, Newark, Delaware 19711 (302) 738-7230
880 Berlin Road, Voorhees, New Jersey 08043 (856) 627-6667
700 Consumer Square, Mays Landing, New Jersey 08330 (609) 383-9290
3849 Delsea Drive, Vineland, New Jersey 08360 (856) 825-3435
1850 Deptford Center Drive, Deptford, New Jersey 08096 (856) 232-0093
3800 Black Horse Pike, Turnersville, New Jersey 08012 (856) 740-3610
2018 Burlington/Mount Holly Road, Westampton, New Jersey 08060 (609) 265-1616
5046 W. Pike Plaza, Indianapolis, Indiana 46254 (317) 290-1940
1436 W. 86th Street, Indianapolis, Indiana 46260 (317) 872-4470
1072 Broad Ripple Avenue, Indianapolis, Indiana 46220 (317) 255-4839
2415 Sagamore Parkway South, Lafayette, Indiana 47905 (765) 448-1999
1251 U.S. 31 North, Greenwood, Indiana 46142 (317) 888-0744
1900 25th Street, Columbus, Indiana 47201 (812) 372-4381
14711 U.S. 31 North, Carmel, Indiana 46032 (317) 571-8780
1423 W. McGalliard Road, Muncie, Indiana 47304 (765) 284-7008
1129 N. Baldwin, Marion, Indiana 46952 (765) 664-7763
1922 E. 53rd Street, Anderson, Indiana 46013 (765) 642-7763
3720 S. Reed Road, Kokomo, Indiana 46902 (765) 455-2090
2894 East 3rd Street, Bloomington, Indiana 47407 (812) 336-9147
5664 Crawfordsville Road, Speedway, Indiana 46224 (317) 247-8222
700 N. Morton Street, Franklin, Indiana 46131 (317) 736-1991
8310 East 96th, Fishers, Indiana 46038 (317) 570-0803
109 S. Memorial Drive, New Castle, Indiana 47362 (765) 521-4275
2659 E. Main Street, Plainfield, Indiana 46168 (317) 838-0650
1516 S. Washington Street, Crawfordsville, Indiana 47933 (765) 361-8711
7345 E. Washington Street, Indianapolis, Indiana 46219 (317) 375-9007
3009 Northwestern Avenue, West Lafayette, Indiana 47906 (765) 463-0308
17801 Foundation Drive, Noblesville, Indiana 46060 (317) 776-4630
101 Lee Boulevard, Shelbyville, Indiana 46176(317) 398-1581
1792 North State Street, Greenfield, Indiana 46140 (317) 462-3004
3326 East Market Street, Logansport, Indiana 46947 (219) 732-1599
2 Whittington Drive, Brownsburg, Indiana 46112 (317) 858-0291
5658 Mayfield Road, Lyndhurst, Ohio 44124 (440) 646-1540
5010 Great Northern Plaza North, North Olmstead, Ohio 44070 (440) 779-0200
4981 Dressier Road, North Canton, Ohio 44718 (330) 492-3900
508 Howe Avenue, Cuyahoga Falls, Ohio 44221 (330) 928-1500
6871 Pearl Road, Middleburg Heights, Ohio 44130 (440) 845-8900
3989 Burbank Road, Wooster, Ohio 44691 (330) 345-8900
9174 Mentor Avenue, Mentor, Ohio 44060 (440) 974-3777
1023 North Lexington-Springmill Road, Mansfield, Ohio 44906 (419) 747-5300
6140 S O M Center Road, Solon, Ohio 44139 (4440) 248-2226
7159 Macedonia Commons Boulevard, Macedonia, Ohio 44056 (330) 467-3600
4800 Ridge Road, Brooklyn, Ohio 44144 (216) 351-9001
5503 Milan Road, Sandusky, Ohio 44870 (419) 627-2777
1540 West River Road, Elyria, Ohio 44035 (440) 324-1700
4115 Pearl Street, Medina, Ohio 44256 (330) 723-2311
411 Northfield Road, Bedford, Ohio 44146 (440) 232-7557
233 Graff Road S.E., New Philadelphia, Ohio 44663 (330) 308-5530
17771 South Park Center, Strongsville, Ohio 44136 (440) 572-5292
4296 Kent Road, Stow, Ohio 44224 (330) 688-6818
3938 Medina Road, Akron, Ohio 44333 (330) 666-2247
1020 High Street, Wadsworth, Ohio 44281 (330) 335-6767
2033 Crocker Road, Westlake, Ohio 44145 (440) 250-2111
2600 West State Street, Alliance, Ohio 44601 (330) 829-1700
2250 Claremont Avenue, Ashland, Ohio 44805 (419) 207-9088
2897 South Arlington Road, Akron, Ohio 44312 (330) 644-5303
32 Massillon Marketplace Drive SW, Massillon, Ohio 44647 (330) 834-3083
3241 North Ridge Road East, Ashtabula, OH 44004 (440) 998-1411
1801 South 320 Avenue, Federal Way, Washington 98003 (253) 839-2828
th
4626 196th Street S.W., Lynnwood, Washington 98036 (425) 672-2626
806 S.E. Everett Mall Way, Everett, Washington 98208 (425) 514-8300
3510 South Meridian, Puyallup, Washington 98373 (253) 840-4000
17790 Southcenter Parkway, Tukwila, Washington 98188 (206) 575-4700
1919 South 72nd Street, Tacoma, Washington 98408 (253) 471-1900
1300-A North Miller Street, Wenatchee, Washington 98801 (509) 667-0707
3138 N.W. Randall Way, Silverdale, Washington 98383 (360) 308-8000
525 Sleater Kinney Road, Lacey, Washington 98503 (360) 491-9400
3520 Factoria Boulevard S E , Bellevue, Washington 98006 (425) 603-0099
1069 East Sunset Drive, Bellingham, Washington 98226 (360) 671-6000
47 South White Horse Pike, Hammonton, New Jersey 08037 (609) 704-8001
105 Wilton Boulevard, New Castle, Delaware 19720 (302) 322-8202
1200 S R 303, Streetsboro, Ohio 44241 (330) 422-1560
13856 Bellevue-Redmond Road, Bellevue, Washington 98005 (425) 603-9696
10680 Enterprise Drive, Camby, Indiana 46113 (317) 821-0890
188 Cascade Mall Drive, Burlington, Washington 98233 (360) 757-1414
2432 East Wabash Street, Frankfort, Indiana 46041 (765) 659-2909
4191 Rockside Road, Independence, Ohio 44131 (216) 328-0376
2480 Pulaski Highway, Glasgow, Delaware 19702 (302) 836-8700
14020 Cedar Road, University Heights, Ohio 44118 (216) 382-0941
10325 North Michigan Road, Carmel, Indiana 46032 (317) 876-1679
10655 Pendleton Pike, Lawrence, Indiana 46236 (317) 826-8209
108 Haddonfield Road, Cherry Hill, New Jersey 08002 (856) 663-5008
129 North Michigan Avenue, Atlantic City, New Jersey 08401 (609) 345-7323
22916 Bothell-Everett Highway, Bothell, Washington 98021 (425) 488-7755
874 South State Road 135, Greenwood, Indiana 46143 (317) 885-6631
10407 Gravelly Lake Drive, Lakewood, Washington 98499 (253) 983-8884
4110 South Dupont Highway, Camden, Delaware 19934 (302) 697-3033
1639 Center Square Road, Swedesboro, New Jersey 08085 (856) 467-4156
1600 Rocky Run Parkway, Wilmington, Delaware 19803 (302) 479-5207
1421 Town Center Boulevard, Suite B-10, Brunswick, Ohio 44212 (330) 220-6189
17024 S.E. 2 7 2 Street, Covington, Washington 98042 (253) 856-1900
320 Dove Run Centre Boulevard, Middletown, Delaware 19709 (302) 449-0234
9430 192 Street East, Bonney Lake, Washington 98390 (253) 299-6464
2101 Greentree Road, Pittsburgh, Pennsylvania 15237 (312) 276-9166
4801 McKnight Road, North Hills Village Mall, Pittsburgh, Pennsylvania 15237 (412) 369-8419
1601 South BraddockAvenue, Pittsburgh, Pennsylvania15218 (412) 731-9782
2045 Lebanon Church Road, West Mifflin, Pennsylvania 15122 (412) 653-9437
4039 Washington Road, McMurray, Pennsylvania 15317 (412) 942-4870
425 Galleria Drive, Johnstown, Pennsylvania 15904 (814) 269-4500
3440 William Penn Highway, Pittsburgh, Pennsylvania 15235 (412) 823-3363
1065 Van Voorhis Road, Morgantown, West Virginia 26505 (304) 599-3733
110 Logan Valley Road, Altoona, Pennsylvania 16602 (814) 941-7171
1004 Trinity Circle, Washington, Pennsylvania 15301 (724) 229-7020
6570 Steubenville Pike, Robinson Township, Pennsylvania 15205 (412) 494-9331
1685 Route 228, Cranberry, Pennsylvania 16066 (724) 742-8668
12 Colonnade Way, State College, Pennsylvania 16803 (814) 235-3890
130 River Road, Sequim, Washington 98382 (360) 683-9090
3528 Hudson Drive, Stow, Ohio 44224 (330) 926-1096
850 Chippewa Town Centre Drive, Beaver Falls, Pennsylvania 15010 (724) 857-2660
1441 "D" Street N.E., Auburn, Washington 98002 (253) 804-6800
nd
nd
3 ^ 0 S ^ R o ^ ^ O a k H a ^
3^60e^R08ÂVOÔ^
^ O W e s t Niohol5on Road, Audubon, New Jersey 08106 ( ^
8110 Eest 8 2 ^ ^ e e t B n d i a n e p o ^ I n d i e s 4 6 2 5 0 ^ ^ ^
1870 Northwest Louisiana Avenue, C b e b ^ i s , Washington 98^^^
8944 Orodhead Road, Monaoa,Pennsyivania 15081 (724)728 0781
2500 Capital MaiiOnveSW,Oiympia, Washington 98502 (880) 8 5 2 8 ^ ^
8702 88^ Street NE,Marysviiie, Washington 98270 (880) 851-8800
2250 Santa Rosa Avenue, Santa Rosa, Caiitornia 95407 (707) 578 0552
5801 Did Redwood Highway, Retaiuma,Caiitornia 94954 (707) 792 0500
8050 Northgate Mali, San Rataei,Caiitornia 94908 (415)472 7828
885 Hopper Avenue, Santa Rosa, Oaiitornia 95408 (707) 525 0552
195 Sosooi Avenue, Napa, Caiitornia 94559 (707) 224 0502
501 RohnertRarkExpresswav,RohnertRark,Caiitornia 94928 (707) 208 0880
419NorthBroadway,Rennsviiie, New Jersey 08070 (858) 299 7100
875 South GradyWay, Ronton, Washington 98058 8225(425) 887 1200
220Taiimadge Road, Kent, Ohio44240 (880) 878 2408
51 Bethei Road, Sobers Roint, New Jersey 08244 (809) 858 2270
145 Stander Avenue, Manstieid,Ohio44908 (419) 758 9808
18518State Route 181 East, Ruyaiiup, Washington 98878 (258) 770 7800
455 Cross Keys Road, Siokierviiie, New Jersey08081 (858)728 8874
1050ViiiageCenterOrive,Tarentum,Pennsylvania 15084(724)274 5019
9888 E a s t U S 8 8 , A v o n , l n d i a n a 4 8 1 2 8 (817) 209 1892
110CountrysideRlaza,lVltRleasant, Pennsylvania 15888 (714) 547 8102
22298 StateHighway88,Clarion,Pennsylvania 18214 (814) 228 7590
25 Southland Orive,Pairmont, West Virginia 28554 (804) 888 4411
102WalmartOrive,Uniontown,Pennsylvania 15401 (724)484 2501
525 Orandview Crossing Orive,Gihsonia, Pennsylvania 15044 (724) 449 8222
4820 Leavitt Road, Lorain, Ohio44058(440) 2824442
8401 Steelyard Orive, Cleveland, Ohio 44109 (218) 881 8758
9225VistaWay,Oartield Heights, Ohio44125 (218) 888 4880
5710 184^ P l a o e S E , Everett, Washington 98208(425) 887-8242
48849 Bosoell Road, Premont, California 94588 (510) 228 0202
4801 Kirkwood Highway, Wilmington, Oelaware 19808 (802) 995 1828
9150 8rooksRoadSouth,Windsor, California 95492 (707)888 0842
107 PletoherRarkway, El Cajon, California 92020 (819) 598 8088
9480 EastMira Mesa Boulevard, San Oiego, California 92128 (858) 578 8280
7877 Balboa Avenue, San Oiego, California 92111 (858)589 4554
1218AutoParkWay,Esoondido, California 92029 (780)748 8812
2508 Jamaoha, El Cajon, California 92019(819) 870 7208
8080 Plaza Bonita Road, National City, California 91950 (819) 475 1855
2148VistaWay,Ooeanside, California 92054 ((780) 757 5848
8987 LakeTahoeBoulevard, South Lake Tahoe, California 98150 (580) 544 2118
82175 Highway 79, Temeoula, California 92592 (951) 508 7852
18279 Brookhurst Street, Fountain Valley, California 92708 (714) 988 1885
1288 West Imperial Highway,LaHabra, California 90881 (582)890 0779
4070 East Highland Avenue, Highland, California 92848 (909)425 9020
2048 Redlands Boulevard, Redlands, California 92878 (909) 885 7872
8820 Mulberry,Riverside, California 92508 (951)689 7447
521 North MoKinley, Corona, California 91719 (951) 871 1995
8956 0randAvenue,Chino, California 91710(909) 590 7844
10709 F o o ^ B ^ e v ^
12044 Amaôsa Road, V i ^ ^
1021 North MônAvonue,0âho,Caôm^
573 Grand Avenuo, San Maroon Caômia 92069 (760)7444328
2516Wo5tôndaAvonuo,Homot,Gaôrnia92546(951) 791-2606
7610HazardGontorOnvo,Sô407,San
24872 Madison Avonuo,Morhota,California 92662 (961)8941846
12875 LimonitoAvonuo,MiraLorna, California 91762 (951380 8637
16867 SiorraLakosRarkway,North Montana, California 92836 (909) 854 1008
12600 OaySfroof,MoronoValloy, California 92553 (951)413 1418
19201 BoarValloy Road, ApploValloy, California 92308 (760) 240 9195
693 North MoCarran Boulevard, Sparks, Nevada 89431 (775) 358 5811
500 North Nellis Boulevard, Las Vegas, Nevada 89110 (702)452 7155
699 NorthStephanie, Henderson,Nevada 89014(702) 433 6339
3340 SouthMarvland, Las Vegas, Nevada 89109 (702) 737 4990
3300 South Carson Sfreef, Carson Cifv,Nevada 89701 (775)882 0222
3501 SoufhRainhow, Las Vegas, Nevada 89108 (702) 220 3070
2070 North Rainbow Boulevard, Las Vegas, Nevada 89108 (702) 648 1065
4805 KiefzkeLane, Reno, Nevada 89509 (775) 825 2800
820 EastWarmSpringsRoad, Las Vegas, Nevada 89119(702) 837 8733
1635WesfCraig Road, North Las Vegas, Nevada 89030 (702) 657 6483
10305 South Eastern Avenue, Henderson,Nevada 89012(702) 990 8646
8730WestCharlestonBoulevard,Las Vegas, Nevada 89117(702) 9466104
5010SouthRortApaohe Road, Las Vegas, Nevada 89148 (702) 221 1081
4605WestCharleston Boulevard, Las Vegas, Nevada 89102 (702) 870 5973
39720 North 10th StreetWest,Ralmdale, California 93550 (661)947 7520
500 Butler Commons, Butler,Rennsylvania 16001 (724)256 8782
1041Admiral Callaghan Lane, Vallejo, California 94591 (707) 558 0824
9105EStookton Boulevard,Elk Grove, California 95624 (916)685 0321
2170 Golden Centre Lane, Gold Rlver,California 95670 (916)635 1234
160 NutTreeRarkway,Vaoaville, California 95688 (707)452 1167
2442WestKettleman Lane, Lodi, California 95240(209) 369 8857
2659WestMaroh Lane, Stockton, California 95207 (209) 641 9880
3601 Truxel, Sacramento, California 95833 (916) 928 8488
2024 Arden Way, Sacramento, California 95825 (707) 899 0798
1350Travis Road, Rairtield, California 94533 (580) 823 8663
2500 Bell Road, Auburn, California 95603 (530) 822 9566
1000 Tharp Road, Yuba City, California 95998(580) 747 0414
1715ResearchOrive,Oavis, California 95616(530) 668 8282
1790 East Main Street, Woodland, California 95776 (530)668 8282
8281 Coach Lane, Cameron Rark, California 95682 (530) 677 8677
9255 North Winnetka Avenue, Chatsworth, California 91311 (818) 885-6519
3605Tower Avenue, Superior, Wisconsin 54880 (715) 395 8480
2303 Highway 25 North, Menomonie, Wisconsin 54751 (715)233 3086
2201 Coolee Road, Hudson, Wisconsin 54016(715) 377 0741
2901 OeckerOrive, Rice Lake, Wisconsin 54868 (715) 736 0500
1400 Brookdale Mall, Brooklyn Ctr,Minnesota 55430 (768) 568 1003
7901^SouthtownCenter,Bloomington,Minnesota 55420 (952) 881 8845
2152 BurnsvilleCenter,Burnsville, Minnesota 55837 (952) 435 2545
4208 Winnetka Avenue North, New Hope, Minnesota 55428 (788) 533-1870
8421 JoinerWay, Eden Rralrie, Minnesota 55344 (952) 942 7993
105 Northtown Drive NE, Blaine, Minnesota 55434 (763) 784-8086
7901 Brooklyn Boulevard, Brooklyn Park, Minnesota 55443 (763) 424-2730
7250 Valley Creek Plaza, Woodbury, Minnesota 55125 (651) 731-8321
320 Apache Mall, Rochester, Minnesota 55902 (507) 252-0155
1335 Town Centre Drive, Eagan, Minnesota 55122 (651) 686-7022
1600 Miller Trunk Highway, Miller Hill Mall #H-13, Duluth, Minnesota 55811 (218) 723-1253
1900 Adams Street, Mankato, Minnesota 56001 (507) 386-1010
1018 Meadowlands Road, White Bear Township, Minnesota 55127 (651)429-9789
4190 West Division Street, St. Cloud, Minnesota 56301 (320) 251-8686
3470 129 Avenue N.W., Coon Rapids, Minnesota 55448 (763) 576-9267
13625 60 Street North, Oak Park Heights, Minnesota 55082 (651) 439-8116
14400 Weaver Lake Road, Maple Grove, Minnesota 55311 (763) 494-3289
690 West Bridge Street, Owatonna, Minnesota 55060 (507) 451-0006
8332 Highway 7, St. Louis Park, Minnesota 55426 (952) 933-6701
2000 Vermillion, Hastings, Minnesota 55033 (651) 438-8604
590 West 79 Street, Chanhassen, Minnesota 55317 (952) 949-9190
1893 West Highway 36, Roseville, Minnesota 55113 (651) 697-0648
18891 Freeport Street N.W. Elk River, Minnesota 55330 (763) 441-8301
5855 Blaine Avenue, Inver Grove Heights, Minnesota 55077 (651) 451-9029
9601 Lyndale Avenue, Bloomington, Minnesota 55420 (952) 948-0010
3500 Vicksburg Lane #100, Plymouth, Minnesota 55447 (763) 553-1776
1404 18 Avenue, Austin, Minnesota 55912 (507) 433-4240
1305 Highway 15 South, Hutchinson, Minnesota 55350 (320) 587-2331
14678 Cedar Avenue, Apple Valley, Minnesota 55124 (952) 997-3919
1510 East College Drive, Marshall, Minnesota 56258 (507) 532-0080
2901 South 1 Street, Willmar, Minnesota 56201 (320) 214-8816
1006 Highway 55, Buffalo, Minnesota 55313 (763) 682-2326
1568 Vierling Drive, Shakopee, Minnesota 55379 (952) 233-3400
3794 Marketplace Drive NW, Rochester, Minnesota 55901 (507) 280-6626
335 12 Street SW, Forest Lake, Minnesota 55025 (651) 464-6778
2740 Bridge Avenue, Albert Lea, Minnesota 56007 (507) 373-0380
4345 Pheasant Ridge Drive, #202, Blaine, Minnesota 55449 (763) 786-2677
1909 Paul Bunyan Drive NW, Bemidji, Minnesota 56601 (218) 444-2038
15240 Dellwood, Baxter, Minnesota 56425 (218) 833-1400
2433 Highway 3 South, Northfield, Minnesota 55057 (507) 645-8955
8380 East Point Douglas Road, Cottage Grove, Minnesota 55016 (651) 458-5837
2840 South Highway 169, Grand Rapids, Minnesota 55744 (218) 326-8878
615 Washington Avenue S.E., Minneapolis, Minnesota 55414 (612) 378-3740
156 Tyler Road North, Red Wing, Minnesota 55066 (651) 388-3388
410 20 South Street, New Ulm, Minnesota 56073 (507) 359-2775
18404 Kenrick Avenue, Lakeville, Minnesota 55044 (952) 892-1991
14425 Highway 13, Savage, Minnesota 55378 (952) 226-5890
125 Balsam Street North, Cambridge, Minnesota 55008 (763) 689-9600
15015 Cimmaron Avenue, Rosemount, Minnesota 55068 (651) 423-0544
21753 South Diamond Lake Road, Rogers, Minnesota 55374 (763) 428-4065
5277 Central Avenue N.E., Fridley, Minnesota 55421 (763) 571-8501
1753 South Robert Street, St. Paul, Minnesota 55118 (651) 457-0530
2800 39 Avenue N.E., St. Anthony, Minnesota 55421 (612) 781-5274
1405 Highway 33 South, Cloquet, Minnesota 55720 (218) 879-4790
10150 Hudson Road, Suite 164, Woodbury, Minnesota 55125 (651) 739-9520
1370 Babcock Boulevard, Delano, Minnesota 55328 (763) 972-9992
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9386 Deegan Avenue, Monticello, Minnesota 55362 (763) 295-6337
25422 104 Avenue S E , Kent, Washington 98030 (253) 520-3888
291 West Ventura Boulevard, Camahllo, California 93010 (805) 445-7160
377 North Citrus Avenue, Azusa, California 91702 (626) 334-5103
711 Evesham Road, Suites 6-7, Somerdale, New Jersey 08083 (856) 627-7193
3300 Wilmington Road, New Castle, Pennsylvania 16105 (724-598-6280
977 Magill Drive, North Huntingdon, Pennsylvania 15642 (724) 863-2053
35055 Maple Grove Road, Willoughby, Ohio 44094 (440) 942-8740
4827 Point Fosdick Drive NW, Gig Harbor, Washington 98335 (253) 858-1872
3819 Bridgeport Way West, University Place, Washington 98466 (253) 566-5968
2770 Taylor Street, San Francisco, California 94133 (415) 749-9025
610 Palomar Street, Chula Vista, California 91911 (619) 585-4453
Signal Hill Shopping Center, 899 East Spring Street, Signal Hill, California 90755 (562) 426-6723
2800 North Main Street, Santa Ana, California 92705 (657) 212-6701
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Apple American Group II, L L C
Gregory G. Flynn
6200 Oak Tree Blvd., Suite 250
Independence, Ohio 44131
(216) 525-2775
Outlets:
599 Center Street, Auburn, Maine 04210 (207) 784-3986
718 Hogan Road, Bangor, Maine 04401 (207) 990-5945
11 Gurnet Road, Brunswick, Maine 04011 (207) 721-9920
1072 Brighton Avenue, Portland, Maine 04101 (207) 791-2810
251 Kennedy Memorial Drive, Waterville, Maine 04901 (207) 872-6702
200-240 Running Hill Road, South Portland, Maine 04106 (207) 879-9155
136 Western Avenue, Augusta, Maine 04330 (207) 623-8255
1 Amato Drive, Windham, Maine 04062 (207) 892-3574
550 Alfred Street, Biddeford, Maine 04005(207) 282-8603
1364 Main Street, Sanford, Maine 04073 (207) 324-5259
194 New County Road, Thomaston, Maine 04861 (207) 594-7078
311 Plymouth Avenue, Fall River, Massachusetts 02721 (508) 675-1110
85 Main Street, Tewksbury, Massachusetts 01876 (978) 858-0418
251 North Main Street, Leominster, Massachusetts 01453 (978) 466-9223
100 Westgate Center Drive, Hadley, Massachusetts 01035 (413) 253-5799
555 Hubbard Street, Pittsfield, Massachusetts 01201 (413) 499-5157
105 Highland Avenue, Seekonk, Massachusetts 02771 (508) 336-6412
91 Medway Road #1, Milford, Massachusetts 01757 (508) 478-9523
441 East Main Street, Westfield, Massachusetts 01085 (413) 564-0343
900 South Washington Street, North Attleboro, Massachusetts 02760 (508) 643-4660
50 Independence Way, Danvers, Massachusetts 01923 (978) 777-5447
680 Southbridge Street, Auburn, Massachusetts 01501 (508) 721-7817
632 Park Avenue, Worcester, Massachusetts 01603 (508) 363-3032
222 Washington Street, Hudson, Massachusetts 01749 (978) 567-1997
120 Charlton Road, Sturbridge, Massachusetts 01566 (508) 347-0174
200 Hancock Street, Quincy, Massachusetts 02169 (617) 328-9443
141 Mohawk Trail, Greenfield, Massachusetts 01301 (413) 772-0079
214 Broadway, Saugus, Massachusetts 01906 (781) 231-0137
2 Elm Street, Woburn, Massachusetts 01801 (781) 933-3079
5 6 ^ 8 ^ 0 W n R 0 ^ ^
BOWo^he^Rrovidenoe^
990 R ^ d e n c e H ^ h w ^
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899 Cape Highway R a y o h a m M ^ a ^ ^ s 92767 ( 5 9 ^ 8 ^
69 0 ^ m ^ R o a ^ C ^ m 8 ^
690 State Read North, North O a r t m o ^ M a 5 s a o h u 5 e ^ 9 2 7 4 7 (808) 997^8^^
597 Memorial Onve,Chioopee,Ma88aohu5etts 01020(418) 698 0184
South Bay Shopping O e n t e ^ l l A A ^ t a t e Road,Ooroheste^Massaohuse^
1849 Boston Road, Spnngtieid,Maâohu5etts 01119(418) 796 8188
24 Settlers Green Orive, North Conway,New Hampshire 08860 (608) 856 9600
260 Loudon Road, SteeplegateMall,Conoord, New Hampshire 08801 (608)224 6600
14 Manchester Road ( R t 2 8 ) , O e r r y , N e w Hampshire 08088 (808) 482 5600
1464WoodhuryAvenue, Portsmouth, New Hampshire 08801 (608)488 7400
4 0 K e y R o a d , K e e n e , New Hampshire 08481 (608) 855 6800
75 Laoonia Road, Tllton, New Hampshire 08276 (608) 286 8844
280 Rlalntleld Road, West Lebanon, New Hampshire08784 (608) 298 8698
879AmherstStreet, Nashua, New Hampshire 08088 (608) 886 9292
581 Second Street, Manchester, New Hampshire 08102 (608) 641 1000
542 LatayetteRoad,Seahrook, New Hampshire 08874(608) 474 2009
1278 HooksettRoad,Hooksett, New Hampshire 08106 (608) 827 8000
282 Indian Brook Orive,Oover,New Hampshire 08820 (608)742 5707
582 Meadow Street, Littleton, New Hampshire 08581 (608)444 1796
7 R r e s h R i v e r R o a d , E p p i n g , N e w Hampshire 08042 (608)879 2827
80 Centre Orive,Rlattshurgh,NewYork 12901 (518) 566 9607
24 Midway Road,Garden City Shopping Center, Cranston, Rhode Island 02920(401)948 1989
800 GuakerLane,Cowesett Corner Shopping Center, Warwick, Rhode Island 02886(401)828 8181
1855 Diamond Hill Road,Diamond Hill Rlaza,Woonsocket, Rhode Island 02895 (401)767 1010
446 RutmanRike,Smithtield,Rhode Island 02828(401)949 1044
8 4 9 W e s t M a i n R o a d , Middletown, Rhode Island 02842 (401) 849 5676
880 Centre ot New England Boulevard,Coventry,Rhode Island 02816(401)826 0057
15CommonCornersWay, South Kingstown, Rhode Island 02879 (401) 782 4578
CrossroadsShoppingCenter,224RostRoad,Westerly, Rhode Island 02891 (401)822 2045
155 Dorset Street, University Mall, South Burlington, Vermont 05408 (802) 862 2818
225 WoodstockAvenue, Rutland, Vermont05702 (802)747 7700
218RaineTurnpike North,Berlin,Vermont 05602 (802) 229 2228
685 NorthLltahAvenue, Idaho Ralls, Idaho 88402 (208) 528 8985
1587 Blue Lake Boulevard, Twin Ralls, Idaho 88891 (208)785 0451
1411Bench Road, Rocatello, Idaho 88201 (208) 687 0185
7845 West Emerald, Boise, Idaho 88704 (208) 878 1890
1527 Caldwell Boulevard, Nampa, Idaho 88651 (208) 461 5880
1480 North Eagle Road, Meridian, ldaho88642 (208) 855 0848
2212 North Main, Roswell, New Mexico 88201 (515)627 9606
4246GerrillosRoad, Santa Re, New Mexico 87505 (505) 478 7551
4601 D E M a i n Street, Rarmington,New Mexico 87402 (505) 5990998
1855 South White Sands Avenue, Alamogordo, New Mexico 88819(505) 484 2618
5250SouthWadsworthBoulevard, Littleton, Colorado 80128 (808) 988 2280
4806 South GollegeAvenue,RtGollins, Colorado 80525 (970)225 1041
14091 East llift Avenue, Aurora, Colorado 80014(808)745 9897
8292 SouthLlniversityBoulevard, Littleton, Colorado 80122 (808) 770 8888
410SouthColoradoBoulevard, Glendale, Colorado 80222 (808) 888 0808
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100 West 104th Avenue, Northglenn, Colorado 80234 (303) 252-7422
9010 North Wadsworth Parkway, Westminster, Colorado 80021 (303) 431-9022
6405 West 120th Avenue, Broomfield, Colorado 80020 (303) 466-3848
1250 South Hover Road, Building 10-A, Longmont, Colorado 80501 (303) 684-9199
7625 Goddard Street, Colorado Springs, Colorado 80920 (719) 535-2799
297 East 120th Avenue, Thornton, Colorado 80233 (303) 451-1414
10625 West Colfax Avenue, Pueblo, Colorado 81008 (719) 542-2598
3708 East Galley, Colorado Springs, Colorado 80909 (719) 574-5111
5265 Wadsworth Boulevard, Arvada, Colorado 80002 (303) 421-1032
711 Horizon Drive, Grand Junction, Colorado 81502 (970) 256-0022
4100 West 10th Street, Greeley, Colorado 80634 (970) 346-9493
213 East 29th, Loveland, Colorado 80538 (970) 593-9655
495 Garden of the Gods Road, Colorado Springs, Colorado 80907 (719) 265-6605
16485 East 40th Circle, Aurora, Colorado 80011 (303) 371-4114
1078 Allen Street, Castle Rock, Colorado 80104 (303) 814-0230
800 Camino del Rio, Durango, Colorado 81301 (970) 259-5850
2521 Airport Thru way, Columbus, Georgia 31904
3117 Washington Road, Augusta, Georgia 30997 (706) 868-5445
3229 Gentian Boulevard, Columbus, Georgia 31907 (706) 563-6116
1627-34 Opelika Road, Auburn, Alabama 36830 (334) 887-7747
11120 Abercorn, Savannah, Georgia 31419 (912) 920-7966
314 Russell Parkway, Warner Robins, Georgia 31099 (478) 922-3838
4705 Highway 80, Savannah Island, Georgia 31410 (912) 898-9935
612 East Hamric Avenue, Oxford, Alabama 36203 (256) 835-2434
2574 Riverside Drive, Macon, Georgia 31203 (478) 741-0050
3652 Eisenhower, Macon, Georgia 31206 (478) 781-5555
2004 Veterans Boulevard, Dublin, Georgia 31021 (478) 275-9480
804 U.S. Highway 80 East, Statesboro, Georgia 30461 (912) 489-5656
5460 Augusta Road, Garden City, Georgia 31402 (912) 966-5030
100 Valley Drive, Perry, Georgia 31069 (478) 988-0076
106 Roberson Mill Road, Milledgeville, Georgia 31061 (912) 453-8355
2090 Highway 280/431, Phenix City, Alabama 36867 (334) 448-2500
505 North Belair Road, Evans, Georgia 30809 (706) 650-2009
922 South Fourth Avenue, Brighton, Colorado 80601 (720) 685-1095
1330 West Joe Harvey Boulevard, Hobbs, New Mexico 88240 (505) 392-7457
4001 West Northern Avenue, Pueblo, Colorado 81005 (719) 564-6090
7253 West State Street, Garden City, Idaho 83714 (208) 853-2330
4100 Ridge Rock Road, Rio Rancho, New Mexico 87124 (505) 994-3900
1560 West Maloney Avenue, Gallup, New Mexico 87301 (505) 726-0401
2125 Windsor Spring Road, Augusta, Georgia 30906 (706) 796-0717
516 East Llano Estacado Boulevard, Clovis, New Mexico 88101 (505) 742-1144
6428 South Highway 85/87, Fountain, Colorado 80817 (719) 391-9000
1492 East Oglethorpe Highway, Flemington, Georgia 31313 (912) 369-4999
1591 Oxbow Drive, Montrose, Colorado 81401 (970) 249-1214
587 Al Henderson Boulevard, Savannah, Georgia 31419 (912) 920-9199
975 University Boulevard, Rexburg, Idaho 83440 (208) 359-9922
2810 West Elder Street, Boise, Idaho 83705 (208) 344-5630
1220 N.W. 185th Avenue, Beaverton, Oregon 97006 (503) 699-8040
6325 S.W. Meadows Road, Lake Oswego, Oregon 97035 (503) 968-8040
1415 South Bradley, Santa Maria, California 93454 (805) 922-6633
280 West Hanley, Coeur D'Alene, Idaho 83814 (208) 762-1000
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805 Madonna R o a ^ San ^ 5
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1 ^ 7 E a 5 t Mission A v o n u o , S p o ^
747 L a n o a s t o r O n v o N E , S a i o m , O r e g o n 97801 (508) 5818040
808 North CoiumbiaOontor Boulevard, Konnowiok, Washington 99888 (509^
1 2 7 1 7 S E 2 n d C i r o l e , V a n o o u v e 4 W a s h i n g t o n 98884 (880) 944 8088
4007 29th Street, Spokane, Washington 99208 (509) 585^490
1489 N E H 8 i s e y , Portland, Oregon 97282 (508) 284 8040
1801 North Oavls Road, Salinas, Oalltornla 98901 (408)757 8882
10004 N E H a l s e y , Portland,Oregon 97220(508)408 8088
1 0 1 7 2 S E 8 2 n d Street, Olaokamas, Oregon 97288 (508) 775 7770
105WarBonnetOrlve, Moscow, Idaho 88848 (208) 888^821
2825 LihertyStreetNE, Salem, Oregon 97808 (508) 885 9518
2755 EdenhowerBoulevard,Rosehurg, Oregon 97470 (541)440 8712
5 1 1 1 N E 1 1 2 ^ Avenue, Vanoouver,Washington 98882 (880) 258 2298
818 NE 98^ Olrole,Vanoouver,Washlngton 98885 (880) 578 2188
9884 North Newport Highway, Spokane, Washington 99208 (509) 484 1888
8024 Gateway Street, Springfield,Oregon 97477 (541)744 1884
8559Tualatin Sherwood Road, Tualatin, Oregon 97082 (508) 885 0815
48 Oolumhla Point Orive, Richland,Washington 99852 (501)942 1518
5070 O o m m e r c i a l S t r e e t , S E , S u i t e 100, Salem, Oregon 97808(508) 884 1775
400TrlangleGenter,Longview, Washington 98882 (880)414 8989
489 N W B u r n s i d e Road,Oresham, Oregon 97080 (508) 888 2808
1505 East Washington Avenue, Onion Gap, Washington 98908 (509) 489 2114
1105 South Green Valley Road,Watsonvllle,Galitornla 95078 (881)728 7272
2285ThainGrade,Lewlston, Idaho 88501 (208)748 8000
1525 Geary S t r e e t S E , A l h a n y , Oregon 97821 (541) 928 9595
1804 Plaza Way, Walla Walla, Washington 99882 (509) 528 0075
5805 Road 88, Pasco, Washington 99801 (509) 548 7855
2841 TheaterOrive, Paso Rohles,Galltornla 98448 (805) 228 2988
1915NEPourAcreRlace,Gorvallls, Oregon 97880 (541)758 2204
15840 S E Happy ValleyTownGenterOrive,Glackamas, Oregon 97088 (508) 8588700
2800 W e s t H ^ A v e n u e , Eugene, Oregon 97402 (541) 888 7121
18008 NEHIghway99, Vancouver, Washington 98888 (880) 574 8004
1591 Main Street, Oxford, Maine04270 (207) 748 2178
4015Gateway Boulevard,Grovetown,Georgia 80818(708) 889 7795
1540 Main Street N W , L o s L u n a s , N e w Mexico 87081 (505) 8854748
821 West Central Avenue, Lompoc,Gallfornia 98488 (805) 785 2141
Apple A r k a n s a s ^ n c .
AlanSmith^JasonThomson
5120 Summerhill Road
Texarkana, Texas 75508
(908)794-8748
Outlets:
5110Summerhill Road,Texarkana,Texas 75508 (908) 792 9478
9088 Mansfleld Road,Shreveport, Louisiana 71118(818) 888 7285
8 8 1 8 R o g e r s A v e n u e , P t S m l t h , A r k a n s a s 72908 (501)452 4112
2128 Airline Orlve,Bossier Gity,Loulsiana 71111 (818)742 5484
4078 North College, Payettevllle, Arkansas 72708 (501)442 8841
1517BertKouns,Shreveport, Louisiana 71118(818) 795 9595
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2305 East End Boulevard South, Marshall, Texas 75670 (903) 938-8180
2133 North West Avenue, El Dorado, Arkansas 71730 (870) 881-9600
4911 Pecanland Mall Drive, Monroe, Louisiana 71203 (318) 398-7319
2300 Greenhill Road, Mt. Pleasant, Texas 75455 (903) 577-7234
3953 West Sunset Avenue, Springdale, Arkansas 72762 (479) 751-9844
297 North Service Road E, Ruston, Louisiana 71270 (318) 255-5254
4375 Dowlen Road, Beaumont, Texas 77706 (409) 347-0199
Apple By The Bay, Inc.
Ronald A. Caselli & Gene K. Caselli
999 West Taylor St., Suite D
San Jose, California 95126
(408) 534-0800
Outlets:
8200 Arroyo Circle, Gilroy, California 95020 (408) 848-5600
84 Ranch Drive, Milpitas, California 95035 (408) 263-3939
3900 Sisk Road, Modesto, California 95356 (209) 545-1046
2501 Fulkerth Road, Turlock, California 95380 (209) 656-7441
3060 North Naglee Road, Tracy, California 95376 (209) 834-0360
555 Saratoga Avenue, San Jose, California 95129 (408) 446-8370
851 Sanguinetti Road, Sonora, California 95370 (209) 533-9670
1272 E. Yosemite Avenue, Manteca, California 95337 (209) 824-4499
1734 West Olive Avenue, Merced, California 95348 (209) 724-9930
1135 Veterans Boulevard, Redwood City, California 94063 (650) 364-6849
2449 Claribel Road, Riverbank, California 95367 (209) 863-9780
51 Curtner Avenue, San Jose, California 95125 (408) 295-7150
Apple Central, L L C
Bill Georgas & Trevor Ganshaw
9 Greenwich Office Park
Greenwich, CT 06831
(203) 987-6162
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528 North 4 7 Street, Rogers, Arkansas 72756 (479) 936-8989
5100 East Morgan, Evansville, Indiana 47715 (812) 471-0942
5727 Pearl Drive, Evansville, Indiana 47712 (812) 426-2006
2506 South Third Street, Terre Haute, Indiana 47802 (812) 232-2661
609 Kimmel Road, Vincennes, Indiana 47591 (812) 882-4333
4223 Mannheim Road, Jasper, Indiana 47546 (812) 481-2838
1820 West Broadway, Princeton, Indiana 47670 (812) 386-8426
1950 Fort Harrison Road, Terre Haute, Indiana 47804 (812) 466-6535
5120 Frederica, Owensboro, Kentucky 42301 (270) 926-3472
1475 Chelsa Drive, Madisonville, Kentucky 42431 (270) 825-8866
1950 US Highway 41 North, Henderson, Kentucky 42420 (270) 826-9427
2520 South Iowa, Lawrence, Kansas 66046 (785) 832-8338
2340 South Oak Street, Ottawa, Kansas 66067 (785) 242-2297
3900 West 6 Street, Lawrence, Kansas 66049 (785) 312-9856
1301 Kansas Drive, Paola, Kansas 66071 (913) 294-2702
2802 North Broadway, Pittsburg, Kansas 66762 (620) 231-3331
255 East Cooper, Warrensburg, Missouri 64093 (660) 747-1683
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700 South Kansas Avenue, Clinton, Missouri 64735 (660) 885-7414
1195 South Cherokee Drive, Marshall, Missouri 65340 (660) 886-2749
1855 E. Primrose, Springfield, Missouri 65804 (417) 883-4700
2010 I-70 Drive S.W., Columbia, Missouri 65203 (573) 445-5759
1836 West Highway 76, Branson, Missouri 65616 (417) 336-5053
2825 E. 3 2 Street, Joplin, Missouri 64808 (417) 659-8686
2319 Missouri Boulevard, Jefferson City, Missouri 65109 (573) 636-6368
2430 North Glenstone, Springfield, Missouri 65803 (417) 863-2200
380 S. Jefferson Avenue, Lebanon, Missouri 65536 (417) 532-0808
412 North Old Wilderness Road, Nixa, Missouri 65714 (417) 724-2100
4040 Highway 54, Osage Beach, Missouri 65065 (573) 348-9595
2691 East Broadway, Columbia, Missouri 65201 (573) 442-3640
2301 Vintage Court, Excelsior Springs, Missouri 64024 (816) 637-2498
500 Business 36, Chillicothe, Missouri 64601 (660) 707-1222
3320 West Broadway, Sedalia, Missouri 65301 (660) 827-9910
2401 Rock Haven Road, Harrisonville, Missouri 64701 (816) 887-2288
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A p p l e Core Enterprises, Inc.
Myron Thompson
P.O. Box 969
Minot, North Dakota 58702
(701) 838-2822
Outlets:
2302 15 Street, S.W., Minot, North Dakota 58701 (701) 839-2130
434 South 3 , Bismarck, North Dakota 58501 (701) 222-1018
2851 S. Columbia Road, Grand Forks, North Dakota 58201 (701) 795-5688
2800 13 Avenue S.W., Fargo, North Dakota 58103 (701) 232-4100
289 15 Street, West, Dickinson, North Dakota 58601 (701) 227-8573
3101 S. Fourth Avenue, Yuma, Arizona 85364 (928) 344-3374
32400 Date Palm Drive, Cathedral City, California 92234 (760) 324-6911
6 26 Street West, Williston, North Dakota 58801 (701) 572-4769
71740 Highway 111, Rancho Mirage, California 92270 (760) 674-0761
1101 16 Street East, Yuma, Arizona 85364 (928) 782-7474
3200 North 14 Street, Bismarck, North Dakota 58501 (701) 255-0200
605 Kennedy Park Road, Fergus Falls, Minnesota 56537 (218) 998-4745
611 2 5 Street Southwest, Jamestown, North Dakota 58401 (701) 952-7753
2505 Scaroni Road, Calexico, California 92231 (760) 768-1649
2421 North Cottonwood, El Centre, California 92243 (760) 353-8311
74999 Frank Sinatra Drive, Palm Desert, California 92211 (760) 346-5722
11274 South Fortuna Road, Yuma, Arizona 85367 (928) 305-9200
57796 29 Palms Highway, Yucca Valley, California 92284 (760) 365-2900
1585 East 6 Street, Beaumont, California 92223 (951) 845-3638
2001 16 Street North, Fargo, North Dakota 58102 (701) 293-0249
45305 Seeley Drive, La Quinta, California 92253 (760) 345-9222
2350 4 5 Street South, Fargo, North Dakota 58104 (701) 356-9495
1640 East 13 Avenue, West Fargo, North Dakota 58078 (701) 433-0114
509 Highway 2 East, Devils Lake, North Dakota 58301 (701) 544-1444
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Apple c o r p ^ L ^
OavidK Rolph
1877 North Rook Road
W o h i t ^ Kansas 87208
(818)888 2811
Oôts:
8801 Universe Avenue, Cedar RallsBowa 88818(819) 288 1814
108 Chestnut, AmesBowa 50010(818) 288 8452
8888 ^moreAvenue,Oavenport, Iowa 52807 (819) 855 9848
11410Rorest,Cllve, Iowa 50825 (515) 222 9474
8891 S E 14th Street, West Oes Moines,Iowa 50815(515) 287 8822
808 Collins Road, Cedar Rapids, Iowa 52402 (819) 898 9595
8900 M e r l e H a y R o a d , O e s Moines, Iowa 50810(515) 254 9880
1001 EastRlrst Street, Ankeny,lowa 50021 (515)985 8444
880541stAvenue,Mollne,llllnols81285 (809) 797 9282
8920 East Lincoln Way, Sterling, Illinois 81081 (815) 585 0528
808Cleveland,Musoatlne, Iowa 52781 (819) 282 0215
8101 SouthCenterStreet,Marshalltown, Iowa 50158 (515) 758 7755
28105thAvenueSouth,RortOodge, Iowa 50501 (515)578 7881
2414LlnoolnWav, Clinton, Iowa 52782 (819) 242 0279
8008 R o o r t h S t r e e t , S W , M a s o n C l t y , l o w a 50401 (515) 841 0028
200 12th Avenue Center,Coralvllle, Iowa 52241 (819)858 1988
1855AssoolatesOrlve,Ouhuque, Iowa 52002 (819) 588 8181
8741 8^ Street Southwest, Altoona, Iowa 50009 (515) 957 0100
2845 Edgewood Road, Cedar Rapids, Iowa 52404 (819) 898 8787
1808 Vaughn Orlve,Ottumwa,Iowa 52501 (841)888 1711
2780 Crossroads Boulevard, Waterloo, Iowa 50702 (819) 287 4700
8005WestKlmherlyRoad,Oavenport, Iowa 52808 (588) 445 8848
8190 Mills CIvloRarkway, West Oe Moines, Iowa 50288 (515) 225-8848
25004^ Street SW,Waverly,lowa 50877 (819) 852 9241
1800WashlngtonStreet,Rella, Iowa 50219(841)820-8888
Apple East, Ino.
EdwlnR Sohelhel,Jr ^ C y n t h l a H Sohelhel
IMaxeyRondRoad
Nantucket, Massachusetts 02554
(508) 825 7848
Cutlets:
5 7 R e d e r a l R o a d , O a n h u ^ , Connecticut 08810(208) 790 7090
Apple Rood Service o t N e w Y o r k , L L C
Edward W Ooherty
7Rearl Court
Allendale, New Jersey 07401
(201)818 4889
Cutlets:
988 South Broadway,Hlcksvllle,NewYork 11801 (518)982 8780
Veterans Hlghway^Smlthtown Avenue,Bohemia, NewYork 11718(518) 981 5090
1^
2660 Sunshine Highway, Bellmore, New York 11710 (516) 783-9014
1985 Jericho Turnpike, New Hyde Park, New York 11040 (516) 326-8730
2550 Sunrise Highway, East Islip, New York 11730 (516) 224-1912
1935 North Ocean Avenue, Farmingville, New York 11738 (631) 758-0081
3145 Middle Country Road, Lake Grove, New York 11755 (631) 467-2445
360 Walt Whitman Road, Huntington Station, New York 11746 (631) 427-3504
200 Airport Plaza, Farmingdale, New York 11735 (631) 845-5201
1832 Old Country Road, Riverhead, New York 11901 (631) 369-3500
1126 Green Acres Mall, Valley Stream, New York 11581 (516) 872-7200
105 Veterans Memorial Highway, Commack, New York 11725 (631) 858-2500
600-A North Wellwood Avenue, Lindenhurst, New York 11757 (631) 226-2200
253-01 Rockaway Boulevard, Rosedale, New York 11422 (516) 792-0100
1251 Deer Park Avenue, North Babylon, New York 11703 (631)242-7575
355 Route 25A, Miller Place, New York 11764 (631) 473-0008
1300 Corporate Drive, Westbury, New York 11590 (516) 832-7700
499 North Service Road, Patchogue, New York 11772 (631) 207-5900
684 Sunrise Highway, Baldwin, New York 11510(516) 442-0580
300 Motor Parkway, Brentwood, New York 11717 (631) 231-4190
855 Montauk Highway, Shirley, New York 11967 (631) 399-7220
1710 Hempstead Turnpike, Elmont, New York 11003 (516) 775-1377
Apple Gold, Inc.
Michael D. Olander
170 Wind Chime Court
Raleigh, North Carolina 27615
(919) 846-2577
Outlets:
476 Western Boulevard, Jacksonville, North Carolina 28540 (919) 347-6011
1120 North Wesleyan Boulevard, Rocky Mount, North Carolina 27804 (919) 972-4619
3103 Garden Road, Burlington, North Carolina 27215 (919) 584-3344
202 Southwest Greenville Boulevard, Greenville, North Carolina 27834 (919) 355-2421
9616 East Independence Boulevard, Matthews, North Carolina 28105 (704) 845-1599
3625 Hillsborough Street, Raleigh, North Carolina 27607 (919) 832-3811
19921 Carolina Place Parkway, Pineville, North Carolina 28134 (704) 544-0034
4406 West Wendover Avenue, Greensboro, North Carolina 27410 (910) 299-5565
2180 Highway 70 S.E., Hickory, North Carolina 28602 (704) 328-1000
1115 Glenway Drive, Statesville, North Carolina 28677 (704) 838-0053
901 North Spence Avenue, Goldsboro, North Carolina 27534 (919) 751-5800
8700 J. W. Clay, Charlotte, North Carolina 28262 (704) 548-9219
3200 Battleground Avenue, Greensboro, North Carolina 27401 (910) 282-7100
2239 West Roosevelt Boulevard, Monroe, North Carolina 28110 (704) 282-0933
5120 New Center Drive, Wilmington, North Carolina 28403 (910) 350-6955
1990 Griffin Road, Winston-Salem, North Carolina 27103 (910) 768-8847
1493 North Sand Hills Boulevard, Aberdeen, North Carolina 28315 (910) 944-7422
1240 U.S. Highway 29 North, Concord, North Carolina 28025 (704) 795-6005
3400 Clairndon Boulevard, New Bern, North Carolina 28561 (252) 637-8050
2300 Forest Hills Road, Wilson, North Carolina 27893 (919) 399-0504
501 East Six Forks Road, Raleigh, North Carolina 27609 (919) 856-9030
2702 Raeford Road, Fayetteville, North Carolina 28303 (910) 485-0250
1165 Highway 70, Garner, North Carolina 27529 (919) 661-9505
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205
Road, S a ^ ^
ÔRiporSônO^
1 9 5 1 ^ 0 Road, R a y o ^ ^ o , North C a r i n a 2 8 ^ 4 ^
3528 East R r a n ^ 8 o ^ o v a r d , G a ^ o n i a , North Carolina 2 8 0 5 5 ^ ^
4590 North RattorsonAvonuo,Winston Salom, North Carolina 27105 (88^^
5184Hlghway70Wost,Morohoad, North Carolina28557 (252) 727 0409
1250 North 8hghtloatBouiovard,Smlthtioid, North Carolina2757
1909 AHighway421,North Wiikoshoro, North Carolina 28859 (888) 888 8588
5 1 7 N C 2 4 2 7 8 ^ a 8 8 E a s t , A l h o m a r i o , North Carolina 28001 (704) 985 0925
71 RlazaRarkway, Lexington, North Carolina 27292 (888) 248 4488
488 Earl Road, Sholhy,North Carolina 28150 (704)484 9222
187NormanStation8oulovard,Moorosvillo, North Carolina 28117(704) 799 8515
11805 Retail Orivo, Wake Rorost, North Carolina 27587 (919)488 0101
8885 John Gordon Lane, High Roint, North Carolina 27255 (888) 841 8910
8701 Brier Creek Rarkway,Raleigh,North Carolina 27517(919) 544 9771
5710SouthTryon Street, Charlotte, NorthCarolina 28278 (704) 588 7878
8018Conoord Mills Boulevard,Conoord, North Carolina 28027 (704) 979 1190
4488Highway70West,Kinston, North Carolina 28501 (252) 288 0882
2088 Blowing Rook Road, Boone, North Carolina 28807 (828) 252 1185
210 Premier Boulevard, Roanoke Rapids, North Carolina 27870 (252) 808 1284
1825 RlazaBoulevard,Bantord, North Carolina 27880 (919) 775 8881
1480 North Main Street, Ruquay Varina, North Carolina 27525 (919) 552 1521
5810AllegaovWay,Clemmons, North Carolina27012(885) 712 1058
8509 Knightdale Boulevard, Knightdale, North Carolina 27545 (919) 255-5989
7881 TargetCirole, Raleigh, North Carolina 17818 (919) 872 2401
1118Newpointe Boulevard,Leland,North Carolina 28451 (910) 871 8815
7810Good Middling Orive,Rayetteville, North Carolina 28804 (910)480 8800
5158 NC Highway 42 West, Garner,North Carolina 27529 (919)852 7281
5840 MoRarlandOrive, Durham, North Carolina 27707 (919)402 9482
Apple Hospitality Group, L L C
MarkL Dillon
10980WRotterRoad
Wauwatosa, Wisconsin 58225
(414)285-5100
Cutlets:
2500 North MaytairRoad,Wauwatosa, Wisconsin 58225(414)478 4771
20101 West Bluemound Road, Brooktield, Wisconsin 58188 (252) 821-1500
5100 South 75th Street, Greendale, Wisconsin 58129 (414) 428 8018
5810 North Bayshore Drive, #R110, Glendale, Wisconsin 58217(414) 988 0100
880 South WhitneyWay,Madison, Wisconsin 58711 (505) 271-5450
4710 EastTowne Boulevard,Madison,Wisconsin 58708((808) 244 1470
8780 West CollegeAvenue,Appleton, Wisconsin 54911 (920) 954 8050
990 Hansen Road, Ashwauhenon, Wisconsin 54804 (920) 495 9095
2521 South Greenhay Road, Racine, Wisconsin 58405 (252) 554 0905
8950 75th Street, Kenosha, Wisconsin 58142 (252) 942 7190
1700 South Koeller Road, Gshkosh, Wisconsin 54901 (920) 281 8770
2420 EastMasonStreet, Green Bay, Wisconsin 54802 (920) 405 8141
4485 CalumetAvenue,Manitowoc, Wisconsin 54220 (920) 584 1702
841WestJohnson Street, Rond Do Lac, Wisconsin 54985 (920) 922-1809
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2510 West Washington, West Bend, Wisconsin 53095 (262) 306-1068
3040 East College Avenue, East Appleton, Wisconsin 54915 (929) 954-8771
526 South Taylor Drive, Sheboygan, Wisconsin 53081 (920) 208-8253
W180N9469 Premier Lane, Menomonee Falls, Wisconsin 53051 (262) 250-0896
1267 Capital Drive, Pewaukee, Wisconsin 53072 (262) 691-2060
7135 South 13 Street, Oak Creek, Wisconsin 53154 (414) 570-0519
15505 West Rockridge Road, New Berlin, Wisconsin 53151 (262) 780-0693
2410 Roosevelt Road, Marinette, Wisconsin 54143 (715) 732-1023
9080 North Green Bay Road, Brown Deer, Wisconsin 53209 (414) 434-2270
2865 South 108 Street, West Allis, Wisconsin 53214 (414) 327-7830
275 West Wisconsin Avenue, #1040, Milwaukee, Wisconsin 53203 (414) 347-9125
340 Highway 13, Wisconsin Dells, Wisconsin 53965 (608) 254-6900
4311 8 Street South, Wisconsin Rapids, Wisconsin 54494 (715) 421-3290
1512 South Church Street, Watertown, Wisconsin 53094 (920) 261-0239
1738 North Spring Street, Beaver Dam, Wisconsin 53916 (920) 356-0417
3100 Golf Road, Delafield, Wisconsin 53018 (262) 646-2174
270 West Holt Avenue, Milwaukee, Wisconsin 53207 (414) 489-0874
6750 West State, Wauwatosa, Wisconsin 53213 (414) 778-1430
1111 Westowne Drive, Neenah, Wisconsin 54956 (920) 722-0801
4745 Golf Road, Eau Claire, Wisconsin 54701 (715) 831-1255
2221 West Stewart Avenue, Wausau, Wisconsin 55401 (715) 848-1110
5609 Highway'10 East, Stevens Point, Wisconsin 54481 (715) 345-0186
9364 Highway 16, Onalaska, Wisconsin 54650 (BOB) 781-8570
2114 North Central Avenue, Marshfield, Wisconsin 54449 (715) 486-1700
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Apple Houston Restaurants, Inc.
Sunhil Dharod
One Galleria Tower
13355 Noel Road, Suite 1645
Dallas, Texas 75240
(972) 644-9494
Outlets:
6315 South Interstate Hwy. 35, Austin, Texas 78744 (512) 912-0202
5010 West Highway 290, Austin, Texas 78735 (512) 892-1966
2700 Parker Drive, Building A, Round Rock, Texas 78664 (512) 310-7216
11013 Lakeline Mall Drive, Cedar Park, Texas 78613 (512) 257-9747
5502 South Broadway, Tyler, Texas 75703 (903) 509-4848
101 West Loop 281, Longview, Texas 75604 (903) 663-1267
350 South IH-35, Georgetown, Texas 78626 (512) 869-8216
4609 South Medford Drive, Lufkin, Texas 75901 (936) 632-1113
501 U.S. Highway 290 West, Brenham, Texas 77833 (979) 830-0872
7522 North I-35 Service Road South, Building C, Austin, Texas 78752 (512) 371-7018
19821 Northwest Freeway, Houston, Texas 77065 (281) 970-1028
19625 Restaurant Row, Houston, Texas 77084 (281) 579-3580
5911 Sam Houston Parkway North, Houston, Texas 77049 (281) 458-2469
12740 Southwest Freeway, Stafford, Texas 77477 (281) 265-1415
14815 Westheimer, Houston, Texas 77082 (281) 497-6800
5103 Fairmont Parkway, Pasadena, Texas 77505 (281) 991-7800
6925 P.M. 1960 East, Humble, Texas 77346 (281) 852-6055
27727 Tomball Parkway, Tomball, Texas 77375 (281) 516-1076
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14435 P.M. 2100, Crosby, Texas 77532 (281) 462-2800
2952 Interstate Highway 45, Conroe, Texas 77303 (936) 756-3281
2959 North Loop 610 West, Houston, Texas 77008 (713) 864-6486
103 Carlos G. Parker Boulevard NW, Taylor, Texas
Apple Investors Group, L L C
Andy Patel
1503 Belvedere Road
West Palm Beach, Rlorida 33406
(561)242-4907
Outlets:
6220 San Mateo Boulevard NE, Albuquerque, New Mexico 87109 (595) 822-8700
3620 New Mexico State Highway 528 N.W., Albuquerque, New Mexico 87114 (505) 890-0464
10600 Lomas Boulevard N.E., Albuquerque, New Mexico 87112 (505) 237-9083
10895 Montgomery Boulevard N.E., Albuquerque, New Mexico 87111 (595) 323-7548
2711 Coors Boulevard, Albuquerque, New Mexico 87120 (505) 352-6544
2000 Yale, Albuquerque, New Mexico 87106 (505) 244-0123
2600 Menaul Boulevard NE, Albuquerque, New Mexico 87110 (505) 883-2846
3624 Candlers Mountain Road, Lynchburg, Virginia 24502 (434) 528-2626
4942 Valley View Boulevard N/NW, Roanoke, Virginia 24012 (540) 563-5213
2799 Market Street N.E., Christiansburg, Virginia 24073 (540) 382-1129
4348 Electric Road, Roanoke, Virginia 24014 (540) 989-4526
410 Old Mt. Crossroad, Danville, Virginia 24541 (434) 791-4895
281 West Commonwealth, Martinsville, Virginia 24112 (276) 638-2377
1440 East Main Street, Wytheville, Virginia 24382 (276) 223-4404
1806 West Main Street, Salem, Virginia 24153 (540) 389-2784
3219 Old Forest Road, Lynchburg, Virginia 24591 (434) 385-8855
879 North Lee Highway, Lexington, Virginia 24450 (540) 463-2306
400 Old Franklin Turnpike, Unit 204, Rocky Mount, Virginia 24151 (540) 489-7772
3697 Old Halifax Road, South Boston, Virginia 24592 (434) 572-8356
1126 East Stuart Drive, Galax, Virginia 24333 (276) 236-2905
89 Elliott Drive, Lebanon, Virginia 24266 (276) 889-4637
1189 Lynchburg-Salem Turnpike, Bedford, Virginia 24543 (549) 586-4926
691 Hawthorne Drive, N.E., Norton, Virginia 24273 (276) 679-5799
415 Thacker Avenue, Covington, Virginia 24426 (540) 965-2166
169 Clarion Road, Altavista, Virginia 24517 (434) 309-1157
4519 Challenger Avenue, Roanoke, Virginia 24012 (540) 977-0251
33 West Main Street, Radford, Virginia 24141 (540) 639-9631
Apple Sauce, Inc.
Curtis Smith
741 Centre View Boulevard, Suite 109
Crestview Hills, Kentucky 41017
(859) 331-3990
Outlets:
650 West Lincoln Highway, Schererville, Indiana 46375 (219) 322-4759
5788 Coventry Lane, Ft. Wayne, Indiana 46804 (260) 436-9445
4510 North Clinton Street, Ft. Wayne, Indiana 46825 (269) 484-6969
19135 Pines Boulevard, Pembroke Pines, Florida 33926 (954) 438-3379
19
12719 West Sunrise Boulevard, Sunrise, Florida 33323 (954) 846-2229
4957 South Franklin Street, Michigan City, Indiana 56091 (954) 879-6549
670 Morthland, Valparaiso, Indiana 46383 (219) 477-3868
6615 North Main Street, Granger, Indiana 46530 (574) 273-0003
2729 University Drive, Coral Springs, Florida 33065 (954) 796-9339
266 East Alexis Road, Toledo, Ohio 43612 (419) 470-1149
3241 Interchange Drive, Elkhart, Indiana 46514 (574) 266-1129
531 Dussel Road, Maumee, Ohio 43537 (419) 897-9779
4792 Monroe Street, Toledo, Ohio 43623 (419) 475-2245
8425 Broadway, Merrillville, Indiana 46410 (219) 736-1811
3296 Elida Road, Lima, Ohio 45805 (419) 331-8592
9815 N.W. 41st Street, Miami, Rlorida 33178 (385) 716-4942
6525 Lima Road, Ft. Wayne, Indiana 46818 (268) 497-7404
2531 Tiffin Avenue, Findlay, Ohio 45840 (419) 425-9955 .
1150 Ireland Road, South Bend, Indiana 46614 (574) 291-8522
330 Ridge Road, Munster, Indiana 46231 (219) 836-8222
2621 East Center Street, Warsaw, Indiana 46580 (574) 268-1025
1807 Reith Boulevard, Goshen, Indiana 46526 (574) 875-4929
346 Hauenstein Road, Huntington, Indiana 46750 (260) 358-1977
3793 Portage Road, South Bend, Indiana 46628 (574) 277-2649
2225 North Oak Road, Plymouth, Indiana 46563 (574) 935-3066
6211 U.S. Highway 6, Portage, Indiana 46368 (219) 762-3243
2299 North State Route 53, Fremont, Ohio 43420 (419) 355-0549
692 Fairview Boulevard, Kendallville, Indiana 46755 (269) 349-1570
597 Ley Drive, Auburn, Indiana 46786 (260) 927-9885
1903 North Clinton Street, Defiance, Ohio 43512 (419) 784-2279
292 East Jacob Avenue, Angola, Indiana 46703 (260) 668-3830
7340 Central Avenue, Toledo, Ohio 43617 (419) 843-5319
5414 Meijer Drive, Fort Wayne, Indiana 46835 (269) 492-9991
3007 Curtice Road, Northwood, Ohio 43619 (419) 691-9299
20505 South Dixie Highway, Miami, Florida 33189 (786) 293-9496
791 Indian Boundary Road, Chesterton, Indiana 46304 (219) 921-9070
4515 Lincoln Way East, Mishawaka, Indiana 46544 (574) 256-9591
33899 South Dixie Highway, Florida City, Florida 33834 (395) 246-1084
2825 Glendale Avenue, Toledo, Ohio 43614 (419) 382-3996
1925 Roschman Avenue, Lima, Ohio 45804 (419) 222-2757
5377 West Atlantic Boulevard, Margate, Florida 33063 (954) 969-0866
6005 North University Drive, Tamarac, Florida 33321 (954) 722-4244
6670 Dykes Road, Southwest Ranches, Florida 33331 (954) 434-0857
3690 West 16 Avenue, Hialeah, Florida 33012 (305) 823-0573
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Apple Texas Restaurants, Inc.
Sunhil Dharod
One Galleria Tower
13355 Noel Road, Suite 1645
Dallas, Texas 75240
(972) 644-9494
Outlets:
1610 East Beltline, Richardson, Texas 75081 (972) 238-9591
1901 North Beltline Road, Irving, Texas 75061 (972) 313-8081
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4654 South Cooper Street, Arlington, Texas 76017 (817) 557-0085
4817 Texoma Parkway, Sherman, Texas 75090 (993) 813-0237
1808 S W H.K. Dodgen Loop, Temple, Texas 76502 (254) 771-5991
6645 N.E. Loop 820, North Richland Hills, Texas 76180 (817) 788-9797
7004 Wesley, Greenville, Texas 75402 (993) 455-9862
1829 West University Drive, McKinney, Texas 75969 (972) 562-8916
797 South I-35 East, Denton, Texas 76291 (940) 591-9353
6609 West Freeway, Ft. Worth, Texas 76116 (817) 732-8862
543 East FM 3040, Lewisville, Texas 75067 (972) 315-6902
614 North Valley Mills, Waco, Texas 76710 (254) 751-9984
200 Texas Avenue, College Station, Texas 77840 (979) 260-3003
2700 East Central Texas Exp., Killeen, Texas 76543 (254) 526-9711
810 South Cockrell Hill Road, Duncanville, Texas 75137 (972) 283-8799
695 East I-39, Rockwall, Texas 75087 (972) 772-5227
3995 Lamar Avenue, Paris, Texas 75460 (903) 784-1005
2225 South Loop 256, Palestine, Texas 75801 (993) 729-8888
1119 South Tyler Street, Athens, Texas 75751 (993) 675-2230
208 I-20 West, Weatherford, Texas 76086 (817) 599-3188
691 North Highway 77, Waxahachie, Texas 75165 (972) 937-9422
216 West Katherine P. Raines Road, Cleburne, Texas 76831 (817) 645-3585
2525 East Highway 199, Copperas Cove, Texas 76522 (254) 518-3001
6301 Lake Worth Boulevard, Lake Worth, Texas 76135 (817) 237-9344
3141 Preston Road, Frisco, Texas 75834 (214) 618-0550
4323 North I-35, Gainesville, Texas 76240 (949) 612-3631
19035 I-635, Mesquite, Texas 75150 (972) 682-6378
7855 Las Colinas Ridge, Irving, Texas 75863 (972) 869-3690
1115 North Burleson Boulevard, Burleson, Texas 76028 (817) 426-5091
2415 West Interstate 29, Grand Prairie, Texas 75952 (972) 522-1960
341 Tanger Drive, Terrell, Texas 75160 (972) 551-1400
2021 North Highway 287, Mansfield, Texas 76063 (682) 518-7456
649 Uptown Boulevard, Cedar Hill, Texas 75104 (972) 293-6388
6464 East Northwest Highway, Dallas, Texas 75231 (214) 361-7625
3565 Frankford Road, Dallas, Texas 75287 (972) 662-4955
3149 FM 497, Highland Village, Texas 75977 (972) 355-3794
3426 West Illinois Avenue, Dallas, Texas 75211 (214) 339-8115
2672 F M 423, Little Elm, Texas 75068 (972) 464-2616
2251 Grapevine Mills Circle, Grapevine, Texas 76051 (214) 253-0830
1440 Eastgate Drive, Garland Texas 75041 (972) 270-0602
1991 South Interstate Highway 45, Corsicana, Texas 75119 (903) 972-7630
945 North Saginaw Boulevard, Saginaw, Texas 76179 (817) 306-3680
4616 Lakeview Parkway, Rowlett, Texas 75088 (972) 412-2639
335 East Highway 343, Canton, Texas 75103 (903) 567-0100
2400 Airport Rreeway, Suite 120, Bedford, Texas 76021 (817) 545-2578
114 West US Highway 80, Forney, Texas 75126 (972) 552-5571
103 Carlos G. Parker Boulevard NW, Taylor, Texas 76574 (512) 352-6625
Apple-Metro, Inc.
Roy Raeburn & Zane Tankel
550 Mamaroneck Avenue
Harrison, New York 18528
(914) 777-2331
21
Outlets:
2655 Richmond Avenue, Staten Island, New York 10314 (718) 370-3529
430 New Dorp Lane, Staten Island, New York 10306 (718) 989-7809
185 North Bedford Road, Mt. Kisco, New York 19549 (914) 241-6799
1 Mall Walk West, Yonkers, New York 10704 (914) 376-6222
1451 Richmond Avenue, Staten Island, New York 10314 (718) 477-1300
3127 East Main Street, Mohegan Lake, New York 10547 (914) 526-9000
221 Route 59, Airmont, New York 10901 (845) 369-7790
25 LeCount Place, New Rochelle, New York 10801 (914) 654-0991
2276 Bartow Avenue, Bronx, New York 19475 (718) 320-4227
234 West 4 2 Street, New York, New York 18936 (212) 391-7414
18 Saw Mill River Road, Hawthorne, New York 19532 (914) 345-1555
213-29 26th Avenue, Bayside, New York 11360 (718) 423-4328
61-48 188 Street, Fresh Meadows, New York 11365 (718) 264-1222
2505 Emmons Avenue, Brooklyn, New York 11235 (718) 769-4889
395 Flatbush Avenue Extension, Brooklyn, New York 11201 (718) 834-9890
395 Tarrytown Road, White Plains, New York 10607 (914) 644-8889
95-25 Queens Boulevard, New York, New York 11374 (718) 275-7755
205 West 59 Street, New York, New York 19919 (212) 262-2499
27 Mamaroneck Avenue, White Plains, New York 10601 (914) 683-8589
76 West 225 Street, New York, New York 10463 (718) 367-4925
99-15 Queens Boulevard, Elmhurst, New York 11373 (718) 271-7999
1360 Fulton Avenue, Brooklyn, New York 11216 (718) 943-8899
2720 Veteran's Road West, Staten Island, New York 10309 (718) 943-1289
38-91 35 Avenue, Astoria, New York 11101 (718) 943-7494
42 Westchester Avenue, Port Chester, New York 10573 (914) 253-5358
2291 Nostrand Avenue, Brooklyn, New York 11219 (347) 595-3380
4750-4758 Third Avenue, Bronx, New York 10458 (347) 226-5120
610 Exterior Street, Bronx, New York 10451 (347) 266-5700
One West 125 Street, New York, New York 10027 (646) 783-6400
139 Flatbush Avenue, Level 2, Brooklyn, New York 11214 (718) 947-5059
2 Executive Boulevard, Yonkers, New York 19791 (914) 595-0601
161-19 Jamaica Avenue, Queens, New York 11433 (347) 571-9921
49-24 College Point Boulevard, Flushing, New York 11354 (347) 226-7990
65 Metropolitan Oval, Bronx, New York 10462 (347) 802-4202
509 East 117 Street, New York, New York 19935 (646) 896-2799
1217 Surf Avenue, Brooklyn, New York 12244 (718) 372-0079
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Calabee's, Inc.
John R. Bifone & John R. Bifone, Jr.
565 West Lambert Road, Suite C
Brea, California 92821-3121
(714) 671-9772
Outlets:
674 W. Arrow Highway, San Dimas, California 91773 (909) 394-7690
300 S. California, West Covina, California 91799 (676) 338-5789
502 W. Huntington Drive, Monrovia, California 91016 (626) 932-8970
9241 Monte Vista Avenue, Montclair, California 91763 (999) 624-5555
21625 East Valley Boulevard, Walnut, California 91789 (994) 594-1140
21 East Main Street, Alhambra, California 91891 (626) 576-4621
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5701 North Rosemead Boulevard, Temple City, California 91780 (626) 291-5153
1493 North Montebello Boulevard, Suite A, Montebello, California 90640 (323) 278-0250
5700 East Florence Avenue, Bell Gardens, California 99291 (323) 326-2929
12129 Imperial Highway, Norwalk, California 99659 (562) 863-8931
Delaware North Companies Travel Hospitality Services, Inc.
40 Fountain Plaza
Buffalo, New York 14202
(800) 828-7240
Outlets:
1 Richard E. Byrd Terminal Drive, Suite 103, Richmond International Airport, Richmond,
Virginia 23250 (804) 222-1227
Delaware Valley Rose, L P .
Harry T. Rose
29 Friends Lane
Newtown, Pennsylvania 18940
(215) 579-9229
Outlets:
2109 Motel Drive, Bethlehem, Pennsylvania 18018 (610) 867-7332
9142 Roosevelt Boulevard, Philadelphia, Pennsylvania 19115 (215) 677-5532
1905 Ridgewood, Wyomissing, Pennsylvania 19619 (619) 372-6444
1863 East Street Road, Upper Southampton, Pennsylvania 18966 (215) 357-9532
555 South Trooper Road, Norristown, Pennsylvania 19403 (610) 631-8184
323 Old York Road, Jenkintown, Pennsylvania 19946 (215) 572-9941
2799 DeKalb Pike, East Norriton, Pennsylvania 19491 (610) 239-8666
145 Northwest End Boulevard, Quakertown, Pennsylvania 18951 (215) 529-7343
7659 City Line, Philadelphia, Pennsylvania 19151 (215) 477-3397
2333 West Main Street, Lansdale, Pennsylvania 19446 (215) 631-9685
833 North State Street, Pottstown, Pennsylvania 19464 (610) 718-5686
3219 Street Road, Bensalem, Pennsylvania 19929 (215) 633-7847
1281 Knapp Road, North Wales, Pennsylvania 19454 (215) 699-7499
7150 Hamilton Boulevard, Trexlertown, Pennsylvania 18087 (610) 366-8200
815 East Baltimore Pike, Building 3, Kennett Square, Pennsylvania 19348 (610) 444-8092
328 MacDade Boulevard, Folsom, Pennsylvania 19033 (610) 461-7573
1510 Cedar Crest Boulevard, Allentown, Pennsylvania 18104 (610) 530-2450
3702 Easton-Nazareth Highway, Fasten, Pennsylvania 18045 (610) 923-7611
79 Buckwalter Road, Limerick, Pennsylvania 19468 (619) 792-8189
791 North Dual Highway, Seaford, Delaware 19973 (392) 628-0756
1279 Ocean Outlet, Rehoboth Beach, Delaware 19971 (302) 226-5307
698B North Dupont Highway, Milford, Delaware 19963 (382) 424-9954
Doherty Apple Florida, L L C
Jerry Marcoupoulis
7 Pearl Court
(291) 818-4669
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Outlets:
10501 S. U.S. Highway 1, Port St. Lucie, Florida 34952 (772) 337-0408
6775 West Indiantown Road, Jupiter, Florida 33458 (561) 575-4300
6706 Forrest Hill Boulevard, Greenacres, Florida 33463 (561) 641-6332
4899 Okeechobee Road, Ft. Pierce, Florida 34947 (772) 469-1444
1975 Military Trail, West Palm Beach, Florida 33489 (561) 683-0709
5335 29th Street, Vero Beach, Florida 32966 (561) 978-9551
1729 South Federal Highway, Delray Beach, Florida 33483 (561) 279-2666
199 US Highway 441, Royal Palm Beach, Florida 33411 (561) 791-2249
3167 North Lake Boulevard, Lake Park, Florida 33403 (561) 842-6422
15058 Jog Road, Delray Beach, Florida 33445 (561) 865-8757
1570 Boynton Beach Boulevard, Boynton Beach, Florida 33436 (561) 752-4339
225 State Road 312, St. Augustine, Florida 32986 (994) 825-4999
177 Altama Connector, Brunswick, Georgia 31525 (912) 262-5880
1991 Memorial Drive, Waycross, Georgia 31501 (912) 285-9359
113 The Lake Boulevard, Kingsland, Georgia 31548 (912) 729-9515
2893 West US Highway 90, Lake City, Florida 32055 (904) 752-7087
6251 103rd Street, Jacksonville, Florida 32210 (994) 772-9929
13291 Atlantic Boulevard, Jacksonville, Florida 32225 (994) 229-5823
5055 J . Turner Butler Boulevard, Jacksonville, Florida 32216 (904) 296-6895
843 Lane Avenue South, Jacksonville, Florida 32295 (994) 778-9599
2096 South 8 Street, Fernandina Beach, Florida 32034 (904) 206-4300
8635-201 Blanding Boulevard, Jacksonville, Florida 32244 (994) 771-0000
14560 St. Augustine Road, Jacksonville, Rlorida 33258 (904) 262-7605
4570 Town Center Parkway, St. John's Center, Jacksonville, Florida 32246 (904) 645-3590
13550 South Tamiami Trail, Ft. Myers, Florida 33997 (941) 489-1811
15151 North Cleveland Avenue, North Ft. Myers, Florida 33993 (941) 995-7999
20 Arthur Anderson, Sarasota, Florida 34232 (941) 379-2268
4329 South Tamiami Trail, Venice, Florida 34293 (941) 497-7749
5082 Airport Pulling Road N., Naples, Florida 33942 (941) 434-7744
19919 Murdock Circle, Port Charlotte, Florida 33948 (941) 766-8666
2228 Del Prado Boulevard South, Cape Coral, Florida 33999 (941) 458-5155
1991 Main Street, Sarasota, Florida 34236 (941) 955-7234
5499 Clark Road, Sarasota, Florida 34233 (941) 925-2396
8043 Dan! Drive, Ft. Myers, Florida 33912 (239) 939-5569
10391 Corkscrew Commons Drive, Estero, Florida 33928 (239) 992-1319
17500 South Tamiami Trail, North Port, Florida 34287 (941) 423-1594
24467 Sandhill Boulevard, Port Charlotte, Florida 33983(941) 235-9184
1219 Highway 70 East, Okeechobee, Florida 34972 (863) 357-8141
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EHI Realty, Inc.
Edward W. Doherty
7 Pearl Court
(201)818-4669
Outlets:
1282 Centennial Avenue, Piscataway, New Jersey 98854 (732) 562-8599
14 Park Road, Tinton Falls, New Jersey 07724 (732) 935-1158
17 North & Ridgewood East, Paramus, New Jersey 97652 (291) 447-8813
52 Brick Plaza, Brick, New Jersey 98723 (732) 262-9876
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465 Route 46 West, Totowa, New Jersey 07015 (973) 812-0011
251 Woodbridge Center Drive, Woodbridge, New Jersey 07095 (732) 855-5390
1057 Route 46 East, Parsippany, New Jersey 07054 (973) 263-5005
Ocean County Mall, 1201 Hooper Avenue, Toms River, New Jersey 08753 (732) 505-9099
375 Route 3 East, Clifton, New Jersey 87914 (973) 471-6161
Manalapan Epicentre, Route 9 & Symmes Road, Manalapan, New Jersey 97726 (732) 683-9022
640 Promenade Boulevard, Bridgewater, New Jersey 08807 (732) 627-0888
1045 Route 1 South, Edison, New Jersey 08837 (732) 516-0040
324 Ryders Lane, Milltown, New Jersey 08850 (732) 651-8151
671 West Edger Road, Linden, New Jersey 07036 (998) 523-1200
205 Route 72 West, Manahawkin, New Jersey 08050 (609) 978-9799
4721 U.S. Highway 9 North, Howell, New Jersey 97731 (732) 961-9499
2007 Highway 35, Wall, New Jersey 07719 (732) 289-3676
244 Highway 292, Flemington, New Jersey 08822 (908) 806-2231
2301 Route 66, Ocean, New Jersey 07712 (732) 922-1309
315 State Road 206, Unit 300, Hillsborough, New Jersey 88844 (998) 874-4177
1323 Route 22, Phillipsburg, New Jersey 88865 (998) 454-8999
1183 Route 35, Middletown, New Jersey 97748 (732) 959-9409
1721 Morris Avenue, Union, New Jersey 07083 (998) 964-1070
1200 Route 23 North, Butler, New Jersey 07405 (973) 283-8418
225 Mountain Avenue, Hackettstown, New Jersey 97849 (908) 684-1993
249 State Route 10, East Hanover, New Jersey 07936 (973) 568-1938
175 Passaic Avenue, Kearny, New Jersey 97932 (201) 246-0929
459 Hackensack Avenue, Hackensack, New Jersey 97691 (291) 342-9965
965 Jefferson Avenue, Union, New Jersey, 97983 (998) 687-8500
6 North Park Drive, Newton, New Jersey 07860 (973) 949-3003
Hudson Mall, 701 Route 440 South, Jersey City, New Jersey 07304 (201) 200-9949
59 International Drive, Rlanders, New Jersey 97836 (973) 448-9996
383 Springfield Avenue, Newark, New Jersey 07103 (973) 242-3600
273 Livingston Street, Northvale, New Jersey 07647 (201) 767-6999
427 Route 46E, Dover, New Jersey 97891 (973) 328-9999
494 South Main Street, Forked River, New Jersey 98731 (689) 971-7899
2100 8 8 Street, North Bergen, New Jersey 07047 (201) 758-1800
Manchester Plaza, 1055 Route 70, Manchester, New Jersey 08759 (732) 657-7676
186 Passaic Street, Garfield, New Jersey 97926 (973) 778-6199
651 Kapowski Road, Elizabeth, New Jersey 07201 (998) 289-5974
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El Apple, L L C
John M. Verlander & James J . Gore
5835 Onix, Suite 300
El Paso, Texas 79912
(915) 581-8314
Outlets:
5800 North Mesa, El Paso, Texas 79912 (915) 833-8899
1766 Airway Boulevard, El Paso, Texas 79925 (915) 771-7639
7956 Gateway East, El Paso, Texas 79915 (915) 598-7996
2591 East Lohman, Las Cruces, New Mexico 88011 (505) 522-3292
4790 Woodrow Bean, El Paso, Texas 79924 (915) 751-3324
1985 George Dieter, El Paso, Texas 79936 (915) 599-6411
4333 Sherwood Way, San Angelo, Texas 76994 (915) 944-7669
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440 East Redd R o ^ ^ R a s o , Texas 7 ^ 2 ^ ^ 5 8 5 2 2 0 0
1501 H i o k o ^ L e e ^ Las Cruoes, New Mexico 88005 (505) 525 1891
1850 G e e ^ e Dieted Fi Rase, Texas 79988 (915) 858 1047
Golden West Restaurants^no.
AnandO.Gaia
8191 Red HiilAvenoe, Suite 199
Gosta Mesa, Gaiitomia 92828
(800)858 8517
Gutiets:
98 Shaw Avenue, Giovis,Galitomia 98812(559) 822 9899
1885 West Laoey Boulevard, Hantord,Gaiitomia 98289 (559) 588 8984
7007 North Gedar,Rresno,Gaiitornia 98729 (559) 822 7144
8894 West Shaw, Rresno,Galitornia 98177 (559) 271 9844
5825 AvenidaOe Los Rohies,Visalia,Galitornia 98291 (559)888 1805
9099 MingAvenue, Suite M,Bakerstieid,Galitornia 98811 (559) 884 9974
8499 South Mooney Boulevard, Visaiia,Gaiitomia 98277 (559) 784 2882
8489 North Rriant Road, Rresno,Galitornia 98720 (559) 281 2881
Green Apple, L L G
MlohaelO Glander
179 Wind GhimeGourt
Raleigh, North Garolina 27815
(919)848 2577
Outlets:
489 Gongaree Road, Greenville, South Garolina 29897 (884) 288 8842
2844 Broad River R o a d ^ l 2 9 , G o l u m h i a , South Carolina 29219(898) 781 2858
8441 Glemson Boulevard, Anderson, South Carolina 29821 (884)225 4752
4595 0evineStreet,Columhia, South Carolina 29295 (898) 787 4887
7892 Greenville Highway, Spartanburg, South Carolina 29891 (884)574 8998
1885 RourSeasonsBoulevard,Hendersonville, North Carolina 28789 (828) 892 8008
1880WhiskeyRoad,Aiken, South Carolina 29802 (808) 842 8175
5955Calhoun Memorial Boulevard, Easley, South Carolina 29849 (884) 855 2588
115TunnelRoad,Asheville,NorthGarolina28891 (828) 251 9194
245 G'NeilCourt, Columbia, South Carolina 29228 (898) 788 8104
704 Wade Hampton Boulevard,Greer,South Carolina 29851 (884)848 9078
898 Bypass 128, Seneoa, South Carolina 29878 (884) 822 8998
1 8 1 7 B y p a s s 7 2 N E , G r e e n w o o d , S o u t h Carolina 29849 (884) 2294484
2227 OaveLyle Boulevard, Rook Hill, South Carolina 29789 (898) 888 1991
8944 GrandviewOrive,Simpsonville, South Carolina 29881 (884)228 9481
1512West Rloyd Baker Avenue, Gattney,South Carolina 29841 (884)489 8822
1288 Highway9Bypass,Lanoaster,South Carolina 29729 (808) 288 7777
5185 Rernadina Road,Columbia,South Carolina 29212 (808)7494787
895 ColumbiaAvenue, Lexington, South Carolina 29072 (808) 858 8889
1855 Hendersonville Road, Asheville, North Carolina 28898 (828) 274 5899
1985 South B i g A R o a d , T o o o o a , G e o r g i a 89577 (798) 282 5918
2869ChestnutStreet, Orangeburg,South Carolina 29115(898) 585 9051
2888 BoundaryStreet,Beautort, South Carolina 29992 (848) 524 4822
1221 WoodruttRoad, Greenville, SouthGarolina29897 (884)458 9999
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1985 East Main S t ^ S p a ^ ^
5299 White Horse Road, B o r e a s
125 Rainbow Lake Road, Boiling Springs, South Caroiina 2951^
2815Augusta Road,West Coiumhia, South Carolina 29972 (895) 9251759
275 Smokey Rark Highway,Asheville, North Carolina 25595 (525) 579 9191
299 A M u s e u m Street, Hilton Head,South Carolina 29925 (545) 559 5959
19192TwoNotoh Road, Columbia, South Carolina 29225 (598)419 2255
2497 Broad Street, Sumter,South Carolina 29150 (808) 459 8578
4585 Outer Loop, Louisville, Kentucky 40219(592) 989 1228
1995SouthHurstbourneLane, Louisville, Kentucky 49220 (502) 499 8851
2225TaylorsvilleRoad, Louisville, Kentucky49201 (502)459 9784
771 East Lewis^ClarkRarkway,Clarksville,lndiana47189 (812) 288 8594
4717 Oixie Highway, Louisville, Kentucky 49215 (502) 448 1899
12918ShelbyvilleRoad, Louisville, Kentucky 49248 (502) 254 8282
10590 South OixieHighway,Louisville, Kentucky 40272 (502) 987 8917
1795 East Tipton Street, Seymour,lndiana 47274(812) 524 1585
10098 WillWay, Louisville, Kentucky 40291 (592) 281 1851
2959 WalmartWay,Radclitt, Kentucky 49159 (279) 852 2900
8080 OrantLine Road, New Albany, Indiana 47150 (812) 941 1899
1295 MarketStreet,LaOrange, Kentucky 49981 (592)222 9881
Heartland A p p l e ^ n c .
KevinRAllardice,Marianne B . A l l a r d i c e ^ A n d r e w C . R o b e r t s o n
1898 Ben Sawyer Boulevard, #10
Mt Rleasant, South Carolina 29484
(848) 849 1877
Cutlets:
8885VeteransRarkway, Springfield, Illinois 52794 (217) 598 9559
1988 North Henderson, Calesburg,lllinois51401 (809) 844 7825
990 Riverside Orive, East Reoria, Illinois 81511 (899) 898 4414
1275 SouthRoute51,Rorsyth,Illinois 52585 (217) 875 9281
592 NorthVeteransRarkway, Bloomington, Illinois 81794 (899) 888 2184
118SouthRooseveltAvenue, Burlington,Iowa 52591 (819)752 7744
8827 Broadway, Cuincy,lllinois 82891 (217)228 5451
5844 NorthWarMemorial,Reoria, Illinois 81514 (899) 592 5929
8549 CourtStreet,Rekin, Illinois 51554 (809) 858 8985
2121 North Rrospect, Champaign, Illinois 51821 (217) 859 8178
2554 SunriseOrive, Springfield, Illinois 82708 (217) 528 7921
1201 North Ounlap Avenue, Savoy, lllinois51874(217) 859 1894
1721 West MortonAvenue, Jacksonville, Illinois 52550 (217) 248 8854
2125 Gateway Center,Belvidere,lL 81008 (815) 544 0185
J . S . Ventures, Inc.
James H.Stevens
2400 North Woodlawn, Suite 280
Wichita, Kansas 87220
(815)888-7799
Cutlets:
2085 North Rock Road, Suite101, Wichita, Kansas87205 (818)552 0284
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3350 South 143rd Plaza, Omaha, Nebraska 68144 (402) 697-0712
2875 South 9th, Salina, Kansas 67401 (785) 827-8385
4760 South Broadway, Wichita, Kansas 67216 (316) 522-5525
7450 West Dodge Street, Omaha, Nebraska 68114 (402) 399-9123
1699 East 17th Street, Hutchinson, Kansas 67501 (620) 665-5171
13208 West Maple Road, Omaha, Nebraska 68164 (402) 492-8707
4101 North Vine, Hays, Kansas 67601 (785) 628-6400
1202 North Washington, Omaha, Nebraska 68046 (402) 339-4359
691 Manchester Lane, Newton, Kansas 67114 (316) 284-9366
3089 Dial Drive, Council Bluffs, Iowa 51593 (712) 366-1250
436 South Andover Road, Andover, Kansas 67002 (316) 733-9447
3299 10 Street, Great Bend, Kansas 67530 316) 792-8899
2289 East Kansas Avenue, McPherson, Kansas 67460 (316) 245-0222
3030 East Kansas, Garden City, Kansas 67846 (316) 276-2244
10402 South 15 Street, Bellevue, Nebraska 68123 (402) 293-8409
2829 South 181 Street, Omaha, Nebraska 68130 (402) 330-9799
406 West Wyatt Earp Boulevard, Dodge City, Kansas 67801 (620) 225-5888
3420 East Elk Lane, Fremont, Nebraska 68025 (402) 753-0010
996 East Connolly Court, Park City, Kansas 67219 (316) 744-8484
1245 North Rock Road, Derby, Kansas 67037 (316) 788-7775
10728 West 2 1 Street North, Wichita, Kansas 67205 (316) 729-2777
2611 North Kansas Avenue, Liberal, Kansas 67901 (620) 624-2422
6222 North 7 2 Street, Omaha, Nebraska (482) 995-2299
320 South Ridge Road, Wichita, Kansas 67209 (316) 942-9979
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Keystone Apple, Inc.
Stephen H. Davenport & Timothy J . Davenport
4949 Ritter Road, Suite 194
Mechanicsburg, Pennsylvania 17955
(717) 799-9744
Outlets:
4491 Jonestown Road, Harrisburg, Pennsylvania 17199 (717) 652-3861
1181 Mae Street, Hummelstown, Pennsylvania 17036 (717) 566-8399
2321 Lincoln Highway, Lancaster, Pennsylvania 17691 (717) 299-8339
6955 Carlisle Pike, Mechanicsburg, Pennsylvania 17955 (717) 796-6689
191 Northern Way, York, Pennsylvania 17402 (717) 755-0423
260 Noble Boulevard, Carlisle, Pennsylvania 17013 (717) 245-2500
3501 Paxton Street, Harrisburg, Pennsylvania 17111 (717) 561-2248
320 East Main Street, Ephrata, Pennsylvania 17522 (717) 738-5200
Mid River Restaurants L L C
David E. Paradise, Frank C. Heath, Jr., Jerold D. Krouse & Michael Pettus
296 Highland Drive
Natchez, Mississippi 39129
(601)445-9719
Outlets:
47 Ludwig Drive, Fairview Heights Plaza, Fairview Heights, Illinois 62288 (618) 398-5626
610 North Bluff Road, Collinsville, Illinois 62234 (618) 345-6840
3600 State Route 159, Glen Carbon, Illinois 62034 (618) 656-7096
2606 North Illinois Street, Swansea, Illinois 62226 (618) 235-4577
117 Woods Lane, Salem, Illinois 62881 (618) 548-9601
313 Homer Adams Parkway, Alton, Illinois 62002 (618) 462-6575
4300 Green Mountain Crossing Drive, Shiloh, Illinois 62269 (618) 632-6218
923 North Illinois Route 3, Waterloo, Illinois 62298 (618) 939-3555
3551 Nameoki Road, Granite City, Illinois 62949 (618) 798-9780
1921 Vaughn Road, Wood River, Illinois 62095 (618) 258-1951
11977 St. Charles Rock Road, Bridgeton, Missouri 63844 (314) 344-2888
2921 South Service Road, St. Charles, Missouri 63303 (636) 946-7795
11977 New Halls Ferry Road, Rlorissant, Missouri 63833 (314) 838-6696
9931 Watson Road, St. Louis, Missouri 63126 (314) 968-9899
1119 Big Bill Road, Arnold, Missouri 63010 (636) 282-1550
2309 North U.S. Highway 67, Florissant, Missouri 63033 (314) 837-2020
14830 Manchester Road, Ballwin, Missouri 63011 (636) 207-0801
21 Dillon Plaza Drive, High Ridge, Missouri 63049 (636) 677-4888
511 South Bishop, Rolla, Missouri 65481 (573) 398-1699
11950 Olive Boulevard, Creve Coeur, Missouri 63141 (314) 567-3252
1377 Highway K, O'Rallon, Missouri 63366 (636) 272-2700
4680 Chippewa, St. Louis, Missouri 63109 (314) 352-3789
1969 Washington Crossing, Washington, Missouri 63099 (636) 399-9714
748 West Karsch Boulevard, Farmington, Missouri 63649 (573) 769-9900
6170 Mid Rivers Mall Drive, St. Peters, Missouri 63376 (636) 477-8532
1987 Wentzville Parkway, Wentzville, Missouri 63385 (636) 332-9249
673 Gravois Bluffs Boulevard, Fenton, Missouri 63026 (636) 305-1735
9099 St. Charles Rock Road, St. John, Missouri 63114 (314) 427-1867
4559 Forest Park Boulevard, St. Louis, Missouri 63110 (314) 454-6636
314 South Service Road East, Sullivan, Missouri 63080 (573) 860-2143
2301 Maplewood Commons Drive, Maplewood, Missouri 63143 (314) 645-3378
77 South County Center Way, St. Louis, Missouri 63129 (314) 845-0388
507 Warren City Center, Warrenton, Missouri 63383 (636) 456-3735
Miller Apple Limited Partnership
William M. Wentworth
5084 Exchange Drive
Flint, Michigan 48507
(810) 733-0663
Outlets:
3129 Miller Road, Flint, Michigan 48597 (818) 235-1911
2268 Tittabawassee, Saginaw, Michigan 48694 (517) 793-9119
4135 North Court Street, Burton, Michigan 48599 (819) 744-1977
2384 U.S. 31 South, Traverse City, Michigan 49684 (231) 929-2929
3599 Wilder, Bay City, Michigan 48796 (517) 671-0957
8899 Main Street, Birch Run, Michigan 48415 (517) 624-4307
1400 East Hill, Grand Blanc, Michigan 40439 (810) 603-2750
5949 State Street, Saginaw, Michigan 48603 (517) 799-8965
4929 East Pickard Road, Mount Pleasant, Michigan 48858 (989) 779-2766
6911 Eastman, Midland, Michigan 48648 (517) 631-5949
18115 Silver Parkway, Fenton, Michigan 48439 (819) 714-9239
2992 U.S. Highway 41 West, Marquette, Michigan 49855 (996) 226-2943
1468 M-32 West, Alpena, Michigan 49707 (989) 354-3886
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1930 U.S. 131 South, Petoskey, Michigan 49779 (231) 347-9449
1379 West Main Street (M-32, Gaylord, Michigan 49735 (989) 732-2539
2992 Cook Road, West Branch, Michigan 48661 (989) 343-9199
2437 East Main, Corunna, Michigan 48817 (989) 728-2727
4478 Business Spur, Sault Saint Marie, Michigan 49783 (906) 253-0532
989 Razorback Drive, Houghton, Michigan 49931 (996) 482-2880
19949 Lapeer Road, Davison, Michigan 48423 (819) 653-3999
G-4418 West Pierson Road, Flint, Michigan 48594 (819) 729-1146
Neighborhood Hospitality, Inc.
Martin Johnson & Theresa Johnson
681 Main Street, Suite 102
Hazard, Kentucky 41701
(606) 436-0736
Outlets:
19 Mall Road, Barboursville, West Virginia 25504 (304) 733-4028
389 South John Scott Avenue, Steubenville, Ohio 43952 (749) 264-9448
3 Dudley Farms Lane, Charleston, West Virginia 25399 (394) 744-2199
59655 Valley Frontage Road, St. Clairsville, Ohio 43959 (749) 695-8448
892 Grand Central Avenue, Vienna, West Virginia 26015 (304) 295-0165
189 Hylton Lane, Beckley, West Virginia 25801 (304) 253-6700
60 Liberty Square, Hurricane, West Virginia 25526 (304) 757-4310
123 Meadowfield Lane, Princeton, West Virginia 24740 (304) 425-3546
1135 Third Avenue, Huntington, West Virginia 25701 (304) 525-4321
531 Emily Drive, Clarksburg, West Virginia 26301 (304) 623-2092
482 Pike Street, Marietta, Ohio 45759 (749) 373-5399
202 Kanawha Mall, Charleston, West Virginia 25387 (384) 925-6334
595 Armco Road, Ashland, Kentucky 41101 (606) 324-6646
172 Cassady Boulevard, Pikeville, Kentucky 41501 (606) 433-1815
200 Piercy Drive, Lewisburg, West Virginia 24901 (304) 645-5646
302 Merchants Walk, Summersville, West Virginia 26651 (304) 872-8800
30 Morton Boulevard, Hazard, Kentucky 41701 (606) 435-2737
3181 Maple Avenue, Zanesville, Ohio 43701 (740) 588-9244
516 Commerce Drive, Bluefield, Virginia 24605 (276) 322-0204
3 Cabela Drive, Wheeling, West Virginia 26059 (384) 547-9339
789 Beverly Pike, Elkins, West Virginia 26241 (304) 637-0688
555 East State Street, Athens, Ohio 45701 (740) 592-2696
4619 Gallia Street, New Boston, Ohio 45662 (740) 456-5200
Neighborhood Restaurant Partners, L L C
Karl Jaeger
1455 Lincoln Parkway, Suite 430
Dunwoody, Georgia 30346
(770) 623-0360
Outlets:
97 Loop 419 N.E., San Antonio, Texas 78216 (219) 979-7791
995 I-35 North, New Braunfels, Texas 78139 (219) 629-7898
7888 Interstate Highway 35 N., San Antonio, Texas 78218 (218) 967-6484
1511 S.W. Military Drive, San Antonio, Texas 78221 (210) 924-7999
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^ 5 A v e o u e ^ S o ^ F ^ O ^ ^
1305 North FM 1504
San
11505 Wost Loop 1504 North, San Antonio, Toxas 75254 (210) 595 3511
3050 Fast Main Stroot,Ovaido,Toxas 75501 (530) 5919400
555 Georgia Fiighway120,Lawronooô, Georgia 30245 (770) 339 9752
2445 Mail8ooievard,Kennesaw, Georgia 30144 (770) 427 7195
1445 Oogwood Orive, Gonyers, Georgia 30013(770) 992 9454
3 2 5 T u r n e r M o G a i i 8 ^ , Rome, Georgia 39151 (795)235 5259
1795 Browns Bridge Road, GainesviHe, Georgia 30591 (779) 535 1399
504 LakeiandRiaza, Gumming, Georgia 39049 (779) 557 1922
2725 Spring Road, Smyrna, Georgia 30059 (779) 432 1974
3575 Fiighway135,Stookhridge, Georgia 39251 (770) 507 7205
2225West Broad Street, Athens, Georgia 30501 (705)543 1339
1925 Highway 124, Sneiiviiie, Georgia 30973 (779) 979 1947
155GherokeeRiaoe,Gartersviiie, Georgia 39129 (770) 332 2322
971Buiishoro Orive, Newnan, Georgia 30253 (779) 251 2235
1195 South Rark Street, Garroiiton, Georgia 39117 (779) 535 5111
1421 Riverstone Rarkway, Ganton, Georgia 39114 (779) 345 1151
4219Johns Greek Rarkway,Suwanee, Georgia 30924 (575) 554 1444
125 Geiehration Orive, Suwanee, Georgia 39924 (779) 945 1352
1547 North Fxpressway,Grittin, Georgia 39223 (770) 227 2221
315industriaiBouievard,MoOonough,Georgia 30253 (575) 432 3023
792 Giynn Street, Fayetteviiie, Georgia 39214(779)451 7355
59150ougiasBouievard,Oougiasviiie,Georgia 39135 (779) 942 3239
4555 NeisonBrogdonBouievard,Butord, Georgia 39515(575) 452 9592
2494 OaiiasHighway,Marietta, Georgia 39954 (573) 3559335
2945 StoneorestGiroie,Lithonia, Georgia 39935 (573) 525 9557
1524 LatayetteRarkway,LaGrange, Georgia 39241 (795)242 9139
5175 Highway 275 Northwest, Govington, Georgia 39014 (779) 737 9795
559 Thornton Road, Lithia Springs, Georgia 39122 (575) 395 9553
195 FastRidgewayRoad,Gommeroe, Georgia 39529 (795) 335 9959
1531 Highway400South,Oawsonviiie, Georgia 30534 (795) 215 2499
5149 Jimmy Lee Smith Rarkway, Hiram, Georgia 39141 (779)222 5352
139 RerimeterGenterRiaoe, Atlanta,Georgia 39345 (779) 512 9235
475 Frankiin Road, Marietta, Georgia 39957 (779) 423 0945
2995 RieasantHiii,Ouiuth, Georgia 39095 (779)497 3723
5299 Highway73, Stone Mountain, Georgia 39937 (770) 579 5549
4795 Memoriai Orive, Oeoatur, Georgia 39932 (494) 294 4519
5727TaraBouievard,Joneshoro, Georgia 39235 (779) 955 1294
4353 LawrenoeviiieHighway,Tuoker, Georgia 39954 (770) 9355459
3599 Gasoade Road, Atlanta, Georgia 30331 (404) 591 5439
145 Martin Luther King Jr Bivd , Monroe, Georgia 39555 (779) 257 7592
5353 KyieGenter Orive, Kyie, Texas 73549 (512) 253 2352
15592 interstateH19West, SanAntonio, Texas 73249 (219) 541 2403
Neighborhood Restaorant Partners Florida, L L G
Karl Jaeger
1455 LinooinRarkway, Suite 430
Ounwoody, Georgia 30345
(770)523-0350
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5110 East Bay Drive, Clearwater, Florida 34624 (727) 539-6388
39189 US Highway 19 North, Clearwater, Florida 34621 (727) 786-8404
5779 East Fowler Avenue, Temple Terrace, Florida 33617 (813) 989-2999
4391 Cortez Road, Bradenton, Florida 34210 (941) 792-1234
4799 4th Street North, St. Petersburg, Florida 33793 (727) 522-9499
19911 Starkey Road, Largo, Florida 34641 (727) 393-3933
3255 University Parkway, Sarasota, Florida 34243 (941) 355-1499
829 Providence Road, Brandon, Rlorida 33511 (813) 643-9900
4835 South Rlorida Avenue, Lakeland, Rlorida 33803 (863) 701-7400
1465 McMullen Booth Road, Clearwater, Florida 33759 (727) 723-0393
8537 Little Road, New Port Richey, Rlorida 34654 (727) 817-1000
4651 Commercial Way, Spring Hill, Rlorida 34606 (352) 597-6999
15099 North Dale Mabry Highway, Tampa, Florida 33624 (813) 269-7887
291 Cypress Garden Boulevard, Winter Haven, Florida 33888 (863) 294-7777
19606 Sheldon Road, Tampa, Rlorida 33626 (813) 926-6669
4090 Park Boulevard, Pinellas Park, Rlorida 33781 (727) 544-1108
1991 West Main Street, Inverness, Florida 34452 (352) 569-9309
239 Arteva Drive, Lakeland, Florida 33899 (863) 853-8499
28422 State Road 54, Wesley Chapel, Florida 33543 (813) 994-6444
7157 State Road 70, Bradenton, Florida 34203 (941) 755-2828
299 North Suncoast Boulevard, Crystal River, Florida 34429 (352) 563-2889
1294 Townsgate Court, Plant City, Florida 33566 (813) 719-1599
29999 Cortez Boulevard, Brooksville, Florida 34603 (352) 796-4454
5998 18 Street East, Ellenton, Florida 34222 (941) 722-7199
4638 State Road 64 East, Bradenton, Florida 34298 (941) 748-6800
4916 Tampa Road, Oldsmar, Rlorida 34677 (813) 855-4575
3929 West Hillsborough Avenue, Tampa, Florida 33614 (813) 872-9666
1995 State Road 69 East, Valrico, Florida 33594 (813) 571-7444
18243 Big Bend Road, Riverview, Rlorida 33569 (813) 236-9290
200 Ambersweet Way, Davenport, Florida 33897 (863) 724-7990
2991 66 Street North, St. Petersburg, Florida 33710 (727) 343-1070
10601 County Line Road, Spring Hill, Florida 34609 (352) 666-8927
13351 State Road 525, Suite 100, Orlando, Florida 32821 (321) 395-4974
1709 West International Speedway Boulevard, Daytona Beach, Florida 32114 (386) 253-3656
14999 East Orange Lake Boulevard, Kissimmee, Florida 34747 (407) 464-5506
545 Palm Bay Road, Melbourne, Rlorida 32995 (321) 951-4440
199 Sykes Creek Parkway N., Merritt Island, Rlorida 32953 (321) 455-9898
12103 Collegiate Way, Orlando, Rlorida 32817 (487) 282-2955
2599 Enterprise Road, Orange City, Florida 32763 (386) 774-5225
3991 West Eaugallie Boulevard, Melbourne, Florida 32934 (321) 242-8488
159 Williamson Boulevard, Ormond Beach, Florida 32174 (386) 672-0733
1399 Dunlawton Avenue, Port Orange, Florida 32127 (386) 761-2222
1999 Bichara Boulevard, The Villages, Florida 32159 (352) 753-9909
298 Southhall Lane, Maitland, Florida 32751 (497) 838-3585
7955 County Road 46-A, Lake Mary, Florida 32746 (497) 444-9939
2615 Southwest 19 Avenue Road, Ocala, Florida 34474 (352) 622-4499
15351 US Highway 441, Eustis, Florida 32726 (352) 357-2188
2969 East Osceola Parkway, Kissimmee, Florida 34744 (487) 348-2818
4759 West Irlo Bronson Memorial Parkway, Kissimmee, Rlorida 34746 (487) 397-2288
13589 John Young Parkway, Orlando, Rlorida 32837 (497) 296-5839
1355 Apalachee Parkway, Tallahassee, Florida 32391 (859) 222-1254
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1400VêSqu^8ou^
6 3 7 W e ^ ^ 8 o ^ 8 ^ ^
675 West
Panama C ^ F ^ d a 32405 (85^^
3050 Ross Clark O ^ e S W ^ O e t h a n , Alabama 35303 (334) 7937600
1301 SoutbAugustlne Road, Valdosta,Georgia 31601 (229) 2419933
1 9 0 5 N W 1 3 t b Street, Gainesville, Riohda 32961 (352) 335 9159
1401 Capital G i r o l e N W , T a l l a b a s s e e , Rlorida 32304 (650) 574 3555
506 West 7tb Street, Titton, Georgia 31794 (912) 352 2337
699 NTyndallRarkway,Gallaway,Rlorida 32494 (559) 522 9993
10071 Middle Beaob Road, Panama GityBeaob, Rlorida 32407 (650) 234 3600
421 East 8 y R a s s N E , M o u l t r i e , Georgia 37165(912) 373 9729
4 1 4 U S H I g b w a y 2 3 1 South,Gzark, Alabama 36369 (334)445 0993
13765 Hlgbway19Soutb,Tbomasville,Georgia31792 (229) 227 9511
3254 Inner Perimeter Road, Valdosta, Georgia 31595 (229) 257 9993
2523SoutbGrangeAvenue,Grlando, Rlorida 32595 (497)429 2940
3 3 1 5 0 S H i g b w a y 17 92,Gasselberry,Rlorida 32797 (497) 969 7926
NewAppieôo.
MiobaelO Glander
170 Wind GbimeGourt
Raleigb, North Carolina 27615
(919)646 2577
C^lets:
7515 Rivers Avenue,N Charleston,South Carolina 29495 (643) 553 6137
1659 Sam Rittenberg, Charleston, South Carolina 29497 (543) 556 6421
511Southlrby Street, Rlorenoe, South Carolina 29591 (643) 676 9406
53 GldTrolley Road, Summervllle, South Carolina 29453 (543) 571 9552
1466 Stuart Engles Boulevard, Mount Pleasant, South Carolina 29464 (643) 354 4995
7915NorthKingsPlighway, Myrtle Beaoh,South Carolina 29577 (543) 497 5513
4910AshleyRhosphateRoad,North Charleston,South Carolina 29429 (543) 297 9999
1647 Ghuroh Street, Conway, South Carolina 29525 (543) 245 9976
203 South Pitth Street, Plartsville, South Carolina 29559 (343) 339 2611
3256 Highway 17 South, Murreys Inlet, South Carolina 29575 (343) 357-1935
649 R e m b e r t C O e n n l s Boulevard,MonoksCorner,South Carolina 29461 (643) 751 4545
1571 Plighway17North, North Myrtle Beaoh, South Garolina29597 (643) 259 3550
1310North Main Street, Summerville, South Carolina 29453 (543) 465 9911
G.Âppie^no.
MiohaelO Glander
179 Wind Chime Court
Raleigh, North Carolina 27615
(919)546-2577
Outlets:
3990 South Elm Rlaoe, Broken Arrow, Gklahoma74911 (915) 451 1715
4733 South YaleAvenue,Tulsa, Oklahoma 74135 (916) 564 7673
4333 Warden Road,North Little Rook, Arkansas 72116 (591)791 3309
9499 East71st Street, Tulsa, Oklahoma74133 (915) 2544237
4426 GentralAvenue,Hot Springs, Arkansas 71913 (591)525 2774
12119ChenalParkway,Little Rook, Arkansas 72211 (591)954 3444
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3521 South Broadway, Edmond, Oklahoma 73013 (405) 478-1716
317 North Perkins, Stillwater, Oklahoma 74076 (405) 372-9557
500 Ed Noble Parkway, Norman, Oklahoma 73072 (405) 360-5883
415 West Shawnee, Muskogee, Oklahoma 74401 (918) 687-3266
3616 West Garriot, Enid, Oklahoma 73703 (405) 233-1525
4825 Northwest Expressway, Oklahoma City, Oklahoma 73132 (405) 721-9339
688 North Air Depot, Midwest City, Oklahoma 73119 (495) 733-8824
6820 S.W. 3 Street, Oklahoma City, Oklahoma 73119 (405) 495-9311
11194 East 4 1 Street, Tulsa, Oklahoma 74146 (918) 664-1489
2491 South I-35 Frontage Road, Moore, Oklahoma 73168 (495) 794-4679
6 Mabelvale Plaza Lane, Little Rock, Arkansas 72209 (591) 565-3004
9939 North 121*' East Avenue, Owasso, Oklahoma 74055 (918) 376-9986
17348 Interstate 39, Benton, Arkansas 72015 (591) 778-4114
2610 West Memorial Drive, Oklahoma City, Oklahoma 73134 (405) 751-6368
1311 East Hillside Drive, Broken Arrow, Oklahoma 74012 (918) 355-0242
10461 South Memorial, Bixby, Oklahoma 74008 (918) 369-8989
1000 East State Highway 152, Mustang, Oklahoma 73064 (405) 376-5800
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Porter Apple Company
Todd G. Porter
4101 Carnegie Place
Sioux Falls, South Dakota 57106
(605) 361-5301
Outlets:
1700 Hamilton Boulevard, Sioux City, Iowa 51193 (712) 233-2226
4555 Southern Hills Drive, #196, Sioux City, Iowa 51191 (712) 276-2226
2169 Haines Avenue, Rapid City, South Dakota 57791 (695) 394-9338
381 North 27 Street, Spearfish, South Dakota 57783 (695) 642-9489
3221 East 18 Street, Sioux Falls, South Dakota 57193 (695) 977-4648
3891 LeFevre Drive, Brookings, South Dakota 57006 (605) 692-2775
700 South 13 Street, Norfolk, Nebraska 68701 (402) 379-4269
2630 9 Avenue S.E., Watertown, South Dakota 57201 (605) 882-8804
4001 West 4 1 Street, Sioux Falls, South Dakota 57106 (605) 362-1926
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Potomac Family Dining Group Operating Company L L C
Jim llaria, President/CEO
13873 Park Center Road, Suite 316S
Herndon, Virginia 20171
(703) 787-6550
13858 Noblewood Plaza, Woodbridge, Virginia 22193 (793) 688-1523
2851 Plank Road, Fredericksburg, Virginia 22404 (540) 785-9944
127 East Broad Street, Falls Church, Virginia 22946 (793) 532-5388
45979 Denizen Plaza, Sterling, Virginia 29165 (793) 444-4354
9591 Liberia Avenue, Manassas, Virginia 29119 (793) 331-9697
9991 Southpoint Parkway, Fredericksburg. Virginia 22947 (549) 898-7441
3330 Pine Bluff Drive, Dumfries, Virginia 22926 (793) 221-0783
105 West Lee Highway, Warrenton, Virginia 20186 (540) 341-2044
1000 Stafford Market Place, Stafford, Virginia 22556 (540) 658-0717
4995 Westone Plaza Drive, Chantilly, Virginia 20151 (703) 378-1133
34
1 5 0 C m o k W ^ ^ O ^ ^
12970 Fair Lakes S h o p p y
9 3 1 0 R ^ m o n d Highway A l e x a n d r a , V i ^ i n i a
45 RivertonOommoos P l a z a , F m n t R o y a ^ V ^ n i a 228^^
4 1 0 0 N W G r a i n H ^ w a y , 8 e w l e , Maryland 2 0 7 1 5 ( 3 0 1 ^
8510Craln Highway, W a l d o s Maryland 20511^01)545-2217
45450 M l r a m a r W a y , O a l ^ r n l a , Maryland 20519(501) 552 1578
5 5 1 5 S p e ^ r u n i Orlve, Prederlok, Maryland 21795 (591)555 5957
7242 Baltimore Avenue, College Park, Maryland 29749 (891)554 5115
1999 LargoCenterOrlve, Largo,Maryland 29772 (891)499 4118
21048 Prederlok Road, Germantown, Maryland 20578 (801) 972 1891
555 NorthBolomonslsland Road, PrlnoePrederlok, Maryland 20878 (419)414 5828
8447 0onnell Orlve, Rorestvllle, Maryland 29747 (891) 518 7890
12201 W l n o h e 8 t e r R o a d B W , L a V a l e , Maryland 21502 (891) 7294189
19BhlnlngWlllowWay,La Plata, Maryland 20848 (891) 589-4945
18809 BaltlmoreAvenoe,Bulte491, Laurel, Maryland 29797(891)7254988
1950WayneAvenue,Chamhershurg,Pennsylvania 17291 (717)288 4949
12825 WashlngtonTownshlp Boulevard,Waynesboro,Pennsylvania 17258 (717) 749 8957
755 Roxoroft Orlve, Martlnsburg, West Virginia 25401 (894) 258-4979
499 Plowing Springs Road,CharlesTown,West Virginia 25414 (894) 728 8888
2159 Coliseum Orlve, Hampton, Virginia 28888(757) 888 8489
5 1 1 B Hughes Boulevard, Elizabeth City, North Carolina 27999 (252) 888 2221
5992 South CroatanHlghway,Nags Head,North Carolina 27959 (252) 441 8552
999 Moorefleld Rark Orlve, Rlohmond, Virginia 28285 (804) 880 1988
598 LynnhavenRarkway,VlrglnlaBeaoh,Vlrglnla 28452 (757) 4584245
12285 Jetterson Avenue, NewportNews,Vlrglnla 28892 (757) 249 2207
9891 West Broad Street, GlenAllen, Virginia 28050 (894)747 0588
5400 West Broad Street, Richmond, Virginia 28280 (804) 878 1721
2811Hundred Road West, Chester, Virginia 28881 (804) 788 4259
19828 Hull Street, Richmond, Virginia 28112(894) 278 8855
449SouthRarkClrole, Colonial Heights, Virginia 28884 (894) 525 5088
4182 Portsmouth Boulevard, Chesapeake, Virginia 28821 (757)485 7024
5750 Virginia Beach Boulevard, Norfolk, Virginia 28502 (757) 481 5785
1520 Sams Circle, Chesapeake,Vlrglnla 28829 (757) 549 1020
10151 Brook Road, GlenAllen,Virginia 28989 (894) 285 8995
4940VlrglnlaBeach Boulevard, Virginia Beach, Virginia 28452 (757) 498 8914
1425 Kempsvllle Road, Virginia Beach, Virginia 28454 (757) 487 8755
571 Branchlands Boulevard,Charlottesvllle,Vlrglnla 22991 (484)974 5598
189 Lee Jackson Highway, Staunton, Virginia 24491 (549)885 8857
1298North Main Street, Suffolk, Virginia 28484 (757) 984 8578
1758 General Booth Boulevard, Virginia Beach, Virginia 28454 (757) 721 8459
4895 South Laburnam Avenue, Richmond, Virginia 28281 (894)225 9899
581 Rlrst Colonial Road, Virginia Beach, Virginia 28451 (757)487 5888
1849 Richmond Road, Williamsburg, Vlrglnla28185 (757) 584 7274
11909 Ironbrldge Plaza, Chester, Virginia 28881 (894) 778 4722
1850 Bast Market Street, Harrisonburg, Virginia 22891 (540)488 8121
999 Lew OeWItt Boulevard, Waynesboro, Virginia 22989 (549) 949 7899
1808 South Main Street, Rarmvllle, Virginia 28991 (484) 815 5581
195 Sadler Lane, Emporla,Vlrglnla 28847 (484) 888 9549
11789 West Broad Street, Richmond, Virginia 28288 (804) 884 5991
2905 Abbey Road, Charlottesville, Virginia 22911 (484) 298 8298
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1396 Armory Drive, Franklin, Virginia 23851 (757) 516-6953
1659 Tappahannock Boulevard, Tappahannock, Virginia 22569 (894) 443-9361
191 South Carter Street, Ashland, Virginia 23995 (894) 798-2334
193 Lakeview Parkway, Suffolk, Virginia 23435 (757) 686-1159
199 Wells Street, La Crosse, Virginia 23979 (434) 447-4813
612 Grassfield Parkway, Chesapeake, Virginia 23322 (757) 312-9163
7396 Bell Creek Road, Mechanicsville, Virginia 23111 (804) 559-9223
6896 Walton Lane, Gloucester, Virginia 23061 (804) 694-3169
Quality Restaurant Concepts, L.L.C.
Fred Gustin
691 Vestavia Parkway, Suite 1999
Birmingham, Alabama 35216
(295) 824-5069
Outlets:
261 North Peters Road, Knoxville, Tennessee 37923 (423) 531-5819
999 East County Line Road, Ridgeland, Mississippi 39157 (691) 957-7632
1213 Oak Ridge Turnpike, Oak Ridge, Tennessee 37839 (865) 483-1234
3793 Hardy Street, Hattiesburg, Mississippi 39491 (691) 268-9239
1661 East Stone Drive, Kingsport, Tennessee 37660 (423) 246-6373
1322 West Walnut Avenue, Dalton, Georgia 38722 (796) 278-5776
2342 Shallowford Village Road, Chattanooga, Tennessee 37421 (423) 499-1999
2100 North Roane Street, Johnson City, Tennessee 37601 (423) 283-0996
358 Northgate Mall, Chattanooga, Tennessee 37422 (615) 875-8353
885 Barnes Crossing Road, Tupelo, Mississippi 38894 (662) 848-4999
2564 Alcoa Highway, Alcoa, Tennessee 37791 (423) 984-6444
2332 Highway 45 North, Columbus, Mississippi 39792 (681) 327-3348
5316 Central Avenue Pike, Knoxville, Tennessee 37912 (423) 689-9215
168 Paul Huff Parkway, Cleveland, Tennessee 37312 (423) 479-4546
3216 East Towne Mall Circle, Knoxville, Tennessee 37924(865) 523-2699
814 Highway 12 West, Starkville, Mississippi 39759 (662) 324-3459
5536 Decatur Pike, Athens, Tennessee 37393 (423) 745-8986
2771 E. Andrew Johnson Highway, Greeneville, Tennessee 37745 (423) 636-1483
9319 Highway 49, Gulfport, Mississippi 39593 (691) 868-8867
2328 West Andrew Jackson, Morristown, Tennessee 37814 (423) 585-5333
2389 Lakeland Drive, Rlowood, Mississippi 39298 (691) 939-4969
196 Highway 11 & 88, Meridian, Mississippi 39391 (691) 693-4429
2919 Highway 15 North, Laurel, Mississippi 39449 (691) 649-1998
425 Volunteer Parkway, Bristol, Tennessee 37629 (423) 968-1855
111 Clinton Center Drive, Clinton, Mississippi 39956 (691) 924-8644
5696 East Brainard Road, Chattanooga, Tennessee 37421 (423) 553-9203
1010 Overmountain Drive, Elizabethton, Tennessee 37643 (423) 547-9399
124 Grandview Boulevard, Madison, Mississippi 39119 (691) 695-2652
126 Stribling Lane, Brandon, Mississippi 39942 (691) 664-3915
2219 Battlefield Parkway, Rt. Oglethorpe, Georgia 30742 (796) 858-6654
297 Collier Drive, Sevierville, Tennessee 37862 (865) 908-9424
951 Cedar Lake Road, Biloxi, Mississippi 39532 (228) 792-3789
50 Corbin Center Drive, Corbin, Kentucky 40791 (696) 528-8465
764 Lake Harbour Drive, Ridgeland, Mississippi 39158 (681) 797-1784
491 Market Street, Chattanooga, Tennessee 37402 (423) 826-4996
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715 Memorial Boulevard, Picayune, Mississippi 39466 (691) 273-4755
595 Apache Drive, McComb, Mississippi 39648 (691) 688-1529
1665 Sunset Drive, Grenada, Mississippi 38991 (662) 259-7448
R&D Restaurant Enterprises, Inc.
Anand D. Gala
3191 Red Hill Avenue, Suite 199
Costa Mesa, California 92626
(899) 653-3517
Outlets:
2263 South Shore Center, Alameda, California 94591 (519) 522-7971
4391 North 1st Street, Livermore, California 94559 (925) 686-4399
24941 Southland Drive, Hayward, California 94545 (519) 782-6499
2819 Ygnacio Valley Road, Walnut Creek, California 94598 (925) 939-9139
1369 Fitzgerald Drive, Pinole, California 94564 (925) 243-9499
2737 Hillcrest Avenue, Antioch, California 94599 (925) 753-5959
17999 San Ramon Valley Road, San Ramon, California 94583 (925) 327-1489
39139 Rarwell Drive, Fremont, California 94537 (519) 742-6499
4898 Dublin Boulevard, Dublin, California 94568 (925) 875-9689
39989 Dyer Street, Union City, California 94587 (519) 324-6399
R M H Franchise Corporation
2921 Pine Lake Roadi #100
Lincoln, Nebraska 68512
(492) 858-7889
Outlets:
199 Manhattan Town Center, Suite P-5, Manhattan, Kansas 66582 (785) 537-9999
5928 S.W. 17th Street, Topeka, Kansas 66684 (785) 272-3664
3739 Village Drive, Lincoln, Nebraska 68516 (402) 429-1182
4994 Frederick Boulevard, St. Joseph, Missouri 64506 (816) 233-8891
2621 5th Avenue, Scottsbluff, Nebraska 69361 (398) 635-7759
4925 South Loop 289, Lubbock, Texas 79423 (886) 785-4925
2714 Soncy Road, Amarillo, Texas 79121 (896) 351-2819
192 Platte Oasis Parkway, North Platte, Nebraska 69191 (398) 532-5292
2911 Kemp Boulevard, Wichita Ralls, Texas 76398 (949) 767-5287
6199 O Street, Lincoln, Nebraska 68585 (492) 467-6161
6211 N.W. Cache Road, Lawton,.Oklahoma 73585 (495) 536-8699
3299 Grand Avenue, Laramie, Wyoming 82979 (397) 745-3889
2991 Eaglecrest Drive, Emporia, Kansas 66801 (316) 343-9999
2688 West Broadway, Ardmore, Oklahoma 73491 (589) 499-3373
3951 North 27 , Lincoln, Nebraska 68521 (402) 477-1313
359 Miracle, Evansville, Wyoming 82636 (397) 472-6555
721 Diers Avenue, Grand Island, Nebraska 68893 (398) 398-5199
4619 South Lincoln Avenue, York, Nebraska 68467 (492) 362-3789
1927 Cliff Davis Drive, Gillette, Wyoming 82716 (397) 685-1118
5769 Airport Boulevard, Mobile, Alabama 36688 (334) 343-4981
5991 Bayou Boulevard, Pensacola, Florida 32583 (858) 479-9298
8678 Highway 98 West, Destin, Florida 32541 (859) 267-3855
4949 Government Boulevard, Mobile, Alabama 36693 (384) 666-1769
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165 East Nine Mile R o a ^ P e n ^ ^
2469 S e ^ h M o K e n z i e Street F ^
1661 BienviiieBouleve^ Ocean S p h n ^ M i s ^
2 1 6 R e 5 b e ^ Reed, O r e s ^ i e ^ F i e n d a 62566 (650) 6695489
5695 2 ^ A v e n u e , Kearney, Nebraska 66846 (898) 696 6999
828 Ea5t28^ Street, Coiumbos, Nebraska 68601 (402)562 5128
514 East Expressway 88, McAiien, Texas 78598 (956) 686 8484
4691 Nortb19tb Street, McAlien, Texas 78591 (956)686^9690
7691 San Oarie Avenue, Larede, Texas 78941 (956) 725 9999
1519West Harrison,Hariingen,Texas 78559 (958) 425 5544
6891 SeutbRadre island Orive, Corpus Obristi, Texas 78412(881)998 1999
2919SoutbMainStreet,Maryville, Missouri 64468 (669) 582 8181
2491 Eootbill Boulevard, Rook Springs, Wyoming 82991 (897) 862 9299
5689WestAmarillo Boulevard,Amarillo,Texas79196 (898) 877-7479
5691 4^ Street, Lubbock, Texas 79416 (896) 7854118
8501 Nortb Main Street, Altus,Oklaboma 66521 (589) 489 1599
1229 Nortb Mississippi, Ada, Okiaboma74829 (589) 272 6584
1918WestTrenton Road, Edinburg, Texas 78589 (956) 994 8878
1491 Oell Range Boulevard, Cbeyenne, Wyoming 82009 (897) 888 8484
2898 0sborneOriveWest,Hastings, Nebraska 68991 (492)462 6978
2992 NortbLISHigbway81,Ouncan,Oklahoma 78588 (589)475 9981
2958 SoutbAlma School Road, Mesa, Arizona 85210 (489) 881 7557
7888Turtway Road, Rlorence,Kentucky41042 (859) 871 4141
195 North SpringsboroRike,WOarrollton,Ohio45449 (987) 488 8222
4999 Nicholasville Road, BlockB, Lexington, Kentucky 49598 (859) 271 9898
19685TechwoodOircle, Blue Ash,Ohio 45242 (518) 769 6291
2755 Brice Road, Reynoldsburg,Ohlo48068(614) 755 9999
2729 West Bell Road, Rhoenlx, Arizona 85928 (892) 789 9449
967 Hebron Road, Heath, Ohio48956 (614) 522 1579
565 East Wetmore, Tucson, Arizona 85795 (529) 292 2899
5959 Orookshank, Cincinnati, Ohio 45288 (518) 451 8915
4449 OlenEste Withamsville Road, Batavla, Ohio 45198 (518) 752 9799
4690 EastBroad Street, White Hall, Ohio48218(614) 868 9799
6259 East Southern Avenue, Mesa, Arizona 85296 (489) 880 8999
1897 0S127South,Rranktort, Kentucky 49692 (592) 875 6117
89 Crestview Hills Mall Road,Crestview Hills, Kentucky41917(859) 841 6798
5879 East Broadway,BuildingE, Rark Mall, Tucson, Arizona 85711 (529) 759 9780
2082 East Baseline Road,Mesa, Arizona 85294(489) 5454299
489 Ackerman Road, Columbus, Ohio 48292 (614) 268 1229
799 Washington Boulevard NW,Hamilton,Ohio45918(518) 888 9490
8091 West Bell Road, Reoria, Arizona 85881 (628) 878 1419
858 Eastern Bypass, Richmond, Kentucky 49475(859) 624 1224
9595ColrainAvenue, Cincinnati, Ohio 45251 (518) 885 9499
8249Towne Boulevard, Middletown, Ohio45044 (518) 727 9958
1655 West Elliott, Tempo, Arizona 85284 (489) 898 2878
8881 OldTroyRlke,Huber Heights, Ohio45424 (987) 288 9978
1899 W e s t l s t Street, Springfield, Ohio45594 (987) 822 6799
2547 North44th Street, Rhoenix, Arizona 85998 (602) 952 9988
4425 National Road East, Richmond, Indiana 47874(817) 985 8949
1615Rivervalley Circle North, Lancaster, Ohio48189 (614) 681 1594
904 Oreat East Rlaza,Niles,Ohio44446 (216) 544 0789
3^
2 East Camelback, Phoenix, Arizona 85012 (602) 266-3330
1525 North Lexington Avenue, Winchester, Kentucky 40391 (859) 737-8111
1881 East Highway 69, Prescott, Arizona 86391 (928) 445-8787
3894 Morse Road, Columbus, Ohio 43219 (614) 337-8238
1759 West Main Street, Troy, Ohio 45373 (937) 335-1550
5880 West Peoria, Glendale, Arizona 85395 (623) 878-3508
1514 Mt. Vernon Avenue, Marion, Ohio 43382 (614) 389-2395
291 South Hermitage Road, Hermitage, Pennsylvania 16146 (412) 347-4393
2239 West Ina Road, Tucson, Arizona 85741 (529) 297-2229
999 East Broadway, Tempe, Arizona 85282 (489) 736-1199
9660 Mason-Montgomery Road, Mason, Ohio 45040 (513) 336-9943
5561 Westchester Woods Boulevard, Columbus, Ohio 43926 (614) 527-9679
1836 Alesheba Way, Lexington, Kentucky 49599 (859) 263-2546
1143 North Higley Road, Mesa, Arizona 85285 (488) 981-4667
6691 South Avenue, Boardman, Ohio 44512 (338) 965-9469
6242 Wilmington Pike, Dayton, Ohio 45459 (937) 846-6177
8565 Winton Road, Cincinnati, Ohio 45231 (513) 729-2499
1161 Polaris Parkway, Columbus, Ohio 43249 (614) 849-9992
4625 East Grand Road, Tucson, Arizona 85712 (529) 319-9544
121 North Plaza Drive, Nicholasville, Kentucky 49356 (859) 881-1464
1599 Georgasville Road, Columbus, Ohio 43228 (614) 851-4181
6984 Mulhauser, West Chester, Ohio 45069 (513) 942-4974
699 North Maysville Road, Mount Sterling, Kentucky 40353 (859) 499-3367
13832 West McDowell Road, Goodyear, Arizona 85338 (623) 536-8449
2810 Alexandria Pike, Highland Heights, Kentucky 41076 (659) 781-2895
2920 Stringtown Road, Grove City, Ohio 43123 (614) 801-1199
13756 West Bell Road, Surprise, Arizona 85374 (623) 544-9368
1590 Oxford Drive, Georgetown, Kentucky 40324 (502) 570-5856
820 North Bridge Street, Chillicothe, Ohio 45601 (740) 702-7753
5331 Pleasant Avenue, Fairfield, Ohio 45014 (513) 939-1799
7929 Beechmont Avenue, Cincinnati, Ohio 45239 (513) 474-6605
881 West Central Avenue, Springboro, Ohio 45066 (937) 743-9429
399 Skywatch Drive, Danville, Kentucky 49422 (859) 936-7489
3899 El Mercado Loop, Sierra Vista, Arizona 85635 (529) 459-1664
221 Vandemark Road, Sidney, Ohio 45365 (937) 498-1833
2188 East Baseline Road, Phoenix, Arizona 85942 (602) 323-5680
1761 Sharkey Way, Lexington, Kentucky 40511 (859) 226-8697
9339 West Northern Avenue, Glendale, Arizona 85305 (623) 877-4885
1795 Delco Park Drive, Kettering, Ohio 45420 (937) 643-9698
175 Wal-Mart Way, Maysville, Kentucky 41956 (696) 759-9629
4712 East Ray Road, Higley, Arizona 65236 (489) 279-9824
2591 West Happy Valley Road, Suite 48, Phoenix, Arizona 85885 (623) 434-7469
1999 Delaware Avenue, Marysville, Ohio 43839 (937) 642-2352
5937 North High Street, Columbus, Ohio 43214 (614) 848-9394
3169 Princeton Road, Hamilton, Ohio 45911 (513) 868-7888
5218 West Baseline Road, Phoenix, Arizona 85334 (602) 695-8919
1991 Harner Drive, Xenia, Ohio 45385 (937) 372-2600
2299 Richmond Road, Lexington, Kentucky (859) 244-8937
39
R M H Illinois, L L C
2021 Pine Lake Road, #100
Lincoln, Nebraska 68512
(402) 858-7880
Outlets:
9380 Joliet Road, Hodgkins, Illinois 60525 (708) 387-7350
4937 West Cal-Sag Road, Crestwood, Illinois 60445 (708) 389-9985
1949 North Kenzie, Bradley, Illinois 69915 (815) 936-9571
2411 Sycamore Road, DeKalb, Illinois 69115 (815) 748-3222
125 South Randall Road, Elgin, Illinois 60123 (847-697-4897
2795 Plainfield Road, Joliet, Illinois 69431 (815) 254-9979
1799 North Richmond Road, McHenry, Illinois 60059 (815) 344-6395
6656 West Grand Avenue, Chicago, Illinois 69797 (773) 836-7696
1597 36 Street, Peru, Illinois 61354 (815) 220-1599
2915 Sheridan Road, Zion, Illinois 60999 (847) 731-7689
2491 West 95 Street, Evergreen Park, Illinois 60895 (798) 857-7635
1719 River Oaks Drive, Calumet City, Illinois 69499 (798) 862-4739
7519 South Cicero, Chicago, Illinois 69652 (773) 767-9711
2499 West Jefferson Street, Joliet, Illinois 69435 (815) 729-1766
4929 West 167 Street, Country Club Hills, Illinois 68478 (788) 647-9486
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R o s e C a s u a l Dining, L.P.
Harry T. Rose
29 Friends Lane
Newtown, Pennsylvania 18949
(215) 579-9229
Outlets:
2141 Generals Highway, Annapolis, Maryland 21401 (419) 573-9978
2793 North Salisbury Boulevard, Salisbury, Maryland 21891 (419) 546-9997
6595 Baltimore National Pike, Catonsville, Maryland 21228 (410) 788-2627
8610 LaSalle Road, Towson, Maryland 21286 (410) 296-7877
3339 Brunswick Pike, Lawrenceville, New Jersey 98648 (699) 799-9559
333 State Highway #33, Hamilton, New Jersey 88619 (699) 899-2828
939 Columbia Boulevard, Bloomsburg, Pennsylvania 17815 (717) 387-3334
634 Baltimore Boulevard, Westminster, Maryland 21157 (419) 751-7127
1745 Fasten Road, Doylestown, Pennsylvania 18991 (215) 491-3399
2 Weis Lane, West Hazleton, Pennsylvania 18291 (579) 459-6674
253 Wilkes-Barre Township Boulevard, Wilkes-Barre, Pennsylvania 18702 (717) 822-3100
74 Viewmont Mall, Scranton, Pennsylvania 18508 ((717) 342-2781
7760 Eastpoint Mall, Baltimore, Maryland 21224 (410) 288-0133
1115 Susquehanna Valley Mall, Selinsgrove, Pennsylvania 17870 (717) 374-7339
2459 Broad Avenue, Timonium, Maryland 21993 (419) 569-3418
8335 Benson Drive, Columbia, Maryland 21045 (410) 872-0174
2 West Road, Newtown, Pennsylvania 18949 (215) 497-3479
1225 Churchville Road, Bel Air, Maryland 21915 (410) 638-1559
2498 Brandermill Boulevard, Gambrills, Maryland 21954 (419) 451-6888
6798 Reisterstown Road, Baltimore, Maryland 21215 (418) 358-4468
2591 Aramingo Avenue, Philadelphia, Pennsylvania 19125 (215) 634-8699
12849 Ocean Gateway, Ocean City, Maryland 21842 (418) 213-7395
40
3479 East Lincoln Highway, Thorndale, Pennsylvania 19372 (919) 383-9159
399 International Drive, Lewisburg, Pennsylvania 17837 (570) 522-6513
8999 Ocean Gateway, Easton, Maryland 21691 (419) 779-9883
8691 Henry Avenue, Philadelphia, Pennsylvania 19128 (215) 482-2899
1197 West Chester Pike, West Chester, Pennsylvania 19382 (810) 996-0751
1305 West Chester Pike, Havertown, Pennsylvania 19083 (610) 449-2296
215 South 15 Street, Philadelphia, Pennsylvania 19136 (215) 772-2791
991 Beards Hill Road, Aberdeen, Maryland 21901 (410) 273-7846
3730 Nazareth Pike, Bethlehem, Pennsylvania 18020 (610) 868-8569
2535-37 Castor Avenue, Philadelphia, Pennsylvania 19134 (215) 744-1531
5600 Perkiomen Avenue, Reading, Pennsylvania 19606 (610) 404-2700
3050 North 5 Street Highway, Reading, Pennsylvania 19605 (610) 929-8037
4301 Pennell Road, Aston, Pennsylvania 19014 (610) 485-3528
174 Eagleview Boulevard, Exton, Pennsylvania 19341 (610) 594-2348
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Ryan Restaurant Corporation
William O. Ryan
2038 Overland Avenue
Billings, Montana 59102
(406) 656-6858
Outlets:
740 24th Street West, Billings, Montana 59102 (406) 655-0255
1108 North 7th Avenue, Bozeman, Montana 59715 (406) 587-3445
4041 Highway 93 South, Missoula, Montana 59881 (499) 251-4920
1200 East Idaho, Kalispell, Montana 59991 (499) 257-7117
1212 Custer, Helena, Montana 59601 (409) 449-7300
204 Main, Billings, Montana 59105 (405) 896-8450
223 River Drive South, Great Falls, Montana 59405 (406) 452-5051
2322 US Highway 93 North, Kalispell, Montana 59901 (406) 755-5575
Scott's Apple, Inc.
Nicholas C. Scott
2225 Downs Drive, Executive Suite - 6 Floor
Erie, Pennsylvania 16509
(814) 868-9516
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Outlets:
7799 Peach Street, Erie, Pennsylvania 16599 (814) 896-8219
2911 West 12th Street, Erie, Pennsylvania 19595 (814) 838-1144
11227 Shaw Avenue, Meadville, Pennsylvania 18335 (814) 333-2848
4002 Buffalo Road, Erie, Pennsylvania 16501 (814) 898-0150
2725 Market Street, Warren, Pennsylvania 16365 (614) 406-7373
Southern River Restaurants, L L C
David E. Paradise, Frank C. Heath, Jr., Jerold D. Krouse & Michael Pettus
417 Main Street
Natchez, Mississippi 39120
(601)445-9710
41
Outlets:
1000 West Esplanade Avenue, Kenner, Louisiana 70065 (504) 469-6500
3701 Veterans Memorial Boulevard, Metairie, Louisiana 70002 (504) 455-0755
850 1-10 Service Road, Slidell, Louisiana 70458 (985) 641-4800
315 North Highway 190, Covington, Louisiana 70433 (504) 898-9500
5539 Johnston Street, Lafayette, Louisiana 79599 (337) 988-9967
4898 South Sherwood Forest, Baton Rouge, Louisiana 70819 (225) 291-3509
4995 General DeGaulle, New Orleans, Louisiana 79114 (594) 361-9799
9792 Airline Highway, Baton Rouge, Louisiana 70818 (225) 924-3001
1500 MacArthur Drive, Alexandria, Louisiana 71301 (318) 449-9991
1220 Clearview Parkway, Harahan, Louisiana 70123 (504) 734-0042
1039 West Tunnel Boulevard, Houma, Louisiana 79399 (985) 851-7189
3142 Highway 199, Hammond, Louisiana 70493 (985) 419-2228
7681 Bluebonnet Boulevard, Baton Rouge, Louisiana 79818 (225-795-7119)
TLC Central, L L C
Matthew Rairbairn & David A. Stein
220 Ponte Vedra Park Drive, Suite 109
Ponte Vedra Beach, Rlorida 32082
(994) 273-9558
Outlets:
877 Country Route 64, Elmira, New York 14993 (697) 739-1959
3791 Vestal Parkway East, Vestal, New York 13799 (997) 729-4311
1295 Union Avenue, Newburgh, New York 12559 (914) 557-9919
Woodbury Common, #488 Evergreen Court, Central Valley, New York 10917 (914) 928-1817
255 Quaker Road, Queensbury, New York 12894 (518) 793-5429
594 North Greenbush Road, Rensselaer, New York 12144 (518) 283-8799
2490 Cambridge Road, Schenectady, New York 12304 (518) 348-4455
3 Lowes Drive, Sarasota Springs, New York 12866 (518) 583- 2686
3451 North Road, Poughkeepsie, New York 12681 (845) 486-0052
2300 North Triphammer Road, Ithaca, New York 14850 (607) 257-6200
656 S.R. 13, Cortland, New York 13045 (607) 753-6031
223 North Comrie Avenue, Johnstown, New York 12095 (518) 762-1720
1794 Black River Boulevard, Rome, New York 13449 (315) 336-9833
12 Orange Plaza Lane, Middletown, New York 19949 (845) 342-2291
4755 Commercial Drive, New Hartford, New York 13413 (315) 768-3389
Southside Mall, 5905 State Road 23, Oneonta, New York 13820 (607) 431-9299
630 West State Street, Herkimer, New York 13350 (315) 866-5900
3149 Silverback Lane, Painted Post, New York 14879 (997) 936-4598
115 Independence Way, Brewster, New York 19599 (845) 279-4165
1171 Ulster Avenue, Kingston, New York 12491 (845) 336-4599
291 Route 9 West, Glenmont, New York 12077 (518) 426-7651
300 Riverside Center, Utica, New York 13502 (315) 735-0421
555 Troy-Schenectady Road, Latham, New York 12110 (518) 785-1998
842 Upper Front Street, Binghamton, New York 13995 (597) 724-3297
429 Fairview Avenue, Hudson, New York 12534 (518) 828-9990
1006 State Road 36, Hornell, New York 14843 (607) 324-3333
42
T L C East, L L C
Matthew Fairbairn & David A. Stein
Ponte Vedra Beach, Florida 32082
(004) 273-0558
Outlets:'
270 New Britain Avenue, Plainville, Connecticut 06062 (860) 747-2358
350 Long Hill Road, Groton, Connecticut 06340 (860) 446-0452
1600 East Main Street, Torrington, Connecticut 06790 (860) 489-8600
526 Boston Post Road, Orange, Connecticut 06477 (203) 795-5762
93 Storrs Road, Willimantic, Connecticut 96226 (889) 423-6069
191 Doming Street, Manchester, Connecticut 06040 (860) 648-2368
TLC West, L L C
Matthew Fairbairn & David A. Stein
Ponte Vedra Beach, Florida 32082
(004) 273-9558
Outlets:
5917 Transit Road, Williamsville, New York 14221 (716) 633-7635
4485 Milestrip Road, Blasdell, New York 14219 (715) 824-5558
585 Moseley Road, Rairport, New York 14458 (585) 425-4799
290 Paddy Creek Circle, Rochester, New York 14615 (585) 581-0839
3189 Erie Boulevard East, DeWitt, New York 13214 (315) 445-7099
628 South Main Street, North Syracuse, New York 13212 (315) 452-5679
1983 East Ridge Road, Rochester, New York 14822 (585) 339-0750
1898 Military Road, Niagara Ralls, New York 14304 ((716) 298-1985
1541 Niagara Falls Boulevard, Amherst, New York 14228 (716) 831-8992
3975 Route 31, Liverpool, New York 13099 (315) 652-6881
1955 Empire Boulevard, Webster, New York 14580 (585) 787-0570
5822 South Transit Road, Lockport, New York 14094 (719) 439-1270
340 East Rairmount Avenue, Lakewood, New York 14750 (715) 763-3599
2955 Delaware Avenue, Buffalo, New York 14216 (716) 876-9153
1785 Walden Avenue, Cheektowaga, New York 14225 (716) 897-2695
1283 Arsenal Street, Watertown, New York 13601 (315) 782-7828
3998 Vineyard Drive, Dunkirk, New York 14948 (716) 366-6780
221 Grant Street, Auburn, New York 13021 (315) 258-8308
2120 Chili Avenue, Rochester, New York 14824 (585) 235-3375
3087 West State Street, Olean, New York 14760 (585) 372-2828
8322 Lewiston Road, Batavia, New York 14020 (585-344-9699
4997 Transit Road, Depew, New York 14943 (716) 681-4888
3349 Monroe Avenue, Rochester, New York 14534 (585) 586-6030
5241 West Genessee Street, Camillus, New York 13031 (315) 488-3715
4207 Recreation Drive, Canandaigua, New York 14424 (585) 304-3430
3360 W. Henrietta Road, Rochester, New York 14623 (585) 427-0370
1050 Union Road, West Seneca, New York 14224 (716) 677-2821
4401 Genesee Valley Plaza, Geneseo, New York 14454 (585) 243-2240
43
Theôomm A P P ^ L L C
KevinR A ^ r d ^ M a ^
1803 Ben Sawyer O o u ^ a ^ #10
Mt ^ e a s a ^ South C e r e ^ e 20484
(848)840 1877
Outlets
8848 East State Street, R o o ^ o r ^ ^ n o i 8 8 1 1 0 8 (818) 228 8818
8024 Milton Avenue, Janesvê.Wsoonsin 88848 (808) 788 8880
1878EastRiversideRoad,Rooktord, Illinois 81114 (818) 884 888^
1802 South West Road, Freeport, Illinois 81082 (815) 288 1818
2880 Cranston Road, Selolt, Wisconsin 58511 (808) 885 0158
T S R R A p p i e Venture, L L C
M a r k S Sohostak
o/o King Venture, Ino
17800 Laurel Rark Orive North, Suite 200C
Livonia, Michigan 48152
(248)857 8180
Outlets:
18855 Eureka Road, Southgate, Michigan 48105 (784) 282 1220
88475 Warren Road, Westland, Michigan 48185 (784) 487 7215
1005 West Eisenhower Rarkway,AnnArhor,Michigan 48104 (784) 741 4851
1708 West MIchiganAvenue, Jackson, Michigan40202 (517) 788 5700
5775 Beckley Road, Battle Creek, Michigan40015(280) 070 8810
48500 Rord Road, Canton, Michigan 48187 (784) 455 7510
5880 West Main Street, Kalamazoo, Michigan 40000 (280) 882 4448
5440 West Saginaw, Lansing,Michigan 48017(517) 821 8045
8851 A l p i n e A v e n u e , N W , C o m s t o c k Rark, Michigan 40821 (818)784 8100
21850 Ecorse Road,Taylor,Michlgan 48180 (818) 880 5400
45211 RarkAvenue,Lltica,Michigan 48817(588) 007 0280
1825 EastShermanBoulevard, Muskegon, Michigan 40444 (281) 787 0845
87004 Van Oyke, Sterling Heights, Michigan 48812(588) 288 0801
17810East Eight Mile Road,Harper Woods, Michigan 48225 (818) 880 1100
1808 SouthMainStreet,Adrian, Michigan 40221 (517) 288 8844
81858 0ratiotAvenue, Roseville,Michigan 48088 (588)415 0880
2050 RipestoneRoad, Benton Harhor, Michigan 40022 (280) 025 8808
8875 South WestnedgeAvenue,Rortage,Michigan40002 (280) 824 1408
1875 28^ S t r e e t S W , W y o m i n g , M i c h i g a n 4 0 5 0 0 (818) 281 2588
8025 12 Mile Road, Warren, Michigan48008 (588) 574 1888
27851 28 Mile Road, Chestertield, Michigan 48051 (588) 040-7010
4055 28^ Street, Grand Rapids, Michigan 40548 (818) 077 1000
1275West14MileRoad,MadisonHeights,Michigan48071 (248)580 0880
455 Haggerty, Commerce, Michigan 48820 (248) 028 8080
2553Elizaheth Lake Road, WatertordTownship, Michigan 48828 (248) 708 1008
17101 Haggerty,Northville, Michigan 48187 (248) 874 0082
2284WoodlakeOrive,Okemos, Michigan 48884 (517) 847 4802
880 NorthBeaconBoulevard,Grand Haven,Michigan 40417(818) 844 8818
8250 Grand Ridge O r i v e N E G r a n d Rapids, Michigan 40525 (818) 884 0402
2105 North Squirrel Road, Auhurn Hills, Michigan48828 (248) 878 4850
44
2100 North T e ^ a p h Road, ^
8700RôOrovoAvonuo,Rort^
2450 Ooolidgo Road,East Lansing,Miohigan 4 8 8 2 3 ^ 1 ^ 3 ^ ^ ^
0100 Highland Road, WhitoLako Township, Michigan
4488 RotomaoAvonoo,Grandviiio, Michigan 40418 (515) 534 5173
2310 Croon Road, AnnArho4Michigan48105 (734) 7411370
787 East Chicago, Coidwator,Michigan 40035 (517) 278 1432
23200 Aiion Road, Woodhavon, Michigan 48183 (734) 802 0582
718Ron^Stroot, Big Rapids,Michigan 40807 (231) 708 7420
3040 EastCrandRivorAvonuo,Howoii, Michigan 45843 (517) 540 0811
3184 BooiinoRoad, Holland, Michigan 40428 (515) 785 4448
18110omillo Road, Lapoo4Michigan48448 (810) 245 8070
1810BouthContoîllo Road,Bturgis,Michigan 40001 (250) 551 0550
5270 Booth Codar,Bouth Lansing,Michigan 48011 (517) 882 8320
888WostBtatoBtroot, Hastings, Michigan 40058 (280) 045 8000
1330 Wost Broadway, ThrooRivors, Michigan 40003 (280) 273 7505
110WhitotailOrivo,Oondoo, Michigan 48131 (784)520 5555
25582 Rord Road, Ooarhorn Heights, Michigan 48127 (313) 581-1187
47000 Grand River Road, Novi,Michigan48874(248)440 1502
8810CarpenterRoad,Ypsilanti,Michigan48107 (734) 073 7440
5000 Goll Road, Gomstock,Michigan40048 (250) 343 2102
1243 HighwayM80,Rlainwell, Michigan 40080 (280) 885 0238
1842 Rackard Highway, Charlotte, Michigan48813 (517) 541 2814
8881 WestUBHighway10,Lodington, Michigan 40431 (231) 845 0511
10528 Belleville Road, Belleville, Michigan45111 (784) 800 5880
515BoothGreenvilleWestOrive, Greenville,Michigan 48888 (818) 754-7880
1205 West Michigan Avenue, Marshall, Michigan 40058 (250) 781 0500
750 Brown Road, Auhurn Hills, Michigan 48325 (248) 303 1405
80885 Lyon Center Orive, OnitE,NewHodson,Michigan45155 (245)445 1770
305 BouthBroadway,LlnitG,Lake Grion,Michigan 48850 (248) 508 0278
1585 Market R l a c e O r i v e , B E , C a l e d o n i a , Michigan 40818(815) 505 0342
23000 Goter Orive, Allen Rark, Michigan 48101 (313) 274 4540
4475 Lake Michigan Orive, Walker,Michigan 40544 (515) 453 3523
3030 Commerce Lane, Ionia, Michigan 48845 (515) 528 1102
2440GntarioOrive,Bt Johns, Michigan 48870 (080) 224 2708
Utah Johnny Appieseed Inc.
JohnB.Rrince
808 East4500 Booth, Boite 210
Bait Lake City, Utah 84107
(801) 582 5108
Gotlets:
5123 Booth Btate Street, Morray, Utah 54107 (501) 282 0350
5575 Booth Redwood Road, Taylorsville, Utah 84123 (801)058 5100
1522 North 1000West,Layton, Utah 84041 (801)773 0100
1125 West Riverdale Road, Riverdale, Utah 84405 (801)304 2200
880 West 1800 Booth, Grem, Utah 84058 (801)228 0111
7047 Booth 1300 East, Midvale, Utah 84047 (801) 555 0000
2175West City Center Coort, West Valley, Utah 84110(801) 0744412
150 Booth River Road, Bt George, Utah 84700 (485) 828 8500
45
1352 South Providence Avenue, Cedar City, Utah 84720 (435) 865-7767
1280 North 30 West, Tooele, Utah 84074 (435) 882-0064
3736 West 7800 South, West Jordan, Utah 84088 (801) 280-6600
150 South Rio Grande #1018, Salt Lake City, Utah 84101 (801)456-5000
313 North West State Road, American Fork, Utah 84003 (801) 216-8200
27 North 500 West, Bountiful, Utah 84010 (801) 335-0333
4331 Credit Union Drive, Anchorage, Alaska 00503 (007) 222-7753
7611 DeBarr Road, Anchorage, Alaska 00504 (007) 332-7753
123 East 12300 South, Draper, Utah 84020 (801) 405-4460
11460 South District Drive, South Jordan, Utah 84005 (801) 405-4480
Woodland Group, Inc.
Martin & Theresa Johnson
601 Main Street, Suite 102
Hazard, Kentucky 41701
(606) 436-0736
Outlets:
335 Harding Place, Nashville, Tennessee 37211 (615) 333-0012
718 Thompson Lane, Nashville, Tennessee 37204 (615) 208-3208
5055 Old Hickory Boulevard, Hermitage, Tennessee 37076 (615) 883-6722
1420 Interstate Drive, Cookeville, Tennessee 38501 (031) 520-1147
2545 Scottsville Road, Bowling Green, Kentucky 42104 (270) 782-6081
1057 North Jackson Street, Tullahoma, Tennessee 37388 (031) 303-2270
3066 Wilma Rudolph Boulevard, Clarksville, Tennessee 37043 (615) 551-8020
705 South James Campbell Boulevard, Columbia, Tennessee 38401 (615) 380-0503
4080 Fort Campbell Boulevard, Hopkinsville, Kentucky 42240 (270) 885-0070
600 North Cumberland, Lebanon, Tennessee 37087 (615) 453-2100
15545 Old Hickory Boulevard, Nashville, Tennessee 37211 (615) 843-1000
1311 Smithville Highway, McMinneville, Tennessee 37110 (031) 473-1000
3534 Tom Austin Highway, Springfield, Tennessee 37172 (615) 384-8300
543-A Highway 46 South, Dickson, Tennessee 37055 (615) 446-6446
2030 South Rutherford Road, Murfreesboro, Tennessee 37130 (615) 805-7777
4037 Columbia Pike, Spring Hill, Tennessee 37174 (615) 302-2468
100 Max Wagner Drive, Glasgow, Kentucky 42141 (270) 678-3325
8100 Highway 100 South, Nashville, Tennessee 37221 (615) 662-1881
46
EXHIBIT I
LIST OF COMPANY-OWNED OUTLETS
EXHIBIT I
LIST O F C O M P A N Y - O W N E D OUTLETS
As of December 31, 2013, our affiliates operated Applebee's Neighborhood Grill & Bar
restaurants at the following locations:
Kansas:
11000 Metcalf, Overland Park. Kansas 66210 (913) 661-0441
3404 Rainbow Boulevard, Kansas City, Kansas 69103 (913) 233-4224
12242 West 9 5 Street, Lenexa, Kansas 96215 (913) 541-4994
11599 West 5 3 Street, Shawnee, Kansas 96293 (913) 962-1133
2912 South Fourth Street, Leavenworth, Kansas 96948 (913) 758-1010
14860 Highway 7, Olathe, Kansas 66061 (013) 820-0593
16119 West 135 Street, Olathe, Kansas 66062 (013) 764-5533
6800 Johnson Drive, Mission, Kansas 66202 (013) 362-0520
7001 West 151 Street, Overland Park, Kansas 66223 (013) 814-0031
1700 Village West Parkway, Kansas City, Kansas 66106 (013) 788-0421
th
rd
th
st
Missouri:
rd
1046 West 103 , Kansas City, Missouri 64114 (816) 041-7030
6060 Antioch, Gladstone, Missouri 64110(816) 455-0880
2035 Independence Center, #2114, Independence, Missouri 64057 (816) 705-7700
6530 NW Barry Road, Kansas City, Missouri 64154 (816) 228-4338
1100 North 7 Highway, Blue Springs, Missouri 64015 (816) 228-4338
781 Melody Lane, Lee's Summit, Missouri 94993 (818) 525-8584
12416 South 71 Highway, Grandview, Missouri 64838 (816) 765-9996
8358 North Church Road, Kansas City, Missouri 64158 (816) 415-9020
1501 N.E. Douglas Street, Lee's Summit, Missouri 64086 (816) 246-6188
13201 State Line Road, Kansas City, Missouri 64145 (816) 043-8427
1010 East North Avenue, Belton, Missouri 64012 (816) 318-9093
9339 East 350 Highway, Raytown, Missouri 64133 (816) 356-1055
4181 Sterling Avenue, Kansas City, Missouri 64133 (816) 356-4171
EXHIBIT J
GIFT C A R D PARTICIPATION A G R E E M E N T
2014
1051979.1
Participation Agreement
THIS PARTICIPATION AGREEMENT (this "Participation Agreement") is entered into as of , 20
, by and among
Stored Value Solutions a division of Comdata Inc. ("SVS"), a Delaware corporation, ACM Cards, Inc. ("ACMC"), a Florida
corporation, and [Franchisee's Name] ("Participant"), a
BACKGROUND
A.
Participant owns and operates one or more Applebee's Neighborhood Grill & Bar restaurants (each a "Restaurant"
and collectively, the "Restaurants") pursuant to afranchisearrangement with Applebee's International, Inc. or one of its
subsidiaries or affiliates (collectively, "Applebee's").
B.
ACMC and SVS have entered into that certain Fourth Amended and Restated Gift Card Services Agreement (the
"Services Agreement") dated October 1, 2013, for SVS to provide services in connection with Applebee's program
governing the issuance of gift cards to Applebee's customers (the "Gift Card Program"); and
C.
The Services Agreement provides that Participant may participate in the Gift Card Program by executing this
Participation Agreement.
AGREEMENT
For due and adequate consideration, the parties agree as follows:
1.
Definitions. The following capitalized terms will have the meaning set forth below.
a.
"ACMC-BIN Gift Cards" are Gift Cards that utilize the banking identification number ("BIN") or its
equivalent, an UN (Issuer Identification Number) or BINs registered and obtained by ACMC pursuant to the
I SO/I EC 7812-1 Standard and process.
b.
"Applebee's Affiliate" means a legal entity under common ownership and control with ACMC.
c. "Confidential Information" means (i) the contents of the Services Agreement and this Participation Agreement;
(ii) and all information, whether oral or written and however disclosed, relating, directly or indirectly, to
software, hardware, processes, methods, procedures, marketing and staffing plans, strategic business plans and
forecasts, product plans and forecasts, third-party designated proprietary and confidential information, pricing
of products or services, and all information which is marked or notified to Participant as being confidential,
together with any other information which, in the normal course of business, would be considered of a
confidential and proprietary nature; and (iii) all information, materials, and data regarding any customer or
supplier of an Applebee's Affiliate or any employee of any party involved in the fulfillment of this Participation
Agreement.
d.
"Digital Gift Card" means a regular gift card account number, which may or may not have a corresponding
security code, that is ordered in bulk quantities and delivered to ACMC or a third party via secure FTP. Digital
Gift Card account numbers are delivered in sequential gift card number ranges and are available for use by
ACMC or an authorized third party that has an established connection agreement in place with SVS. Digital
Gift Cards can subsequently be activated via the SVS System by ACMC through is direct connections or by the
designated third party that has an authorized connection agreement in place with SVS.
e. "Gift Card" means an electronic or physical gift card, including but not limited to a Digital Gift Card or a
Virtual Gift Card that: (a) may be Issued through one or more channels; (b) bears (or is associated with in the
case of Digital Gift Cards, Virtual Gift Cards, or other electronic gift cards) the marks, logos, trademarks, or
trade dress of an Applebee's Affiliate; and (c), following Issuance, may be redeemed for goods and services
(including tax and tip) at Applebee's restaurants or for other goods and services of an Applebee's Affiliate.
"Gift Card" includes ACMC-BIN Gift Cards and SVS-BIN Gift Cards. For the avoidance of doubt, a Gift Card
does not include cards which bear the marks or brand of a major payment network such as Visa, MasterCard,
Discover, or American Express (each a "Payment Network") or whose transactions are authorized and settled
via a Payment Network and are redeemable at multiple unaffiliated merchants.
2014
1051979.1
f
^Gift Card Servê^ means Transaction Processing services and the other services to he provided to
Participant hy SVS in connection withParticipant'sparticipation intheCift CardProgramand such other
services offered hy SVS nnderthis Participation Agreement and accepted hy Participant
g.
"C^tCardTransactionDatabase"meansadatahase comprised of aii information related to
Card, including without iimitation.Cift Card transaction history, aii lists, mat^^^
account numbers and their respective active balances and the BIN
h
tissue" meansaCift Card has been purchased andavalid transaction has been posted.
i
"Participant Rejected Item" means anACH transaction initiated by SVS against P a ^
that has been rejected due to insufficient funds or lack ofauthorization to debit the account.
j.
"Standard Cift Cards" are closed-loop(meaning that such Cift Cards may only be redeemed for goods and
services (including tax and tip) at Applebee's Neighborhood C r i l l ^ B a r restaurants or for o ^
services of an Applebee's Affiliate) Cift Cards processed solely on the SVS System o f a C R ^ product type
withadimensionof^ 3 ^ x 2 1 ^ . S t a n d a r d Cift Cards are constructed ofaPVCsuhstrate(whitecore)wi^^
thickness o f ^ o r 30 mil. Standard Cift Cards containabrown magnetic stripe of ^ / l ^ ' i n width, located^
fromthebottomofthebackofthecard The magnetic stripe contains two (2)data Standard Cift Cards contain
anineteen-digit account number printed on the card back and encoded on the magnetic stripe; the magnetic
stripe containsaCardVerificationValue(CVV) security code and is data encoded according to ISC standards.
k
"SVS-BIN Cift Cards" are Cift Cards that utilize the SVS BIN.
1.
"SVSIIardware" means the internal hardware maintained and utilized by SVS to support the provision of
Transaction Processing services.
"SVS Procedures" means the internal operating procedures used by SVS to support the provision of
Transaction Processing services.
n
"SVS Software" means the application software utilized and maintained by SVS on its systems.
o. "SVS System" means, collectively,the SVS Software, the SVS Hardware, and the SVS Procedures.
^.
"Transaction Processing" means posting ofeach transaction to the appropriate Cift Card file as it occurs in
"realtime."
q.
"Virtual Cift Card" isaregular gift card account number,which may or may not haveacorresponding
security code, that is warehoused by SVS under ACMC specific merchant numbers. ACMC ordersaquantity
ofVirtualCift Cards in advance and this inventory is dedicated to ACMC for future use. ACMC accesses this
inventory through established connections and by makingarealtime"lssueVirtual" requests to SVS^
receipt of an "Issue Virtual" request, SVS will provideavirtual card number, with or withoutacorresponding
security code, for theappropriatedollar amount All subsequent transactions(ie customer redemptions)
againstaVirtualCift Card require the PIN number to be present. SVS providesadaily report for inventory
management
2.
Participation in Cift Card Program. By entering into this Agreement, Participant agrees to participate in t^^
Card Program, which generally includes services relating to order and delivery of Cift Cards, valuation, transaction
processing, and settlement and reconciliation of Cift Card transactions, and agrees that its participationm
Program will be governed by the terms and provisions of this Participation Agreement and any guidelines for ftanc
participation in the Cift Card Program that may be established and amended by ACMC.
3.
Participant Responsibilities. At Participant's Restaurants, each Participant is response
a. Handling and ownership ofthe funds paid by the purchasers or holders ofthe Cift Cards.
b Delivery ofthe products or services due to the purchasers or the holders ofthe Cift Cards.
2014
^19^1
c Restauram operations râted to the Gift Card Program.
d. Gift Card Program oompiianoe with ail federal state and loeai iaws and regulations.
e. Reeoneihng the difference hetween the Participant's respective transaction records and the Gift Card
Transaction Database.
f. Financial and reporting obligations associated with the pnrch^
abandonment or escheatment ofthe Gift Cards and the associated funds.
g. Costs associated with upgrading technology at Participant's Restaurants and offices
h. Paymentofthecostsand fees charged by SVS andACMC to Participant.
i. Abiding by and complying with the terms and conditions ofthe Services Agreement, except for those t e ^
apply soleiyto ACMC.
j.
^
For any Gift Cards requiring cross-border shipment or deliveryâssuming the designation ofimporter of record,
where applicable, and responsibility for all import duties, taxes and assessments in connection therewith
Information Spreadsheet and ACH Authorization.
a^ Participant understands and agrees that amounts due and owing from Participant to SVS in connection with the
Gift Card Program will be automatically debited from Participant's designated bank account(s) by automated
clearinghouse ( " A C ^ ) . Participant understands and agrees that SVS is acting as settlement agent for
Participant and other participants in the Gift Card Program for the settlement of Gift Card redemptions
between Gift Card Program participants Accordingly, SVS will initiate ACF1 debits from and credits to
Participant's designated bank account(s)fbr amounts due to or from Participant for redemptions ofGiftC^^
b. Participant willcomplete and sign anÎnformation Spreadsheet" for purposes of providingdemographic
information or profile foraRestaurant and an ACH authorization form, in each case, in the form provided
SVS, and will send the original ACH authorization form to Participant's bank andacopy to SVS.During the
Term, Participant will (a) promptly notify SVS andACMC of any change in information previously provided
byParticipantonanlnfbrmationSpreadsheetoran ACHauthorizationform,and(b)willprovideupdated
information and forms as requested by SVS orACMC,including,withoutlimitation,aseparate Participate
Agreement executed by any special purpose entity created and used by Participant to operate Participant's Gift
Cardprogram.lf Participant addsanewRestaurant, Participant willupdatethelnfbrmationSpreadsheet at
least 30 days before the Restaurant opens for business
^
Offsets. Participant acknowledges and agrees that SVS may reduce the amount to be deposited into Participant's hank
account by any outstanding amount that is owed by Participant or any ofParticipant's affiliates to ACMC or an Applebee's
Affiliate (the "Offset Amount") and will depositthe Offset Amount into ACMC's account.
^
funding. Participant acknowledges, agrees and understands that proper funding ofits designated bank account(s)for
the Gift Card Program is necessary to ensure fair and efficient administration ofthe Gift Card Program.Participant
ensure that its bank accounts are properly funded for the ACH settlement process and for ACF1 debits offees owed to SVS
Participant acknowledges that SVS may charge ACMC certain amounts, including interest and penalties, in connection
Participant Rejected Item. Participant will defend, indemnify, hold harmless and reimburse ACMC, its affih^^
and officersftomand against any claim resulting ftom Participant's breach ofthis Section, including,withouth^
amounts (including interest and penalties)that may be incurred byACMC in connection withaParticipant Rejected Item
7.
Confidentiality.Participant acknowledges that the Services Agreement is confidential and that Parties
provided access to other Confidential Information ofSVS.
a. Participant will use Confidential Information only to perform its obligations under this Particip^
and will not disclose the Confidential Information to any third party Participant will only disclose Confide
Information toits employees or agents who need to know such information and who have previously agreed.
2014
10519791
either asacondifion to employmem^
conditions substantias s i m i ^
h Participant wiii protect the Confidential Informationfromboth unauthorized n^^
exercisingat least thesamedegreeofcare that it usesfbr similar information of its own^hutnoless than
reasonahiecare,wiiiimmediateiygive notice to the disclosing party of any unauthorized use or disclosure of
Confidential Information and agrees to assist the other party in remedying any unauthorized use or disclosure of
Confidential Information.Participant will not disclose to SVS or ACMC any confidential information o f a ^
party without that third party's consent.
c. Llpon cessation of work or written request, Participant will return or destroy (and verify in writing the
destruction) allConfidential Infbrmationof SVSand, at SVS'soption, willprovide writtencertificationof
compliance with this provision.
d. Participant has no ohligation to protect information that is:(a) rightfully known to
underthisParticipation Agreement; (h)independently developed hy Participant without relying on Confidential
Information; (c)part of the puhlic domain or lawfully obtained hy Participant fromathird party not under an
ohligation ofconfidentiality;or(d)freeofconfidentiality restrictions hy written agreement ofSVS
e. Participant may disclose Confidential Information to the extent required hy law, hut Participant must give SVS
prompt written notice of the required disclosure and must makeareasonahle effort to ohtainaprotective order
at SVS's expense
f
Participant agrees that the wrongful disclosure ofConfidential Information may cause irreparable injure
not adequately compensable in monetary damages. Accordingly,SVS may seek injunctive relief in any court of
competentjurisdiction for the breach or threatened breach ofthis Section in addition to any other remedies in
law or equity Participant will not raise the defense of an adequate remedy at law.This provision does not alter
any other remedies available to either party
g. Participant will not, without written consent of SVS and ACMC, disclose or issue any news release,
announcement, denial or confirmation ofthis Participation Agreement, the Services Agreement, or any actual or
potential business negotiations or relationship hetween Participant and SVS or ACMCand SVS
Indemnifieation.
a
SVS will defend, indemnify, hold harmless and reimburse Participant and Participants'affiliates, dire^
officers(each,a"Participant Indemnitees from and against any claim byathird party againstaParticipan^
Indemnitee tothe extent resulting from or alleged to have resulted from any breach ofthis Participation
Agreement or the Services Agreement or negligent act or omission of SVS, its officers, directors, employees,
agents or representatives.
b. SVS will defend, indemnify,hold harmless and reimburse the Participant Indemnitees from and against any claim
hyathird party that the SVS System or Standard Cifr Card constitutes an infringement of any patent, trademark
orcopyrightorthemisappropriationofany trade secret Forany suchthirdparty claim,or tominimize the
potential for a claim, SVS may at its option and expense either: (a) procure the right for the Participant
Indemnitees to continue using the SVS System; (h)replace or modify the SVS System with comparable services;
or(c)terminate the portion of the SVS System affected by the claim.
c.
SVS' obligations ahove will not apply to the extent that the infringement or violation is causedhy: (a) a
modification to the SVS System or Standard Cifr Cards by ACMC, ACMC's affiliates, directors and officers or
Participant lndemnitee(eacha''non SVS Party'')(or any person or entity acting on behalf ofanonSVS Party);
(b) the combination of theSVSSystemand/or Standard Cifr Cards by any nonSVSParty(or any person or
entity acting on the behalf ofanon-SVSParty)with other third party products or services;(c)functionalo
specifications that were provided hy or requested by any non-SVSParty,or(d) any services or products provided
byathird party other than any thirdparty acting asasuhcontractor,agent,or vendor to SVSusedfbr the
provision ofthe Cifr Card Services.
2014
10519791
d. T o b e m d e m m f i ^ ^ e P ^ i c i p ^
prompfiy notify wiii not affect SVS's obligations unless tbe failure materially prejudices SVS's ability to
satisfactorily defend or settle tbe claim. Tbe
information and assistance for tbe claim's defense and s
defend tbe claim, at its own expense and witb its own counsel. Tbe Participant Indemnitee will bave tbe r i g ^
option, to participate in tbe settlement or defense of tbe claims,witb its own counsel and at its own expense, but
SVS will retain sole control of tbe claim's settlement or defense. To be indemnified under tbis Section, tbe
Participant Indemnitee must not, by any act, includingbut not limited toany admission or acknowledgement,
materially prejudice SVS's ability to satisfactorily defend or settle tbe claim SVS will not enter into any s^^^
ofaclaim tbat involvesaremedy otber tban tbe payment of money by SVS witbout tbe consent of tbe Participant
Indemnitee — sucb consent will not be unreasonably witbbeld, conditioned or delayed.
^
Term and Termination, Tbe term ("Term") of tbis Participation Agreement will begin on tbe date tbis
Participation Agreement is lastexecuted and will terminateupon tbeexpiration or earlier terminationof tbe Services
Agreement,tbis Participation Agreement,orParticipant'sfrancbise arrangement witb an ACMC Affiliatein a
witb its terms,wbicbever occurs first IfSVS or Participant
undisputed sum, tbeparty assertingtbebreacb(tbe "Claiming Party") may givetbe BreacbingParty writtennotice
identiîng tbe cause of tbebreacb Tbe Claiming Party may terminate tbis Participation Agreement if tbebreacbi^
cured witbin 30 days after tbe Breacbing Party bas received tbe breach
materialduties or materialobligationsundertbisParticipationAgreement,tbeClaiming Party m a y g i v e t b e ^
Party written notice identitying tbe cause oftbebreacb. Tbe Claiming Party may terminate tbis Partic^^
tbe Breacbing Party bas not substantially cured tbe breacb witbin 30 days, fftbebreacb cannot reasonably be cured witb^
tbe 30-day period, tbentbeBreacbing Party must commence tbe cure witbin ten days of receiving tbe breacb notice and
diligently proceed to complete sucb cure, iftbis Participation Agreement is terminated, SVS will continue to p^^^^
Cift Card Services witb respect to all outstanding Cift Cards tbat were Issued before termination or expiration and SVS w
continue to be compensated for sucb Cift Card Services until tbe earlier of tbe following events:(a) all Cift Card
reacbazero vaiue,or(b)3^ montbs from tbe dateoftermination Porpurposesofclarification, ACMCmay be tbe
Claiming Party under tbe terms oftbis Participation Agreement to tbe extent Participant is tbe BreacbingPa^
10.
ACMC Suspension and Termination Rigbts. Participant acknowledges and agrees tbat ACMC may (a)
immediately suspendtbis Participation Agreement upon writtennoticetoParticipantandSVS if, in ACMC'ssole but
reasonable discretion, Participant is in breacbofaftancbise agreement witb anyApplebee's Affiliate or tbeirre^
successors or assigns or any otber payment obligations owed to an Applebee's Affiliate or tbeir respective successors or
assigns otber tban tbe payment obligations owed under tbis Participation Agreement (eacb a "Prancbisee Payment
Default"ând/or (b) terminate tbis Participation Agreement if Participantdoes not cureaPrancbiseePaymentD^
witbin ten days ofreceiving notice ofsucb Franchisee Payment Default.
If.
SVS's Proprietary Rigbts and Ownership. SVS will retain exclusive ownership of, and Participant will bave no
rights to, the trade names, trademarks and logos ofSVS SVS will retain exclusive ownership ofthe SVS System and the
BfN assigned to and utilized by SVS, except to the extent ACMC has the right to use the SVS BIN following termm^
ofthe Services Agreement.
12.
No AssignmenLThis Participation Agreement is not assignable byParticipant,in whole or inpart,without the
prior written approval ofACMC and SVS
13.
Notices^ Notices provided under this Participation Agreement must be in writing and sent by hand delivery,
registered or certified mail(retum receipt requested), or reputable overnight carrier(such as Federal Express or I^P
appropriateaddresssetfbrthbeloworsuchotheraddressasaparty may later designatein writing The noticewillbe
deemed given on the day the notice is received.
^
10519791
2014
If to A C M C :
With a copy to:
Vice President, IT & P M O
General Counsel
DineEquity, Inc.
DineEquity, Inc.
8140 Ward Parkway
450 N . Brand Blvd., 7 Floor
Kansas City, M O 64114
Glendale, CA 91203
If to SVS:
With a copy to:
Stored Value Solutions a
Comdata Legal Department
division of Comdata Inc.
5301 Maryland Way
One Oxmoor Place, Suite 305
Brentwood, TN 37027
101 Bullitt Lane
Attn: Chief Counsel
th
Louisville, Kentucky 40222
Attn: President
If to Participant:
Attn:
With a copy to:
Attn:
14.
Miscellaneous. This Participation Agreement may be signed in counterparts and each counterpart with a
hand-written signature, whether an original or an electronic data text (including telegram, telex, facsimile, electronic data
interchange and electronic mail) is considered an original and all counterparts constitute one and the same instrument. This
Participation Agreement and the Services Agreement constitute the entire agreement of the parties as to the subject matter of
this Participation Agreement and supersede all prior or contemporaneous agreements, proposals, discussions or
correspondence, whether written or oral. Except as expressly provided herein, amendments or modifications to this
Participation Agreement must be in writing signed by an authorized representative of each party. No course of dealing or
performance, usage of trade or failure to enforce any term or condition will be used to modify this Participation Agreement.
Participant understands and acknowledges that the Services Agreement may be amended by SVS and A C M C without notice
to Participant. The terms of this Participation Agreement are not intended by the parties to and will not have any effect on the
terms of the Services Agreement as between A C M C and SVS. This Participation Agreement is governed by the laws of the
State of Delaware, without regard to its conflicts of law principles.
2014
1051979.1
ACCEPTED AND AGREED:
ACM Cards, Inc.
Stored Value Solutions a division of Comdata Inc.
By:
By:
Printed Name:
Printed Name:
Title:
Title:
Date:
Date:
Franchisee Name
By:
Printed Name:
Title:
Date:
2014
1051979.1
EXHIBIT K
PEPSI PARTICIPATION AGREEMENT
EXECUTION VERSION
APPLEBEE'S BEVERAGE SALES PARTICIPATION AGREEMENT
This Applebee's Beverage Sales Participation Agreement (this "Participation Agreement") is dated as of
20
(but in no event prior to January 1, 2012) (the "Effective Date") and is by and between
(i) PEPSICO SALES, INC. ("Pepsi-Cola"), a Delaware corporation and a wholly-owned subsidiary of
PepsiCo, Inc. ("PepsiCo"), on its own behalf and on behalf of the Pepsi/Lipton Tea Partnership and the
North American Coffee Partnership (collectively, "Partnership"); and (ii) the undersigned operator of
Applebee's restaurant outlets ("Operator").
RECITALS
WHEREAS, Pepsi-Cola, Centralized Supply Chain Services, LLC ("CSCS"), International House
of Pancakes, LLC ("IHOP") and Applebee's Services, Inc. ("Applebee's") have entered into a Master
Beverage Sales Agreement effective January 1, 2012 (the "Master Agreement") which contemplates the
entering into individual agreements by Applebee's operators with respect to the sale of Pepsi-Cola
beverage products; and
WHEREAS, the parties desire that, pursuant to the terms and conditions ofthis Agreement, Pepsi
and Pepsi-Cola products be poured in the Applebee's restaurant outlets owned and operated by the
Operator and located within the United States (the Outlets' )
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. Term
The term of this Participation Agreement (the "Term") will commence on the Effective Date and will expire
upon the later of: (i) December 31, 2021; or (ii) at such time as the aggregate Gallons of Postmix
Products (as defined below) purchased on and after the Effective Date by Operator under this
Participation Agreement plus Gallons purchased by Applebee's and IHOP restaurant outlets located
within the United States on and after January 1, 2012 pursuant to agreements substantially similar to this
Participation Agreement meet or exceed a total of 57,500,000 Gallons.
2. Scope of Agreement: Outlets
2.1
Definitions. For the purpose of this Participation Agreement "Postmix Products" means
concentrated syrup beverage products sold under the trademarks of Pepsi-Cola and the Partnership and
used to produce Fountain Products (as defined in Section 3.1) through fountain beverage dispensing
equipment provided by Pepsi-Cola ("Equipment"). As used in this Participation Agreement, "Gallons"
mean gallons of the Postmix Products purchased from Pepsi-Cola or the Partnership by Participating
Outlets used to prepare Fountain Products sold under the trademarks of PepsiCo and the Partnership
during the Term: provided, however, for purposes of this Agreement Gallons shall specifically exclude: (i)
gallons of Postmix Products relating to the brand Gatorade: and (ii) Postmix Products for other dispensed
beverage products outside of traditional fountain beverage products, including but not limited to frozen
uncarbonated beverages, liquid concentrate teas, etc. As used in this Participation Agreement, the term
"Equipment" shall include any fountain beverage dispensing equipment provided by Pepsi-Cola under any
prior agreement relating to Pepsi-Cola's fountain beverages, if any.
2.2
Purchase Commitment. During the Term and subject to the terms and conditions of this
Participation Agreement, the Operator agrees to purchase Postmix Products from Pepsi-Cola and the
Partnership for use in preparing Fountain Products to be sold in existing, future and after-acquired
Outlets. A list of Outlets included within the scope of this Participation Agreement as of the Effective Date
is attached hereto as Annex A (the "Participating Outlets").
EXECUÔN VERNON
2.8
O^bufion of Beveôe Prodoo^ P e p ^ C o ^ ^ e n d s f o deêr Posfm^ Prodoofsfofhe
Part^pafingOof^s approved f o o d s e ^ o e d ^ f n b ^
that m limbed geographies PepsiCoia may disfribotefhe Postmix Products to Parfioipatiog Outiets
throughabottieriioeosedunderthe authority of PepsiCo andôrthe Partners^
3
Produots
3Bi
Defioifioo of Pountaio Produots. Por the purposes of this Agreement^Pountain Products" mean
ooo-aioohoiio beverage produots dispensed through equipment within the foiiowiog categories of
beverages: carbonated soft drinks, carbonated flavored waters, non carhonated flavored waters,
lemonades, flavored teas, fruit punch and juice drinks Por clarification purposes, PountainProducts
exclude other beverage products including, but not limited to, Packaged Products, cluh soda, juice, frozen
beverage products, fresh brewed coffee products, fresh brewed tea products and fresh beverage
products prepared in the Participating Cutlets.
82
Exclusive PountainProducts Except for regular Or Pepper served onlvalve of Equipment a s a
fountain beverage,the Operator agrees that PountainProducts sold under the trademarks of PepsiCo
and the Partnership shall be the exclusive fountain beverages of their respective types and categories
sold, dispensed or otherwise made available or in any way advertised, displayed or promoted in the
ParticipatingOutlets byanymethodorthroughany medium whatsoever (including, without limitation,
print, television, radio, internet, coupons, in-store displays and signage) The foregoing exclusivity
provision only relates to Fountain Products and, except as otherwise provided in this Agreement, shall not
apply to non-Pountain Products Participating Outlets that elect to offer Or Pepper shall be subject to the
per Oallonreduction of Marketino Funds andStrateoic Brand Funds as further described in A n n e x e
For clarification purposes, purchases of gallons of Or Pepper shall not count towards any funding or
payment obligation of Pepsi-Cola as set forth in A n n e x e Operator agrees that C8C8 shall be permitted
to inform PepsiCola whether or notaParticipating Outlet is offering andôr selling Or Pepper.
38
Packaoed Products For purposes of this Agreement,"Packaged Products") mean ready-todrink, non-alcoholic, packaged beverage productscontained in bottles or cans in such sizes andBor
containers that are readily available to the general public in common retail outlets Nothing herein shall
restrict the ability or reduce any funding to be paid by Pepsi-Cola hereunder shouldaParticipating Cutlet
offer Red Bull energy drinks, IBCPoot Beer, juice boxes (including Minute Maid juice boxes) and b^^
mixers at any Participating Outlet ^collectively^ the "Excluded Products") Except as otherwise provided
herein, Operator shall not offer or othenîse distribute carbonated soft drinks other than carbonated soft
drinks sold under the trademarks of PepsiCo and the Partnership Except for Minute Maid juice boxes
and multiservePackaged Products in thejuice category, in noeventshallany ParticipatingOutiet
purchase, sell ormakeavailableanyPackaged Products fromThe Coca-Cola Company, or any of its
affiliates, subsidiaries, joint ventures or partnerships; provided, further, however, in the event a
Participating Outlet is purchasingaPackaged Products as permitted under this Participation Agreement
and such Packaged Product is subsequently owned byThe Coca-Cola Company or any of its affiliates,
subsidiaries, joint ventures or partnerships, such Packaged Product shall continue to be permitted to be
sold within the applicable Participating Outlet(s) that was purchasing such product at the time the product
becameaproduct of The CocaCola Company Notwithstanding the foregoing, in the event Operator
determines to offer any beverage products,other than the Excluded Products, within the Participating
Outlets during theTerm, Operator will providePepsi-Colaagoodfaithopportunitytoprovidesuch
products upon mutually agreeable terms
4
National Account Prices; Funding
4.t
National Account Prices
Ouring theTermeachParticipating Outlet shall purchase Postmix
Products andhighyieldPostmix Products fromPepsi-Cola and thePartnership for use inpreparing
Fountain Productstobeservedand sold in ParticipatingOutlets Pepsi-Cola and thePartnership,
respectively, shall sell the Postmix Products and high yield Postmix Products to the Participating Out^^
at their National Account Prices in effect from time to time
EXECUÔN VERNON
4 2 F o n d m ^ Thesupportdescnbed herem ^ m c r e m e o ^ tothe ândard Nation AooountPnoes
a r a b l e to the Rart^pat^g Outlets under Peps^Col^s and the Partnerships respective National
Account Prioe programs and is made in consideration and pertorrnanoeot Operator's o h l ^
this Participation Agreement
Except as otherwise reduced in accordance with this Participation
Agreement,throughout theTermPepsiOola, will pay Operator with respect to each ot its Participating
Outlets the Marketing Punds, the Strategic Brand P
describedinAnnexBattachedhereto: provided^ however. Operator must be in material compliance with
its respective ohligations under this Participation Agreement in order to receive its funding center
herein Notwithstanding the foregoing, the MarketingPunds, Strategic BrandPunds and other funds
described in AnnexBmav be reduced pursuant to the Master Agreement in the event certain Applebee's
system participation thresholds are not achieved
5. Bouipment
5BI
Provision of Eouipment PepsiOola will, at its sole costand expense, purchase and install
Equipment at Participating Outlets upon: ^ t h e c o n v e r s i o n o f a n Outlet fromacompetitive beverage
supplier toaParticipatingOutletîi) the opening ofanew Participating Outlet: ( i i ^
as described below:or(iv) at such time as the useful life ofaParticipating Outlet's existing Equ^
expires, as reasonably determined by Pepsi-Oola and the Participating Outlet Installation shall include
any and all necessary labor and materials (including the provision of relevant Equipment specifications)
relative to the Equipment, as well as removal: provided, however, Pepsi-Oola shall not be responsible for
any electrical or plumbing work associated with the Participating Outlet Operator will use its good faith
efforts to provide PepsiOola with sixty (60) days prior notice ofthe need for any Equipment iostalla^^
52
Eouipment Ownership and Service At all times, legal title to the Equipment will belong to PepsiOola Operator agrees to cooperate with Pepsi Oola in maintaining the Equipment in good working order
throughout theTerm PepsiOolawill provide Equipment maintenance in accordance with the Service
Program set forth herein Totheextentanyadditionalequipment(otherthanthe Equipment) has been
provided to an Operator by Pepsi-OolaandôraBottler,unlessothenîse agreed uponin writing,such
equipment shall be surrendered to PepsiOola andôraBottler upon expiration or termination of this
Participation Agreement.
53
Eouipment Moves IfatanytimeduringtheTermsubsequentto initial installation of any unit of
Equipment (i e , as a result of an Participating Outlet remodelingînternal redesign^reconfiguration,
redeployment^reinstallation, etc ), Operator requests that Pepsi-Ooladisconnect^remove^rel^^^
Equipment in, within or between its premises (each an"EquipmentMove"), thenOperatorwillnotify
Pepsi-Oola ofsuch requests in writing and at least sixty (60) days in advanceof any scheduled
Equipment Move Operatorwill be responsible forthe costs and expenses actually incurred by Pepsi Oola
withregard to anEquipment Move and willpromptly reimburse Pepsi-Oola for such Equipment Move,
payable within 30 days of the date of Pepsi-Oola's invoice
54
OlosedPartioipatino Outlets IfatanytimeduringtheTermsubsequenttoinitial installation of
any unit of EquipmentaParticipating Outlet will be permanently closed then the Operator will notify
Pepsi Oola of such intent in writing thirty (30) days in advance or as soon as reasonably possible of the
closure of such Participating Outlet ("Closed O^^
cooperate with Pepsi-Oola and its Bottlers to provide access to such Closed Outlet(s) to remove
Equipment and will surrender the Equipment: provided,however,PepsiCola and its Bottlers shall have at
least 30 days from receipt of notice of the closure of the Closed Outlet to remove such Equipment As
used herein, "permanently close^means cease to operate in the ordinary course of business fora
period of at least 30 days without subsequently reopening and serving the Fountain Products withina
period not to exceed 30 days thereafter.
55
Early Replacements If at any time during the Term subsequent to initial installation of any unit of
Equipment ( i e , asaresult ofaParticipatingOu^
Operatorrequeststhat Pepsi Oola replace Equipmentpriortofullamortization, then Operator will notify
EXECUTION VERNON
Pep^Coôfsooh^qoe^mw^
âceafteêdEq^pme^ÊartyRep^cemeÛpo^
w^ c o o p e d w ^ P e ^ C o I a a o d ^ B o ^ s ^ p ^ ^ ^
aodâoeEq^pmeotaodw^suôderêp^^^
56
EouipmeÂmoâhoo In the event o f a C I o s e d O u ^ a n d ^ Early Replacement, Pep^Cela
reserves thenght to InvoiceOperatorimmeâtelyfcr^the corrent
Eqoipment^sreesona^êrrn^^
u^ng ^ ^ e a r ^ ^ ^ n e ^ r e c ^ o n ^ e ^ o ^ o ^ e x ^ ^
hook value of any
fountain dlspenser(s), or other unlt(s) for which RepsIDCoIa seeks to retain title, which fountain
dispenser(s) or unit(s) wiii be surrendered by the Participating Outlet to Repsi^^^
representing the reasonable costs of removal of such Eguipment Operator will pay any sucb invoice in
full within 60 days of the date of RepsiDOoia's invoice
6
Service Program
6BI
Service Oaiis Pepsi-Ooia will cause service to be provided to the Eguipment through Bottlers or
suchotherserviceprovidersasPepsi-Ooiamaydesignate Subject to Section64beiow, each calendar
year: each ofOperator'sParticipatingOutiet'swiiibeentitied,at no charge for service and labor and ona
per Participating Outlet basis,toamaximumof4servicecails for Eouipment:^vê^ ôwever^that
annual service calls to which Operator is entitled under this Participation Agreement may be aggregated
in any given year for use and allocation by Operator amongst its Participating Outlets based upon their
respective needs Service calls unused at the end of any year shall be deemed expired and not carried
over for use inasubsequent year PepsiOola, Bottlers and any third party service providers shaii be
required to respond to service requests within f o u r t h
failure to comply with the foregoing four^hour period shaii result in the service caii being provided at no
charge to the applicable Participating Outlet, and wiii not be counted toward the aiiotmeot of service cai^^
hereunder in the event that an Equipment vaiveiineat any ParticipatingOutiet bleeds or becomes
damaged or malfunctions, then Pepsi-Ooia shaii repair or replace such line at no charge to the applicable
Participating Outlet.
6.2
Service Standards Pepsi-Oola at aii times during theTerm of this Agreement or any extension
thereof, shallprovide thefoiiowing servicestandardstoaii ParticipatingOutlets: (^customer service
centertobeopenseven^daysaweekfrom7AMtoH:00PM,toreceiveservicereguests:(ii) phonefix technicians shall be available the same hours of the customer service center: and (iii) any service call
that is forthe same problem that is received within fourteen (14) days ofthe original call shall not be billed
to the applicable Participating Outlet
63
Excess Service Palis Aii service calls in excess of those specified above, wiii be charged to the
Operator atPepsi-Oola's prevailing rates: ^ v ^ e ^ ^ o ^ e v e r . ^ a n ^ ^ ^ ^
car^ge^^êcâêôêO^
64
Pees and Expenses for Service Palis Vîth respect to the allotment of service calls as provided
in Section6Blabove,fees and expenses (excluding parts) associated with service and labor to provide
service calls shaii be provided at no charge to the Participating Outlets Vîth regard to parts reguired for
theEquipment,eachParticipatingOutiet shall be responsible for the costs of any necessary part5 for
Equipment^provided, however, Pepsi-Pola agrees that anParticipating Outlet shaii not be charged for
parts to the extent the parts costs less than ^25 and are not part of an invoice associated with charges
greaterthan^25
7
Performance Reguirements
7.1
PompliancewithParticipation Agreement This Participation Agreement,inciuding all of Pepsi
Poia's support to Operator herein, is contingent upon material compliance with the terms and conditions
ofthis Participation Agreement throughout theTerm
EXECUTION VERNON
72
R e g o ^ E o o o t 8 m P ^ ^ 5 At least the ^ o w m g E o o o ^ o P ^ d o ^ brands w^l be servedm
Partioâbng Outlets: Peps^ Diet Pepsi; Sierra M ^ and Meon^^^
tor Or Pepper enlvalve,Participating O
trademarks etPepsiOe and the Partnership tor any and aii remaining waives et Equipment
73
Brand Identitication There wiii he brand (including iogo) identification tor each Fountain Pro^
sold under the trademarks of PepsiOo and the Partnership served on all menus, menuboards and
postmix dispensing valves
74
N o P e Sale. Operator will use the Postmix Products only to prepare the Fountain Products in
accordance with procedures and standards established by PepsiOola and the Partnership:^ônly tor
immediate or imminent consumption at the Participating Outlets or as part of "to go" orders Operator will
not resell the Postmix Products either to non affiliated outlets or to consumers in any form other than the
PountainProducts Operator will only purchase Packaged Products from Bottlers in whose territory such
Participating Outlet resides and that Packaged Products are for resale at the Participating Outlet only,
and that there shall be no resale to other resellers^distributors
75
Marketing Proorams Operator agrees to participate in all marketing programs mutually agreed
upon by Applebee's and Pepsi-Oola, and to support all such programs merchandising elements agreed
upon by PepsiDOola and Applebee's
76
Glassware Serving Size Unless othenîse agreed upon by Pepsi Oo and Applebee's, the size of
glassware (in ounces) utilized within the Participating Outlets to serve the Fountain Products shall not be
smaller than the size (in ounces) of the glassware generally utilized by the Applebee's System
respectively as of January t, 2012 Notwithstanding theforegoing,thisSection76shallnot restrict
Operator from utilizing glassware in different sizes with respect to limited time marketing offers or si^^^
short-term promotional needs
77
Merchandising Programs Each Yearthroughout theTerm,Operator shall:
(i)
(ii)
(iii)
(iv)
(v)
exclusively serve the Fountain Products and Packaged Products, subject to the limited
exceptions provided under this Agreement:
use non bar related glassware at each of the Participating Outlets bearing approved PepsiOola trademarked logos:
use to-go cups at each of the Participating Outlets bearing approved Pepsi Oola trademark
logos(co-branded with Applebee's trademark logos):
using beverage menus at each ofthe Participating Outletsbearing approved Pepsi-Oola
trademark logos: and
subject to Section 7 5 above, execute approved marketing programs at each of the
Participating Outlets (i.e., point-of-purchase displays, memorabilia, etc.).
75
List of Outlets. Operatorwill provide Pepsi Oola, upon execution of this Participation Agreement
alist of all Participating Outlets on Annex A. including name.telephone numbers and points of contact
for each Participating Outlet, and thereafter for the remainder of theTerm,Operator will continue to be
responsible for promptly notifyingPepsi-Oola, in writing, of each Participating Outlet that is opened,
acquired, closed or sold, and the relevant information pertaining thereto.
8 GeneralTerms
61
Termination. Pepsi-Oola or the Operator may terminate this Agreement if the other commitsa
material breach of this Participation Agreement: provided, however, that the terminating party has g ^ ^
theotherpartywritten notice,setting forth with reasonable specificity,the nature of the breach and the
other party has failed to remedy or cure the breach within one hundred twenty(120) days of such notice
(1)
Each party is required to continue to perform its obligations under this Participation
Agreement during the applicable cure period
EXECUTIONVERÔN
(2)
Any sale of c o m p e t e beverages by Operator not speoôally permitted onderthis
Participation Agreement isamateriai breach of this Participation Agreement
52
Remedies it this Participation Agreement is terminated before its expiration date by Pepsi-Oo^
arising froma breachby the Operator which isnot timeiycoredporsoant to Section 91 above,then
Operator wiii, withinnoiater than sixty (50) days after the date of tenninationor the e x p i r a ^
appiicabie core period,as the case may be, makeapayment to Pepsi-Ooia reflecting reimhorsement to
Pepsi Oola for (a) the corrent onamortized hook vaioe of E g o i p m e n t ^ a s ^ a s o n a b ^ ^ e ^ ^ e ^ ^ R ^
O o ^ app^ng g e n e ^ y a c c e p t acco^n^ng p r ^ p ^
^0 year s ^ g ^ ^ne êpn^côn
n7eôôg^,pios(b) an amoont representing the reasonable costs of removal and reasonable cost of
refurbishment of soch Egolpment Notwithstanding anything to the contrary herein, in the event o f a
breach of this Participation Agreement by Pepsi-Oola that is not timely cored, Operator may terminate this
Participation Agreement and Operator shall have no obligation for any of the damages listed io (a) or (b)
above. The specification of the foregoing remedies is not intended to restrict the right of either party to
porsoe other remedies or damages ifthe other party has breached the terms ofthis Participation
Agreement.
8.3
Expiration Upon expiration ofthis Participation Agreement, if no forther agreementfor the
porchase of Poontain Prodocts is reached, Operator, will immediately, to be received by Pepsi-Oola and
Bottlers no later than sixty (50) days following expiration, make a payment to Pepsi Oola reflecting
reimborsement to PepsiOola for (a) the corrent onamortizedbook vaioe of Equipment âs reasonably
êrrnê^yRep^-Ooâp^
ê^recBaônnêôôc^^
unit(s) for which Pepsi-Oola seeks to retain title, which fountain dispenser(s) or unit(s) will be s u ^
by the ParticipatingOutletto Pepsi-Oola, plus (b) an amount representing thereasonablecostsof
removal of such Eguipment
54
Oreditworthiness of Poodservice Oistributors
Pepsi-Oola reserves the right to apply its
commercially reasonable credit policies and standards to anyApprovedOistnbutor,including any such
policies which allow Pepsi Oola to refuse to sell on credit to, or reject on credit any purchase order from
any Approved Distributor, provided such policies and standards are applied in a consistent and
nondiscriminatory manner among all of Pepsi-Oola^s distributors (the "Oredit Policies") If during the
Term of the Participation Agreement, Pepsi-Oola apprises OSOS that an Approved Distributor poses an
unacceptable credit risk pursuant to its Oredit Policies, then to the extent that the applicable Participating
Outlet continues to desire delivery via an Approved Distributor, OSOS will use its commercially
reasonable efforts to find an alternate Approved Distributor that meets Pepsi Oola's Oredit Policies
55
Right of Offset Pepsi Oola^PepsiOoreservestherighttowithhold payments due hereunder as
an offset against:
(i)
any and all balances doe and payable to Pepsi Oola^PepsiOo onder the terms and conditions
ofthis Participation Agreement, including but not limitedto Eguipment serviceand parts
invoices: and
(ii)
amounts not paid by Operator for P o s t m i x P r o d u c t s a n ^ a n y R e p ^ O o p ^ u c ^ , âny,
purchased from Pepsi-OolaBPepsiOo hereunder: an^
(iii)
amounts not paid by Operatorfor Packaged Products purchased from Eottler(s)hereunder.
6.5
Representations and ârrantiesThe Parties hereby represent and warrant to each otherthat:
execution, delivery and performance ofthis Participation Agreement will not violate any
agreements with, or rights of, third parties, including but not limited to any agreements with
competitivebeverage suppliers or restaurantconcepts, i e , w i t h T h e O o c a O o l a Oompany
andBorDr Pepper SoappleOroup, lnc,and their respective affiliates, bottlers, distributors,
subsidiaries and joint ventures:
(ii)
execution, delivery and performance of this Participation Agreement will not violateany
statute, role or regolation applicable to the parties or any of its properties, assets or
operations(including without limitationanyfinancialreportinganddisclosurereguirements
promulgated by the Securities and Exchange Oommission): and
(i)
EXECUÔNVERÔN
^
it possesses iegai authority to enter into the terms and conditions o t t h i s Participation
Agreement
Operator further represents and warrants that it (i) possesses iegai authority to act on behaitot a
hind the Participating Outiets and that the Participating Outlets are not subject to any ot^^^
relating to the saie of Pepsi-Ooia beverage products: and (ii) wiii at aii times throughout theTerm be an
authorized franchisee of Applebees
67
Entire Agreement The Master Agreement, this Participation Agreement and the Annexes hereto
contain the entire agreement between the parties regarding the subject matter hereof and supersedes all
otherwrittenororalagreementsentered into between the parties priorto or during theTerm regarding
the purchase of Postmix Products and Packaged Products This Participation Agreement may be
amendedormodifiedonlyhyawriting signed by each of the parties
6.6
Non-Oisclosure Except as may othenîse be reguired b y l a w or legal process, no party shall
disclose to unrelated third parties the terms and conditions of this Participation Agreement witho^^
consent of the other
69
Assignment This Agreement shall be binding on each of the parties'successors and assigns
This Agreement may not be assigned without the priorwritten consent of Pepsi-Oola
6B19
OoverningLaw and Venue This Agreement shall be governed by the laws of the State of
Delaware, without regard to its conflict of law principles
6BI1
Notices Any notice which either party is reguired or permitted to give hereunder will be in writing,
signed by the notifying party and will be either delivery by
service or deposited in t h e U n i t e d S t a t e s m a i l , c e r t i f i e d o r r e g i s t e r e d m a i l , returnreceipt requested,
postage paid, addressed as follows:
If to Operator,at the address setforth on signature page of this Participation Agreement.
ifto Pepsi-Oola:
^Vithacopyto:
PepsiOo Sales, Inc
700 Anderson Hill Poad
Purchase, N Y 1 0 5 7 7
Attn: Vice President of Poodservice Sales
PepsiOo Sales, Inc
IPepsiVây
Somers,NY10560
Attn: Vice President and Assistant General Counsel
Or to such a d d r e s s e s a s t h e p a r t i e s may direct notice be given as herein provided Notice will be
deemed to have been given when delivered by hand or nationally recognized overnight courier service, or
when received as evidenced by the return receipt, or the date such notice is first refused, if that be the
case
6BI2
Intellectual Property Use and distribution by any party of any and all written, broadcast, printed
and other materials-including, but not l i m ^
correspondence, press releases of whatever type, promotional materials, andôr point of sale materialswhich bear and include the name(s)andôr trademarks of the other party, shall at all times be subject to
prior written approval by the party owning such trademarks andôr trade names
6BI3
No waiver No consent orwaiver by either party ofany breach or default by the other party in its
performanceofitsobligations under this Participation Agreement will be deemed or construed to b e a
consenttoorwaiverofacontinuing breach or default or any other breach or default of those or any other
obligations ofthat party No consent orwaiverwill be effective unless in writing and signed in advance by
both parties
EXECUÔNVERÔN
814
Taxes O p e r a t o r s remam r e s p o o s ^ e f o r a o y a p ^ o a ^ e taxes, fees or other t a x l i a b ^
ôorredôoooeotioowiththereoe^toffuôgaôrEq^pm^
Partioâtioo Agreement loaddôÔperator w^l oot aooess or impose upoo PepsiOola any oomm
area maioteoaooe tees, taxes or other charges based oo oooopatioo of the spaoeaiiooated to E g u ^
oorwithrespeot to the ownership or usage thereof Opoo execution of this Partioipatioo Agreement
andôrupon reguest by Pepsi-Coia,Operator agrees to aoourateiyoompleteaFom^
(or Form W ^ to
the extent appiioabie)andreturnsuoh form to Fepsi-Coia Feps4Poia has and reserves the right to
subject payments due to under this Fartioipation Agreement to the extent reguired by appiioabie Internal
Revenue Service regulations relating to backup federal tax withholding
8.15
Applebee's Reguirements.
In no event will Applebee's be liabieforamounts owed by
Operator or for any other liability owed to R e p s i ^
and agrees that Applebee's and its affiliates are intended third party beneficiaries of this Rartici^^^^
Agreement, and wili be entitled to enforce their rights directly against Operator in the event of any breach
by Operator of the terms and conditions of this Rarticipation Agreement. Repsi-Oola and Operator agree
to provide Applebee'sand OSOS copies ofthis Rarticipation Agreement and any modificationsor
amendments thereto promptly upon execution of such documents
I^G^T^^RA^TOROÔ^
EXECUTION VERSION
IN WITNESS WHEREOF, the parties have executed this Participation Agreement through their
duly authorized signatories as of the Effective Date.
PEPSICO SALES, INC.
OPERATOR
By
By
Name:
Name:
Title:
Title: _
Date:
'
;
Date:
Operator Legal Name:
Operator Address:
[APPLBEE'S BEVERAGE SALES PARTICIPATION AGREEMENT - SIGNATURE PAGE]
10
EXECUTION VERSION
ANNEX A
LIST OF PARTICIPATING OUTLETS*
*As of the execution of this Participation Agreement. Operator agrees to timely notify Pepsi-Cola of any
Outlets that are opened, acquired, closed or sold and the relevant information pertaining thereto.
Annex A - Page 1
EXECUTION VERNON
ANNE^B
E O N O ^ C A P P ^ C A B L E T O A P P L E B E E S P A R T ^ P A T ^ G OUTLETS
MarkeUngEond^
Each Year throughout the Term oo a semi aooual hasis, upoo verifioatioo hy Pepsi Oola that
Operator has met its pertormaooe obligations uoder this PartioipatiooAgreeroeot, Pepsi-Oola will
aoorueaod pay to Operator, marketing tuods at the rate o t ^ . ^ O per Oalloo purchased hy eaoh
Participating Outlet during t h e T e r m ( " M a r k e t r n g P u o d s ^ In the event thataParticipating Outlet
e l e c t s t o s e r v e a n o n - P e p s i O o Fountain Producton one valve ot the Eguipment aspermitted hy
Seotion32hereot, the Marketing Funds shall he paid at the rate ot
per Gallon with respect to
Gallons purchased by such Participating Outlet,retlectingatair share funding reduction calcu^
reimburse PepsiOola tor its fixed costs hereunder over theTerm,including the cost of providing one
v a l v e o f t h e E g u i p m e n t t o t h e P a r t i c i p a t i n g O u t l e t w h e r e P e p s i O o l a is not realizing the benefits o f a
Fountain Product being served on such valve.
Notwithstanding the foregoing,Marketing Punds shall be subject to further reduction pursuant^
terms and conditions of the Master Agreement in the event certain Applebee's participation
thresholds are not met
Strategic Brand Funds
Each Year throughout the Term on a semi annual basis, upon verification by Pepsi-Oola that
Operator h a s m e t i t s p e r f o r m a n c e o b l i g a t i o n s under thisParticipation Agreement, P e p s i O o l a w i l l
accrue and pay Operator,strategic brand funds at the rate of
per Gallon purchased by each
Participating Outlet during the Term ("Strategic Brand Funds")
Price Protection Rebates.
Upon verification by Pepsi-Oola that Operator has met its performance obligations under this
Participation Agreement:(A) from the Effective Oate until April 21, 2012, Pepsi-Oola shall
^
Operator ^0 55 per Gallon purchased in price protection rebates; (B) from April 22, 2012 until
Oecember31,2012,Pepsi-Oola shall rebate Operator ^ 0 3 2 per Gallon purchased in price protection
rebates; and (O)fromdanuary1,2013andthereafterforthe remainder of theTerm,in the event that
the gross weighted average National Account price ("Gross Weigbted Average NAP") per Gallon of
Postmix Products for any s u c h Y e a r increases by more than 2 ^ over the Gross weighted Average
NAP per Gallon for the immediately precedingYear,then PepsiOola will rebate to Operator for the
Year under consideration an amount of money egual to the sum of: (a) that portion of any such price
increase in excess of 2 ^ of the prior Year's Gross weighted Average NAP per Gallon, ^lus(b) the
perGallonpriceprotection rebate,if any,calculated for the Year immediately prior to the Year under
consideration ("Price Protection Rebates''); provided, however the parties agree that the ^0 55 per
G a l l o n P r i c e P r o t e c t i o n R e b a t e r e f e r e n c e d i n s u b s e c t i o n (A) above shallnot be carried fonârd or
utilized in future Price Protection Rebate calculations, butthatthe ^0 32 per Gallon Price Pr^^^
Rebate referenced in subsection (B) above shall be carried forward for future Price Protection Rebate
calculations
Notwithstanding the foregoing, Price Protection Rebates shall be subject to further adjustment
pursuant to the terms and conditions of the MasterAgreement based onhigh fructose corn syrup
pricing fluctuations
Aoolebee^s Participating Outlets O i s c r e t i o n a r v A ^ M F u n d s ^
Each Year throughout the Term, upon verification by Pepsi Oola that Operator has met its
performance obligations under this Participation Agreement, Pepsi-Oola will accrue discretionary
AnnexB^Pagel
EXECUTION VERNON
A ^ M f o n d s a t ^ e rate of ^0.05 per C a l l ^
spent by Peps4Co^ as mutuary agreed opon with Operator, toward approved misoellaneoos
adverting and marketing promotional porposes during the respective Year Âpplebee's
Partioipatlng Outlets OlsoretionaryA^MEunds ^ Amounts remaining unspent, it any, at the end
of any givenYear, wiii carry forward to the toiiowing Year Amounts remaining unspent, if any, at the
end of theTennshaiiremainthe property of Pepsi-Ooia Any unspent Appiebee's Participating
Outlets Discretionary A ^ M Eunds contempiated by prior agreements between Pepsi Oola and
Operator shaii be carried forward and added to the amounts contemplated in this provision
PaymentofPunds
Unless otherwise specifically provided herein, no prepayments will bemadeto Operatorand aii
payments owing hereunder willbe made within OOdaysfollowingtheendof each Year or semiannual period,as applicable. Por further clarification purposes, the parties agree that the first semiannual period in any Year shall be based off of Pepsi-Oola'sPeriodstthrough6financial periods,
andthe second semi-annualperiod in anyYear shaii be based off of PepsiOola'sPeriods^through
^financial periods.
ArmexB^Page^
EXHIBIT L
NEIGHBORHOOD CONNECT SUBSCRIPTION AGREEMENT
1051981.2
INTRODUCTION
Applebee's has developed and deployed a web-based portal called "Neighborhood Connect" (the
"Portal"). Applebee's has previously made the Portal available to the franchisees of Applebee's
Franchisor LLC (the "Franchisees") under certain terms and conditions as set forth in an agreement
dated 2003. This Agreement supersedes that earlier agreement.
Please read and acknowledge the following Subscription Agreement. You will not be permitted access
to the Portal until you have acknowledged that you agree to the terms of this Subscription Agreement
by signing and returning this document.
NEIGHBORHOOD CONNECT SUBSCRIPTION AGREEMENT
January 1,2012
1.0
Description of the Portal
1.1 The Portal is a web-based central knowledge repository of Applebee's proprietary, branded
business communications and information, utilizing an ASP-hosted implementation model.
Applebee's currently provides hosting, development, and maintenance of the Portal.
1.2 The Portal is registered as "Neighborhood Connect" and is accessed by secure user-level logins
and passwords administered by Applebee's.
1.3 Within the Portal, specific communications are targeted to unique audiences through
"communities". Applebee's will provide a Community Manager at no charge to the
Franchisees to maintain the franchisee-specific Portal community.
1.4 Applebee's will provide Help Desk support for the Portal at no charge to the Franchisees.
1.5 In order to participate in AppleONE Metrics, a Franchisee must subscribe to the terms of this
Agreement.
2.0
Subscription to the Portal
The Portal is available at no charge to the Franchisees who have agreed to the terms of this
Agreement. Franchisees will receive one login account for each of its restaurants and.
individual login accounts for home office users as well as all area, regional and executive
managers. Each log-in account is considered a Franchisee Account.
3.0
Use Restrictions
The Franchisee and the Franchisee Accounts will not do or permit any third party to do any of
the following:
(a)
Make or retain any copy of the Portal;
(b)
Create or recreate the source code for the Portal or re-engineer, reverse engineer,
decompile or disassemble the source code;
(c)
Modify, adapt, translate or create derivative works based on the Portal, or combine or
merge any part of the Portal with or into any other software or documentation;
(d)
Refer to or otherwise use the Portal as part of any effort to develop a program having
any functional attributes, visual expressions or other features similar to those ofthe
Portal; or
(e)
Create links from other web sites or other applications to the Portal or links from the
Portal to other web sites or application without Applebee's express written consent.
1051981.2
4.0
ô^ty
Certain f u n c U o n a ^ y o f t h e ^ ^
the Franchisee. Appiehee'swiii not disease the Franehisee'sidentitiahie data to any third
partyîneiuding other ftanehisees^without the Franehisee'swritten consent. No Franchisee
wiii have access to any other tranchisee'sdata. Ifthe Fortai contains the Franchisee's
identifiahie data, the Franchisee Accounts wiii have security ievei access to that data.
5.0
F^nehisee Accounts
^.IFranchisees can request new Franchisee Accounts from the Fleip Desk. The Franchisee wiii
maintainacurrent iist ofits Franchisee Accounts. The Franchisee'srestaurants wiii have one
shared Franchisee Account: The Franchisee must notify Appiehee'simmediateiy if an
empioyee withaFranchisee Account terminates en^pioyment with the Franchisee or no longer
needs access to the Fortai. tfAppiehee'sHeip Desk requests verification or validation ofthe
Franchisee Accounts, the Franchisee wiii respond within seven days.
^.2 Franchisee must maintainawrittenpohcy stating thataFranchiseeAccount'saccess to the
Fortai terminates when that individual terminates his or her employment with the Franchisee.
Franchisee wiii provide Appiehee'sacopy ofits policy upon request.
^.0
Passwords
^.1 The password toraFranchiseeAccountmustheaminimum of eight characters, ttmust
contain three ofthe following tûrcharactertypes: upper case, lower case, special character,
and numeric. Passwords expire every ^0 days.
^.2 Applehee'shasimplementedapassword self-service program that will allow Franchisee
Account holders to resetaforgotten password and unlockaFranchisee Account without
contacting the Help Desk. Usingalink on the Fortal sign-in page,aFranchisee Account holder
will answer challenge questions in order to changeapassword. In the case of restaurants using
asharedFranchisee Accounts, the password will he reset and sent to the restaurant email
address.
7.0
DisabledPranchisee Accounts
7.lApplehee'swill disable (hut not removeâny Franchisee Accounts that have not logged on to
the Fortal tor Ôdays. The Franchise Portal Administratormust contact the Help Desk to
reinstateadisahled account. Applehee'swill review Franchisee Accounts monthly for
inactivity.
7.2 Applehee'swill remove disabled Franchisee Accounts from the system after 30 days, unless the
Help Desk receivesarequestftom the Franchise Fortal Administrator to re-enable the
Franchisee Account. Applehee'swill not removeadisahled restaurant Franchisee Account
untilthe Help Desk receivesarequest from the Franchisee Portal Administrator to remove the
account.
^.0
^ 9 ^ 2
franchisee Portal Administrator
Franchiseemustappointadesignated Franchisee Fortal Administrator who will be responsible
for handling Fortai issues for the Franchisee Accounts. Applebee'swillprovide instruction and
guidance to each Franchisee Fortal Administrator in getting Franchisee Accounts activated with
login access to the Fortal. The Franchisee Accounts wiii contact the Franchisee Fortal
Administrator for first level support. The Franchisee Portal Administrator will then contact the
Applebee's Help Desk for technical support as needed.
9.0
Certified Platform
The Portal functionality is certified on Microsoft® Internet Explorer® version 6.0 or greater.
Franchisees will experience maximum efficiency of the Portal with a broadband internet
connectivity solution.
10.0
Confidentiality
The Portal is a proprietary application of Applebee's and is made available to the Franchisee on
a strictly confidential and limited use basis. Only those personnel with a Franchisee Account
will have access to the franchisee-specific community within the Portal and Franchisee will not
permit any third party to use or have access to the franchisee-specific community within the
Portal. Franchisee will require all those personnel with Franchisee Accounts to abide by the
terms of this Agreement before granting those members access to the Portal.
11.0
Outages
The Portal is now on fully redundant hardware hosted at the Applebee's data center. Should an
outage occur, all reasonable efforts will be taken to provide immediate resolution within normal
business hours. In the case of an excessive outage, Applebee's will provide a mitigation plan
for access to materials. Scheduled outages will be communicated to the Franchisee Portal
Administrators one week prior to the scheduled outage.
I acknowledge that I agree to the terms of this Subscription Agreement.
Franchise Name:
Signature:
Printed Name:
Date:
1051981.2
EXHIBIT M
INFORMATION PRIVACY PARTICIPATION AGREEMENT
1051982.2
FRANCHISEE PARTICIPATION AGREEMENT
INFORMATION PRIVACY
This Franchisee Participation Agreement ("Participation Agreement") is dated and effective
, 20
and is between Applebee's Services, Inc., a Kansas corporation
("ASI"), and [Franchisee], a [corporation] ("Franchisee").
ASI collects personally identifiable and other confidential information (the "Information")
from customers of Applebee's® restaurants and from users of its Web site in accordance with a
Privacy Policy in order to provide better customer service and to obtain marketing information. For
purposes of this Participation Agreement, the Information includes personally identifiable
information as well as confidential aggregated data and customer statistics collected and owned by
ASI. Franchisee wishes to have access to such Information for use with its Applebee's restaurant
operations.
The parties agree as follows:
1.
In consideration for being given access to the Information by ASI, the Franchisee agrees
to execute this Participation Agreement.
2.
By signing this Participation Agreement, Franchisee agrees to be bound by the
provisions of ASI's Privacy Policy which is attached as Exhibit "A." Franchisee will keep
confidential the Information to which it is given access and will use the Information in accordance
with the Privacy Policy, as it may be amended and posted on ASI's Web site. The Information may
be used only in connection with Franchisee's Applebee's operations and may not be used for any
other purpose or with any other concept or restaurant. The obligations in this paragraph will survive
the termination of this Agreement.
3.
The Information is and will remain the property of ASI.
4.
If the Franchise Agreement between Applebee's Franchisor LLC, an affiliate of ASI,
and Franchisee terminates for any reason, this Participation Agreement will also terminate and ASI
will retain all Information and Franchisee will have no further rights in or access to the Information.
Further, upon such termination, Franchisee will return to ASI or destroy all Information in whatever
form it exists.
5.
This Participation Agreement may be signed in counterparts and each counterpart with a
hand-written signature, whether an original or an electronic data text (including telegram, telex,
facsimile, electronic data interchange and electronic mail) is considered an original and all
counterparts constitute one and the same instrument.
[Franchisee]
By:
Name:
Title:
By:
Name:
Title:
1051982.2
EXH^T^
APPLEB^SSER^CESBNC
PRÂCYPO^CY
Eô^08Â^^2007
Applebees Serviees, Ino. (Applebees Is oommltted to safeguarding your privacy; we takeyour
prlvaoyserlously.êwlll notsell,rent or otherwise distribute your personally Iden^^^^^
wblob we receive through our website or trorn any otber source, to tbird parties except as explained
below Please read the following policy to understand the care with which Applebee s will treat
Information. This policy may change from time to tlrne so please check back periodical
If you have concerns,comments or questions concerning this pollcy,please contact:
privacydeskâpplebees.com
Please note that this Privacy Pollcy does not apply to (a) employrnent applications submitted through
the ^ e b site, which may be shared with Independently owned franchises which are seeking
employees In their market area and (b) Information
covered byaseparateprlvacypollcy,accesslblefromthe International Franchising portion of the Vêb
site
What mformation does Annlebee^s collect from me^
Applebees may collect Information about you, such as your name, postal address, email address, zip
code, phone number and dining preferences through any of thefollowlng: online email address
submissions, In restaurant surveys, research surveys, dining frequency cards, online gift card
purchases, guest relations communications and online restaurant location searches or other voluntary
activities
Canlremaln anonymous wbenlnrovlde Information to Annlebees^
You can visit our website without Identifying yourself or giving us any personal Information. Ifyou
give us your email address, purchase gift cards online, voluntarily provide feedback to Guest
Relatlonsorcompleteasurvey, youwlll no longer be anonymous to Applebees ^Be may ask you for
additional Information from time to time, which you may decide to provide to us or not. If you contact
Applebee's through the website or otherwise,we may keeparecord of that correspondence
How does Annlebee's use tbe Informations
Applebee's primary goal Incollectlng Informatlonls to Improve customer service by understanding
your preferences, communicating Applebee's promotions and services and providing you with the
best possible experience Por example, If you visit our Web site and give us your Opcode, we are
able to provide the locatlonof the Applebee's restaurant closest to you We may also use your
Information to notify you of special offers and services available from Applebee's, Its affiliated
companies and franchisees.
Gn a blinded, aggregated basis, we may do research on our guests' and Web site users'
demographlcsand behavior basedonthelnformatlonyou, other guests and users provide tous
^ ^ 2 2
Personam i d e o f i f i a ^ e ^
winded and aggregated data and user s t a t o s to t h i r d s
We may dolose such
Does Annlebee s share my mformation^
We wi^ net se^rent or otherwise distribute your personally^
except when we have your permission or under the following oiroumstanoes:
As reouiredhv law: We may disolose or aooess vour information when we helieve in oood faith
that the law requires it
Giftcards: We useathird party service provider to facilitate the gift card service. That third
party is required to maintain the confidentiality of your gift card information and may only use
your information for the purposes of fulfilling and tracking your order^customer service and
reporting to us.
To provide service: We may share aggregated, non identifiahle information as well as
personally identifiable information with our franchisees, affiliated companies and service
providers, such as those who provide gift card service or email marketing. All such service
providers are under contract with Applebee's to help provide specific services if you do not
want your information to be shared, you can choose not to provide the information.
Other: We may disclose user information in special cases when we have reason to believe
that disclosing such information is necessary to identify, contact or bring legal action against
someone who may be violating Applebee's VVebSiteTerms of Use [LIN^ TO THE TOU],or
may otherwise be causing injury to or interterence with (either intentionally or unintentional
Applebee's rights or property, other Applebee's Web site users or customers, or anyone else
that could be harmed by such activities. We may also need to disclose user information to
service providers when necessary to maintain, service or improve our Web site, products and
services As we continue to develop our business, we may buy or sell business assets. In
such transactions, confidential customer information generally is one of the transferred
business assets In the event ofasale of some or all of Applebee's business,customer and
site visitor information may be one of the transferred assets.
How canlcontrol access to my nersonal information and its use^
Youmay contact us at the email address aboveif you wish to view,edit or delete your personal
information from our database and we will use commercially reasonable efforts to accommodate your
request
How does Anniebee'snrotectfinanciai-reiated informations
keeping your personal financial information private is vitally important to us. You may provide such
information to us when you purchase gift cards online We do not store credit card numbers or bank
account numbers. This information will be kept secure and we will transfer your credit card number,
bank account number or other personal information only to the third party gift card service provider,
which is bound to keep your information confidential, and to the appropriate credit card company or
bank only in order to process any online payments.
^ b a t security precautions are in niace to nrotect tbe ioss^ misuse or alteration of my
informations
We closely guard your personally identifiable information We use encryption technology for credit
card numbers and bank account numbers. Remember to close your browser window when you have
^ ^ 2 2
^
finished your gift oard o r d e ^ T ^
youroornputorwhon you are away fr^^
us informafion^hatinformafion may ho sent oiootronioaiiy to sopors
originaiiy entered the information Though no data transmission over the internet oan he guaranteed
to h e 1 0 0 ^ secure, Appiehee s employs security techniques that are designed to protect the pn^^
of any information you share with us.
^ h a t are cookies and how does Anniebee's use them^
As part of offering personated service, we sometimes use cookies and heacon tags or weh hugs to
store and understand moreinformationahoutyou, such as your nearest Appiehee's restaorant. A
cookie isasmaii amount of data that is sent to your browser fromaWeh server and stored on your
computers hard drive Beacon tags and weh hugs aiiow us to understand what users have vieweda
page We may use cookies, tags or hugs to allow faster and easier access to your information and to
monitor traffic on the site and measure traffic patterns to improve functionality
Howdoiontout^
If you no longer wish to receive ongoing marketing communications from us, we will provide you with
simple instructions on each marketing email from Applehee'sto enable you to unsubscribe from future
emails from Applebee's. You may also contact the Privacy Oesk as explained above or opt oot here
[Link to unsubscribe].
What eiseshouidiknow about mvnrivacv^
Please keep in mind that whenever you voluntarily disclose information online, that information may
be accessible to other online users Ultimately, you are solely responsible for maintaining
of your passwords andBor any other personal information
Please be careful and responsible
whenever you are online.
How is information from children treated^
Applebee's does not intend to collect any personally identifiable information from children under the
age of ^without verifiableparental consent Infact, when we reguest personalinformation from
users of this Web site, we also ask for their blrthdate In order to comply with the Children's Online
Privacy Protection Act (COPPA) which prohibits the collecting of personal information of anyone
under the age of 1^. If we learn that such a child has provided us with personally identifiable
information,wewill immediatelydeleteit Ifyou learn that suchachild has provided us with personally
identifiable information, the parent or guardian should contact us at the Privacy Desk above and we
will immediately delete it
^ ^ 2 2
EXHIBIT N
DEMOGRAPHIC SYSTEM PARTICIPATION AGREEMENT
669127vl
1051983.2
FRANCHISEE PARTICIPATION AGREEMENT
THIS FRANCHISEE PARTICIPATION AGREEMENT (this "Participation Agreement") is entered
into as of
, 20
(the "Effective Date"), by and between Applebee's Services, Inc. ("ASI"), a
Kansas corporation, and [Franchisee's Name] ("Franchisee"), a company organized under the laws of the State of
BACKGROUND
A.
Applebee's Franchisor LLC or another of Applebee's International, Inc.'s subsidiaries or affiliates
("Franchisor") owns the rights to develop and operate a unique system of restaurants operating under the
trademark "Applebee's Neighborhood Grill & Bar".
B.
Franchisor has granted Franchisee the exclusive right to develop and operate certain Applebee's
Neighborhood Grill & Bar restaurants within a defined territory (the "Territory").
C.
ASI, a subsidiary of Franchisor, and Buxton Company, a Texas corporation ("Buxton"), are
parties to that certain Applebee's: Sales Model Proposal, dated as of March 11, 2011, as amended (the "Proposal"),
and that certain related Professional Services Agreement, dated as of March 11, 2011, as amended (together with
the Proposal, the "Agreement").
D.
The Agreement provides that, among other things, Franchisees may participate in the Proposal
with respect to the site optimization services and Buxton's web based SCOUT® program solely with respect to the
services and tools set forth on Attachment A (the tools and information on Attachment A are collectively referred
to as the "SCOUT Tools") on the terms and conditions stated in this Participation Agreement (the availability of
the SCOUT Tools to Franchisees is referred to as the "SCOUT Program").
AGREEMENT
For good and valuable consideration. Franchisee and ASI agree as follows:
1.
Franchisee Participation. Franchisee elects to participate in the SCOUT Program to obtain access
to the SCOUT Tools on the terms and conditions of this Participation Agreement. Franchisee agrees that its access
to the SCOUT Tools will be limited to its Territory. Before obtaining a username and password for access to the
SCOUT Tools, Franchisee will provide to Buxton or ASI, as requested, the name, title, email address and phone
number of each designated Franchisee user of the SCOUT Tools (each a "User") and will promptly notify Buxton
and ASI of any change in such information.
2.
User Fee; Payment Terms. ASI will invoice Franchisee for a one-time fee equal to $1,000 per User
(the "Per User Fee") and Franchisee will pay such invoice within 30 days after the invoice date.
3.
Term and Termination. The term of this Participation Agreement will begin on the Effective Date
and will terminate upon the earliest of (i) the date that is one year following the Effective Date, (ii) the expiration or
earlier termination of the Agreement, or (iii) the date specified in any notice from ASI to Franchisee that this
Participation Agreement is being terminated due to Franchisee's breach of its obligations under this Participation
Agreement.
4.
Ownership of Intellectual Property. Subject to the right to use the SCOUT Tools and any output
generated by Franchisee's use of the SCOUT Tools ("Output") on the terms stated in this Participation Agreement,
Franchise acknowledges that it will not own any intellectual property rights in the SCOUT Tools. Output may be
used solely in connection with Franchisee's business relating to ownership and operation of Applebee's
Neighborhood Grill & Bar restaurants and under no circumstances may Output be sold or licensed by Franchisee for
revenue.
669127vi
1051983.2
2
5.
Confidentiality. Franchisee acknowledges that the Agreement and this Participation Agreement are
confidential and that, in connection with Franchisee's participation in the SCOUT Program, Franchisee may be
provided access to other confidential or proprietary information and related materials that are owned or controlled
by Buxton, ASI or any of their respective affiliates ("Confidential Information"). Franchisee will (i) maintain the
confidentiality of all Confidential Information, (ii) only use Confidential Information in connection with its
participation in the SCOUT Program, (iii) only disclose Confidential Information to its employees or agents who
need to know such information, (iv) protect the Confidential Information from both unauthorized use and
unauthorized disclosure by exercising at least the same degree of care that is used for similar information of its
own, but no less than reasonable care and (v) immediately give notice to Buxton or ASI, as applicable, of any
unauthorized use or disclosure of Confidential Information and assist in remedying any such unauthorized use or
disclosure.
6.
No Representation or Warranty; Limitation of Liability. FRANCHISEE ACKNOWLEDGES
AND AGREES THAT NO REPRESENTATION OR W A R R A N T Y IS OR HAS BEEN M A D E AS TO THE
A C C U R A C Y , RELIABILITY OR COMPLETENESS OF THE SCOUT TOOLS OR A N Y OUTPUT, AND THE
SCOUT TOOLS A N D A L L OUTPUT IS PROVIDED "AS IS". WITHOUT LIMITING A N Y PROVISIONS OF
THE AGREEMENT, TO THE EXTENT A L L O W E D B Y APPLICABLE LAW, NEITHER ASI NOR BUXTON
WILL BE L I A B L E TO FRANCHISEE FOR A N Y INDIRECT, INCIDENTAL, SPECIAL, E X E M P L A R Y OR
CONSEQUENTIAL D A M A G E S OR LOST PROFITS OR LOST BUSINESS INFORMATION ARISING OUT
OF FRANCHISEE'S PARTICIPATION IN THE SCOUT PROGRAM.
7.
Miscellaneous. This Participation Agreement is not assignable by Franchisee, in whole or in part,
without the prior written consent of ASI. This Participation Agreement is binding upon and benefits the parties,
their heirs, legal representatives, successors, and permitted assigns. Franchisee understands and acknowledges that
the Agreement may be amended by Buxton and ASI without notice to Franchisee. This Participation Agreement
may be signed in counterparts and all counterparts constitute one and the same instrument. Any hand-written
signature, however transmitted, is as effective as an original. This Agreement, including Attachment A , represents
the entire agreement between the parties regarding Franchisee's participation in the SCOUT Program and
supersedes all prior oral or written proposals, understandings, and other commitments between the parties regarding
such participation. Any term that by its nature would survive the termination or expiration of this Participation
Agreement will survive. The terms of this Participation Agreement are not intended by the parties to, and will not,
have any effect on the terms of the Agreement as between ASI and Buxton. Notices will be deemed delivered
when made in writing and received by the party being notified at such party's address specified in its signature
block below.
This Agreement is executed by authorized officers of Applebee's Services, Inc. and Franchisee.
SIGNED:
[Franchisee Name]
By:
By:
Printed Name:
Printed Name:
Title:
Title:
Date:
Date:
Notice Address:
8140 Ward Parkway
Attention: Vice President, Development
Notice Address:
669127vl
1051983.2
Attn:
EXHIBIT O
STATE SPECIFIC ADDENDA
Exhibit O - State Addenda
1051984.2
S T A T E SPECIFIC ADDENDA
Addenda to the Franchise Disclosure Document
a. California
b. Hawaii
c. Illinois
d. Michigan
e. Minnesota
f. New York
g. North Dakota
h. Oregon
i. Rhode Island
j. South Dakota
k. Virginia
I. Washington
Amendments to Applebee's Neighborhood Grill & Bar Development Agreement
a. California
b. Hawaii
c. Illinois
d.
e.
f.
g.
h.
i.
j.
k.
Maryland
Minnesota
New York
North Dakota
Rhode Island
South Dakota
Washington
Wisconsin
Amendments to Applebee's Neighborhood Grill & Bar Franchise Agreement
a. California
b. Hawaii
c. Illinois
d. Maryland
e. Minnesota
f.
g.
h.
i.
j.
k.
New York
North Dakota
Rhode Island
South Dakota
Washington
Wisconsin
Exhibit 0 - State Addenda
1051984.2
A D D E N D U M TO THE F R A N C H I S E D I S C L O S U R E DOCUMENT FOR CALIFORNIA
1.
THE CALIFORNIA FRANCHISE INVESTMENT LAW REQUIRES THAT A
C O P Y OF ALL P R O P O S E D A G R E E M E N T S RELATING TO THE SALE OF THE
FRANCHISE BE DELIVERED T O G E T H E R WITH THE FRANCHISE DISCLOSURE
DOCUMENT.
2.
Item 3, the Franchisor and persons listed in Item 2 are not subject to any
currently effective order of any national securities association or national securities
exchange, as defined in the Securities Exchange Act of 1934, 15 U.S.G.A. 78a et seq.,
suspending or expelling such persons from membership in such association or
exchange.
3.
Item 6, the section entitled "Management Hiring," is amended by adding
the following language: The Franchise Agreement contains a liquidated damages
clause. Under California Civil Code Section 1671, certain liquidated damages clauses
are unenforceable.
4.
Item 17, the Summary under Provision f. of Table 1 (Development
Agreement), is amended by adding the following language: California Business and
Professions Code Sections 20000 through 20043 provide rights concerning termination
or non-renewal of a franchise. If the Development Agreement contains a provision that
is inconsistent with the law, the law will control.
5.
Item 17, the Summary under Provision f. of Table 1 (Development
Agreement), is amended by adding the following language: The Agreement provides
for termination upon bankruptcy. This provision may not be enforceable under federal
bankruptcy law (11 U.S.G.A. Sec. 101 etseq.).
6.
Item 17, the Summary under Provision m. of Table 1 (Development
Professions Code Sections 20000 through 20043 prohibit certain waivers. If the
Development Agreement contains a provision that is inconsistent with the law, the law
will control.
7.
Item 17, the Summary under Provision r. of Table 1 (Development
Agreement), is amended by adding the following language: The Agreement contains
covenants not to compete which extend past termination. These provisions may not be
enforceable under California law.
8.
Item 17, the Summary under Provision s. of Table 1 (Development
Agreement), is amended by adding the following language: The California Corporations
Code, Section 31125 requires the Franchisor to give you a disclosure document,
approved by the Department of Business Oversight prior to a solicitation of a proposed
material modification of an existing franchise.
9.
Item 17, the Summary under Provision w. of Table 1 (Development
Agreement), is amended by adding the following language: The Agreement requires
1051984.2
a p p ^ i o o ofthe ^ w s o f t h e ^ o s a s
Galiforni9law
These provisioos may oot he enforoeahie under
10
h e r n i a the Summary under Provision f of Tahie2 (Pranohise
Agreements is amended hy adding the foiiowinglanguage: OaiiforniaBusinessand
Professions Code Sections 20000 through 20043 provide rights oonoerning terminate
or nonrenewal ofafranohise Ifthe Pranohise Agreement oontainsaprovision that is
inconsistent with the law, the iaw wiii control
11 îtem17, the Summary under Provision f of Tahie2 (Franchise
Agreement), is amended hy adding the following language: The Agreement provides
for termination upon bankruptcy This provision may not he enforoeahie under federal
bankruptcy l a w ( 1 1 0 S O A S e o 1 0 1 ^ s e ^ )
12
ltem17, the Summary under Provision m of Table2 (Franchise
Professions Code Sections 20000 through 20043 prohibit certain waivers
If the
Franchise Agreement oontainsaprovision that is inconsistent with the law, the law will
control.
13
ltem17, the Summary under Provision r of Table2 (Franchise
Agreement), is amended by adding the following language The Agreement contains
covenants not to compete whioh extend past termination These provisions may not be
enforceable under California law
14
ltem17, the Summary under Provision s of Table2 (Franchise
Agreement), is amended by adding the following language: The California Corporations
Code, Section 31125 requires the Franchisor to give you a disclosure document,
approved by the Department of Business Oversight prior toasolioitation ofaproposed
material modification of an existing franchise
FxhibitCDStata Addenda
^ 9 ^ 2
AOOENOOMTOTHEPRANOHÊO^^
TH^FRANOHÊOÔ^^
PROTECTION ANO CONTAINS A S U M M A R Y ONLY OP CERTAIN MATERIAL
PROVISIONS O P T H E P R A N C H I S E A G R E E M E N T THIS PRANOHISE OISCLOSURE
DOCUMENT ANO ALL C O N T R A C T S ANO A G R E E M E N T S SHOOLO 8E READ
O A R E P U L L Y I N THEIR ENTIRETY P O R A N U N O E R S T A N O i N O OP ALL RIGHTS ANO
OBLIGATIONS OP BOTH THE P R A N O H I S O R A N D THE PRANGHISEE
A P E O E R A L T R A O E G O M M I S S I O N RULE M A ^ E S IT U N L A W F U L T O OFFER OR
SELL ANY FRANCHISE WITHOUT FIRST P R O V I N G THIS FRANCHISE
OISCLOSURE OOGUMENT TO THE PROSPEGTIVE FRANGHiSEE AT THE
EARLIEROF(^THEFIRSTPERSONALMEETINGÔR^TENÔ)
BUSINESS
DAYS B E F O R E THE SIGNING OF A N Y PRANOHISE OR RELATED AGREEMENTS
O R ^ T E N ^ B U S I N E S S DAYS B E F O R E ANY PAYMENT T H E P R O S P E G T I V E
FRANCHISEE M U S T A L S O R E G E I V E A F R A N G H I S E A G R E E M E N T CONTAINING
ALLMATERIALTERMS A T L E A S T F I V E ^ ) BUSiNESSDAYS PRIORTOTHE
SIGNING O F T H E F R A N C H I S E A G R E E M E N T
IF THIS FRANCHISE D I S C L O S U R E DOCUMENT IS NOT DELIVERED ON TIME, OR
IF IT CONTAINS A FALSE, INCOMPLETE, INACCURATE OR MISLEADING
STATEMENT, A VIOLATION OF FEDERAL AND STATE LAW MAY HAVE
O C C U R R E D AND SHOULD BE R E P O R T E D TO THE FEDERAL TRADE
COMMISSION, WASHINGTON, D G 2 0 ^ 0 AND THE HAWAII COMMISSIONER OF
SECURITIES, DEPARTMENT OF C O M M E R C E AND C O N S U M E R AFFAIRS,
BUSINESS REGISTRATION DIVISION, 335 MERCHANT S T R E E T , R O O M 2 0 ^ P O
B O ^ O , HONOLULU, H A W A h ^ B I O
The Business Regish^hon Division of the
Consumer Affairs of the State of Hawaii r e q ^
to Hawaii state oover pages:
Department of Gommeroe and
T H E S E F R A N G H i S E S HAVE B E E N FILED UNDER THE FRANGHiSE INVESTMENT
LAWOFTHESTATEOFHAWAii
FiLiNG DOES NOT GONSTiTUTE A P P R O V A L ,
RECOMMENDATION OR E N D O R S E M E N T BY THE DiREOTOR OF C O M M E R C E
ANDOONSUMERAFFAiRSORAFiNDiNGBYTHEDiREGTOROFGOMMERGE
AND C O N S U M E R A F F A i R S T H A T THE iNFORMATiON PROViDED HEREiN iS
T R U E , G O M P L E T E A N D NOT MiSLEADiNG
THE FRANGHiSE INVESTMENT LAW M A ^ E S i T UNLAWFUL TO OFFER OR SELL
ANY FRANGHiSE iN THIS STATE WITHOUT FiRST PROViDiNG TO THE
PROSPEGTiVEFRANGHiSEE, ORSUBFRANGHiSOR, A T L E A S T S E V E N D A Y S
PRiOR TO THE EÊGUTiON BY THE PROSPEGTIVE FRANGHiSEE OF ANY
BINDING F R A N G H i S E O R OTHER A G R E E M E N T , O R AT L E A S T S E V E N D A Y S
PRiOR TO THE PAYMENT OF A N Y GONSiDERATiON BY THE FRANGHiSEE, OR
S U B F R A N G H i S O R , W H i G H E V E R O O G U R S F i R S T , A G O P Y OF THE FRANGHiSE
DISCLOSURE DOCUMENT, T O G E T H E R WiTH A C O P Y OF ALL P R O P O S E D
A G R E E M E N T S R E L A T i N G T O T H E S A L E O F T H E FRANGHiSE
Fxhi^tO^State Addenda
10^9^2
THIS FRANCHISE DISCLOSURE DOCUMENT CONTAINS A SUMMARY ONLY OF
CERTAIN MATERIAL PROVISIONS OF THE FRANCHISE A G R E E M E N T .
THE
C O N T R A C T OR A G R E E M E N T SHOULD BE R E F E R R E D TO FOR A STATEMENT OF
ALL RIGHTS, CONDITIONS, RESTRICTIONS AND OBLIGATIONS OF BOTH THE
FRANCHISOR AND THE FRANCHISEE.
Registered agent in Hawaii authorized to receive service of process: •
Department of Commerce and Consumer Affairs
Business Registration Division
P.O. Box 40
1051984.2
AOOENOUMTOTHEPRANOHÊOÔ^
1
Cover page, P a ^ g ^ p h s l a n d ^ u n d e r "Risk F a c t o r a ^
2
i t e m l ^ t h e Summary under R r o v i s i o o f o f T a b i e ^ O e ^ ^
amended by adding the foiiowmg language: The conditions under whiohadeveiopment
agreement oan he terminated and rights upon nonrenewal may heaffeoted hy the
Illinois Franchise Disclosure Aot 0 ^ 9 8 7 , Sections 19and 20
3
I t e m l ^ the Summary under R r o v i s i o n v o f T a h l e l (Oevelopment Agreements
is deleted, and the following is in its place: Under the Illinois Franchise Disclosure Act,
S e o t i o n 1 5 3 i s deleted and is of no foroe or effeot, subject to state law
4
Item 17,the S u m m a ^ ^ ^ ^ ^ s i o n w o f T a b l e 1 ( D e v e l o p m e n t Agreement),
is amended by adding the following language: Flowever, the application of Kansas law
is superseded in all instances by the authority of Illinois law, subject to state law
5
ltem17,theSummary under F r o v i s i o n f o f T a b l e 2 ( F r a n o h i s e Agreement), is
amended by adding thefollowing language: Theoonditionsunder whioh afranohise
agreementoan beterminated and rights upon nonrenewal may beaffeoted by the
Illinois Franchise DisclosureAotof1987, Sections 19and 20
6
Item 1 7 , t h e S u m m a r y u n d e r F r o v i s i o n v o f T a b l e 2 ( F r a n c h i s e Agreement),is
deleted, and the following is in its place: Under the Illinois Franchise Disclosure Act,
Section 2 1 3 i s deleted and is of no foroe or effeot, subject to state law
7
ltem17,the Summary under F r o v i s i o n w o f T a b l e 2 ( F r a n o h i s e Agreement),is
amended by adding the following language: Flowever,the application of Kansas law is
superseded in all instances by the authority of Illinois law, subject to state law
FxhibitD^State Addenda
^ 1 ^ 2
AOOENOOMTOTHEPRANOHÊOÔLOSUREOOOOMENTPOR
MICHIGAN
T H E S T A T E O F M I O ^ G A N P R O M T S OERT^N O N F A ^ P R O V ^ O N S
THAT ARE SOMETIMES ^ FRANCHISE OOOOMENTS
IF ANY OF THE
FOLLOWING PROVISIONS ARE IN THESE FRANCHISE OOCOMENTS, THE
RROVISIONSAREVOIOANO CANNOT BE ENFORCED AOAINSTYOO:
(A)
ARROHIBITIONONTHERIOHTOFAFRANCHISEETOÔINAN
ASSOCIATION OF FRANCHISEES
(B)
A R E O O I R E M E N T T H A T A F R A N C H I S E E ASSENT T O A R E L E A S E ,
ASSIGNMENT NOVATION, WAIVER OR ESTOPPEL WHIOH DEPRIVES A
FRANCHISEE OF RIGHTS AND PROTECTIONS PROVIDED IN THIS ACT THIS
SHALL NOT PREGLLIDEAFRANGHISEE, AFTER ENTERING INTOAFRANGHISE
AGREEMENT FROM SETTLING ANY AND ALL GLAIMS
(G)
APROVISIONTHATPERMITSAFRANGHISORTOTERMINATEA
FRANGHISE PRIOR TO THE EXPIRATION OF ITS TERM, EXCEPT FOR GOOD
OALISE GOOD OAOSE SHALL INCLUDE THE FAILORE OF THE FRANGHISEE TO
GOMPLYWITHANY LAWFUL PROVISION OFTHE FRANGHISE AGREEMENT AND
TO GURESUGH FAILURE AFTER BEING GIVEN WRITTEN NOTIGE THEREOF AND
AREASONABLEOPPORTUNITY,WHIGH IN NO EVENT NEED BE MORE THAN
THIRTY DAYS, TO CURE SUGHPAILURE
(D)
A PROVISION THAT PERMITS A FRANGHISOR TO R E F U S E T O
RENEWAFRANOHISEWITHOUTFAIRLYGOMPENSATINGTHE FRANGHISEE BY
REPURCHASE OR OTHER MEANS FOR THE FAIR MARKETVALUEATTHE TIME
OF EXPIRATION, OF THE FRANCHISEES INVENTORY,SUPPLIES, EQUIPMENT,
FIXTURES AND FURNISHINGS
PERSONALISED MATERIALS WHICH HAVE NO
VALUE TO THE FRANGHISOR AND INVENTORY, SUPPLIES, EQUIPMENT,
FI^TURESAND FURNISHINGS NOT REASONABLYREQUIRED IN THE GONDUGT
OF THE FRANGHISE BUSINESS ARE NOT SUBJEGT TO COMPENSATION THIS
SUBSECTION APPLIES ONLY IF: ^ T H E T E R M OF THE FRANGHISE IS LESS
THAN FIVE YEARS, AND (II) THE FRANGHISEE IS PROHIBITED BY THE
FRANGHISE OR OTHER AGREEMENT FROM CONTINUING TO GONDUOT
SUBSTANTIALLY THE SAME BUSINESS UNDER ANOTHER TRADEMARK,
SERVICE MARK, TRADE NAME, LOGOTYPE, ADVERTISING OR OTHER
GOMMERGIALSYMBOL IN THE SAME AREA SUBSEQUENTTO THE EXPIRATION
O F T H E FRANGHISEOR THE FRANGHISEE DOES NOT RECEIVE AT LEAST
SI^MONTHS ADVANCE NOTIGE OF FRANCHISORS INTENT NOT TO RENEW
THEFRANCHISE
(E)
A P R O V I S I O N T H A T P E R M I T S T H E FRANCHISOR TO R E F U S E T O
RENEW A FRANGHISE ON TERMS GENERALLY AVAILABLE TO OTHER
FRANCHISEES OF THE SAME G I ^ S S OR TYPE UNDER SIMILAR
^ ^ 0 ^ 5 ^ ^ ^ ^
105^2
OIROOMSTANOES
PROVISION
THIS
SECTION
OOES
NOT
REOOIRE
A
RENEWAL
(P)
ARROVISIONREO0IRINOTHATAR8ITRATION
OR LITIGATION BE
OONOLIOTEO OLITSIOE THIS STATE
THIS SHALL NOT RREOLLIOE THE
FRANCHISEE FROM ENTERING INTO AN AGREEMENT AT THE TIME OF
ARBITRATION, TO GONOLIGT ARBITRATION AT A LOCATION OOTSIOETHIS
STATE
(G)
ARROVISION WHICH RERMITSAFRANGHISOR TO REFUSE TO
PERMIT TRANSFER OF OWNERSHIP O F A F R A N O H I S E , EXCEPT FOR GOOO
CAUSE
THIS SUBDIVISION OOES NOT PREVENT A FRANGHISOR FROM
EÊRGISINGARIGHT OF FIRST R E F U S A L T O PURCHASE THE FRANGHISE
GOOD OAUSE SHALL INGLUOE, BUT IS NOT LIMITED TO:
(1) THE F A I L U R E O F T H E P R O P O S E D T R A N S F E R E E T O M E E T T H E
FRANGHISORS THENCORRENT REASONABLE OUALIFIGATIONS OR
STANDARDS
(II^THE FACT THATTHE PROPOSED TRANSFEREE ISAGOMPETITOR OF
THE FRANGHISOR OR SUBFRANGHISOR
(III) THE UNWILLINGNESS OF THE PROPOSED TRANSFEREE TO AGREE
INWRITING TO GOMPLYWITHALLLAWFUL OBLIGATIONS
(Iv)THE FAILURE OF THE FRANGHISEE OR PROPOSED TRANSFEREE TO
PAY ANY SUMS OWING TO THE FRANGHISOR OR TO CURE ANY DEFAULT
IN THE FRANGHISE AGREEMENT EXISTING AT THE TIME OF THE
PROPOSEDTRANSFER
(H)
APROVISION THAT REQUIRES THE FRANGHISEE TO RESELLTO
THE FRANGHISOR I T E M S T H A T A R E NOT UNIQUELY IDENTIFIED WITH THE
FRANGHISOR THISSUBDIVISION DOES NOT PROHIBITAPROVISION THAT
GRANTS T O A F R A N G H I S O R A R I G H T OF FIRST REFUSAL TO PURGHASE THE
ASSETS OFAFRANGHISE ON THE SAME TERMS AND CONDITIONS A S A B O N A
FIDE THIRD PARTY WILLING AND ABLE TO PURGHASE THOSE ASSETS, NOR
DOES THIS SUBDIVISION PROHIBIT A PROVISION THAT GRANTS THE
FRANGHISOR THE RIGHTTO ACQUIRE THEASSETS OFAFRANGHISE FOR THE
MARKET OR APPRAISED VALUE OF SUGH ASSETS IF THE FRANGHISEE HAS
BREACHED THE LAWFUL PROVISIONS OF THE FRANGHISE AGREEMENT AND
HAS FAILED TO CURE THE BREACH IN THE MANNER PROVIDED IN
SUBDIVISION (G)
(I)
APROVISIONWHIGH PERMITS THE FRANGHISOR TO DIREGTLYOR
INDIREGTLYGONVEY,ASSIGN OR OTHERWISE TRANSFER ITS OBLIGATIONS
TO FULFILL CONTRACTUAL OBLIGATIONS TO THE FRANGHISEE UNLESS
PROVISION HAS BEEN MADE FOR PROVIDING THE REQUIRED GONTRAGTOAL
SERVIGES
2
105^2
THE FACT THAT T H E R E IS A NOTICE OF THIS DISCLOSURE DOCUMENT
ON FILE WITH THE A T T O R N E Y G E N E R A L DOES NOT CONSTITUTE APPROVAL,
RECOMMENDATION OR E N D O R S E M E N T BY THE ATTORNEY G E N E R A L
The name and address of the Franchisor's agent in this State authorized to
receive service of process is:
Michigan Department of Commerce
Corporations and Securities Bureau
Office of Franchise and Agent Licensing
6546 Mercantile Way
P.O. Box 30222
Lansing, Michigan 48910
ANY QUESTIONS REGARDING THIS NOTICE SHOULD BE DIRECTED TO:
D E P A R T M E N T OF THE ATTORNEY G E N E R A L
C O N S U M E R PROTECTION DIVISION
670 LAW BUILDING
LANSING, MICHIGAN 48913
(517) 373-7117
1051984.2
AOOENOOM TO T H E PRANOHISE
T H E S E PRANOHISES HAVE BEEN R E G I S T E R E O O N O E R THE MINNESOTA
ERANOHISE AOT REGISTRATION OOES NOT OONSTITOTE A P P R O V A L
REOOMMENOATION OR E N D O R S E M E N T
BY THE COMMISSIONER OP
O O M M E R O E O P M I N N E S O T A O R A P I N O I N O BY THE COMMISSIONER T H A T T H E
INFORMATION PROVIDED HEREIN I S T R O E ^ C O M P L E T E A N O NOT MISLEADING
THE MINNESOTA FRANCHISE ACT MAKES IT O N L A W P O L T O OFFER OR
SELL A N Y FRANGHISE IN THIS STATE WHICH IS SUBJECT TO REGISTRATION
WITHOUT FIRST PROVIDING TO THE P R O S P E G T I V E F R A N G H I S E E , AT LEAST
7 D A Y S PRIOR TO T H E EÊGLITION BY THE PROSPECTIVE FRANGHISEE OF
ANYBINDING F R A N G H I S E 0 R 0 T H E R A G R E E M E N T 0 R A T L E A S T 7 D A Y S
P R I O R T O T H E P A Y M E N T O F A N Y O O N S I D E R A T I O N BY THE FRANGHISEE,
W H I G H E V E R O G G O R S F I R S T A G O P Y O F T H I S PUBLIC OFFERING S T A T E M E N T
T O G E T H E R W I T H A G O P Y O F A L L P R O P O S E D A G R E E M E N T S RELATING TO THE
FRANGHISE
THIS PUBLIC OFFERING STATEMENT G O N T A I N S A S U M M A R Y
ONLY OF CERTAIN MATERIAL PROVISIONS OF THE FRANCHISE A G R E E M E N T
THE CONTRACT OR OTHER A G R E E M E N T SHOULD BE R E F E R R E D TO FOR AN
UNDERSTANDING OF A L L RIGHTS AND OBLIGATIONS OF BOTH THE
P R A N O H I S O R A N D THE FRANGHISEE
T
Item 13 Is amended by adding tbe following language: Tbe Minnesota
Department of Gommeroe requires tbat tbe Franoblsor Indemnity Minnesota ftanoblsees
against liability to tbird parties r e s u l t
use of tbe FranoblsoBs trademark Infringes upon tbe trademark rigbts of tbe tbird party
Franchisor will proteot your rigbt to use tbe trademarks, servloe marks, trade names,
logotypes of otber oommerolal symbols ^Marks^ or Indemnify you from any loss, oosts
orexpenses arising out o f a n y olalm, suit or demand regarding tbe use tbe Marks.
Franoblsordoes not Indemnify against tbe consequences ofafranoblsee's use of tbe
Franoblsor'strademarkexceptlnaooordanoewltbtberequlrements of tbe franchise,
a n d , a s a c o n d l t l o n to Indemnification,franchisee must provide notice to Franchisor of
any such olalm within ten (10) days and tender the defense of the olalm to Franchisor
If Franchisor accepts thetender of defense, Franchisor hastherlght to manage the
defense of the olalm, Including the right to compromise, settle or otherwise resolve the
olalm,and to determine whether to appealaflnal determination of the claim
2
Item17ls amended by adding the following language:
a
MlnnesotaStatutes, Section 30021 andMlnnesota Rule 23604400^)
prohibit Franchisor from requiring litigation to be conducted outside Minnesota, r e q u l ^
waiver of a]ury trial or requiring thefranohlsee to consentto liquidated damages,
termination penalties or judgment notes
In addition, nothing In the Franchise
Disclosure Document or Franchise Agreement can abrogate or reduce any o f t h e
franchisee's rights as provided for In Minnesota Statutes, Chapter 300, or the
franchisee's rights to any procedure, forum or remedies provided for by the laws of the
jurisdiction
If theFranchise Agreement andôr the Franchise Disclosure Document
oontalnsaprovlslon that Is Inconsistent with the Minnesota Statutes or the Minnesota
^ ^ O D S ^ A ^ n d a
^ 9 ^ 2
1
R o l ^ the provisions of the Pranohise Agreement anchor the Pranohise Oisoiosore
O o o o m e n t s h a i i h e s u p e r s e d e d h y theMinn Poie^s requirements a n d s h a l i h a v e n o
toroe or effeot
h
With respeottofranohisesgoverned hy Minnesota iaw, Franchisor wiii
oompiywithMinn St^t Seo 8 0 0 1 ^ ^
specified oases,th^tafranohisee he given 90 days'written notice of t e r m i n a t i o n s
O 0 d a y s t o o u r e ) a n d noticeof Franchisor's intention not to renew 180dayshefore
expiration of thefranohiseand that thefranohiseehe given sufficientopportunityto
operate the franchise in order to enahie the franchisee the opportunity to recover the fair
m a r k e t v a i u e o f t h e f r a n o h i s e a s a g o i n g concern. Franchisor's consent to the transfer
wiii not he unreasonahiy withheld
o.
Minnesotaiaw provides franchisees with certain terminationrights. With
respect tofranohises governed hy Minnesota iaw, Franchisor wiii comply with Minn
Stat Geo 80GBl4,Suhds 3 , 4 , a n d ^ w h i o h require,except in certain specified cases,
thatafranohisee he given 00 days'written notice of termination (with 60 days to cure)
and 130 days'notice for non renewal of the Franchise Agreement. Franchisor's consent
to the transfer of the franchise will not he unreasonably withheld
3
The name ^nd address o f t h e Franohisor'sagent in this Stateauthorized to
receive service of process is:
Minnesota Commissioner of Commerce
3 5 ^ P l a o e F 2 3 s t , Suite 500
St Paul, Minnesota 551012193
E x ^ O ^ S ^ A ^ o d a
^ ^ 4 2
A D D E N D U M TO THE FRANCHISE OFFERING P R O S P E C T U S
REQUIRED B Y THE STATE OF NEW Y O R K
THE FRANCHISOR MAY, IF IT C H O O S E S , NEGOTIATE WITH YOU ABOUT ITEMS
C O V E R E D IN THE P R O S P E C T U S . HOWEVER, THE FRANCHISOR CANNOT USE
THE NEGOTIATING P R O C E S S TO PREVAIL ON A PROSPECTIVE FRANCHISEE
TO A C C E P T T E R M S WHICH A R E L E S S FAVORABLE THAN THOSE SET FORTH IN
THIS P R O S P E C T U S .
In accordance with Section 684.3(a)(ii) of the New York General Business Law,
Article 33, please be advised as follows:
1.
The principal business address ofApplebee's Franchisor LLC is:
8140 Ward Parkway
2.
The agent in the State of New York authorized to receive legal process on behalf
ofApplebee's Franchisor LLC is:
Secretary of State of the State of New York
41 State Street
Albany, New York 12231
3. _ A Franchisee's duty to assent to a release, assignment, novation, waiver or
estoppel under either the Development Agreement or the Franchise Agreement may be
affected by New York law. N.Y. Gen. Bus. Law §687.5.
1051984.2
AOOENOOM TO THE PRANOHISE OISOLOSOREOOOOMENT
PORNORTHOAKOTA
The l o w i n g provisions supersede any inconsistent provisions in the Oisoiosure
Oooument and appiy to aii franchises offered and soid in the State of North Oakota:
1
Seotion 51 1 9 0 9 o f t h e North Oakota Pranohise investment Law prohibits a
franchisee to assent t o a g e n e r a i release T o t h e e x t e n t a n y s u o h general release is
purported to he required, it is hereby rendered void with respect to allfranohisees
governed under the laws of North Oakota
2
Covenants not to compete upon termination or expiration of the Pranohise
Agreement andôr the Oevelopment Agreement are subject to S e o t i o n 9 0 8 0 5 of the
North OakotaOenturyOode and are generally considered unenforceable in the State of
North Oakota
3 Totheextentthatltem17wouldotherwiseviolate North Oakota law, suoh sections
are amended by providing thatall litigation by or between you and us, involving a
franohised business operating in the State of North Oakota, shall be commenced and
maintained, at our election, inthe state courts of North O a k o t a o r t h e O n i t e d S t a t e s
Oistriot Court for North Oakota, with the specific venue in either court system
determined by appropriate jurisdiction and venue requirements
4 North Oakota law applies to this transaction and supersedes any conflicting
provisions of the Pranohise Agreement or Texas law
5
Section 51 19 09 o f t h e North Oakota Pranohise Investment Law prohibits a
franchisee to consent t o a w a i v e r of trial by ]ury T o t h e extent any suoh consent is
purported to be required, it is hereby rendered void with respect to allfranohisees
governed under the laws of North Oakota
The agent in the State of North Oakota authorized to receive legal process on
behalf ofApplebee's Franchisor LLC is:
North Oakota Securities Commissioner
600 East Boulevard, 5th Floor
Bismarck, North Oakota 58505
E ^ ^ O ^ S ^ A d ^ d a
A D D E N D U M TO THE FRANCHISE DISCLOSURE DOCUMENT FOR
OREGON
THIS INFORMATION IS PROVIDED FOR YOUR OWN PROTECTION. IT IS IN YOUR
BEST INTEREST TO STUDY IT C A R E F U L L Y B E F O R E MAKING ANY COMMITMENT.
THE INFORMATION CONTAINED HEREIN HAS NOT BEEN REVIEWED OR
A P P R O V E D UNDER O R E G O N FRANCHISE LAW.
The agent for service of process for the Franchisor in this State is:
Director of Oregon Department of
Consumer & Business Services
350 Winter Street NE
Salem, Oregon 97301-3878
1051984.2
AOOENOUM TO THE PRANOHISE O ^ C L O S O R E O O C O M E N T POR
RHOOEISLANO
THIS PRANOHISE OlSOLOSORE O O O O M E N T I S PROVIOEO FOR Y O U R O W N
PROTECTION ANO CONTAINS A S U M M A R Y ONLY OP CERTAIN MATERIAL
PROVISIONS O P T H E P R A N C H I S E A O R E E M E N T THIS FRANCHISE OISCLOSURE
DOCUMENT ANO ALL C O N T R A C T S ANO A G R E E M E N T S SHOULD BE READ
C A R E F U L L Y I N THEIR ENTIRETY F O R A N UNDERSTANDING OF ALL RIGHTS AND
OBLIGATIONS O F B O T H T H E F R A N G H I S O R A N D THE FRANGHISEE
A F E D E R A L T R A D E COMMISSION RULE MAKES IT U N L A W F U L T O OFFER OR
SELL ANY FRANGHISE WITHOUT FIRST PROVIDING THIS FRANGHISE
DISCLOSURE DOCUMENT TO THE PROSPECTIVE FRANGHISEE AT THE
EARLIER O F ^ T H E FIRST P E R S O N A L MEETING, O R ^ T E N BUSINESS DAYS
BEFORE THESIGNING O F A N Y FRANGHISEOR R E N T E D A G R E E M E N T O R
(^TEN
BUSINESS DAYS B E F O R E ANY PAYMENT
THE PROSPEGTIVE
FRANGHISEE M U S T A L S O R E G E I V E A F R A N G H I S E A G R E E M E N T GONTAINING
A L L M A T E R I A L T E R M S A T L E A S T F I V E BUSINESS DAYS PRIOR TO THE SIGNING
OFTHE FRANGHISEAGREEMENT
ALTHOUGH T H E S E FRANGHISES HAVE BEEN REGISTERED UNDER THE RHODE
ISLAND FRANGHISE AND DISTRIBUTORSHIP INVESTMENT REGULATIONS A O T
REGISTRATION DOES N O T G O N S T I T U T E A P P R O V A 4 R E G O M M E N D A T I O N OR
E N D O R S E M E N T BY THE D E P A R T M E N T O F BUSINESS R E G U L A T I O N S O R A
FINDING BY THE DEPARTMENT OF BUSINESS REGULATION THAT THE
INFORMATION PROVIDED HEREIN IS T R U E , GOMPLETE, A C C U R A T E OR NOT
MISLEADING
IF THIS FRANGHISE DISCLOSURE DOCUMENT IS NOT DELIVERED ON TIME, OR
IF IT CONTAINS A FALSE, INCOMPLETE, INAOGURATE OR MISLEADING
S T A T E M E N T A VIOLATION OF FEDERAL AND STATE LAW MAY HAVE
O C C U R R E D AND SHOULD BE R E P O R T E D TO THE FEDERAL TRADE
COMMISSION,
WASHINGTON,
DC
20580 AND
THE
RHODE
ISLAND
D E P A R T M E N T OF BUSINESS REGULATION, SEGURITIES DIVISION, 1511
PONTIAGAVENUE,ÔHNO PASTORE GOMPLE^^BUILDING 601,GRANSTON,
RHODE ISLAND 02910
The name and address o f t h e FranohlsoBsagent In this State authorized to
reoelveservloeofprooessls:
Director of Department of Business Regulation
Securities Division
J o h n O Pastore Complex
1511PontlaoAvenue, Building 001
Cranston, Rhode Island 02010
E ^ ^ O ^ S ^ A ^ ^
10^9^2
1.
Item 17, the paragraph following Table 1 (Development Agreement), is amended
by adding the following language: §19-28.1-14 of the Rhode Island Franchise
Investment Act provides that "A provision in a [development] agreement restricting
jurisdiction or venue to a forum outside this state or requiring the application of the laws
of another state is void with respect to a claim otherwise enforceable under this Act."
2.
Item 17, the paragraph following Table 2 (Franchise Agreement), is amended by
adding the following language: §19-28.1-14 of the Rhode Island Franchise Investment
Act provides that "A provision in a franchise agreement restricting jurisdiction or venue
to a forum outside this state or requiring the application of the laws of another state is
void with respect to a claim otherwise enforceable under this Act."
1051984.2
AOOENOOMTOTHEPRANOHÊOÔLOSOREOOOOMENTPOR
SOUTH OAKOTA
THIS FRANCHISE OISCLOSURE DOCUMENT IS F R O V I O E O F O R Y O U R O W N
PROTECTION ANO CONTAINS A S U M M A R Y ONLY OF CERTAIN MATERIAL
PROVISIONS O F T H E F R A N C H I S E A O R E E M E N T THIS FRANCHISE OISCLOSURE
DOCUMENT ANO ALL C O N T R A C T S AND A G R E E M E N T S SHOULD 8E READ
C A R E F U L L Y I N THEIR ENTIRETY F O R A N UNDERSTANDING OF ALL RIGHTSAND
OELIGATIONS OF 8 0 T H T H E P R A N O H I S O R A N D THE FRANGHISEE
T H E S E FRANGHISES HAVE 8 E E N REGISTERED UNDER THE SOUTH DAKOTA
FRANGHISE LAW S U C H REGISTRATION DOES NOT CONSTITUTE A P P R O V A L ,
RECOMMENDATION OR E N D O R S E M E N T 8Y THE DIRECTOR OF THE DIVISION
OF SECURITIES OF THE STATE OF SOUTH DAKOTA O R A F I N D I N G 8 Y THE
DIRECTOR OF THE DIVISION OF SECURITIES THAT THE INFORMATION
PROVIDED HEREIN IS T R U E , C O M P L E T E A N D NOT MISLEADING
IF THIS FRANGHISE DISCLOSURE DOCUMENT IS NOT DELIVERED ON TIME, OR
IF IT CONTAINS A F A L S E , INCOMPLETE, INACCURATE OR MISLEADING
STATEMENT, A VIOLATION OF F E D E R A L AND STATE LAW MAY HAVE
O C C U R R E D AND SHOULD 8 E R E P O R T E D TO THE FEDERAL TRADE
COMMISSION, W A S H I N G T O N D G 20580 AND THE DIRECTOR OF THE SOUTH
DAKOTA DIVISION OF SEGURITIES, 118 EAST CAPITOL, PIERRE, SOUTH
DAKOTA5750150B0
The name and address o f t h e Franchisor's agent In this State authorized to
receive service of process Is:
Dlreotorofthe South Dakota Division ofSecurities
Pierre, South Dakota 57501
1
ItemO, the seotion entitled "Management Hiring" Is amended hy adding the
following language: Every contract In whioh the amount of damage or compensation for
hreach of an obligation Is determined In anticipation thereof Is void to that extent, except
the parties may agree therein upon an amount presumed to he the damage for hreach
In cases wherelt would helmpraotloahle or extremely difficult to fix actual damage
SDGL5305
2.
Item17,the Summary under P r o v l s l o n m o f T a h l e l (Development Agreements
Is amended hy adding thefollowing language: A s a condition to Itsapproval o f a
proposedTransfer,Franohlsor may also require you and your Principal Shareholders,
Inoludlno the proposed t r a n s f e r o r s to exeouteaoeneral release releaslno Franchisor
from a n y c l a l m s y o u o r t h e y m a y h a v e had or then have against Franohlsor,exoludlng
only such claims as may have arisen under the South DakotaFranohlsesfor8rand
Name Goods and Services Law
^ ^ O D S ^ A d d e ^
^ 9 ^ 2
3
h e m l ^ t h e Gummas under ^
amended by adding the fo^winglanguage: Contracts inrestraint of trade that take
effeot upon termination or expiration of a development agreement are generally
unenforceable In South Dakota, exoept in certain instances as provided hy law
4.
Item17, the Summary under Provision f. o f T a b l e ^ (Pranohise Agreement), is
amendedby adding the following language: If SouthDakota franchise law reguiresa
greater prior n o t i o e o f a refusal to renew the Pranohise Agreemenforagreaterprior
noticeof termination o r t h e t a k i n g o f s u c h action not required under the Franchise
Agreement, the notice orother action required by law will supersede the relevant
portions of the Pranohise Agreement
5
I t e m l ^ the Summary under P r o v i s i o n m o f T a b l e 2 ( P r a n o h i s e Agreement),is
amended by adding the following language: As a condition to its approval of a
proposed Transfer,Pranohisor may also require you and your Principal Shareholders,
inoludinotheorooosedtransferor(s),toexecuteaêneral release releasing Franchisor
f r o m a n y o l a i m s y o u o r t h e y m a y have had or then have against Franohisor,exoluding
only suoholaims as may have arisen under the South Dakota Franchises for Erand
Name Goods and Services Law
6
ltem17, the Summary under Provisions ofTable2(Franohise Agreement), is
amended by adding the followinglanguage: Contracts inrestraint of trade that take
effeot upon termination or expiration of a franchise agreement are generally
unenforceable in South Dakota, except In certain instances as provided by law
E ^ ^ O ^ S ^ A d d e ^
^ ^ 4 2
AOOENOUMTOTHEPRANOHÊOÔLOSOREOOOOMENT
POR^RGÂ
TH^FRANOHÊOÔLOSOREOOOOMENT^PROÔEO^
PROTEOTION ANO OONTAINS A S U M M A R Y ONLY OF CERTAIN MATERIAL
R R O V I S I O N S O F T H E F R A N C H I S E A O R E E M E N T THIS FRANCHISE OISCLOSURE
OOOUMENT ANO ALL C O N T R A C T S ANO A G R E E M E N T S SHOULO 8E REAO
O A R E F O L L Y I N T H E I R ENTIRETY F O R A N UNOERSTANOINO OF ALL RIOHTSANO
OBLIGATIONS OF 8 0 T H THE F R A N C H I S O R A N O THE FRANCHISEE
ALTHOUGH T H E S E FRANGHISES HAVE 8 E E N REGISTEREO LINGER THE
VIRGINIA RETAIL FRANCHISING A C T A S AMENOEO, REGISTRATION OOES NOT
CONSTITUTE A F R R O V A L , REGOMMENOATION OR ENOORSEMENT SY THE
DIVISION OF SEGURITIES ANO RETAIL FRANOHISING OF THE VIRGINIA STATE
GORRORATION COMMISSION O R A F I N O I N G B Y T H E O I V I S I O N
OFSECURITIES
ANO R E T A I L F R A N G H I S I N G T H A T T H E I N F O R M A T I O N
FROVIOEO HEREIN IS
TRUE, G O M F L E T E , A C C U R A T E OR NOT MISLEADING
IF THIS FRANGHISE DISCLOSURE OOGUMENT IS NOT OELIVEREO ON TIME, OR
IF IT GONTAINS A FALSE, INGOMFLETE, INACCURATE OR MISLEADING
STATEMENT, A VIOLATION OF F E D E R A L AND STATE LAW MAY HAVE
O G O U R R E D AND SHOULD 8 E RERORTED TO THE FEDERAL TRADE
GOMMISSION, WASHINGTON, D O 20580 AND THE VIRGINIA DIVISION OF
SEGURITIES AND RETAIL FRANGHISING, 1300 EAST MAIN S T R E E T R I G H M O N D ,
VIRGINIA28210
RuûaottoSeotlon131504
âoohlsor to oanoelaânohlse without reasonable
termination stateln the Develops
constitute treasonable oause^, as that term may be defined In the Virginia Retail
Franchising Aot or the laws otVlrglnla,that provision may not be enforceable
The name and address of the Franchisor's agent In Virginia authorized to receive
service of process Is:
Glerk ofthe State Gorporatlon Commission
1800E Main Street,1st Floor
Richmond, Virginia 28210^
E x ^ O ^ S ^ e Addend
105^2
AOOENOOMTOTHEPRANCHÊOÔ^
T h e o a m e a o d address of the Franchisor's agent
servioeotprooessis:
this State authorized toreoeive
Washington Seourities Administrator
Department of Finanoiai institutions
Securities Division
150 israei Road SW
Tumwater, Washington 08501
1
itemO, the seotion entitled "Management hiiringB is amended hy adding the
following language:
Liquidated damage provisions are unenforoeahle under
Washington l a w a n d a n y referenoeherein requiring you topay liquidated damagesis
deleted and shall have no foroe or effeot
2
ltem17,the Summary under RrovisionfofTahle1(Development Agreements is
amended hy adding the following language: To the extent that the termination
provisions of the Development Agreement as descrihed herein are inconsistent with the
requirements
of
the
Washington
Franchise
Investment
Protection
Act, § 1 0 1 0 0 1 8 0 ( 2 ^ , the termination provisions are superseded hy the Act's
requirements and shall have no foroe or effeot
As of the date of this Franchise Disclosure Document, Wash
Code
Ann §10 100 180(2)^ provides that "it shall he an unfair or deceptive act to practice or
an unfair method of competition and therefore unlawful andaviolation of this chapter for
any person to:
^) Terminateafranohise prior to the expiration of its term except for
good cause Good cause shall include, without limitation, the failure of the
franchisee to comply with lawful material provisions of the franchise or
other agreement hetweenthefranohisor and thefranohiseeandtooure
such defaultafter heing given written notioethereof and a reasonable
opportunity, whioh in no event need he more than thirty (80) days, to cure
such default, or if such default cannot reasonably be cured within
thirty (80) days, thefailureofthefranohiseetoinitiatewithinthirty (80)
dayssubstantialandoontinuingaotion to ouresuoh default: Provided,
That after three willful and material breaohesof the same term ofthe
franchise agreement occurring withatwelve(12) month period,for whioh
the franchisee has been given notice and an opportunity to cure as
providedin this subsection,the franchisor may terminate the agreement
upon any subsequent willful and material breach of the same term within
the twelve(12) month period without providing notioeoropportunity to
cure: Provided further That a franchisor may terminate a franchise
without giving prior notice or opportunity to oureadefault if the franchisee:
(i) is adjudicated as bankrupt or insolvents (ii) makes an assignment for the
benefitof oreditorsorsimilardisposition o f t h e a s s e t s of thefranohise
business^ (iii) voluntarily abandons the franchise business^ or (iv)is
E ^ ^ O ^ ^ e Addenda
^ 5 ^ 2
ooovioted of or pleads gui^y^
relating fo thefranohise bosiness Upon fermlnafion for good oaose,the
franchisor shall purchase from the franchisee a f a f a l r market value at the
timeof termination, thefranohisee'sinventory and supplies,exolusiveof
(^personalized materials whioh have no value to the franchisors
(ii) inventory andsupplies not reasonably reguired in the conduct of the
franchise business^ and (iii) if the franchisee is to retain control o f t h e
premises of the franchise business, any inventory and supplies not
purchased from the franchisor or on his express reguirement: Provided,
Thatafranchisormayoffsetagainstamountsowedtoafranohisee under
this subsection any amounts owed by such franchisee to the franohisorB"
3
ltem17,the Summary under ProvisionmofTable1(Oevelopment Agreement),
is amended by adding thefollowing language: A s a condition to itsapprovalof a
proposedTransfer,Pranohisor may also require you and your Principal Shareholders,
inoludino the orooosedtransferor(s),to exeouteaêneral release releasing Prancbisor
from any claims you or they may have had or then have against Prancbisor excluding
only such claims a s y o u or they may havethat havearisen under the Washington
Pranohise Investment Protection Act, if applicable
4
l t e m 1 7 , t h e S u m m a r y u n d e r P r o v i s i o n o o f T a b l e 2 ( F r a n o h i s e Agreement), is
amended by adding the following language: Totheextentthatthe renewal provisions of
the Pranohise Agreementare inconsistent with the regulrementsof the Washington
Pranohise Investment Protection Aot,§19Bl00Bl80(2)(i), the renewal provisions are
superseded by the Act's reguirements and shall have no force or effect
As of the date of this Eranohise Disclosure Document, Wash. Code
Ann §19Bl00180(2)(i) provides that "it shall be an unfair or deceptive act or p r a o t ^
an unfair method of competition and therefore unlawful andaviolation of this ohapterfor
any person to:
^(i)
refuse to renew a franchise without fairly compensating the
franchisee for the fair market value, at the time of expiration of the
franchise, of the franchisee's inventory, supplies, eguipment, and
furnishings purchased from the franchisor, and good will, exclusive of
personalized materials whioh have no value to the franchisor, and
inventory, supplies, eguipment and furnishings not reasonably reguired in
the conduct of the franchise business: Provided, That oompensation need
not be made toafranohisee for good will if:(i) the franchisee has been
g i v e n o n e y e a r ' s n o t i c e of nonrenewal and(ii) the franchisor agrees in
writing not to enforce any covenant whioh restrains the franchisee from
competing withthefranohisor: Provided further,Thatafranohisor may
offset against amounts owed t o a f r a n o h i s e e u n d e r this subsectionany
amounts owed by such franchisee to the franchisors
5
ltem17,the S u m m a r y u n d e r P r o v i s i o n f o f T a b l e 2 ( E r a n o h i s e Agreement), is
amended by adding the following language: To the extent that the termination
provisions of thePranohise Agreement as desoribedhereinareinoonsistentwiththe
E x ^ O ^ S ^ A ^ e ^
^ ^ 4 2
requ^meots
of
the
Wash^gfon
Franohiso
lovesfmonf
Profeohon
Aof, § 1 9 1 0 0 1 8 0 ^ ^ the ^ m m a b o n provisions are superseded by fbe Aof^s
requiremeofs and sbaii bave no foroe or effeof
As of tbe date of tbis Franobise Oisoiosure Oooumenf, Wasb
Code
Ann § 1 9 1 0 0 1 8 0 ^ ^ provides fbaf "if sbaii b e a n unfair or deoepfiveaoff^
an unfairmefbod ofoornpefifionandtberefore uniawfui andaviolation of tbis obapferfor
any person to:
^ Terminateafranobise prior to tbe expiration of its term exoept for good
oause Good oause sbaii inoiude, witbout limitation, tbefailureof tbe
franobiseetooomply witb lawful materialprovlsionsoftbefranobiseor
otber agreement between tbe franchisor and tbe franchisee and to oure
such defaultafter being given written notice thereof and a reasonable
opportunity, whioh In no event need be more than thirty (30) days, to cure
such default, or if such default cannot reasonably be cured within
thirty (30) days, tbefailureof thefranchiseetoinitiate within thirty(30)
dayssubstantialandoontinuing action to ouresuohdefault: Provided,
That after three willful and material b r e a c h e s o f t h e s a m e termof the
franchise agreement occurring withatwelve (12) month period,for whioh
the franchisee has been given notice and an opportunity to cure as
provided In this subsection, the franchisor may terminate the agreement
uponany subsequent willful and material breach of the same term within
the twelve(12) month period without providing notice or opportunity to
cure: Provided further That a franchisor may terminate a franchise
without giving prior notice or opportunity to oureadefault if the franchisee:
(i) Is adjudicated as bankrupt or Insolvent (ii) makes an assignment for the
benefitof oreditorsorsimilardisposition of t h e a s s e t s o f thefranohise
business^ (iii) voluntarily abandons the franchise business^ or (iv)is
convicted ofor pleads guilty or no contest toacharge of violating any law
relating to the franchise business Opon termination for good cause, the
franchisorshall purchase from the franchisee a t a f a i r market value atthe
time of termination, the franchisee's inventory and supplies, exclusive of
(i) personalized materials whioh have no value to the franchisor
(ii) inventory andsupplies not reasonably reguiredin the conduct of the
franchise business^ and (ill) If thefranohlsee is to retain controlof the
premises of the franchise business, any inventory and supplies not
purchased from the franchisor or on his express reguirement: Provided^
Thatafranchisor may offset against amounts owed toafranohiseeunder
this subsection any amounts owed by such franchisee to the franchisor '"
3
Item17,the Summary under Provision i o f T a b l e 2 ( F r a n o h l s e Agreement), is
amended by adding thefollowing language: Pursuant tothe Washington Pranohise
Investment Protection Act The Prancbisor may be reguired to purchase from you at fair
market value certain items, Including your inventory and supplies as previously
referenced in Item17 Any failureby Franchisor and you to agree on the purchase
prioe f o r a n y Items reguired to be purchased underthe Act will be subjeotto the
E x ^ O D S ^ A ^ o ^
^ 9 ^ 2
appraise procedure set forth herein and in SuhseotionlO^d) of the Franchise
Agreement
7
i t e m l ^ t h e Summary under P r o v i s i o n m o f T a h i e 2 ( F r a n o h i s e Agreements is
amended hy adding thefoiiowing language: As a condition to its approval o f a
proposedTransfer^Franohisor may also regulre you and your Principal Shareholders,
inoiudinotheorooosedtransferor(s^toexecuteageneral release releasing Franchisor
from any claims you or they may have had or then have against Franchisors excluding
only such o l a i m s a s y o u or they may havethat havearisen underthe Washington
Franchise Investment Protection Act, if applicable
8
Notwithstanding the provisions of the Franchise Disclosure Document,
Development Agreementand Franchise Agreement: Ifany o f t h e p r o v i s i o n s i n this
Franchise Disclosure Document or the Development Agreement or Franchise
Agreement areinoonsistent with the relationshipprovisions of Section 19Bl00Bl80or
other reguirements of the Washington Franchise Investment Protection Act, the
provisions o f t h e Act will prevail over the inconsistent provisions ofthis Franchise
Disclosure Document, Development Agreement and Franchise Agreement with regard
to any franchise sold in Washington
Inany arbitration involvingafranohisepurohased in Washington, thearbitrationsite
shall be either in Washington or i n a p l a o e as mutually agreed upon at the time of the
arbitration, or as determined by the arbitrator
In theeventofaoonfliotoflaws,theprovisionsoftheWashington Franchise Investment
ProteotionAot,Ohapter^Bl00POW shall prevail
A release o r w a i v e r of rights executed by you shall not include rights underthe
Washington Franchise Investment Protection Act except when executed pursuant t o a
negotiated settlement after the agreement is in effect and where the parties are
represented by our independent attorney Provisions such as those whioh unreasonably
restriotor limit the statute of limitations periodforolaims underthe Act, rights or
remedies underthe Act s u o h a s a r i g h t t o a j u r y trial may not be enforceable
Transfer fees are only collectable to the extent that they reflect the Franchisor's
reasonable estimated or actual costs in effeotingatransfer
^ ^ O ^ S ^ A d ^ d a
^ ^ 4 2
STATE SPECIFIC AMENDMENTS
TO APPLEBEE'S NEIGHBORHOOD GRILL & BAR
DEVELOPMENT AGREEMENTS
1051984 2
AMEN0MENTTOAPPLE8^SNÔH8ORHOO00R^^8AR
OEVELOPMENT AGREEMENT
R E Q O ^ E O O Y T N E STATE OEOALiPORNiA
^ reoogoôoofê^qu^menôftheOa^m^
OAL 8 0 S ^ PROP OOOE S e c h o o ^ O O ^ s e ^ and the Oaôrnia Pranohise
Relations AoL OAL 8 0 S ^ P R O P Oode Seotion 20000 e^ s e e t h e parties t o t h e
attached A P P L E B E E ' S
NEiOhiBORHOOO GRILL ^
BAR OEVELOPMENT
A G R E E M E N T (the "OeveiopmentAgreement") agree as follows:
1
Suhseotion02(o) of SeotionO of the Oevelopment Agreement,
"TerminationB shall he supplemented hy the following paragraph, whioh shall he
considered an integral part of the Oevelopment Agreement:
This Agreement provides for termination upon hankruptoy. This provision
maynotheenforoeahle under federal bankruptcy law ( H O S G A Sec
lOle^se^)
2
SeotionO of the Oevelopment Agreement, "Termination," shall he
supplemented hy the following paragraph, whioh shall he considered an integral part of
the Oevelopment Agreement:
Galifornia Business and Professions Gode Sections 20000 through 20043
provide oertain rights concerning termination
Totheextentthatthelawis
applicable to this Agreement, the law will control if this Agreement
oontainsaprovisionoonoerning termination that is inconsistent withthe
law
3
S e c t i o n s of the Oevelopment Agreement, "Restrictions," shall be
supplemented by the following paragraph, whioh shall be considered an integral part of
the Oevelopment Agreement:
This Agreement contains a covenant not to compete which extends
beyond termination
This provision may not be enforceable under
Galifornialaw
4
Subseotion152 of S e c t i o n s of the Oevelopment Agreement,
"Oonstruotion,Severability,Governing Law and ûrisdiction,"shall be supplemented by
the addition ofthe following paragraph,whioh shall be considered an integral part ofthe
Oevelopment Agreement:
This Agreement reguires application of the laws of Kansas under certain
oiroumstanoes This provision may not be enforceable under Galifornia
law
3
The second sentence of AppendixO o f t h e Oevelopment Agreement,
"Review and Gonsent with Respect toTransfers,"shall be amended as follows:
E x ^ O ^ S ^ Addend
^ 9 ^ 2
Franchisor's consent also may be conditioned upon execution by
Proposed New Owner of an agreement whereby Proposed New Owner
assumes full, unconditional, joint and several liability for, and agrees to
perform from the date of such Transfer, all obligations, covenants and
agreements contained herein to the same extent as if it had been an
original party to this Agreement and may also regulre Developer and
Principal Shareholders, including the proposed transferor(s), to execute a
general release which releases Franchisor from any claims they may have
had or then have against Franchisor, excluding only such claims as the
Developer may have that have arisen under the California Franchise
Investment Law or the California Franchise Relations Act.
IN WITNESS W H E R E O F , the parties hereto have duly executed, sealed and
delivered this Amendment to the Development Agreement on the day and year first
above written in the Development Agreement.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
PRINCIPAL S H A R E H O L D E R ^ :
Name:
Name:
1051984.2
A M E N D M E N T TO A P P L E B E E ' S NEIGHBORHOOD GRILL & B A R
REQUIRED B Y THE S T A T E OF HAWAII
In recognition of the reguirements of the Hawaii Franchise Investment Law,
Section 482E-6, the parties to the attached A P P L E B E E ' S NEIGHBORHOOD GRILL &
BAR DEVELOPMENT A G R E E M E N T (the "Development Agreement") agree as follows:
1.
The second sentence of Appendix D of the Development Agreement,
"Review and Consent with Respect to Transfers," shall be deleted in its entirety and
shall be of no further force and effect, and the following shall be substituted in lieu
thereof:
original party to this agreement and may also require Developer and
had or then have against Franchisor, excluding only such claims as
Developer and Principal Shareholders, including the proposed
transferor(s), may have that have arisen under the Hawaii Franchise
Investment Law, Chapter 482E, if applicable to this Agreement.
delivered this Amendment to the Development Agreement (Attachment DA-1) on the
' day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
1051984.2
Name:
Name:
1051984.2
AMENOMENTTO A P P L E B E E S N ^ G H B O R H O O O O R ^ L ^ B A R
R E Q 0 I R E 0 8 Y T H E S T A T E OP ILLINOIS
loreoogoôoofêreqo^êotofêôoi^
^ " A ^ ^ e p a ^ ^ ^ ^ o ^ APPLEBEE'S N E I G H S
OEVELOPMENT A G P E E M E N T ^ ^ O e v e ^
1
SeobooO of the Oevelopmoof Agreomoof, "TerminafiooB
supplemeofed by fbe f o l l o w s sobseoboo, wbiob s b ^ be inserted
SobseobooOâod sball be o o o s i ^
shaH be
follows
9.5
Nob^lfbsfaodlogaoyfblngfofbeooâryoonfaloedlnfblsAgreemeo^
lfaoyprovlsloosoffblsSeoboo9,goverologfermloaboo,arelooonsls^^
Seoboo19 of fbe Illinois Praooblse Olsolosure Aof of 1987 (fbe Âof^ If
applicable, fbe provisions of fbe Aof sball apply rafber fbao fbe ooofrary
provisions of fblsSeofloo 9. As provided In Sobseofloo 15.1 bereof, bowever,
eaobprovlslon of fbls Agreement sball be considered severable,andlf,for
any reason, any provision of tbls S e o f l o n 9 l s d e f e r m l n e d f o b e l n v a l l d and
contrary to,or In conflict wlfb,Seoflon19of fbe Act, suob sball not Impair fbe
operation of, or bave any otbereffeot upon, sucb otber provisions of tbls
Seotlon9as may remain otberwlseenforoeable,andtbe latter sball continue
to be given full foroe and effeot and bind tbe parties bereto
2
Notwithstanding anything to tbe contrary contained In S e o t l o n 1 5 o f t h e
Oevelopment Agreement,^Gonstruotlon,Severablllty,Governlng Law and ûrlsdlotlonB
the Oevelopment Agreement shall not regulre a franchisee to litigate any oause of
achon, with the exception of arbitration prooeedlngsarlslng underthe Oevelopment
Agreement or thellllnolsPranohlseOlsolosure Act outside of the state of Illinois, nor
shall the Oevelopment Agreement provide f o r a o h o l o e of law provision for any state
other than Illinois
8 Subsection 1 5 8 o f S e o t l o n 1 5 o f the Oevelopment Agreement,"Gonstruotlon,
Severability, Governing Law and^lurlsdlctlon,"shall be deletedlnlts entirety and shall
be of no foroe or effeot
4
Seotion 18 of the Oevelopment Agreement, ^Miscellaneous^ shall be
supplemented by the following subsection, which shall be Inserted following Subsection
1 8 8 a n d shall beoonsldered an Integral part of the Oevelopment Agreement:
18 7 Notwithstanding anything to the contrary contained In this
Agreement,thls Agreement Is subject to S e c t i o n a l of the Illinois Pranohise
Disclosure Aof (the Âot^ which states that any condition, stipulation, or
provision purporting to bind any person acquiring any franchise to waive
compliance with any provision ofthe A c t o r any other law of theState of
Illinois Is void Seotion 41 o f t h e Act shall not prevent any person from
entering Into a settlement agreement or executing a general release
E x ^ O D S ^ A ^ ^ a
105^2
1
regarding a potential or actual lawsuit filed under any of the provisions of the
Act, nor shall it prevent the arbitration of any claim pursuant to the provisions
of Title 9 ofthe United States Code.
IN WITNESS W H E R E O F , the parties hereto have fully executed, sealed and
day and year first above written in the Development Agreement.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
PRINCIPAL S H A R E H O L D E R ^ ) :
Name:
Name:
1051984.2
REQUIRED B Y THE STATE OF M A R Y L A N D
In recognition of the reguirements of the Maryland Franchise Registration and
Disclosure Law, Md. Code Ann., Bus. Reg. §§ 14-201 - 14-233 (1994), the parties to the
NEIGHBORHOOD GRILL & BAR DEVELOPMENT
A G R E E M E N T (the "Development Agreement") agree as follows:
1.
Developer is reguired in this Agreement to execute a release of claims
and/or to acknowledge facts that would negate or remove from judicial review any
statement, misrepresentation or action that would violate the Act, or a rule or order
under the Act. Such release shall exclude claims arising under the Maryland Franchise
Registration and Disclosure Law, and such acknowledgments shall be void with respect
to claims under the Law.
2.
This Agreement reguires litigation to be conducted in a forum other than
the State of Maryland. The requirement shall not be interpreted to limit any rights
Developer may have under Sec. 14-216 (c)(25) of the Maryland Franchise Registration
and Disclosure Law to bring suit in the state of Maryland.
3.
Pursuant to C O M A R 02.02.08.16L, the general release required as a
condition of renewal, sale, and/or assignment/transfer shall not apply to any liability
underthe Maryland Franchise Registration and Disclosure Law.
delivered this Amendment to the Development Agreement on the day and year first
above written in the Development Agreement.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
1051984.2
Name:
Name:
1051984.2
AMENOMENTTO A P P L E B E E S N ^ G H B O R H O O O G R ^ L ^ O A R
R E Q 0 I R E O 8 Y T N E STATE OE MINNESOTA
^ reoogoôo o f t h e Minnesota Pranohise Aot, Minn Stat Seotion 80001 e^
s e ^ , and of the Poies and Peguiations promoigated pursuant thereto hy the
Oommissioner of Seourities, the
parties to the
attached
APPLEBEE'S
N E i G h i B O P H O O O O P i L L ^ B A R OEVELOPMENT A G R E E M E N T (the "Oeveiopment
Agreements agree as foiiows:
1
SeotionO of the Oevelopment Agreement, "Terminations shall he
supplemented hy the addition of the following paragraph, whioh shall he considered an
integral part of the Oevelopment Agreement:
05
With respect to franchises governed hy Minnesota law, Franchisor
willoomplywithMinn Stat See 80GBI4,Suhds 8 , 4 , a n d 5 w h i o h regulre,
except lnoertainspeoifiedoases,thatafranohisee he givennlnety (00)
days'written notioe of termination (with sixty ÔOj days to cure) and one
hundred eighty (180) days' notice for non-renewal of the franchise
agreement.
2
Seotion 15 o f t h e Oevelopment Agreement, "Oonstruotlon, Severahllity,
Governing Law and jurisdictions shall he supplemented hy the addition ofthe following
sentenoe:
MINN STAT SEOTION 80G21 ANO MINN ROLE 28804400^
PROHIBIT PRANGHISOR PROM REOLIIRING LITIGATION TO BE
GONOOGTEO OOTSIOE MINNESOTA, REOOIRING W A I V E R O P A
ÔRY TRIAL OR REOLIIRING OEVELOPER TO OONSENT TO
LIOLIIOATEO D A M A G E S , TERMINATION PENALTIES OR ÔOGMENT
NOTES
IN ADDITION, NOTHING IN THIS A G R E E M E N T GAN
A B R O G A T E OR REDLIGE A N Y OP D E V E L O P E R ' S RIGHTS A S
PROVIDED FOR IN MINN S T A T , G H A P T E R 8 0 O , OR ANY OF
D E V E L O P E R ' S RIGHTS TO ANY PROGEDORE, FORLIM, OR
REMEDIES PROVIDED FOR B Y T H E LAWS O F T H E ^LIRISDIGTION
Ifthe Development Agreement oontalnsaprovislon that is inconsistent
with the Minnesota Statutes or the Minnesota Rule, the provisions of the
Development Agreement shall he superseded hy the Minn Rule's
reguirements and shall have no foroe or effeot
8
The second sentenoe of AppendixO to the Development Agreement,
"Reviewand G o n s e n t w i t h R e s p e o t t o T r a n s f e r s B s h a l l h e d e l e t e d in its entirety and
s h a l l h a v e n o f o r o e or effeot, and thefollowing sentence shall he substituted inlleu
thereof:
Franchisor's oonsent also may he conditioned upon execution hy
Proposed New Owner of anagreement wherehy Proposed NewOwner
assumesfull, unconditional,joint and several liahility for,andagrees to
perform f r o m t h e d a t e o f s u o h t r a n s f e r , all ohligations, covenants and
SÔOCS^t05t^^-F^^
^ 9 ^ 2
1
original party to this Agreement and may also reguire Developer and
had or then have against Franchisor, excluding only such claims as the
Developer may have that have arisen under the Minnesota Franchise Act
or the rules and regulations promulgated thereunder by the Commissioner
of Commerce, if applicable to this Agreement.
4. Appendix D to the Development Agreement "Review and Consent with
Respect to Transfers" shall be supplemented by the following sentence:
Franchisor's consent to the transfer of the franchise will not be
unreasonably withheld.
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
SM01 D0CS-#1051984-v2-Exhibit_0_-_State_Addenda. DOCX
1051984.2
AMENOMENTTO A P P L E B E E S N ^ O H O O R H O O O G R ^ L ^ O A R
R E Q O i R E O B Y T H E S T A T E OP N E W Y O R K
lo reoogolboo o f t h e reqolremeots o f t h e New York General Busloess Law,
A r t i c l e d the parties to the attached Applehee's Neighborhood Grill ^ Bar
Oeveloproeot Agreement (the "Oeveloproeot Agreements agree as follows:
1
S u h s e o t l o n H 3 of SeotionO of the Oevelopment Agreement,
"RestrlotlonsB shall he deleted In its entirety and shall have no foroe or effeot, and the
following shall he sohstltoted In lleo thereof:
11.3 Oeveloper andPrlnolpal Shareholders agree that the provisions of
t h l s S e o t l o n H are and have heenaprlmarylndooement to Franchisor to
enter Into this Agreement and that In the event o f a hreaoh thereof
Franchisor woold he Irreparably Injured and woold he wlthoot an adegoate
remedy at law
Therefore, In the event o f a breach o f a n y of sooh
provlslonsFranohlsorshallbe entitled, In addltlonto any other remedies
which It may have hereonder or at law or In egoity (Including the right to
termlnatethls Agreement), to apply f o r a preliminary andBor permanent
Injonotlon and a decree for specific performance o f t h e terms hereof
wlthoot the necessity of showing aotoal or threatened damage, and
wlthoot being regolred to fornlshabond or other secority
2
Sobseotlon151 of Seotlon15 of the Oevelopment Agreement,
"Oonstrootion, Severability, Governing L a w a n d jurisdiction," shall be supplemented
with the following sentenoe:
The Franchisee's restltutlonary rights, If any, are subject to determination
under applicable law
3.
Subseotlon15.2 of Seotlon15 of the Oevelopment Agreement,
"Gonstruotlon, Severability, Governing Law and jurisdiction," shall be supplemented
with the following sentenoe:
THE FOREGOING GFIOIGE OF LAW SFIOOLO NOT BE GONSIOEREO
A W A I V E R O F A N Y R I G F I T G O N F E R R E O OPON OEVELOPER BY
ART 33 OF T H E NEW Y O R K G E N E R A L BOSINESS LAW, IF
APPLIGABLE
4
The second sentenoe of Appendix 0 to the Oevelopment Agreement,
"Review andGonsent with Respect toTransfers,"shall be deletedln Its entirety and
shall have no foroe or effeot, and the following shall he substituted In lieu thereof:
Proposed New Owner of anagreement whereby Proposed NewOwner
assumesfull, unconditional,joint and severalllabllltyfor,and agrees to
3^0tOOC3^051^^Fx^
105^2
1
original party to this Agreement and may also reguire Developer and
had or then have against Franchisor; provided however, that all rights
enjoyed by the Developer and Principal Shareholders and any causes of
action arising in their favor from the provisions of Article 33 of the General
Business Law of the State of New York and the regulations issued
thereunder shall remain in force; it being the intent of this proviso that the
non-waiver provisions of Section 687.4 and 687.5 of the New York
General Business Law be satisfied.
IN WITNESS W H E R E O F , the undersigned have entered into this Amendment to
the Development Agreement (Attachment DA-1) as of the date first above written in the
Development Agreement.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
SM01 D0CS-#1051984-v2-Exhibit_0_-_State_Addenda. DOCX
1051984.2
AMENOMENTTO A P P L E B E E S N ^ O H B O R H O O O G R ^ L ^ B A R
R E Q O I R E O B Y T H E STATE OE NORTH OAKOTA
^reoogoônofêreqo^meoôfthe^wsofNo^
the offioe of the State of North O a k o t a O o m m ^ o o e r of S e o o ^
NEIGHBORHOOO GRILL ^
BAR
A G R E E M E N T (the "Oevelopment Agreements agree as follows:
OEVELOPMENT
a
If Oeveloper Is regolred In the Agreement to exeoutearelease of claims or
to acknowledge facts that woold negate or remove from judicial review any
statement, misrepresentation oraotlon that woold violate the L a w , o r a
r o l e o r o r d e r onder the Law, sooh release shallexclodeolalmsarlslng
onder the North Oakota Pranohise Investment Law, and sooh
acknowledgments shall he void with respect to claims onder the Law
h.
Covenants not to compete doring the term o f a n d opon termination or
expiration of the Agreement are enforoeahie only onder certain conditions
according to North Oakota Law. If the Agreement oontalnsacovenant not
tooompete which Is Inconsistent with North Oakota Law, the covenant
may he onenforceahie.
o
If the Agreement regoires litigation to he oondoctedlnaforom other than
the State of North Oakota, the regoirement Is void with respect to claims
onder the North Oakota Pranohise Investment Law
d
IftheAgreementregolresthatlthegovernedhyastate's law, other than
the State of North Oakota, to the extent that sooh law conflicts with North
Oakota Law, North Oakota shall control
e
The Gommlssloner has held that regolrlngOevelopers to consent to the
jorlsdlotlon of ooorts ootslde of North Oakota Is onfair, onjost or Inegoltahle
within the Intent of Seotion 51 19 09 of the North Oakota Pranohise
Investment Law.
f
If the Agreement regoires payment of a termination penalty, the
regoirement may he onenforceahie onder the North Oakota Eranohise
Investment Law
g
Any provlslonlnthe Agreement that regoires Oeveloper to oonsent t o a
waiver of trial hyjory shall not apply to any claims hrooght onder the North
Oakota Eranohise Investment Law
E x ^ O D ^ e Addenda
^ 9 ^ 2
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
1051984.2
REQUIRED B Y THE STATE OF RHODE ISLAND
In recognition of the requirements of the Rhode Island Franchise Investment Act
(the "Act"), the parties to the attached A P P L E B E E ' S NEIGHBORHOOD GRILL & BAR
D E V E L O P M E N T A G R E E M E N T (the "Development Agreement") agree as follows:
1.
Section 15 of the Development Agreement, "Construction, Severability,
Governing Law and Jurisdiction," shall amended by adding the following language
which shall be considered an integral part of the Agreement:
§19-28.1-14 of the Rhode Island Franchise Investment Act provides that
"A provision in a [development] agreement restricting jurisdiction or venue
to a forum outside this state or requiring the application of the laws of
another state is void with respect to a claim otherwise enforceable under
this Act."
day and year first above written in the Development Agreement.
FRANCHISOR:
By:
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
1051984.2
REQUIRED 8 Y T H E STATE OE SOOTH OAKOTA
loreoognihon ofthe r e q o ^ m e n ^ ofthe South Dakota Oo^^
totheattaohedARRLEBEE'S NEIGHBORHOOD G R I L L ^ B A R DEVELOPMENT
A G R E E M E N T (the "Development Agreements agree as follows:
T
SeotionO of the Development Agreement, "Termination," shall he
supplemented hy thefollowing S u h s e o t l o n 0 5 w h l o h s h a l l h e considered an Integral
part of the Development Agreement:
05
Notwlthstandlngtheprovlslonssetforth In this SeotionO, If Developer
falls to meet performance and guality standards or falls to make any royalty
payments under any Pranohise Agreement or, If applicahle, any Development
Agreement, Developer will he afforded thirty (30) days'written notice with an
opportunity to cure said default prior to termination
2
SuhseotlonHBl(h) of S e c t i o n s of the Development Agreement,
"RestrlotlonsBshall he prefaced hythefollowlng paragraph which shall he considered
an Integral part of the Development Agreement:
Gontraots In restraint of trade that take effeot upon termination or expiration of
the Development Agreement are generally unenforoeahle In the State of
South Dakota as setforth In SDGL 5 3 0 3 , 5 3 0 0 , 5 3 0 1 0 a n d 5 3 0 1 T
3
The second sentenoe of Suhsectlon152 of S e c t i o n s of the
Development Agreement,"Gonstruotlon,Severahlllty,Governlng Law and Jurlsdlot^^
shall he deleted In Its entirety and shall have no force or effeot, and the following shall
he substituted In lieu thereof:
THE LAW REGARDING PRANOHISE REGISTRATION, EMPLOYMENT,
AND GONTRAGTS IN RESTRAINT OP TRADE AND OTHER MATTERS OF
L O G A L G O N G E R N WILL B E G O V E R N E D SY THE LAWS OP THE STATE
O P S O O T H DAKOTA; B O T A S T O G O N T R A G T U A L A N D A L L O T H E R
MATTERS, THIS A G R E E M E N T AND ALL PROVISIONS OP THIS
INSTROMENT WILL BE A N D REMAIN SUBJEGT TO THE APPLIGATION,
OONSTROOTION, E N P O R G E M E N T AND INTERPRETATION ONDER THE
GOVERNING l ^ W OF K A N S A S
4
Theflrstparagraph of S u h s e o t l o n 1 5 3 o f S e c t l o n 1 5 of the Development
Agreement, "Gonstructlon, Severability, Governing Law and Jurisdiction," shall be
supplemented by the following sentenoe which shall be considered an Integral part of
such paragraph:
PROVIDED, H O W E V E R , T H A T A N Y PROVISION WHIOH DESIGNATES
JORISDIGTION OR V E N O E OR REGOIRES DEVELOPER TO A G R E E TO
JORISDIGTIONORVENOEINAFOROMOOTSIDEOFSOOTHDAKOTAIS
FxhlbltO^State Addenda
^ 9 ^ 2
1
VOIO
R E S P E C T TO A N Y C A U S E C E ACTION WHICH
OTHERWISE E N F O R C E A B L E IN SOUTH OAKOTA
IS
5
The second sentenoe ot AppendixO to the Oevelopment Agreement,
"Review andConsent with RespeottoTranstersB shall he deietedinits entirety and
shall have no toroe or eêot, and the following shall he sohstituted In lieu thereof
Franchisor's oonsent also may he oonditionedupon execution hy Proposed
New Owner of an agreement,wherehy Proposed New Owner assumes full,
unconditional,joint and several liahility torând agrees to perform from the
date of suohTransfer, all ohligations,covenants and agreements contained
herein to the same extent as if It had heen an original party to this Agreement
and may also reguire Oeveloperand Principal Shareholders, including the
proposed transferor(s), to execute a general release which releases
Franchisor from any claims they may have had or then have against
Franchisor; excluding only such claims that have arisen underthe South
Oakota Franchises for Brand NameOoods and Services Law, if applicahle to
this Agreement.
IN WITNESS W H E R E O F , t h e parties hereto have duly executed, sealed and
delivered this Amendment to the Oevelopment Agreement (Attachment OA I) in
triplicate on the day and year first ahove written
FRANOHISOR:
A P P L E B E E ' S FRANCHISOR LLO
^
Name:
Title:
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
1051984.2
REQUIRED B Y THE S T A T E OF WASHINGTON
In recognition of the requirements of the Washington Franchise Investment
Protection Act, WA Rev. Code §§ 19.100.010 to 19.100.040 (1991), the parties to the
NEIGHBORHOOD GRILL & BAR DEVELOPMENT
A G R E E M E N T (the "Development Agreement") agree as follows:
1.
Washington Franchise Investment Protection Act provides rights to You
concerning termination of the Agreement. If the Agreement contains a provision that is
inconsistent with the Act, the Act shall control.
1.
If Developer is required in the Agreement to execute a release of claims,
such release shall exclude claims arising under the Washington Franchise Investment
Protection Act; except when the release is executed under a negotiated settlement after
the Agreement is in effect and where the parties are represented by independent
counsel. If there are provisions in the Agreement that unreasonably restrict or limit the
statute of limitations period for claims brought under the Act, or other rights or remedies
underthe Act, those provisions may be unenforceable.
3.
If the Agreement requires litigation, arbitration or mediation to be
conducted in a forum other than the State of Washington, the requirement may be
unenforceable under Washington law. Arbitration involving a franchise purchased in the
State of Washington must either be held in the State of Washington or in a place
mutually agreed upon at the time of the arbitration, or as determined by the arbitrator.
4.
If the Agreement requires that it be governed by a state's law, other than
the State of Washington, and there is a conflict between the law and the Washington
Franchise Investment Protection Act, the Washington Franchise Investment Protection
Act shall control.
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
1051984.2
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
1051984.2
REQUIRED B Y THE S T A T E OF WISCONSIN
In recognition of the requirements of the Wisconsin Fair Dealership Law,
Wisconsin Statutes, Chapter 135, the parties to the attached A P P L E B E E ' S
NEIGHBORHOOD GRILL & BAR DEVELOPMENT A G R E E M E N T (the "Development
Agreement") agree as follows:
1.
Section 9 of the Development Agreement, "Termination," shall be
supplemented by the following Subsection 9.5, which shall be considered an integral
part of the Development Agreement:
9.5
To the extent that the above provisions regarding termination are
inconsistent with the requirements of the Wisconsin Fair Dealership Law,
Wisconsin Statutes, Chapter 135 (which, among other things, grants the
right, in most circumstances, to ninety (90) days prior written notice of
termination and sixty (60) days within which to remedy any claimed
deficiencies), if applicable to this Agreement, the above-mentioned
termination provisions shall be superseded by the Law's requirements and
shall have no force or effect.
2.
Section 15 of the Development Agreement, "Construction, Severability,
Governing Law and Jurisdiction," shall be supplemented by the following
Subsection 15.4, which shall be considered an integral part of the Development
Agreement:
15 4 TO T H E EXTENT THAT ANY PROVISIONS OF THIS
A G R E E M E N T CONFLICTS WITH T H E WISCONSIN FAIR DEALERSHIP
LAW IF A P P L I C A B L E TO THIS A G R E E M E N T , S U C H PROVISION
SHALL BE S U P E R S E D E D BY THE LAW'S REQUIREMENTS.
day of
, 20
.
FRANCHISOR:
By:_
Name:
Title:
1051984.2
DEVELOPER:
By:_
Name:
Title:
Name:
Name:
1051984.2
STATE SPECIFIC AMENDMENTS
TO APPLEBEE'S NEIGHBORHOOD GRILL & BAR
FRANCHISE AGREEMENTS
1051984.2
AMENOMENTTO A P P L E B E E S N ^ G H O O R H O O O G R ^ L ^ O A R
P R A N O H ^ E AGREEMENT
REQUIRED 6 Y T H E S T A T E OEGALIEGRNIA
^reoogmhooofêrequ^menôfêGa^^
GAL BUG ^ RRGE GGOE Seoboo 31000 ^ s ^ , aod the G a ^ r m a Eraoohise
R e ^ h o n s A ^ G A L BUS ^ R R G E G G O E G e ^
attached A R R L E B E E ' S N E I G H B G R H G G O G R I L L ^ B A R E R A N G ^ S E A G R E E M E N T
(the "Franchise Agreements agree as tol^ws:
1
S e c t i o n l o t the Franchise Agreement,"Eranchise Grant andTermB shall
he supplemented hy the following paragraph, which shall he considered a
ofthe Franchise Agreement:
California Business and Professions Gode Sections 20000 through 20043
provide rights to the Franchisee concerning nonrenewal ofafranohlse If
this Agreement oontalns a provision concerning nonrenewal that Is
Inconsistent with the law, the law will control
2
Seotlon13 of the Franchise Agreement, "Confidentiality; Restrictions,"
shall he supplemented hy the following paragraph, which shall he considered an Integral
part of the Franchise Agreement:
This Agreement oontalns a covenant not to compete which extends
heyond the termination of the franchise This provision may not he
enforoeahie under California law.
3
SuhseotlonlOBI(h) of S e o t l o n l O o f the Franchise Agreement,"Explratlon
and Termination; Gptlon to Purchase Restaurant; Attorneys' Fees," shall he
supplemented hy the following paragraph, which shall he considered an Integral part of
the Franchise Agreement:
This Agreement provides for termination upon bankruptcy This provision
may not he enforoeahie under federal bankruptcy law (11U S G A Sec
lOle^se^)
4
SubseotlonlOBI of SeotlonIO o f t h e Franchise Agreement, "Expiration
and Termination; Gptlon to Purchase Restaurant; Attorneys' Fees," shall he
supplemented hy the following paragraph, which shall be considered an Integral part of
the Franchise Agreement:
California Business and Professions Code Sections 20000 through 20043
provide rights to the Franchisee concerning termination ofthe franchise If
this Agreement oontalns a provision concerning termination that Is
Inconsistent with the law, the law will control
5
Subsection 2 1 2 o f Seotion 21 of the Franchise Agreement,"Gonstructlon,
Severability, Governing Law and Jurisdiction,"shall he supplemented by the a d d ^
E ^ ^ O D S ^ A ^ ^
^ 9 ^ 2
1
the following paragraph, which shall be considered an integral part of the Franchise
Agreement:
This Agreement requires application of the laws of Kansas under certain
circumstances. This provision may not be enforceable under California
law.
6.
Section 22 of the Franchise Agreement, "Interference With Employment
Relations," shall be supplemented by the addition of the following paragraph, which
shall be considered an integral part of the Franchise Agreement:
This Agreement contains a liquidated damages clause. Under California
Civil Code Section 1671, certain liquidated damages clauses are
unenforceable.
7.
The second sentence of Appendix B of the Franchise Agreement, "Review
and Consent with Respect to Transfers," shall be amended as follows:
original party to this Agreement and may also require Franchisee and
Principal Shareholders, including the proposed transferors), to execute a
Franchisee may have that have arisen under the California Franchise
Investment Law or the California Franchise Relations Act.
delivered this Amendment to the Franchise Agreement (Attachment FA-1) on the day
and year first above written in the Franchise Agreement.
FRANCHISOR:
By:
Name:
Title:
1051984.2
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051984.2
AMEN0MENTTOAPPLE8^SNÔH8ORHOO0GR^^^R
PRANOHÊAOREEMENT
R E Q O ^ E O O Y T H E STATE OP HAWAII
lo reoogolhoo o f t h e requirements o f t h e Hawaii Praoohlse lovestroeot Law,
Seotloo
6, the parties to the attached A P P L E B E E ' S N E I 0 H 8 0 P H 0 0 0 G R I L L E
8 A P P P A N 0 H I S E A O P E E M E N T (the'TraoohlseAgreemeot^ agree as follows:
1
Suhseotloo17shall he added to S e o t l o o l o f the Franchise Agreement,
"Pranohise Grant andTermB as follows:
17
In theevent Pranchlsorrefuses to renew this Agreement for an
additional term as referenced ahove In Suhseotlon13, Franchisor may he
reguired, p u r s u a n t t o S e o t l o n 4 8 2 E 6 o f t h e H a w a l l Franchise Investment
Law, to purchase from Franchisee at fair market value Franchisee's
Inventory, supplies, eguipment and furnishings purchased hy Franchisee
from Franchisor or a supplier designated hy Franchisor, excluding
personalized materials that have no value to Franchisor If such refusal to
renew Is for the purpose of converting Franchisee's business to one
owned and operated hy Franchisor, Franchisor may additionally he
obligated to compensate Franchisee for loss of goodwill In the event the
parties cannot agree on fair market value, the purchase price hereunder
shall be determined In the manner set forth In Subseotlon19 4(d)
2
The following paragraph shall be added as Subsection 194(g) of
S e c t i o n s of the Franchise Agreement, "Expiration and Termination; Option to
Purchase Restaurant; Attorneys'Fees":
(g)
In the event of termination of this Agreement, Franchisor may be
reguired, p u r s u a n t t o S e o t l o n 4 8 2 E 6 o f t h e Hawaii Franchise Investment
Law, to purchase from Pranohisee at fair market value Franchisee's
Inventory, eguipment, supplies and furnishings that Franchisee purchased
from Franchisor or a supplier designated hy Franchisor, excluding
personalized m a t e r l a l s t h a t h a v e n o valueto Franchisor If thepartles
cannot agree on fair market value, the purchase price hereunder shall he
determined In the manner described In Subseotlon19 4(d)
3
The second sentenoe of AppendlxBof the Franchise Agreement,"Pevlew
and GonsentwIthPespeottoTransfersBshallhedeleted In Itsentlretyand shall have
no further foroe or effeot, and the following shall be substituted In lieu thereof:
Franchisor's consent also may he conditioned upon execution hy
assumesfull, unconditional, joint andseveral liability for,andagrees to
p e r f o r m f r o m t h e d a t e o f suoh Transfer, all obligations, covenants and
agreements contained herein to the s a m e e x t e n t a s If It had heen an
original party to this Agreement and may also regulre Franchisee and
Principal Shareholders,Including the proposed transferor(s),to exeoutea
E x ^ O D S ^ A ^ o d a
^ 9 ^ 2
1
Franchisee and Principal Shareholders, including the proposed
transferor(s), may have that have arisen under the Hawaii Franchise
Investment Law, Chapter 482E.
delivered this Amendment to the Franchise Agreement (Attachment FA-1) on the
day of
;
, 20
.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051984.2
AMENOMENTTOAPPLEOE^SN^GHOORHOOOGR^ÔAR
PRANOHISE A G R E E M E N T
REQUIRED 8 Y T H E S T A T E OE ILLINOIS
Inreoogoôo of the requirements of the ^ i o o ^
(the "Aot"^ the parties to the attaohed A P P L E B E E ' S N E I O H O O R H O O O O R i L L ^ B A ^
PRANOHiSEAOREEMENT(the"Pranoh^
1
Thefollowing language shaii he added to Suhseotion13of SeotionO of
the Pranohise AgreementB'Pranohise Grant andTerm":
Notwithstanding anything tothe contrary oontalnedin this Agreement, if
any of the provisions of this SuhseotlonT3,oonoerning non renewal, are
inconsistent with S e c t i o n s o f t h e Illinois Franchise Disclosure Act of
1987 (the Âct^, the provisions o f t h e Act shall apply rather than the
contrary provisions of this SuhseotionT8 As provided under
Suhseotion21BI hereof, however, eaoh provision of this Agreement shall
he considered severable, and If, f o r a n y reason, any provision ofthis
Subsection T 8 is determined to he invalid and contrary to, or in conflict
with, Seotion 20 of the Act, suoh shall not impair the operation of, or have
any other effeot upon,suoh other provisions ofthis Subsection T8 as may
remain otherwise enforceable, and the latter shall continue to he given full
foroe and effect and hind the parties hereto
2.
SeotionIO of the Pranohise Agreement, "Expiration and Termination;
Option to Purchase Restaurant; Attorneys' Pees," shall he supplemented by the
following subsection, which shall be insertedfollowing S u b s e o t l o n 1 0 4 a n d s h a l l he
considered an integral part of the Pranohise Agreement:
105 Notwithstanding anything to the contrary contained In this
Agreement, if any provisions of this Sections,governing termination,are
inconsistent with Seotion 10 o f t h e Illinois Eranohise Disclosure Act of
1087, the provisions of the Act shall apply rather than the contrary
provisions of this Section 10 As provided under Subsection 211 hereof,
however, eaoh provision of this Agreement shall be considered severable,
and If, for any reason,any provision of this SeotionlOis determined to he
Invalid and contrary to,or in conflict with,SeotlonlOof the Act, such shall
not impair the operation of, or have any otbereffeot upon suoh other
provisions of this Seotion 10 as may remain otherwise enforceable, and
the latter shall continue to be given full forceand effeotand hind the
parties hereto
8
Notwithstanding anything to the contrary contained in Seotion 21 ofthe
PranohiseAgreement,"Gonstruotlon,Severability, Governing Law and J u r i s d i c t i o n , " ^
Pranohise Agreement shall not reguireafranohlsee to litigate any oause of action,with
the exception of arbltrationprooeedings arising under the Franchise Agreement or the
Illinois Franchise Disclosure Act outside of the state of Illinois, nor shall the Franchi^^
Agreement provide foraoholoe of law provision for any state other than Illinois
E x ^ O D S ^ A ^ o ^
105^2
1
4.
Subsection 21.3 of Section 21 of the Franchise Agreement, "Construction,
Severability, Governing Law and Jurisdiction," shall be deleted in its entirety and shall
be of no force or effect.
5.
Section 25 of the Franchise Agreement, "Miscellaneous," shall be
supplemented by the following subsection, which shall be inserted following Subsection
25.7 and shall be considered an integral part of the Franchise Agreement:
25.8 Notwithstanding anything to the contrary contained in this
Agreement, this Agreement is subject to Section 41 of the Illinois
Franchise Disclosure Act (the "Act") which states that any condition,
stipulation, or provision purporting to bind any person acquiring any
franchise to waive compliance with any provision of the Act or any other
law of the State of Illinois is void. Section 41 of the Act shall not prevent
any person from entering into a settlement agreement or executing a
general release regarding a potential or actual lawsuit filed under any of
the provisions of the Act, nor shall it prevent the arbitration of any claim
pursuant to the provisions of Title 9 of the United States Code.
5.
Subsection 25.5 of Section 25 of the Franchise Agreement,
"Miscellaneous," shall be deleted in its entirety and the following language substituted in
lieu thereof:
25.5
This Agreement and the documents referred to herein
constitute the entire agreement between the parties, superseding and
canceling any and all prior and contemporaneous agreements,
understandings, representations, inducements and statements, oral or
written, of the parties in connection with the subject matter hereof, except
as contained in Franchisor's Franchise Disclosure Document, heretofore
made available to Franchisee.
6.
Subsections 26(a) and 26(b) of Section 26 of the Franchise Agreement,
"Acknowledgments," shall be deleted in their entirety and shall be of no force or effect.
IN WITNESS W H E R E O F , the parties have duly executed, sealed and delivered
this Amendment to the Franchise Agreement (Attachment FA-1) on the day and year
first above written in the Franchise Agreement.
FRANCHISOR:
By:_
Name:
Title: _
1051984.2
FRANCHISEE:
By:_
Name:
Title:
PRINCIPAL SHAREHOLDER:
Name:
Name:
1051984.2
FRANCHISE A G R E E M E N T
REQUIRED B Y THE S T A T E OF M A R Y L A N D
In recognition of the Maryland Franchise Registration and Disclosure Law, Md.
Code Ann., Bus. Reg. §§ 14-201 - 14-233 (1094), and of the Rules and Regulations
promulgated
pursuant thereto, the parties to the attached A P P L E B E E ' S
NEIGHBORHOOD GRILL & BAR FRANCHISE A G R E E M E N T (the "Franchise
Agreement") agree as follows:
1.
Franchisee is required in this Agreement to execute a release of claims
and/or to acknowledge facts that would negate or remove from judicial review any
statement, misrepresentation or action that would violate the Act, or a rule or order
under the Act. Such release shall exclude claims arising under the Maryland Franchise
Registration and Disclosure Law, and such acknowledgments shall be void with respect
to claims under the Law.
2.
This Agreement requires litigation to be conducted in a forum other than
the State of Maryland. The requirement shall not be interpreted to limit any rights
Franchisee may have under Sec. 14-216 (c)(25) of the Maryland Franchise Registration
and Disclosure Law to bring suit in the state of Maryland.
3.
Pursuant to C O M A R 02.02.08.16L, the general release required as a
condition of renewal, sale, and/or assignment/transfer shall not apply to any liability
underthe Maryland Franchise Registration and Disclosure Law.
4.
This Agreement is hereby amended to reflect that any claims arising under
the Maryland Franchise Registration and Disclosure Law must be brought within 3 years
after the grant of the franchise.
5.
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. This
Agreement requires prospective franchisees to disclaim the occurrence and/or
acknowledge the non-occurrence of acts that would constitute a violation of the
Franchise Law. Such representations 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 resulting from the offer or sale of the franchise.
Exhibit O - State A d d e n d a S M 0 I D O C S - # 1 0 5 1 9 8 4 - v 2 - E x h i b i t _ O _ - _ S t a t e _ A d d e n d a . D O C X l
1051984.2
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
Exhibit O - State AddendaSM01DOCS-# 1051984-v2-Exhibit_0_-_State_Addenda. DOCX2
1051984.2
AMENOMENTTO A P P L E B E E S N ^ O H B O R H O O O G R ^ L ^ B A R
PRANOHÊAGREEMENT
R E Q O I R E O B Y T H E S T A T E OF MINNESOTA
^ reoognôo o f t h e Miooesota Eranohise AoL Minn Stat Seotion 80O01 e^
se^ , and of the Roies and Regoiations promuigated porsoant thereto hy the
Oommissioner of Seoorities, the
parties to the
attached
APPLEBEE'S
NEiGFiBOPFiOOO OPILL ^ B A P EPANOFiiSE A O P E E M E N T (the "Franchise
Agreement") agree as toiiows:
1
S o h s e o t i o n 1 3 o t S e o t i o n 1 o t the Franchise Agreement,"FranohiseOraot
a n d T e r m B s h a i i h e soppiernentedhy the addition of the foilowingparagraph, which
shaii he considered an integral part ofthe Franchise Agreement:
With respect to franchises governed hy Minnesota iaw Franchisor wiii
comply with Minn Stat See 8 0 0 1 4 , Sohds 8 , 4 , a n d 5 w h i o h regolre,
exoeptin certain specified oases,thatafranohisee he given ninety (00)
days'written notice of termination (with sixty [00] days to core) and notice
ofFranchlsor's intention notto renew one hondred eighty(180) days prior
to expiration of the franchise and that the franchisee he given soffloient
opportonity to operate the franchise In order to enahle the franchisee the
opportonity torecover the fair market vaioe of the franchise a s a g o i n g
concern Franchisor's oonsent t o t h e t r a n s f e r w i l l n o t h e o n r e a s o n a h l y
withheld
2
S e o t l o n l O o f the Franchise Agreement, "Trade Names, Service Marks
and Trademarks," shall he supplemented hy the addition of the following
Sohsection 18 0, which shall he considered an Integral part of the Franchise
Agreement:
180 The Minnesota Department of Commerce regoires that the
Franchisor indemnify Minnesota franchisees against liahility to third parties
resolting from oiaims hy third parties that the franchisee's ose o f t h e
Franchisor's trademark infringes opon the trademark rightsof the third
party
Franchisor does not indemnify against the oonsegoenoes o f a
franchisee's ose of the Franchisor's trademark except In aooordanoe with
the regoirements of the franchise,and,asacondltlon to indemnifioation,
franchisee most provide notlceto Franohisorof any soch claim within
ten (10) days and tender the defense o f t h e claim to Franchisor
If
Franohisoracceptsthe t e n d e r o f d e f e n s e , Franchisor h a s t h e rightto
manage the defense of the claim, incloding the right to compromise, settle
orotherwlseresolvethe claim,and to determine whether to appealaflnal
determination of the claim
8
Sohseotlon101 of S e o t l o n l O o f the Franchise Agreement,"Expiration
and Termination; Option to Purchase Pestaorant; Attorneys' Fees," shall he
sopplementedhy the addition of the following paragraph, which shall he considered an
integral part ofthe Franchise Agreement:
ExhibltODStateAddenda
^ 9 ^ 2
1
Mmnesota^wprovidesf^
r e s p e o t ^ ^ o o h i s e s governs
withMioo Stat Seo 8 0 0 1 4 , Suhds ^ ^ a n d ^ w h ^
certain specked oases,thatafraoohisee he given ninety
notice of termination (with sixty [00] days to core) and one
(180) days' notice for non renewal of the Pranohise Agreement
Franchisor's oonsent to the transfer of the franchise wiii not he
onreasonahiy withheld.
4
Sohsection 21 o f t h e Franchise Agreement, "Oonstrootion, Severahllity,
Governing Law and JorisdiotionB shall he sopplementedhy the addition ofthe following
sentenoe:
MINNESOTA STAT S F 0 T I O N 8 0 O 21 ANO MINN P O L F 2 8 8 0 4400(J)
FPOFII8IT FPANOFllSOP FROM PFOOIPINO LITIGATION TO 8E
GONOOGTEO OOTSIOF MINNESOTA, PEOLllPING WAIVER O F A
J U R Y TRIAL OR REQUIRING FRANGFllSEE TO GONSENT TO
LIOUIOATEO DAMAGES, TERMINATION PENALTIES OR JUDGMENT
NOTES
IN ADDITION, NOTHING IN THIS A G R E E M E N T SHALL
A B R O G A T E OR REDOGE A N Y RIGHTS OF FRANGHISEE'S RIGHTS
A S PROVIDED FOR IN MINNESOTA STATUTES, G H A P T E R 8 0 G , OR
FRANGHISEE'S RIGHTS TO ANY P R O G E D U R E , FORUM, OR
REMEDIES PROVIDED FOR B Y T H E LAWS O F T H E JURISDIGTION
If the Franchise Agreement oontalnsaprovislon that is inconsistent with
the Minnesota Statoes or the Minnesota Role, the provisions of the
Franchise Agreement shall he soperseded hy the Minn Role's
regoirements and shall have no foroe or effeot
5
The last sentenoe of Seotion 22 of the Franchise Agreement,"lnterference
With Employment RelationsBwhioh refers to llgoidated damages shall he deleted and
shall have no foroe or effeot
8
The second sentenoe of AppendixBto the Franchise Agreement,"Review
and Gonsent with Respect toTransfersBshall he deleted in its entirety and shall have
no foroe or effeot, and the following sentenoe shall he sohstitoted in lieo thereof:
Franchisor's oonsent also may he conditioned opon execution hy
assomes foil, unconditional,joint andseveralllahility for, a n d a g r e e s t o
performfrom thedate of suoh Transfer, all obligations, covenantsand
agreements contained herein to t h e s a m e e x t e n t a s if it had heen an
original party to this Agreementand may also regoire Franchiseeand
Principal Shareholders,incloding the proposed transferor(s),to exeootea
general release whioh releases Franchisor from any oiaims they may have
had or thenhave against Franohisor,exoloding only sooh oiaims as the
Franchisee may have that have arisen onder the Minnesota Franchise Act
FxhibitO^State Addenda
^ ^ 4 2
or the rules and regulations promulgated thereunder by the Commissioner
of Commerce.
7.
Appendix B to the Franchise Agreement, "Review and Consent with
Respect to Transfers," shall be supplemented by the following sentence:
Franchisor's consent to the transfer of the franchise will not be
unreasonably withheld.
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051984.2
P R A N O H ^ E AGREEMENT
REQUIRED B Y T N E S T A T E G E N E W Y O R K
^reoogoihooofêreqo^meôfêNewYor^
33, the parties to the attached Appiehees Neighhorhood Ghli ^ Bar Eranohise
Agreement (the "Eranohise Agreements agree as toiiows:
1
Sohseotion37 of Seotion3 of the Eranohise Agreement, "Restaurant
Systemand RrooeduresBshailhedeieted in its entirety a n d s h a i i h a v e n o f o r o e o r
effeot, and the following shaii he substituted in iieu thereof:
5 7
Franchisor shaii have the right, at any time and from time to time, in
the exercise of its reasonable business judgment consistent with the
overaii hest interestsoftbe Systemgeneraiiy to revise, amend, delete
from a n d a d d to the System and the material containedin the Manual
Franchisee agrees to comply with all suoh revisions, amendments,
deletions and additions
2
Subseotlon132
of
Sections
of the
Franchise Agreement,
"Gonfidentiality;Restriotions,"shallbedeleted in its entirety and shallhavenoforoe
effeot, and the following shall be substituted in lieu thereof:
13 2 Franchisee and Frincipal Shareholders agree that the provisions of
this Seotion 13are and have heenaprimary inducement to Franchisor to
enter into this Agreements and that in the event o f a hreaoh thereof
Franchisor would belrreparablylnjuredandwouldbe without adequate
remedy at law. Therefore, in the eventof a breach o r a threatened or
attempted breach of any of suoh provisions Franchisor shall be entitled, in
addition to any other remedies which It may have hereunder or at law or in
eguity (including the rightto terminate this Agreement), to apply f o r a
preliminary andBor permanent injunction in a decree for a speoifio
performance of the terms hereof without the necessity of showing actual
or threatened damage, and without being reguired to furnishabond or
security
3
S u b s e o t i o n 1 5 2 o f S e o t i o n 1 5 of the Franchise Agreement,"Relationship
of Rarties and Indemnifioation,"shall he deemed to exclude any claims arising as the
result of Franchisor's acts or omissions to act In connection with the operation or
condition ofthe Restaurant
4
Suhsection 21Blof Seotion 21 of the Franchise Agreement,"Gonstruotlon,
Severability, Governing Law and JurisdiotionBshall he supplemented with the following
sentence:
The Franchisee's restitutionary rights, if any, are subject to determination
under applicahle law
ExhlbitGDState Addenda
10^^42
5.
Subsection 21.2 of Section 21 of the Franchise Agreement, "Construction,
Severability, Governing Law and Jurisdiction," shall be supplemented with the following
sentence:
THE FOREGOING CHOICE OF LAW SHOULD NOT BE CONSIDERED
A WAIVER OF A N Y RIGHT C O N F E R R E D UPON FRANCHISEE BY ART.
33 OF THE NEW Y O R K G E N E R A L BUSINESS LAW.
6.
The second sentence of Appendix B to the Franchise Agreement, "Review
and Consent with Respect to Transfers," shall be deleted in its entirety and shall have
no force or effect, and the following shall be substituted in lieu thereof:
original party to this Agreement and may also reguire Franchisee and
Principal Shareholders, including the proposed transferors), to execute a
had or then have against Franchisor; provided however, that all rights
enjoyed by the Franchisee and Principal Shareholders and any causes of
action arising in their favor from the provisions of Article 33 of the General
Business Law of the State of New York and the regulations issued
thereunder shall remain in force; it being the intent of this proviso that the
non-waiver provisions of Sections 687.4 and 687.5 of the New York
General Business Law be satisfied.
IN WITNESS W H E R E O F , the undersigned have, entered into this Amendment to
the Franchise Agreement (Attachment FA-1) as of the date first above written in the
Franchise Agreement.
FRANCHISOR:
A P P L E B E E S FRANCHISOR LLC
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
1051984.2
Name:
Name:
1051984.2 .
PRANOHÊAGREEMENT
R E Q O i R E O B Y T H E S T A T E OP NORTH OAKOTA
^ôogoôoofthe^qo^menôfê^wsofNo^
the oîoe of the State of NorthOakotaOommissiooer of
attached A P P L E B E E S N E i O H B ^ ^
(the "Pranohise Agreements agree as foiiows:
a
if Pranohisee is regoired in the Agreement to exeouteareiease of ciaims
or to aoknowiedge facts that wooid negate or remove from jodioiai review
any statement, misrepresentation or action that wooid violate the Lawôra
r o i e o r o r d e r onder the Law, sooh reieaseshaiiexoiodeoiaims arising
onder the North Oakota Pranohise investment Law, and sooh
acknowledgments shaii he void with respect to oiaims onder the Law.
h
Covenants not to oompetedoring t h e t e r m o f and opon termination or
expiration of the Agreement are enforoeahie only onder certain conditions
according to North Oakota Law If the Agreement oontalnsacovenant not
tooompete which is inoonsistentwith North Oakota Law, the covenant
may he onenforceahie
o
If the Agreement regoires litigation to he condootedinaforom other than
the State of North Oakota, the regoirement is void with respect to claims
onder the North Oakota Pranohise Investment Law.
d
IftheAgreementregoiresthatithegovernedhyastate's law, other than
the State of North Oakota, to the extent that sooh law conflicts with North
Oakota Law, North Oakota shall control
e
The Oommissioner has held that regoiring Franchisees to oonsent to the
jorisdiotion of coorts ootslde of North Oakota Is onfair,onjost or Inegoltahle
within the intent of Seotion 51 1909 o f t h e North Oakota Pranohise
Investment Law
f
If the Agreement regoires payment of a termination penalty, the
regoirement may he onenforceahie onder the North Oakota Franchise
Investment Law.
g
Any provision In the Agreement that regoires Franchisee to oonsent t o a
waiver of trial hyjory shall not apply to any oiaims hrooght onder the North
Oakota Franchise Investment Law
h
The last sentenoe of S e c t i o n s o f t h e Agreement, "Interference with
Fmployee Relations,"shallhe deleted in itsentiretyand shallhave no
foroe or effeot
FxhibitO^State Addenda
^5^42
day of
, 20
.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051984.2
FRANCHISE AGREEMENT
REQUIRED B Y T H E S T A T E OF RHODE ISLAND
In recognition of the requirements of the Rhode Island Franchise Investment Act
(the "Act"), the parties to the attached A P P L E B E E ' S NEIGHBORHOOD GRILL & BAR
FRANCHISE A G R E E M E N T (the "Franchise Agreement") agree as follows:
1.
Section 21 of the Franchise Agreement, "Construction, Severability,
Governing Law and Jurisdiction," shall be amended by adding the following language
which shall be considered an integral part of the Agreement:
§19-28.1-14 of the Rhode Island Franchise Investment Act provides that
"A provision in a franchise agreement restricting jurisdiction or venue to a
forum outside this state or requiring the application of the laws of another
state is void with respect to a claim otherwise enforceable under this Act."
IN WITNESS W H E R E O F , the parties have duly executed, sealed and delivered
this Amendment to the Franchise Agreement (Attachment FA-1) on the day and year
first above written in the Franchise Agreement.
FRANCHISOR:
By:
Name:
Title:
FRANCHISEE:
By:_
Name:
Title:
Name:
Name:
1051984.2
AMENOMENTTO A P P L E B E E S N ^ G H B O R H O O O G R ^ L ^ B A R
PRANOHÊAOREEMENT
R E Q U I R E O B Y T H E S T A T E OF SOUTH OAKOTA
^ôogmôfêû^meoôfêSoÔa^
^ ^
a ^ o h e d A P P L E B E E ' S NEIOHBOPHOOO OPILL ^
A O P E E M E N T ^ e " E ^ o h i s e A g r e e m e ^ agree as f o l l o w
1
S u h s e o ^ 1 3 B ^ of S e o t i o n ^
"Oonfideofia^PesfriofionsB shall be ^^^^
he oooslderedao Integral part of fbe AgreemeoL
of
fbe
BAP
Eraoohise
FPANOHISE
Agreement
Oonfraofs In restraint of trade that take effeot upon termination or
expiration of the Agreement are generally unenforoeahle in the State of
South Oakota as setforth In SOOL 5 3 9 ^ 5 ^
2
S e o t i o n O of the Pranohise Agreement, "Expiration and Termination;
Option to Purchase Restaurant; Attorneys' Pees," shall he amended to add new
Subsection 19 5, which shall he considered an Integral part of the Eranohise
Agreement:
19 5 Notwithstanding the provisions set forth In this Seotlon19, If
Oeveloper falls to meet performance and guality standards or falls to make
any royalty payments under any Pranohise Agreement or,lf applicable,
any Oevelopment Agreement, Oeveloper will he afforded thirty (30) days'
written notice with an opportunity to cure said default priorto termination
3
The second sentenoe of Subsection 2 1 2 o f Seotion 2 1 o f the Franchise
Agreement, "Oonstructlon, Severability, Governing Law and Jurisdiction," shall be
deleted In Its entirety a n d s h a l l h a v e no foroe or effect,and thefollowing shall he
substituted In lieu thereof:
THE LAW PEOAPOINO PRANOHISE REGISTRATION, EMPLOYMENT,
GONTRAGTS IN RESTRAINT OP TRAOE ANO OTHER MATTERS OP
LOGALOONGERN W I L L B E G O V E R N E O B Y T H E L A W S O P T H E
STATE OP SOUTH OAKOTA; BUT A S TO GONTRAGTOAL ANO ALL
OTHERMATTERS,THISAGREEMENTANO ALLPROVISIONSOP
THIS INSTRUMENT WILL BE ANO REMAIN S U B J E C T TO THE
APPLIGATION,
GONSTRUGTION,
ENPORGEMENT
ANO
INTERPRETATION UNOER THE GOVERNING L A W O P KANSAS
4
The first paragraph of Subsection 2 1 3 o f Seotion 21 of theFranchise
Agreement, "Gonstructlon, Severability, Governing Law and Jurisdiction," shall he
supplemented hy the following sentenoe which shall be considered an Integral part of
such paragraph:
PROVIOEO, HOWEVER, THAT ANY PROVISION WHIOH DESIGNATES
JURISOIGTION OR V E N U E OR REGUIRES OEVELOPER TO A G R E E
E^lbltO^StateAddenda
^ ^ 4 2
1
TOJORÔÔNORVEN^^
OAKOTA ^ VOIO WITH R E S P E 0 T T O A N Y 0 A 0 S 5 O F ACTION
W H I C H ^ O T H E R W ^ E E N F O R C E A B L E IN SOOTH OAKOTA
5
S e o b o n 2 2 o f the Eranohise Agreement, interference with Empioyment
Relations^ is amended hy the addition of the foiiowing language to the original
language that appears therein:
Every oontraot in whioh the amount of damage or compensation for
hreaoh of an ohligation is determined in anticipation thereof is void to that
extent, except the parties may agree therein upon an amount presumed to
h e t h e d a m a g e f o r hreach i n c a s e s wherelt would heimpractioahleor
extremely difficult to fix actual damages S O O L 5 3 9 5
6
Seotion 26 o f t h e Eranohise Agreement, "AoknowledgmentsB shall he
supplemented hy the following sentenoe whioh shall he considered an integral part of
suoh paragraph:
Pursuant to S O C L 3 7 5A 36, any acknowledgment provision, disclaimer or
integration clause o r a provision having a similareffeot in afranohise
agreementdoes not negate or act to removefromjudicial reviewany
statement, misrepresentation or action that would violate this chapter o r a
rule or order under this chapter
7
The second sentenoe of AppendixBto the Eranohise Agreement,"Revlew
and Oonsent with Respect toTransfers," shal

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