Highlights of Teriyaki Madness’s Item 19 Financial Performance Representations (2014 FDD)

• As of December 31, 2013, Teriyaki Madness had 6 franchised restaurants and 2 affiliate-owned restaurants (“Affiliate Locations”). All of these restaurants are located in Nevada.

Explanatory Notes for Section I – High, Low, and Average Unit Volume for the 4 Teriyaki Madness Businesses That Have Been in Operation for at Least 1 Year and That Were Larger Than 1,300 Square Feet

• The information in the table below is a historical financial performance representation for the 4 Teriyaki Madness Businesses that have been in operation for at least 1 year and that were larger than 1,300 square feet (which match the footprint required of new restaurants). Two Teriyaki Madness Businesses did not meet this requirement and therefore were not included in the table below.

• Teriyaki Madness has provided the following information:

• the high and low annual Gross Revenue information for each year that the Teriyaki Madness Businesses were open;
• the average same store sales percentage increases for each year;
• the average unit volume of the group for each year; and
• the number and percentages of Teriyaki Madness Businesses that met or exceeded the average unit volume for each year.

• For 2013 and 2012, 5 Teriyaki Madness Businesses were in operation for the entire year.

• For 2011, 4 Teriyaki Madness Businesses were in operation for the entire year.

• For the years 2008 to 2010, only 3 Teriyaki Madness Businesses were open for the entire year.

• The financial performance representation figures do not reflect the cost of sales, operating expenses, or other costs or expenses that must be deducted from the Gross Revenue or Gross Sales figures to obtain your net income or profit.

• You should conduct an independent investigation of the costs and expenses you will incur in operating your Teriyaki Madness Business. Franchisees or former franchisees listed in the Franchise Disclosure Document may be one source of this information.

• Your individual results may differ. There is no assurance you will earn as much.

Explanatory Notes for Section II – Total Income, Cost of Goods Sold, Labor Costs, Gross Profit, Operating Expenses, and Operating Profit for Affiliate Locations (January 1, 2013 through December 31, 2013)

• The information provided in the following charts consists of the actual performance of Teriyaki Madness’s Affiliate Locations for January 1, 2013 to December 31, 2013.

• The size, physical layout, and operations of the Affiliate Locations are generally similar to the Teriyaki Madness Businesses that franchisees operate. While the representations relate to the performance of the Affiliate Locations, franchised outlets will share some of the same characteristics, including degree of competition and similar goods sold.

• The Affiliate Locations do not pay a royalty but do make Marketing Fund Contributions.

• Teriyaki Madness has included certain expenses for the Affiliate Locations. Franchise locations may or may not have additional expenses to the ones listed below.

9845 S. Maryland Parkway, Suite C, Las Vegas, Nevada, 89183

• The Maryland Teriyaki Madness Business opened in August 2003. It may take some time for a new Teriyaki Madness Business to establish itself in the marketplace. You should expect lower revenues during the early period of your operations.

• The Maryland Teriyaki Madness Business is located in Las Vegas, which typically has long, hot summers and mild winters. It is open 7 days a week for an approximate total of 80 hours per week. Revenues for Teriyaki Madness Businesses in other climates would be affected by the local weather.

• Cost of Goods Sold includes the cost of all food items and beverage items, and related supplies, such as napkins, cups, utensils, and takeaway containers.

• Operating Expenses include many items such as rent, insurance, marketing, miscellaneous supplies, repairs, bank fees, and utilities.

• Wages, Salaries, and Benefits include actual labor cost of all personnel in the restaurants.

7481 West Lake Mead, Las Vegas, Nevada, 89128

• The Lake Mead Teriyaki Madness Business opened in November 2010. It may take some time for a new Teriyaki Madness Business to establish itself in the marketplace. You should expect lower revenues during the early period of your operations.

• The Lake Mead Teriyaki Madness Business is located in Las Vegas, which typically has long, hot summers and mild winters. It is open 7 days a week for an approximate total of 80 hours per week. Revenues for Teriyaki Madness Businesses in other climates would be affected by the local weather.

• Cost of Goods Sold includes the cost of all food items and beverage items, and related supplies, such as napkins, cups, utensils, and takeaway containers.

• Operating Expenses include many items such as rent, insurance, marketing, miscellaneous supplies, repairs, bank fees, and utilities.

• Wages, Salaries, and Benefits include actual labor cost of all personnel in the restaurants.

Section I – High, Low, and Average Unit Volume for the 4 Teriyaki Madness Businesses That Have Been in Operation for at Least 1 Year and That Were Larger Than 1,300 Square Feet

2013

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