FRANCHISE_AGREEMENT[1]

CAFFEKENONFRANCHISEAGREEMENT1stApril,2010TABLEOFCONTENTS1.GRANTOFFRANCHISE12.DUTIESOFTHEFRANCHISEE13.FRANCHISOR’SPROVISIONOFSERVICES24.TRAINING25.INTELLECTUALPROPERTY36.CONFIDENTIALINFORMATION37.INDEMNIFICATION38.FEESANDPAYMENTS49.RECORDSANDREPORTS510.INSPECTIONANDAUDITS611.ASSIGNMENT712.RENEWALOFFRANCHISE813.COVENANTSOFFRANCHISEE914.TERMINATION1015.POST-TERMINATION1216.ENFORCEMENT1217.NOTICES1418.MISCELLANEOUS14iSCHEDULESchedule1ListofequipmentandsuppliesiiFRANCHISEAGREEMENTTHISAGREEMENTismadeandenteredintothis1stApril2010,betweenHippoLaceLimited(“Franchisor”),and北京咖意浓餐飲有限公司(BeijingKenonBistroCateringLimited),(“Franchisee”).WITNESSETHWHEREAS,FranchisorforitsaffiliatenamedLegendSunLimitedisauthorizedtofranchisetherighttousecertaintrademarks(the“Trademarks”)anddistributionofcertainproducts.(the“Products,”)whichtermshallincludeallupdatesadditions,otherchangesmadetotheTrademarksandProductsfromtimetotime;andWHEREAS,FranchiseeacknowledgesthatithasreadthisAgreementandthatFranchiseeunderstandsandacceptstheterms,conditionsandcovenantscontainedhereinasbeingreasonableandnecessarytomaintainFranchisor’shighstandardsofqualityandserviceandtheuniformityofsuchstandardsthroughoutthetermofthisAgreement;andWHEREAS,theFranchiseeexpresslyacknowledgesthatithasnotreceivedorrelieduponanyguaranty,expressorimplied,astotherevenues,profits,orlikelihoodofsuccessofthefranchisedbusinesscontemplatedbythisAgreement;andWHEREAS,FranchiseeacknowledgesthatithasnotreceivedorrelieduponanyrepresentationsaboutthefranchisegrantedhereinbyFranchisororitsagentscontrarytothetermshereof.NOW,THEREFORE,thepartiesagreeasfollows:GRANTOFFRANCHISEGrant.FranchisorgrantstoFranchisee,andFranchiseeaccepts,anon-exclusivelicenseandfranchisetooperatecafébistrocarryingthenameofCaffeKenon(the“Kenon”)atshopno.02-04,5/F,JoyCity,No.28QingnianRoad,ChaoyangDistrict,Beijing,ChinaduringthetermofthisAgreement.IfFranchisorwantstooperateanotherfranchiseofKenonwiththesametermsofthisfranchise,theFranchiseehastheprioritytobeconsideredasthegrantee.Term.ThetermofthisAgreementis3years,commencingonthedatethisAgreementissigned.FranchiseAgreement,Page1Franchiseeassumesallcosts,liability,expenses,andresponsibilitiesfortheestablishmentoftheKenonandFranchisorhasnoobligationtoanylegalconsequencesarosefromwhattheFranchiseeassumed.DUTIESOFTHEFRANCHISEEDutiesofBusinessEntity.IfFranchiseeisacorporation,partnership,oralimitedliabilitycompany,Franchiseerepresents,warrants,andcovenantsasofthedateofthisAgreementthatFranchiseeis,andshallatalltimesbe,dulyorganizedandvalidlyexistingunderthelawofitsformation.FRANCHISOR’SPROVISIONOFSERVICESSpecificationsforKenon.FranchisoragreedFranchiseetousetheTrademarksincludedbutnotlimitedtoCaffeKenonandotherintellectualpropertyownedbytheFranchisor.Franchiseeagrees,inaccordancewiththestatutoryandlegalrequirements,tosetupandinstalltheKenon,reflectingFranchisor’srequirementsandspecificationsforinteriorandexteriordesign,layout,image,fixtures,equipment,furniture,signs,anddecoration.FranchisorhastherighttomakechangestotheTrademarksorchangetoothertrademarksthatFranchisordeemed,forwhateverreason,suitableforthebusinessfromtimetotime.FranchiseeacknowledgesandagreestotheaforesaidrighttotheFranchisorwhichshallnotconstitutetoanydefaultoftheAgreement.FranchiseeagreestouseintheconstructionandoperationoftheKenononlythosetypesoffixtures,equipment,furniture,signsandsuppliesthatFranchisorhasapprovedforShopsasmeetingitsspecificationsandstandards.IfapprovebyFranchisor,FranchiseemaypurchasethoseequipmentlistedonSchedulefromothersupplierprovidedtheycomplywithFranchisor’sspecificationsandstandards.FranchiseeagreesnottoopentheKenonforbusinesswithoutFranchisor’swrittenapproval.DeadlineforOpening.Franchiseemustopenitsshopwithinonehundredeight(180)daysafterFranchiseesignsthisFranchiseAgreement.TRAININGInitialTrainingFranchisorshallonitsowndeterminationtodesignateappropriatenumberofstaffbyfunctiontoprovidetrainingtoFranchiseepriortotheopeningofFranchisee’sKenon.Franchiseeissolelyresponsibleforcompensationtothosestaffnotlessthantheircurrentstandard,livingexpensesandtravelexpensesinconnectionwithattendanceattheinitialtrainingprogram.FranchiseAgreement,Page2INTELLECTUALPROPERTYOwnership.FranchiseeacknowledgesFranchisor’sownershipofanexclusiverighttotheIntellectualProperty,forms,methodsofoperationandallothermaterialsandConfidentialInformationwhichareapartthereof.Franchisee’srighttousetheIntellectualPropertyisderivedsolelyfromthisAgreementandislimitedtotheconductofbusinessincompliancewiththisAgreement.AnyunauthorizeduseoftheIntellectualPropertybyFranchiseeconstitutesaninfringementoftherightsoftheFranchisor.Goodwill.FranchiseeagreesthatusageoftheIntellectualPropertyandanygoodwillestablishedexclusivelybenefitsFranchisor,andFranchiseeacknowledgesthatthisAgreementdoesnotconferanygoodwillorotherinterestsintheIntellectualPropertyuponFranchisee.Franchiseemustnot,atanytimeduringthetermofthisAgreementorafteritsterminationorexpiration,contestthevalidityorownershipofanyoftheIntellectualPropertyorassistanyothe