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Business Description

Our immediate parent is Advanced Fresh Concepts Corp. (“AFCC”) which licensed us to grant the franchises described in this Disclosure Document. They were incorporated in California in 1986, We have no other predecessor. We are affiliated with. Advanced FreshConcepts Ptv. Ltd. (“AFCPL”), an Australian entity formed on April 23, 2015 ,and AFC Distribution Corp. '(“AFCDC”), a California corporation incorporated on April 29, 2016. The business address for us, AFCG and AFCDC is 19205 South Laurel Park Road, Rancho Dominguez,, California 90220. Our phone number is 310-604-3200. Our agent for service of process in California is Incorp Services, Inc. 5716 Corsa Avenue Suite 110, Westlake Village, California 91362-7354. AFCPL's address is 12/538 Gardeners Road, ,Mascot NS W 2020, Australia. Please check Exhibit N for agents in other registration states.

Prior Experience

Our ultimate parent is, Zensho Holdings Go., Ltd. (“Zensho Moldings”), a Japan limited liability company formed on June 3Q, 1982. Zensho Holdings does not operate franchises in any line of business. The business address for Zensho Holdings is JR Shinagawa East Building 2-18-1, Konan, Minato-ku, Tokyo 108- 0075. Zensho.Holdings is affiliated with Zensho USA Corporation, Zensho Food Singapore Pte, Ltd., Poeind Foods Company, Mauri Wasabi, Inc., Coco's Japan Co., Ltd., and Nakau Co., Ltd. Zensho USA Corporation (“Zensho USA”)„AFCC's immediate parent and,also Our indirect parent is a Delaware corporation formed On January 5, 2015. Zensho USA is a wholly-owned subsidiary of Zensho Holdings. Zensho USA does not operate franchises in any line of business. The business address for Zensho USA is 27261 Las Ramblas, Suite 340, Mission ViejOi California 92691. Pocino Foods Company (“Pocino Foods*'), a wholly owned subsidiary of Zensho USA is a Cailifomia corporation formed on January 27, 1965. PocinO FoOds is an American food manufacturer specializing in premium pastrami and other defi meats, meatballs, and Mexican and Asian-style meats. AFCDC (discussed below) purchases products directly from PocuiO Foods and sells those products to Our franchisees to be used at AFC food serviee cOunters. Pocino Foods does not operate franchises; in any line of business. The business address for Pocino Foods is 14250 Lomitas Avenue, Cjty of Industry, California 91746, MaTiii Wasabi, Inc. (“Marui Wasabi”), owned, 50% by AFCC is a California corporation fpnned on August 7, 2000. Marui Wasabi is an importer, manufacturer and distributor Of wasabi-based products and other Asian style saticeS. AFCDC may purchase products directly from Marui Wasabi and sell those products to our franchisees to be used at AFC food service counters in the future. Marui Wasabi does not operate franchises in any line of business. The business address fOr Marui Wasabi is; 320 West Carob Street, Compton, California 90220., ' Zensho Food Singapore Pte. Ltd. (“Zensho FOod”), a Singapore limited liability company formed in 2012, is a franchisee of Long John Silver's, LLC. As of May 2019, Zensho Food operated 26 Long John Silver's restaurant locations in Singapore. Long John Silver's restaurants offer fried seafood and chips in a quick-serveirestaurant enviromnent. The business address of Zensho Food is 31 Ubi Road 1, #07-02 Annex Building, Singapore 408694. Coco's Japan Co., Ltd. (“Coco's”), a Japan limited liability company, formed on April 5, 1978, is a franchisor of Coco's restaurants in Japan. As of May 2019, Coco's had 79 franchised: restaurants in Japan. Coco's restaurants offer a variety of signature soups, hamburgers, salads and conibination dinners, in a fiill- service family-style environment. The business address of Coco's is the same as Zensho Holdings. Nakau COi, Ltd. (“Nakaii”), a Japan limited liability company formed in 1966, is.a franchisor of Nakau restaurant locations in Japan. , As of May 20 J9„Nakau had 11 franchised locations in . Japan. Since March 2005, Nakau has operated as a subsidia^ of Zensho Holdings. Nakau restaurants offer donburi (rice, bowls) and Kyoto-style udon noodles, in addition to other items, in a fast-food environment. The business address of Nakau is the same-as Zensho Holdings. Other than,stated above, Zensho Holdings,, Zensho USA, Zensho Food, PocinO Foods, Mauri Wasabi, Coco' s and Nakau are not in any other line of business'and do not currently offer franchises in any other line Of business.

Business Offered

Our business is granting franchises to let people, like you. Operate AFC' food service counters. Sometimes, due to arrangements with the facility owner, you will operate your food service counter under a different name, or a generic name. We have offered (and sold franchises since May 2002 in the United States and September 2009 in Canada. On April 23, 2015, AFCPL was created to offer and sell franchises in Australia.. We are the master Franchisor of AFCPL in Australia. Originally, our franchises emphasized sushi and this continues to bean importantpart of the franchise. Since approximately September 2005, we broadened our emphasis and now describe ourselves as.food service counters. We aremot in any other business and haven't offered franchises; in any other business: We offer three types of franchises-—Full-time food service counters, part-time food service counters and self-service food service counters. Full-time food service, counters allow you to operate a food service counter as a department of a retail supermarket or in another kind of location, like a college campus or arena on a full time basis. In some instances, we may permit you to operate at these facilities on a part-time basis. In part-time locations, you,are not required to be personally present or have a manager personaily present at the food service counter more than four hours per day . We currently drt ly permit franchisees to operate a part-time location if they already own a full time food service location. Self-service food service counters are available only to selected franchisees who already operate a full­ time or part-time food service counter with us. Under the self-service franchise, you service a supermarket Or other location's sushi and/or other prepared food needs front your existing location. You do not have to be physically present .at the selfrservice location during all hours of operation. It is your responsibility to prepare the prepared foods (such as sushi, roll n' wraps and other foods in our system) at your full-time or part-time food service, counter and, deliver it at least once daily to yOur self-service location. To purchase an AFG franchise, you must sign our form franchise agreement and a separate addendum for each location to be Opened by you. All the addendums are controlled by one franchise agreement. Under each type of franchise, customers pay the facility .owner for their purchases and sales are recorded in the facility owner's cash registers and then reported to us. The facility owner and we keep a percentage of your gross sales.. We then return the remainder to you less amounts we deduct for Other charges to you. At most locations, you will hot use a cash register. At other locations, cash registers will be provided by the location owner for your use (See Items 6 & 11.) We also dperate food service counters that are similar to the, ones you will operate. See Exhibit M. We are not in any other business. AFCC's business is supplying; sushi and other food items to supennarkets, and other venues and preparing iresh sushi and other food products to sell at food service counters. They have been in this business since 1986. They have agreements to operate food service counters as separate departments Of supermarkets and other yenues. In many ihStances they perform their a^eement by having us grant you, a franchise, so you can operate the food service counter. AFGC has entered into agreements to operate orlet others operate food service counters since 1986. AFCC enters into agreernents with location owners. Enteririg into a franchise agreernent with you to operate at that location enables AFG.C to satisfy its agreement. We will tell you available locations when we meet. AFCG operates some food service counters of the type: you will operate. They also make sushi products for home use, and sell products via an online store at the website www.afcsushi.cdih. AFGG is, not in any other line of business and does nOt offer franchises, in any line of business. Our affiliate AFGPL offers franchises sirnilar to the ones you will operate outside the United States and Ganada., As of March 31, 2019, AFGPL had 178 franchised and company owned locations in Australia. AFGPL is not in any other line of business and does not offer franchises in any other line of business. Our affiliate AFGDG fulfills and ships franchisee orders and is our logistics provider for product shipments sold to you. AFGDG is not in any other linel of business and does not offer franchises in any line of business. There is an existirig market for sushi and other prepared food products at stand-alone food service counters and restaurants, and also at grocery stores. You will sell prepared foods mainly to customers who shop: at the, grocery store or visit the venue where your food service couhter is located. Customer traffic will be generated primarily by the facility and its,owner. You are only pennitted to sell your prepared foodproducts at tke food service counter(s) we designate. The facility owner has the right tp sell competing products at other locations in the facility. The market for sushi products is fairly developed and is enjoyed by customers year round.

Initial Fees

If you are an existing franchisee with us obtaining a self-service or partrtime franchise in addition to your existing full time location, there is currently no initial franchise fee for the self-service or part-time location (although we can irnplement such a fee in the ,future). You pay the initial franchise fee in a lump sum on signing each full time location addendum. There are no refunds or prorations, if a location starts as a Full Time location and later is transformed into a Self Service or Part-Time location. However, if a location starts as a Self Service or Part-Time location and is transforrned into a Full Time location, then you must pay our then current initial franchise fee for the Full Time location. In addition, if you are a new franchisee, you pay us a $85 credit and background check fee when turning in your application, up to $2,300 for our training program for each of your principal owner(s), up to $2,300 for each manager you bring with you to the initial training, up to $275 per person for the ServSafe® Food Protection Manager Certification (for you and ypur managers), up to $ 1,OOO per person for drug, tuberculosis and criminal background testing and a manual lease fee of up to $300 for each full service or part, time food service counter to be opened. You pay the training fee, ServSafe® training and examination fee and manual lease fee in a lump sum when you start training. You pay the drug, tuberculosis and criminal background test fee and/or the cost of other testing required by the facility owner after the tests/check is completed through deduction from your commissions. If you fail to complete our training program to our satisfaction or if you fail any required drug, tuberculosis or other chemical and disease, testing and/or criminal background investigation we may cancel the franchise agreement. Before opening, we also require you to purchase a label machine consisting of a tablet and printer and warranty costing up to $1,599, equipment and small wares costing up to $33,000, opening food inventory which depending on what you order can range from $8,000 to $24,000 at a fulLtime or part-time service location and $1250 to $5,000 at a self-service location, scanner costing up to $500, ongoing inventory which for 3 months can range from $5,000 to $ 18,000 at a,full-time or part-time service location and.$ 1,000 to $5,000 at a self-service; location, signage which depending on'your location can cost up to $1,000,, up to $1,800 in opening assistance fees if we stay at your location 4 additional days beyond the first 3 for on-site training and up to $350 for four additional sets of uniforms. None of these fees, is refundable. Except as indicated above, these initial fees are uniform to all new franchisees, though we rnay change them in the future; If you are an entity, each of your owners who are individuals must sign a personal guaranty, The, guaranty is on the signature page of the franchise agreement and each applicable addendum. If you purchase an existing location from us, we will charge you $1,000 to $100,000 for the food service!counter business, assets equipment and value of the established market of the food ,service counter, as we determine at our sole discretion. We may finance some of the initial franchise fee(s) and various other expenses that you incur with us. (See Item 10.) * These items are not required when you purchase a self-service franchise, because you already have these, items in your full-tirne or part-time location.

Financing

We can finance certain expenses you incur in operating your fOOdiservice counter,.at our discretion, in circumstances when the,commission payable to you is less than the balance owed, to us. You can pay us over a jperiod of months by deductions from commissions we pay you. We do npt offer other direct or indirect financing. We do not finance any debt to a third party. We do not guarantee your iiotei lease or obligation. Footnotes: (1) We may lump all expenses together. Our accounting manager makes a determination regarding the term of the financing and monthly payment, which is then deducted fi'oin commissions we pay you. The range financed will depend on which items are financed and ratio between store sales and amount owed. A shorter term would increase the inonthly deduction. (2) We self-finance the above purchases, We do not require any security interest to obtain financing. Except when purchasing an existing location, you do not sign a promissory note, so there is no waiver of defenses. We do not have any practice or intent to sell, assign or discount the financing arrangements to any third party. We do not arrange financing from other sources and we do not guarantee your obligations to third parties. (3) If you purchase an existing business from us and ask Us to finance part of your purchase price, you will sign a promissory note. If you fail to make payments, we can deduct payments fi-om commissions due to yoti. The Promissory Note provides a late payment penalty of the lower of 1 % per monthior highest rate allowed by law of the amount overdue and acceleration of the entire amount due if you are more than 10 days late making a payment. If you don't comply with the Promissory Note or any of the other agreements with us we can accelerate the entire amount remaining due without notice. You waive all rights to presentment, protest and demand, diligence in collection and notice of protest, presentment,, demand, dishonor and nonpayment of the Promissory Note and any release or discharge arising from any extension of time, discharge of any party liable for payment of the Promissory Note, or other cause of release or discharge other than actual payment in full of the Promissory Note. We don't have any intent to sell, assign or discount to a third party all or part of the Proinissoiy Note; however, we reserve the right to do so.

Franchisee Revenue and Profit

The FTC's Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor owned outlets, if there is a reasonable basis for the information, and if the information is included in the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if: (1) a franchisor provides the actual records; of an existing outlet you are considering buying; or (2) a franchisor supplements the information provided in this Item 19, for example; by providing information about possible perfonnance at a particular location or under particular ciremnstances. We do not make any representations about a franchisee's future financial performance or the past financial performance of company-owned of franchised outlets. We also do not authorize our employees or representatives to make any such representations either orally or in, writing. If you are purchasing an existing outlet, however, we may provide you with the actual records of that outlet. If you receive any other financial performance information or projections of your future income, you should report it to the franchisor's management by contacting Jeff Seiler, 19205 S. Laurel Park Road, Rancho Dominguez, CA 9022O, Telephone: (310) 604-3200, theiEederal Trade Commission, and the appropriate state regulatory agencies.