Common use of Assignment by Franchisee Clause in Contracts

Assignment by Franchisee. (a) Franchisee understands and acknowledges that the rights and duties created by this Agreement are personal to Franchisee and that the Company has granted the Franchise in reliance upon the individual or collective character, skill, aptitude, attitude, business ability and financial capacity of Franchisee. Therefore, except as provided with respect to assignment to a corporation or partnership, or to a spouse or heirs in the event of Franchisee’s death or disability pursuant to subsection 13.02 (c) below, neither the Franchise, the Restaurant (or any interest therein), nor any part or all of the ownership of the Franchise may be voluntarily, involuntarily, directly or indirectly assigned, sold, subdivided, subfranchised, issued or otherwise transferred by Franchisee (including without limitation by consolidation or merger) without the prior written approval of the Company, which approval shall not be unreasonably withheld. Such assignment or transfer without approval shall constitute a breach hereof and will convey no rights or interests in the Franchise or the Restaurant to such assignee(s). Transferees shall be subject to the Company’s then current franchisee selection and qualification criteria. Grounds for withholding consent to an assignment or transfer include, but are not limited to: (i) the transfer is proposed to be made to any competitor of the Company or a transferee involved with a competitor of the Company; (ii) the transfer is proposed to be made to a transferee who fails to demonstrate to the Company’s satisfaction that it or its owners and management meet the Company’s educational, managerial and business standards, possess good moral character, business reputations, and credit ratings, and have the aptitude and ability to conduct the business contemplated by this Agreement; or (iii) in the Company’s sole judgment, the price, payment terms, or other material terms of the transaction or any financing incurred in connection with the transaction are so burdensome, individually or in the aggregate, as to threaten the continued operation of the Steak n Shake Restaurant after the transfer. Notwithstanding the foregoing, Franchisee may assign its ownership of the Franchise to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation and, if applicable, good standing.

Assignment by Franchisee. (a) Franchisee understands and acknowledges that the The rights and duties created by this Agreement are personal to Franchisee. Franchisee and acknowledges that the Company has granted the Franchise entered into this Agreement in reliance upon on the individual or collective character, skill, aptitude, attitudebusiness ability, business ability and financial capacity of FranchiseeFranchisee and its owners. ThereforeFranchisee and each owner of an interest in this Agreement represent, except as provided with respect to assignment to a corporation or partnershipwarrant, or to a spouse or heirs and agree that all “Interests” in the event Franchisee are owned in the amount and manner in which Franchisee has disclosed them to the Company, as more particularly set forth in Schedule 1 to this Agreement. (An “Interest” means any shares or partnership interests in the Franchisee and any other legal or equitable right in any of Franchisee’s death stock, revenues, profits, rights or disability pursuant assets. When referring to subsection 13.02 (c) belowthe Franchisee’s rights or assets, neither an “Interest” also includes this Agreement and the FranchiseFranchisee’s rights under and interest in this Agreement, the Restaurant (and the revenues, profits or any interest therein)assets of the Restaurant.) Franchisee and each owner also represent, nor any part or all of warrant and agree and no change will be made in the ownership of an Interest other than as permitted by this Agreement or as we may otherwise approve in writing. Franchisee and each owner agree to furnish the Franchise Company with evidence as the Company may request from time to time to assure that the Interests of the Franchisee and each owner remain as permitted by this Agreement, including a list of all persons or entities owning any Interest. Neither this Agreement nor any Interest herein nor any Interest of the Franchisee or any owner may be voluntarily, involuntarily, directly or indirectly assigneddirectly, sold, subdividedtransferred, subfranchisedassigned, issued conveyed, gifted, pledged, mortgaged, or otherwise transferred by Franchisee (including without limitation by consolidation or merger) encumbered without the Company’s prior written approval (“Assignment”). Any such purported Assignment occurring by operation of law or otherwise without the Company, which approval shall not be unreasonably withheld. Such assignment or transfer without approval ’s prior written consent shall constitute a breach hereof default of this Agreement by Franchisee, and will convey no rights or interests shall be null and void. Except in the Franchise or instance of Franchisee advertising to sell its Restaurant and assign this Agreement in accordance with the Restaurant to such assignee(s). Transferees terms thereof, Franchisee shall be subject to not, without the Company’s then current franchisee selection and qualification criteria. Grounds prior written consent, offer for withholding consent to an assignment sale or transfer include, but are not limited to: (i) the transfer is proposed to be made to any competitor of the Company at public or a transferee involved with a competitor of the Company; (ii) the transfer is proposed to be made to a transferee who fails to demonstrate to the Company’s satisfaction that it private auction or its owners and management meet the Company’s educational, managerial and business standards, possess good moral character, business reputations, and credit ratings, and have the aptitude and ability to conduct the business contemplated by this Agreement; advertise publicly for sale or (iii) in the Company’s sole judgmenttransfer, the pricefurnishings, payment termsinterior and exterior décor, items, supplies, fixtures, equipment, Franchisee’s lease or other material terms of the transaction real or any financing incurred personal property used in connection with the transaction Restaurant. This Agreement may not be transferred by Franchisee to a publicly-held entity, or to any entity whose direct or indirect parent’s securities are so burdensome, individually publicly traded and no shares of Franchisee or in the aggregate, as to threaten the continued operation any direct or indirect owner of the Steak n Shake Restaurant after the transfer. Notwithstanding the foregoing, Franchisee may assign its ownership be offered for sale through the public offering of the Franchise to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation and, if applicable, good standing.

Assignment by Franchisee. (a) Franchisee understands and acknowledges that the The rights and duties created by this Agreement are personal to Franchisee. Franchisee and acknowledges that the Company Franchisor has granted the Franchise entered into this Agreement in reliance upon on the individual or collective character, skill, aptitude, attitudebusiness ability, business ability and financial capacity of FranchiseeFranchisee and its owners. ThereforeFranchisee and each owner of an interest in this Agreement represent, except as provided with respect to assignment to a corporation or partnershipwarrant, or to a spouse or heirs and agree that all “Interests” in the event Franchisee are owned in the amount and manner in which Franchisee has disclosed them to the Franchisor, as more particularly set forth in Schedule 1 to this Agreement. (An “Interest” means any shares or partnership interests in the Franchisee and any other legal or equitable right in any of Franchisee’s death stock, revenues, profits, rights or disability pursuant assets. When referring to subsection 13.02 (c) belowthe Franchisee’s rights or assets, neither an “Interest” also includes this Agreement and the FranchiseFranchisee’s rights under and interest in this Agreement, the Restaurant (and the revenues, profits or any interest therein)assets of the Restaurant.) Franchisee and each owner also represent, nor any part or all of warrant and agree and no change will be made in the ownership of an Interest other than as permitted by this Agreement or as we may otherwise approve in writing. Franchisee and each owner agree to furnish the Franchise Franchisor with evidence as the Franchisor may request from time to time to assure that the Interests of the Franchisee and each owner remain as permitted by this Agreement, including a list of all persons or entities owning any Interest. Neither this Agreement nor any Interest herein nor any Interest of the Franchisee or any owner may be voluntarily, involuntarily, directly indirectly or indirectly assigneddirectly, sold, subdividedtransferred, subfranchisedassigned, issued conveyed, gifted, pledged, mortgaged, or otherwise transferred by Franchisee (including without limitation by consolidation or merger) encumbered without the Franchisor’s prior written approval (“Assignment”). Any such purported Assignment occurring by operation of law or otherwise without the Company, which approval shall not be unreasonably withheld. Such assignment or transfer without approval Franchisor’s prior written consent shall constitute a breach hereof default of this Agreement by Franchisee, and will convey no rights or interests shall be null and void. Except in the Franchise instance of Franchisee advertising to sell its Restaurant and assign this Agreement in accordance with the terms thereof, Franchisee shall not, without the Franchisor’s prior written consent, offer for sale or transfer at public or private auction or advertise publicly for sale or transfer, the furnishings, interior and exterior décor, items, supplies, fixtures, equipment, Franchisee’s lease or the Restaurant to such assignee(s). Transferees shall be subject to the Company’s then current franchisee selection and qualification criteria. Grounds for withholding consent to an assignment real or transfer include, but are not limited to: (i) the transfer is proposed to be made to any competitor of the Company or a transferee involved with a competitor of the Company; (ii) the transfer is proposed to be made to a transferee who fails to demonstrate to the Company’s satisfaction that it or its owners and management meet the Company’s educational, managerial and business standards, possess good moral character, business reputations, and credit ratings, and have the aptitude and ability to conduct the business contemplated by this Agreement; or (iii) in the Company’s sole judgment, the price, payment terms, or other material terms of the transaction or any financing incurred personal property used in connection with the transaction Restaurant. This Agreement may not be transferred by Franchisee to a publicly-held entity, or to any entity whose direct or indirect parent’s securities are so burdensome, individually publicly traded and no shares of Franchisee or in the aggregate, as to threaten the continued operation any direct or indirect owner of the Steak n Shake Restaurant after the transfer. Notwithstanding the foregoing, Franchisee may assign its ownership be offered for sale through the public offering of the Franchise to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation and, if applicable, good standing.

Assignment by Franchisee. (a) Franchisee understands This Agreement and acknowledges that the rights and duties created by granted to the Franchisee pursuant to this Agreement are personal to Franchisee and that the Company has granted the Franchise in reliance upon the individual or collective character, skill, aptitude, attitude, business ability and financial capacity of Franchisee. Therefore, except as provided with respect to assignment to a corporation or partnership, or to a spouse or heirs in the event of Franchisee’s death or disability pursuant to subsection 13.02 (c) below, neither the Franchise, the Restaurant (or any interest therein), nor any part or all of the ownership of the Franchise may be voluntarily, involuntarily, directly or indirectly assigned, sold, subdivided, subfranchised, issued assigned or otherwise transferred by the Franchisee (including without limitation by consolidation or merger) without only with the prior written approval of the CompanyElephant & Castle. Elephant & Castle will not unreasonably withhold its written consent to any sale, which approval shall not be unreasonably withheld. Such assignment or transfer without approval shall constitute a breach hereof and will convey no rights or interests in of this Agreement, if the Franchise or the Restaurant to such assignee(s). Transferees shall be subject to the Company’s then current franchisee selection and qualification criteria. Grounds for withholding consent to an sale, assignment or transfer include, but are does not limited toviolate Article 17.9 of this Agreement and if the Franchisee and/or the transferee franchisee comply with the following conditions: (ia) the transfer is proposed Franchisee has provided written notice to be made to any competitor Elephant & Castle of the Company proposed sale, assignment or a transferee involved with a competitor transfer of this Agreement at least ninety (90) days prior to the transaction; (b) all of the CompanyFranchisee's monetary obligations due to Elephant & Castle have been paid in full, and the Franchisee is not otherwise in default under this Agreement; (iic) the transfer is proposed Franchisee has executed a written agreement, in a form satisfactory to be made Elephant & Castle, in which the Franchisee agrees to observe all applicable provisions of this Agreement, including the provisions with obligations and covenants that continue beyond the expiration or termination of this Agreement, which includes the covenants not to compete contained in Article 21 of this Agreement; (d) Elephant & Castle and the Franchisee have executed a joint and mutual release, in a form satisfactory to Elephant & Castle, of any and all claims against Elephant & Castle or the Franchisee and of any and all claims against their officers, directors, shareholders, Owners, agents and employees, in their corporate and individual capacities arising from, in connection with, or as a result of this Agreement or the Franchisee's purchase of the Franchise including, without limitation, all claims arising under any federal or state franchising laws or any other federal, state or local law, rule or ordinance; provided, however, that Elephant & Castle and the Franchisee may exclude from the coverage of the release any prior or concurrent written agreements between them; (e) the transferee who fails to demonstrate franchisee has demonstrated to the Company’s satisfaction of Elephant & Castle that he, she or it or its owners and management meet meets the Company’s educationalmanagerial, managerial financial and business standardsstandards required by Elephant & Castle for new franchisees, possess possesses a good moral character, business reputationsreputation and credit rating, and credit ratings, and have possesses the aptitude and ability to conduct operate the Elephant & Castle-Registered Trademark- Restaurant in an economic and businesslike manner (as may be evidenced by prior related business contemplated by this Agreementexperience or otherwise); (f) the transferee franchisee and all parties having a legal or (iii) beneficial interest in the Company’s sole judgment, the price, payment terms, or other material terms of the transaction or any financing incurred in connection with the transaction are so burdensome, individually or in the aggregate, as to threaten the continued operation of the Steak n Shake Restaurant after the transfer. Notwithstanding the foregoing, Franchisee may assign its ownership of the Franchise to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation andtransferee franchisee including, if applicable, good standingthe transferee franchisee's Owners and the Personal Guarantors, execute the transfer and assignment agreement between Elephant & Castle, the Franchisee and the transferee franchisee and such other ancillary agreements as Elephant & Castle or its legal counsel may require for the transfer of this Agreement for the Franchisee's Elephant & Castle-Registered Trademark- Restaurant to the transferee franchisee; (g) the transferee franchisee has purchased the Franchised Location, acquired the lease for the Franchised Location or otherwise acquired possession of and access to the Franchised Location for a term consistent with the remaining term of this Agreement; (h) the transferee franchisee has purchased or otherwise acquired a valid liquor license and a valid food service license for the Elephant & Castle-Registered Trademark- Restaurant at the Franchised Location; and (i) the transferee franchisee has successfully completed the initial training program as set forth in Article 16.1 of this Agreement.

Assignment by Franchisee. (a) Franchisee understands and acknowledges that the rights and duties created by this Agreement are personal to Franchisee and that the Company has granted the Franchise in reliance upon the individual or collective character, skill, aptitude, attitude, business ability and financial capacity of Franchisee. Therefore, except as provided with respect to assignment to a corporation or partnership, or to a spouse or heirs in the event of Franchisee’s death or disability pursuant to subsection 13.02 (c) below, neither the Franchise, the Restaurant (or any interest therein), nor any part or all of the ownership of the Franchise may be voluntarily, involuntarily, directly or indirectly assigned, sold, subdivided, subfranchised, issued or otherwise transferred by Franchisee (including without limitation by consolidation or merger) without the prior written approval of the Company, which approval shall not be unreasonably withheld. Such assignment or transfer without approval shall constitute a breach hereof and will convey no rights or interests in the Franchise or the Restaurant to such assignee(s). Transferees shall be subject to the Company’s then current franchisee selection and qualification criteria. Grounds for withholding consent to an assignment or transfer include, but are not limited to: (i) the transfer is proposed to be made to any competitor of the Company or a transferee involved with a competitor of the Company; (ii) the transfer is proposed to be made to a transferee who fails to demonstrate to the Company’s satisfaction that it or its owners and management meet the Company’s educational, managerial and business standards, possess good moral character, business reputations, and credit ratings, and have the aptitude and ability to conduct the business contemplated by this Agreement; or (iii) in the Company’s sole judgment, the price, payment terms, or other material terms of the transaction or any financing incurred in connection with the transaction are so burdensome, individually or in the aggregate, as to threaten the continued operation of the Steak n Shake Restaurant after the transfer. Notwithstanding . (b) In the foregoingevent Franchisee, Franchisee may assign its ownership of the Franchise to including any successors, is a duly organized, validly existing partnership, limited liability company, corporation corporation, or other entity that is not a natural person provided such person: (i) The organizational documents shall recite that the issuance and transfer of any interest in the Franchise is restricted by the terms of this Franchise Agreement, and copies thereof shall be furnished to the Company upon request (together with copies of the Resolutions of the Board of Directors authorizing its entry into this Agreement). (ii) A transfer of any fractional ownership interest in Franchisee from one partner, member or shareholder to another or by a partnership, limited liability companycompany or corporation must be approved in advance, corporation or other entity in writing, by the Company. One condition of any such transfer shall be the requirement that is not all general partners and all direct and indirect holders of an interest in Franchisee in excess of ten percent (10%) shall execute a natural person is controlled directly or indirectly throughwritten agreement with the Company, or is under common control withpersonally guaranteeing the full payment and performance of Franchisee's obligations to the Company and individually undertaking to be bound, jointly and severally, by all terms of this Agreement, including, without limitation, the restrictions on assignment in this Section 13. (iii) Franchisee shall not use the name "STEAK N SHAKE", any other ▇▇▇▇ or any name deceptively similar thereto, in any offering of its securities, except to reflect its franchise relationship with the Company. Any prospectus, private placement or Registration Statement proposed to be used in such an offering shall be submitted to the Company within a reasonable time prior to the filing and effective date thereof for the limited purpose of permitting the Company to verify Franchisee. "Control" means 's compliance with this requirement. (iv) Franchisee shall furnish the possessionCompany, directly at the time of execution of this Agreement and upon all transfers subject to the provisions of this Section 13 thereafter, a list of all stockholders and/or persons having an interest in Franchisee which reflects the percentage interest of each stockholder or indirectlyperson, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, interest directly and indirectly held or controlled by contract, each stockholder or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation and, if applicable, good standingperson.

Assignment by Franchisee. (a) Franchisee understands and acknowledges that the rights and duties created This Agreement has been entered into by this Agreement are personal to Franchisee and that the Company has granted the Franchise in reliance upon and in consideration of the individual or collective character, singular personal skill, aptitude, attitude, business ability qualifications and financial capacity of trust and confidence reposed in Franchisee. ThereforeNeither Franchisee nor any Owner shall cause or permit any Assignment unless Franchisee shall have obtained Company’s prior written consent, except which consent may be withheld for any reason whatsoever in Company’s judgment, and shall comply with Company’s right of first refusal pursuant to Section 7.3(d). Except as provided in Section 7.2(b), Franchisee acknowledges and agrees that it will not be permitted to make an Assignment of this Agreement or sell, gift, convey, assign or transfer the assets used in any of the Restaurants developed hereunder or any Franchise Agreement executed pursuant to this Agreement except in conjunction with respect a concurrent Assignment to assignment the same approved assignee of all of the assets used in all of said Restaurants, and all of the Franchise Agreements executed pursuant to a corporation this Agreement or partnershipat Company’s election the execution by the assignee of new Franchise Agreements on Company’s Then-current form for each of the Restaurants then developed or under development by Franchisee, or to a spouse or heirs and otherwise in accordance with the event terms and conditions of Franchisee’s death Franchise Agreement(s). If Franchisee is an Entity, Franchisee shall promptly provide Company with written notice (stating such information as Company may from time to time require) of each and every transfer, assignment, encumbrance, gift and other conveyance, voluntarily or disability pursuant to subsection 13.02 involuntarily, in whole or in part, by operation of Applicable Law or otherwise by any Owner of any direct or indirect Equity or voting rights in Franchisee, notwithstanding that the same may not constitute an “Assignment” as defined by this Agreement. (b) Franchisee shall not, directly or indirectly, pledge, encumber, hypothecate or otherwise grant any third party a security interest in this Agreement in any manner whatsoever without the prior express written consent of Company. To the extent that the foregoing prohibition may be ineffective under Applicable Law, Franchisee shall provide not less than 10 days prior written notice (which notice shall contain the name and address of the secured party and the terms of such pledge, encumbrance, hypothecation or security interest) of any pledge, encumbrance, hypothecation or security interest in this Agreement. (c) belowSecurities, neither partnership or other ownership interests in Franchisee may not be offered to the Franchisepublic under the Securities Act of 1933, as amended, nor may they be registered under the Restaurant (Securities Exchange Act of 1934, as amended, or any interest therein)comparable federal, nor any part state or all of the ownership of the Franchise foreign law, rule or regulation. Such interests may be voluntarily, involuntarily, directly or indirectly assigned, sold, subdivided, subfranchised, issued offered by private offering or otherwise transferred by Franchisee (including without limitation by consolidation or merger) without only with the prior written approval consent of the Company, which approval consent shall not be unreasonably withheld. Such assignment All materials required for any such private offering by federal or transfer without approval state law shall constitute be submitted to Company for a breach hereof limited review as discussed below prior to being filed with any governmental agency; and will convey no rights any materials to be used in any exempt offering shall be submitted to Company for such review prior to their use. No such offering by Franchisee shall imply that Company is participating in an underwriting, issuance or interests offering of securities of Franchisee or Company, and Company’s review of any offering materials shall be limited solely to the subject of the relationship between Franchise and Company and its Affiliates. Company may, at its option, require Franchisee’s offering materials to contain a written statement prescribed by Company concerning the limitations described in the Franchise or preceding sentence. Franchisee, its Owners and the Restaurant other participants in the offering must fully defend and indemnify Company, and its Affiliates, their respective partners and the officers, directors, manager(s) (if a limited liability company), shareholders, members, partners, agents, representatives, independent contractors, servants and employees of each of them, from and against any and all losses, costs and liability in connection with the offering and shall execute any additional documentation required by Company to such assignee(s)further evidence this indemnity. Transferees For each proposed offering, Franchisee shall pay to Company a non-refundable fee of $5,000, which shall be subject in addition to any transfer fee under any Franchise Agreement or such greater amount as is necessary to reimburse Company for its reasonable costs and expenses associated with reviewing the proposed offering, including without limitation, legal and accounting fees. Franchisee shall give Company written notice at least thirty (30) days prior to the Companydate of commencement of any offering or other transaction covered by this Section. (d) Franchisee’s then current franchisee selection and qualification criteria. Grounds written request for withholding consent to any Assignment must be accompanied by an assignment or transfer include, but are not limited to: (i) offer to Company of a right of first refusal to purchase the transfer interest which is proposed to be made to transferred, on the same terms and conditions offered by the third party; provided that Company may substitute cash for any competitor of the Company or a transferee involved with a competitor of the Company; (ii) the transfer is non-cash consideration proposed to be made given by such third party (in an amount determined by Company reasonably and in good faith as the approximate equivalent value of said non-cash consideration); and provided further that Franchisee shall make representations and warranties to a transferee who fails Company customary for transactions of the type proposed (the “ROFR”). If Company elects to demonstrate to exercise the Company’s satisfaction that it ROFR, Company or its owners and management meet the Companynominee, as applicable, shall send written notice of such election to Franchisee within 60 days of receipt of Franchisee’s educational, managerial and business standards, possess good moral character, business reputations, and credit ratings, and have the aptitude and ability to conduct the business contemplated by this Agreement; or (iii) in the Company’s sole judgmentrequest. If Company accepts such offer, the price, payment terms, or other material terms closing of the transaction shall occur within 60 days following the date of Company’s acceptance. Any material change in the terms of an offer prior to closing or any financing incurred in connection with the failure to close the transaction are so burdensomewithin 60 days following the written notice provided by Franchisee (the “ROFR Period”) shall cause it to be deemed a new offer, individually subject to the same right of first refusal by Company, or its third-party designee, as in the aggregate, as to threaten the continued operation case of the Steak n Shake Restaurant after initial offer. Company’s failure to exercise such right of first refusal shall not constitute consent to the transfer. Notwithstanding the foregoingtransfer or a waiver of any other provision of this Agreement, Franchisee may assign its ownership including any of the Franchise requirements of this Article with respect to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation and, if applicable, good standingproposed transfer.

Assignment by Franchisee. (a) Franchisee understands This Agreement and acknowledges that the rights and duties created by granted to the Franchisee pursuant to this Agreement are personal to Franchisee and that the Company has granted the Franchise in reliance upon the individual or collective character, skill, aptitude, attitude, business ability and financial capacity of Franchisee. Therefore, except as provided with respect to assignment to a corporation or partnership, or to a spouse or heirs in the event of Franchisee’s death or disability pursuant to subsection 13.02 (c) below, neither the Franchise, the Restaurant (or any interest therein), nor any part or all of the ownership of the Franchise may be voluntarily, involuntarily, directly or indirectly assigned, sold, subdivided, subfranchised, issued assigned or otherwise transferred by the Franchisee (including without limitation by consolidation or merger) without only with the prior written approval of the CompanyE & C. E & C will not unreasonably withhold its written consent to any sale, which approval shall not be unreasonably withheld. Such assignment or transfer without approval shall constitute a breach hereof and will convey no rights or interests in of this Agreement, if the Franchise or the Restaurant to such assignee(s). Transferees shall be subject to the Company’s then current franchisee selection and qualification criteria. Grounds for withholding consent to an sale, assignment or transfer include, but are does not limited toviolate Article 17.9 of this Agreement and if the Franchisee and/or the transferee franchisee comply with the following conditions: (ia) the transfer is proposed Franchisee has provided written notice to be made to any competitor E & C of the Company proposed sale, assignment or a transferee involved with a competitor transfer of this Agreement at least ninety (90) days prior to the transaction; (b) all of the CompanyFranchisee's monetary obligations due to E & C have been paid in full, and the Franchisee is not otherwise in default under this Agreement; (iic) the transfer is proposed Franchisee has executed a written agreement, in a form satisfactory to be made E & C, in which the Franchisee agrees to observe all applicable provisions of this Agreement, including the provisions with obligations and covenants that continue beyond the expiration or termination of this Agreement, which includes the covenants not to compete contained in Article 21 of this Agreement; (d) E & C and the Franchisee have executed a joint and mutual release, in a form satisfactory to E & C, of any and all claims against E & C or the Franchisee and of any and all claims against their officers, directors, shareholders, Owners, agents and employees, in their corporate and individual capacities arising from, in connection with, or as a result of this Agreement or the Franchisee's purchase of the Franchise including, without limitation, all claims arising under any federal or state franchising laws or any other federal, state or local law, rule or ordinance; provided, however, that E & C and the Franchisee may exclude from the coverage of the release any prior or concurrent written agreements between them; (e) the transferee who fails to demonstrate franchisee has demonstrated to the Company’s satisfaction of E & C that he, she or it or its owners and management meet ELEPHANT & CASTLE INTERNATIONAL, INC. 5 GTM/LEH/JAW 042199 ALAMO GRILL FRANCHISE AGREEMENT 475250.5 meets the Company’s educationalmanagerial, managerial financial and business standardsstandards required by E & C for new franchisees, possess possesses a good moral character, business reputationsreputation and credit rating, and credit ratings, and have possesses the aptitude and ability to conduct operate the Alamo Grill-TM- Restaurant in an economic and businesslike manner (as may be evidenced by prior related business contemplated by this Agreementexperience or otherwise); (f) the transferee franchisee and all parties having a legal or (iii) beneficial interest in the Company’s sole judgment, the price, payment terms, or other material terms of the transaction or any financing incurred in connection with the transaction are so burdensome, individually or in the aggregate, as to threaten the continued operation of the Steak n Shake Restaurant after the transfer. Notwithstanding the foregoing, Franchisee may assign its ownership of the Franchise to a duly organized, validly existing partnership, limited liability company, corporation or other entity that is not a natural person provided such partnership, limited liability company, corporation or other entity that is not a natural person is controlled directly or indirectly through, or is under common control with, the Franchisee. "Control" means the possession, directly or indirectly, of the power to cause the direction of the management and policies of the Permitted Assignee, whether by the ownership of voting securities, by contract, or otherwise. Franchisee shall provide Company with written notice of a transfer to a Permitted Assignee along with other documentation evidencing the Permitted Assignee’s valid formation andtransferee franchisee including, if applicable, good standingthe transferee franchisee's Owners and the Personal Guarantors, execute the transfer and assignment agreement between E & C, the Franchisee and the transferee franchisee and such other ancillary agreements as E & C or its legal counsel may require for the transfer of this Agreement for the Franchisee's Alamo Grill-TM- Restaurant to the transferee franchisee; (g) the transferee franchisee has purchased the Franchised Location, acquired the lease for the Franchised Location or otherwise acquired possession of and access to the Franchised Location for a term consistent with the remaining term of this Agreement; (h) the transferee franchisee has purchased or otherwise acquired a valid liquor license and a valid food service license for the Alamo Grill-TM-Restaurant at the Franchised Location; and (i) the transferee franchisee has successfully completed the initial training program as set forth in Article 16.1 of this Agreement.