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FRANCHISE OFFERING CIRCULAR

SUSHI GO! INTERNATIONAL INC.

a Nevada corporation

2250 E. Tropicana Avenue, Suite 19-667

Las Vegas, Nevada 89119

Phone: (808)250-2500

The Franchise offered is for a kaiten sushi restaurant concept operating under the name "Hanakai Sushi Bar & Grill" which specializes in the sale of our sushi products and menu items including a limited menu of additional Japanese and American foods, prepared in accordance with Our recipes and specifications.

The initial franchise fee for a Restaurant is $25,000. If You enter into a development agreement to develop more than one Restaurant, upon signing the Development Agreement You will pay a development fee equal to $25,000 for the first Restaurant to be developed plus $10,000 multiplied by each additional Restaurant to be developed under the Development Agreement. The development fee is applied gro rata to the initial franchise fees due. The estimated initial investment required to establish one Restaurant, including the initial franchise fee, is $341,850 to $692,000. This sum may not represent Your total investment in the Franchised Business (see Items 5-7 of this Offering Circular for further explanation concerning the total investment).

RISK FACTORS:

1. THE FRANCHISE AGREEMENT AND AREA DEVELOPMENT AGREEMENT REQUIRE THE FRANCHISEE TO ARBITRATE WITH THE FRANCHISOR ONLY IN NEVADA. OUT OF STATE ARBITRATION MAY FORCE YOU TO ACCEPT A LESS FAVORABLE SETTLEMENT FOR DISPUTES. IT MAY ALSO COST MORE TO ARBITRATE WITH THE FRANCHISOR IN NEVADA THAN IN YOUR OWN STATE.

2. THE FRANCHISE AGREEMENT AND AREA DEVELOPMENT AGREEMENT STATE THAT THE LAW OF THE FRANCHISOR'S HOME STATE GOVERNS THE AGREEMENT, AND THIS LAW MAY NOT PROVIDE THE SAME PROTECTIONS AND BENEFITS AS LOCAL LAW. YOU MAY WANT TO COMPARE THESE LAWS.

3. THERE MAY BE OTHER RISKS CONCERNING THIS FRANCHISE.

INFORMATION ABOUT COMPARISONS OF FRANCHISORS IS AVAILABLE. CALL THE STATE ADMINISTRATOR LISTED ON ATTACHMENT A OR YOUR PUBLIC LIBRARY FOR SOURCES OF INFORMATION.

REGISTRATION OF THIS FRANCHISE WITH THE STATE DOES NOT MEAN THAT THE STATE RECOMMENDS IT OR HAS VERIFIED THE INFORMATION IN THIS OFFERING CIRCULAR. IF YOU LEARN THAT ANYTHING IN THIS OFFERING CIRCULAR IS UNTRUE, CONTACT THE FEDERAL TRADE COMMISSION AND THE APPROPRIATE STATE AGENCY LISTED ON ATTACHMENT A.

Effective Date: _____________

FOR USE ONLY IN THE STATE OF CALIFORNIA

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TABLE OF CONTENTS

ITEM1.........................................................................................................................................................1

FRANCHISOR, ITS PREDECESSORS AND AFFILIATES..................................................................1

ITEM 2.........................................................................................................................................................4

BUSINESS EXPERIENCE.......................................................................................................................4

ITEM 3.........................................................................................................................................................4

LITIGATION............................................................................................................................................4

ITEM 4.........................................................................................................................................................5

BANKRUPTCY........................................................................................................................................5

ITEM 5.........................................................................................................................................................5

INITIAL FRANCHISE FEE.....................................................................................................................5

ITEM 6.........................................................................................................................................................6

OTHER FEES...........................................................................................................................................6

ITEM 7.........................................................................................................................................................9

INITIAL INVESTMENT..........................................................................................................................9

ITEM 8.......................................................................................................................................................13

RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES..................................................13

ITEM 9.......................................................................................................................................................17

FRANCHISEE'S OBLIGATIONS.........................................................................................................17

ITEM 10.....................................................................................................................................................18

FINANCING...........................................................................................................................................18

ITEM 11.....................................................................................................................................................18

FRANCHISOR'S OBLIGATIONS.........................................................................................................18

ITEM 12.....................................................................................................................................................28

TERRITORY...........................................................................................................................................28

ITEM 13.....................................................................................................................................................31

TRADEMARKS.....................................................................................................................................31

ITEM 14.....................................................................................................................................................32

PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION..................................................32

ITEM 15.....................................................................................................................................................34

OBLIGATIONS OF FRANCHISEE TO PARTICIPATE IN THE ACTUAL OPERATION OF THE

FRANCHISED BUSINESS....................................................................................................................34

ITEM 16.....................................................................................................................................................35

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RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL..........................................................35

ITEM 17.....................................................................................................................................................37

RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION.....................................37

ITEM 18.....................................................................................................................................................44

PUBLIC FIGURES.................................................................................................................................44

ITEM 19.....................................................................................................................................................44

EARNINGS CLAIMS.............................................................................................................................44

ITEM 20.....................................................................................................................................................44

LIST OF OUTLETS................................................................................................................................44

ITEM 21.....................................................................................................................................................47

FINANCIAL STATEMENTS.................................................................................................................47

ITEM 22.....................................................................................................................................................47

CONTRACTS.........................................................................................................................................47

ITEM 23.....................................................................................................................................................47

RECEIPT.................................................................................................................................................47

EXHIBITS

A- FINANCIAL STATEMENTS

B - DEVELOPMENT AGREEMENT

C - FRANCHISE AGREEMENT

D - FRANCHISEE LIST

E - LIST OF FRANCHISEES WHO HAVE LEFT THE SYSTEM

F - TABLE OF CONTENTS OF OPERATIONS MANUAL

G - STATE SPECIFIC ADDENDUM

ATTACHMENTS

A - LIST OF STATE ADMINISTRATORS/AGENTS FOR SERVICE OF PROCESS

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ITEM1 FRANCHISOR, ITS PREDECESSORS AND AFFILIATES

Franchisor

Sushi Go! International Inc. (referred to in this Offering Circular as "Hanakai", "We," "Us," or "Our" and where the context requires also includes Our Parent and our Affiliates) was filed as a Nevada corporation on February 6, 2004. Our principal place of business is 2250 E. Tropicana Avenue, Suite 19-667, Las Vegas, Nevada 89119, and we do business under Our corporate name and the Marks as described below. In this Offering Circular, We refer to the person or entity that will be signing the Franchise Agreement (defined below) as "You," "Your," or "Franchisee," which includes all franchise owners and partners, if franchisee is a corporation, partnership or other entity.

Since February 18, 2000, our affiliate has operated a restaurant which specialize in the kaiten style of dining and the sale of Japanese style foods, including soups, noodles, rice and various dim sum items, as well as a limited menu of American foods, all prepared in accordance with their recipes and specifications ("Hanakai" or "Restaurant"). The Restaurants will generally be located within strip shopping centers, urban locations, and universities, colleges, sports arenas, train stations, airports and other similar non-traditional facilities with a captive market customer base. The Restaurants will operate under the service mark "Hanakai" and the additional principal service marks, trademarks, trade names, logos, emblems and indicia of origin identified in Item 13. These principal marks and all other marks which may be designated by Us in the future in writing for use with the System (defined below) are referred to in this Offering Circular as the "Marks". The Marks and System are owned by Us. We have not offered franchises in any other line of business and We do not engage in any other business activity.

Kaiten-style dining is a restaurant concept where the food passes along a conveyor device in front of the seated customers. The customers help themselves to the dishes they desire and are charged on a per plate basis. This dining style has existed in Japan for over 20 years.

Mr. Jon Miyabuchi, our President and CEO further developed and expanded this dining concept to broaden its appeal to "every-person" and not just sushi lovers. Our entire concept has been tweaked and changed to appeal to a broad audience and to especially cater to families and their budgets. Our restaurant concept was further expanded by the addition of our appetizer menu of American and Japanese dishes. Dishes we added include, but are not limited to, Chicken Nuggets, Sizzling Grilled Steak w/ sauteed mushrooms and onions, Oriental Chicken Wings, Egg Roll Platter, Sashimi Platter, Crab Cakes Platter, Miso Chile Salmon Platter, and our Big Bowl of Ramen. These dishes have expanded our restaurant's menu and allowed us to gain access to a wider audience and customer base.

We have never offered franchises in this or any other line of business.

Our agents for service of process are listed in Attachment A.

We have written the Offering Circular in "plain English" in order to comply with legal requirements. Any differences in the language in this Offering Circular describing the terms, conditions or obligations under the Franchise Agreement, Development Agreement or any other agreements is not intended to alter in any way Your or Our rights or obligations under the particular agreement.

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Our Predecessors and Affiliates

We have no predecessor, but do have one Affiliate, Sushi Go! Investment Group, LLC which operates a Sushi Go! company-owned restaurant in Kahului, Maui, Hawaii. This initial location was used as the prototype for our current franchised concept. Our affiliate's principal business address is P.O. Box 880457, Pukalani, Hawaii 96788 USA.

Except as previously disclosed, Our affiliate has not offered franchises in this or any other line of business.

Description of Franchise

We offer franchises for the right to establish and operate "Hanakai Sushi Bar & Grill" Restaurants to be primarily located in retail shopping centers or urban locations under the Marks and the System in accordance with the terms of the Franchise Agreement ("Restaurant" or "Franchised Business"). We may, however, consider sites such as train stations, sports arenas, airports, university campuses or other captive market spaces on a case by case basis ("Non-Traditional Location"). The marketing strategy of the Restaurant is a quick food establishment with a main menu of fresh sushi and sushi related items, and a limited menu of Japanese and American foods served both plated and on a sushi conveyor belt. The conveyor belt occupies the main dining floor and is configured to run throughout the dining room floor. You will operate your Restaurant according to Hanakai's business formats, methods, procedures, recipes, designs, layouts, standards and specifications all of which we may modify from time to time. Hanakai's sushi conveyor belts and style of sushi presentation to the general public is a unique alternative to other casual dining restaurant outlets currently saturating the casual dining food market. Each Restaurant will typically offer a menu of specialty Japanese cuisine and sushi items, including soups, noodles, rice and dim sum, American and Japanese foods prepared in accordance with Our proprietary recipes and ingredients. Restaurants will typically range between 2,500 and 4,000 square feet. Each Restaurant shall offer catering services as well.

The Restaurants are established and operated under a comprehensive and unique system (the "System"). The System includes distinctive signage, interior and exterior design, decor and color scheme; special recipes and menu items, including proprietary products and ingredients; uniform standards, specifications, and procedures for operations; quality and uniformity of products and services offered; inventory, management and financial control procedures (including point of purchase and tracking systems); training and assistance; and advertising and promotional programs; all of which We may change, improve, and further develop, in Our discretion. Certain aspects of the System are more fully described in this Offering Circular and the Manuals that are provided to You as a franchisee (described in Item 11).

We offer the right to establish and operate a Restaurant under the terms of a single unit franchise agreement (the "Franchise Agreement"), Exhibit C to this Offering Circular. You may be an individual, corporation, partnership or other form of legal entity. Under the Franchise Agreement, certain parties are characterized as Franchisee's Principals (referred to in this Offering Circular as "Your Principals"). The Franchise Agreement is signed by Us, by You, and by those of Your Principals whom We designate as Controlling Principals. In most instances, We will designate Your principal equity owners and executive officers, and certain affiliated entities as Controlling Principals. By signing the Franchise Agreement, Your Controlling Principals agree to be individually bound by certain obligations in the Franchise Agreement, including covenants concerning confidentiality and non-competition, and to personally guarantee Your performance under the Franchise Agreement (see Item 15). Depending on the type of

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business activities in which You or Your Principals may be involved, We may require You or Your Principals to sign additional confidentiality and non-competition agreements.

You must also designate an "Operating Principal" who will be the main individual responsible for Your business. If You are an individual, You will be the Operating Principal. If You are not an individual, the person You designate as Your Operating Principal must maintain an equity interest in You. The Operating Principal must sign the Franchise Agreement as the Operating Principal and as one of Your Controlling Principals (see Item 15). The Operating Principal must individually make certain covenants in the Franchise Agreement and must personally guarantee Your performance under the Franchise Agreement.

In certain circumstances, We will offer to You the right to enter into an area development agreement to develop more than one franchised Restaurant to be located within a specifically described geographic territory (the "Development Agreement"). We will determine the territory before You sign the Development Agreement and it will be included in the Development Agreement (the "Territory"). The Development Agreement requires You to establish more than one Restaurant within the Territory according to a development schedule, and to enter into a separate Franchise Agreement for each Restaurant established under the Development Agreement. The Franchise Agreement for the first Restaurant developed under the Development Agreement will be in the form attached as Exhibit C to this Offering Circular. For each additional Restaurant developed under the Development Agreement, You must sign the form of Franchise Agreement that We are then offering to new franchisees. The size of the Territory will vary depending upon local market conditions and the number of Restaurants to be developed (see Item 12).

The person or entity signing the Development Agreement is referred to as the "Developer." The Development Agreement contains concepts similar to the Franchise Agreement involving the "Developer's Principals," Controlling Principals of Developer, and an Operating Principal of Developer. For purposes of this Offering Circular, the terms Your Principals, Controlling Principals and Operating Principal include those persons having similar obligations identified in both the Development Agreement and Franchise Agreement, and the terms You, Your, and Franchisee also include the Developer under the Development Agreement, unless We have noted otherwise. Any reference to the "Agreements" means the Development Agreement, and the Franchise Agreement, as applicable.

Competition

The market for the Japanese style food products and services offered by the Restaurants is highly competitive. However, We believe Our competitive position is enhanced by Our operational format and by the food products offered by the Restaurants. We plan to continue controlled expansion into areas that We determine can support the Restaurants to improve name recognition and the reputation of the System through both franchised businesses and Restaurants operated by Our Affiliate.

Industry Regulations

The restaurant industry is regulated on the federal, state and local levels. The preparation and handling of food is federally regulated by the Pure Food and Drugs Act of 1906; the Federal Food, Drug and Cosmetic Act and by rules and policies of the Food and Drug Administration. State requirements relating to food safety typically pertain to sanitation and handling. Local inspectors may also enforce sanitation and handling rules created on the state and/or local level.

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Among the licenses and permits You may need are: Zoning or Land Use Approvals, Sunday Sale Permits, Liquor Licenses, Sales and Use Tax Permits, Special Tax Stamps, Fire Department Permits, Food Establishment Permits, Health Permits, Alarm Permits, County Occupational Permits, Retail Sales Licenses, and Wastewater Discharge Permits. There may be other laws, rules or regulations which affect Your Restaurant, including minimum wage and labor laws along with ADA, OSHA and EPA considerations. We recommend that You consult with Your attorney for an understanding of them.

ITEM 2 BUSINESS EXPERIENCE

President. CEO. & Chairman: Jon Miyabuchi

Jon Miyabuchi has served as our President, CEO, & Chairman since the company's planning stages from May 23, 1999. He has also served as the President, CEO, & Chairman of Our Affiliate, Sushi Go! Investment Group, LLC, since the company's inception and planning stages from May 23, 1999. From September 1997 to February 2000, he was the Hawaii Retail Channel Manager for Sprint PCS. From September of 1995 to September of 1997, he was the Neighbor Islands Sales & Operations Manager for Bell South, later to be merged with MobileComm. From July of 1989 to August of 1995 he was the President of SBN International, a statewide wholesale food & candy distributor located in Honolulu, Hawaii.

Vice President-Human Resources/Finance: Melanie Miyabuchi

Melanie Miyabuchi has served as our V.P. of Human Resources/Finance since the company's planning stages from May 23, 1999. She also serves as the V.P. of Human Resources/Finance of Our Affiliate Sushi Go! Investment Group, LLC, since the company's inception and planning stages from May 23, 1999. From February of 1996 to April of 2003, she was the HR Benefits Manager and Financial Specialist for the Wailea Marriott Resort. From March of 1992 to January of 1996, she was an HR Benefits Representative with First Hawaiian Bank located in Honolulu, Hawaii.

Vice President-Food & Beverage Operations: Patrick Turner

Patrick Turner is our Executive Chef and V.P. of Food & Beverage. He has served in these positions since the company's planning stages in May 1999. Patrick Turner is also the Executive Chef and V.P. of Food & Beverage of Our Affiliate Sushi Go! Investment Group, LLC since the company's inception and planning stages from May 23, 1999. From 1994 to February 2000, he was a Cook II and Sushi Chef with the Kapalua Bay Hotel in Maui, Hawaii. From 1995 to February 2000 he was a Prep Cook with the Hula Grill Restaurant located in Maui, Hawaii. From 1994 to 1995, he was a Grill Cook with the Beach Barbeque in Kaanapali, Maui, Hawaii.

We currently do not employ any franchise brokers, but may do so in the future.

ITEM 3 LITIGATION

No litigation is required to be disclosed in this Offering Circular.

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ITEM 4 BANKRUPTCY

No person previously identified in Items 1 or 2 of this Offering Circular has been involved as a debtor in proceedings under the U.S. Bankruptcy Code or comparable foreign law required to be disclosed in this Item.

ITEM 5 INITIAL FRANCHISE FEE

Franchise Agreement: You must pay Us an initial franchise fee of $25,000 for the right to establish a single Restaurant under a Franchise Agreement. You must pay the initial franchise fee in full when You sign the Franchise Agreement and the initial franchise fee is the same for all franchisees under this offering. This fee is used in part for working capital and in part for profit. If You cannot obtain possession of an approved location for the Restaurant within six months after You have signed the Franchise Agreement, We have the right to terminate the Franchise Agreement and refund 75% of the initial franchise fee. Before returning any initial fees, We will require You to demonstrate that You have made a good faith effort to obtain the financing or obtain possession of an approved location for the Restaurant. This policy may be revoked by Us at any time. If We decide to revoke this policy, We will provide written notice to franchisees that have executed a Franchise Agreement to establish a single Restaurant at least 60 days before the revocation takes effect.

Development Agreement: When You sign the Development Agreement, You must pay us a development fee equal to $25,000 for the first Restaurant to be developed plus $10,000 for each additional Restaurant to be developed under the Development Agreement. For each Restaurant developed after the first, We will apply $10,000 toward the initial franchise fee due under the Franchise Agreement. The balance of the initial franchise fee due, or $15,000, is payable immediately upon execution of a lease or purchase agreement for the Restaurant or 90 days prior to the scheduled opening of the Restaurant, whichever occurs first. We also reserve the right to adjust this formula depending upon the size of the area and the financial ability of Our developer. The development fee must be paid in a lump sum and is non-refundable.

Initial Training Fee: We do not charge a training fee for the initial training of Your Operating Principal or General Manager. At Your request, and subject to space availability, We will provide initial training to additional members of Your personnel, but We may charge a fee for that initial training. The initial training fee We currently charge is $1,500 per person. This fee represents Our cost of providing the training, including Our administrative costs of making personnel available for training purposes, and the cost of materials. You must pay the initial training fee for the additional personnel before training begins and it is nonrefundable. The initial training fee is charged uniformly to all franchisees under this Offering Circular, although actual dollar amounts may vary depending on how many additional persons are trained.

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ITEM 6 OTHER FEES

Fees (1)	Amount	Due Date	Remarks
Royalty Fee (2)	6% of Gross Sales	Weekly on Wednesday	Amounts due will be withdrawn by EFT from Your designated bank account.
Creative Fund (3)	1% of Gross Sales	Weekly on Wednesday	You must contribute when We establish the Creative Fund. We have the right to increase this amount to 2% upon 30 days notice to you.
Local Advertising	2% of Gross Sales	Monthly - as incurred by You	Your contributions to an Advertising Cooperative are credited against Your local advertising obligations.
Cooperative Advertising (4)	Maximum - 1Vi% of Gross Sales	As determined by Cooperative	Your Cooperative contribution may be allocated by Us to the Creative Fund.
Advertising & Promotional Materials	Varies, depending on Your advertising needs	When billed	See Items 7 and 11.
Interest	18% or highest rate allowed by applicable law	On demand	Interest may be charged on all overdue amounts.
Prohibited Product or Service Fine	$250 per day of use of unauthorized products or services	If incurred	In addition to other remedies available to us
Initial Training of additional or replacement and successor personnel	$1,500 per person	Before Training	No additional charge for initial training for General Manager and Operating Principal (see Item 11).
Additional Assistance	If You request additional assistance, You must pay the current per diem charge for Our employees used to provide the assistance and Our associated costs. Current per diem $500	When billed	We provide opening assistance without additional charge (see Item 11). Any additional assistance You request is billed at the current per diem rate.
Transfer Fee	$5,000 to reimburse Us for Our reasonable costs and expenses in reviewing the transfer application	Submitted with transfer application	No fee charged to an individual or partnership franchisee that transfers its rights to a corporation controlled by the same interest holders. A transfer

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Fees (1)	Amount	Due Date	Remarks
			fee of a similar amount is charged under both the Franchise Agreement and the Development Agreement.
Public Offering	$5,000 to reimburse Us for Our reasonable costs and expenses in reviewing the proposed securities offering	When billed	This covers Our cost to review the proposed offering of Your securities. The offering fee is the same amount under both the Franchise Agreement and the Development Agreement.
Additional or Remedial Training	Our cost in providing the training	Before additional training	We reserve the right to charge a fee for additional or remedial training that is not mandatory. We do not charge for mandatory training. Cost will vary based on the staff, location, and type of training being offered.
Inspection and Testing	Cost of inspection or testing	When billed	We may require You to pay Us or an independent laboratory for the cost of inspection or testing if You purchase or lease items used in the Restaurant from sources We have not previously approved (see Item 8).
Audit Fee	Cost of audit	When billed	Payable only if We find, after an audit, that You have understated any amount You owe to Us by more than 2%
Late Payment or Reporting Fee	$50 per day You are late	Daily	If You fail to pay royalties when due or fail to submit royalty reports weekly as required, We may charge You $50 per day until the payment or report is received.
Manual and Videos Replacement Fee	$500	When billed	If You request additional or replacement copies of the Manual or Videos (see Item 11).
Costs Associated with Dedicated Telephone Lines for Internet Access	$25 to $50 per month	When billed	This amount is paid to Your internet or telephone provider and not to Us

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Notes:

1. All fees and described in this Item 6 are non-refundable. Except as otherwise indicated in the preceding chart, We impose all fees and expenses listed and You must pay them to Us. Except as specifically stated above, the amounts given may be subject to increases based on changes in market conditions, Our cost of providing services and future policy changes. At the present time We have no plans to increase payments over which We have control.

2. For the purposes of determining the royalties to be paid under the Franchise Agreement, "Gross Sales" means the total selling price of all services and products and all income of every other kind and nature related to the Restaurant (including income related to catering and delivery activities, and any sales or orders of food products or food preparation services provided from or related to the Restaurant), whether for cash or credit and regardless of collection in the case of credit. If a cash shortage occurs, the amount of Gross Sales will be determined based on the records of the electronic cash register system and any cash shortage will not be considered in the determination. Gross Sales expressly excludes the following:

(a) Receipts from the operation of any public telephone installed in the Restaurant or products from pre-approved vending machines located at the Restaurant, except for any amount representing Your share of the revenues;

(b) Sums representing sales taxes collected directly from customers, based on present or future laws of federal, state or local governments, collected by You in the operation of the Restaurant, and any other tax, excise or duty which is levied or assessed against You by any federal, state, municipal or local authority, based on sales of specific merchandise sold at or from the Restaurant, provided that the taxes are actually transmitted to the appropriate taxing authority; and

(c) Proceeds from isolated sales of trade fixtures not constituting any part of Your products and services offered for resale at the Restaurant nor having any material effect on the ongoing operation of the Restaurant required under the Franchise Agreement.

We may authorize certain other items to be excluded from Gross Sales. Any exclusion may be revoked or withdrawn at any time by Us. The royalty fee will be withdrawn from Your designated bank account by electronic fund transfer ("EFT") weekly on Wednesday based on Gross Sales from the preceding Accounting period (see Section IV.B. of the Franchise Agreement), unless We require otherwise. You are required to maintain a minimum of $3,000 in Your designated bank account for the Restaurant.

3. We will establish and administer a national creative fund on behalf of the System (see Item 11) to provide national or regional creative materials for the benefit of the System.

4. Cooperatives will be comprised of all franchised Restaurants and Restaurants owned by Our affiliate located in designated geographic areas. Each Restaurant has one vote in the cooperative. No Cooperatives have been established as of the date of this Offering Circular.

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ITEM 7 INITIAL INVESTMENT

Expenditure	Actual or Estimated (Low)	Estimated High	When Payable	Method of Payment	Whether Refundable	To Whom Paid
Initial Franchise Fee(l)	$25,000	$25,000	On signing Franchise Agreement	Lump Sum	Nonrefundable except as described below	Us
Leasehold Improvements (2)	$109,000	$210,000	As Arranged	As Invoiced	No	Independent Contractors
Lease Payments and other rental expenses(3)	$5,000	$25,000	Monthly	Per Lease	No	Landlord
Equipment (4)	$140,000	$290,000	As Arranged	As Invoiced	No	Designated Vendors
Signage (5)	$6,000	$20,000	As Arranged	As Invoiced	No	Designated Vendors
Initial Inventory (6)	$7,500	$15,000	As Arranged	As Invoiced	No	Designated Vendors
Architectural/ Engineering (7)	$5,000	$15,000	As Arranged	As Invoiced	No	Designated Vendor
Electronic Cash Register System with Modem (8)	$10,000	$20,000	Lump Sum	As Invoiced	No	Designated Vendor
Facsimile Machine (9)	$350	$500	Lump Sum	As Invoiced	No	Designated Independent Vendor
Travel, lodging and meals for initial training (10)	$1,500	$10,000	As Incurred	As Incurred	No	Independent Suppliers
Business Supplies (stationery, business cards, brochures, presentation folders, paper and other materials) (11)	$1,000	$1,500	Lump Sum	As Invoiced	No	Us or Independent Suppliers
Business licenses, permits, utility deposits, etc. (for first year) (12)	$2,500	$10,000	As Arranged	As Incurred	No	Various Agencies

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Expenditure	Actual or Estimated (Low)	Estimated High	When Payable	Method of Payment	Whether Refundable	To Whom Paid
Insurance deposits and premiums (for first year) (13)	$1,500	$2,500	As Arranged	As Invoiced	No	Independent Carrier
Grand Opening Advertising (14)	$7,500	$7,500	As Arranged	As Incurred	No	Suppliers
Ancillary Real Estate Fees (15)	$5,000	$10,000	As Arranged	As Incurred	No	Vendors
Additional Funds (16)	$15,000	$30,000	As Arranged	As Incurred	No	Various Vendors
TOTAL	$341,850	$692,000

Notes:

(1) You must pay an initial franchise fee of $25,000 when You sign a Franchise Agreement to obtain a single Restaurant. The initial franchise fee is non-refundable under the terms of the Franchise Agreement, except that We currently have a policy under which We will refund 75% of the initial franchise fee if You are unable to locate an acceptable site (see Item 5). If You enter into a development agreement to develop more than one Restaurant, upon signing the Development Agreement You will pay a development fee equal to $25,000 for the first Restaurant to be developed plus $10,000 multiplied by each additional Restaurant to be developed under the Development Agreement. The Development Fee is applied to the Franchise Fee when you sign the Franchise Agreement.

(2) The cost of leasehold improvements will vary depending on numerous factors, including: (i) the size and configuration of the premises; (ii) pre-construction costs (e.g., demolition of existing walls and removal of existing improvements and fixtures); and (iii) cost or materials and labor which may vary based on geography and location. These amounts are based on the cost of adapting Our prototypical architectural and design plans to remodel and finish-out of the Restaurant and the cost of leasehold improvements. These figures are Our best estimate based on remodeling/finish-out rates and conditions in the Maui Metropolitan area where Our Affiliate operates a Restaurant and some estimates from US based general contractors. These amounts may vary substantially based on local conditions, including the availability and prices of labor and materials. These costs may also vary depending on whether certain of these costs will be incurred by the landlord.

(3) The figures are for the first month's rent and assume that the premises of the Restaurant will be in a strip shopping center or urban location ranging in size from approximately 3,000 to 4,000 square feet, and that no security deposit is required. Further, the figures assume base annual rental rates ranging from $20 to $30 per square foot. Landlords may also vary the base rental rate and charge rent based on a percentage of gross sales. In addition to base rent, the lease may require You to pay common area maintenance charges ("CAM Charges") for the mall and for the food court, Your pro rata share of the real estate taxes and insurance for the mall, and Your pro rata share of other charges. The actual amount You pay under the lease will vary depending on the size of the Restaurant, the types of changes that are allocated to tenants under the lease, Your ability to negotiate with landlords and the prevailing rental rates in the geographic region.

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(4) You must purchase equipment meeting Our specifications to be used in the Restaurant, including, the sushi conveyor (3 standard layouts are availableselection of a custom configuration other than the three 3 we have designated may increase your equipment costs), ice machine, work tables, shelving, grill, convection oven, griddles, noodle cookers, deli refrigerators, display refrigerators, walk-in reefers and freezers, and other items including smallwares and Your delivery vehicle if applicable, which can be leased and which can be either a van or a sedan. We have established relationships with equipment vendors for all equipment used in the Restaurant that meet Our specifications.

(5) These amounts represent Your cost for menu boards, menu panels, neon logo and descriptive signs. Your landlord may have different restrictions it places on interior and exterior signage which may affect Your costs.

(6) These amounts represent Your initial inventory of food supplies and paper goods for use in the first month of operating the Franchised Business.

(7) These fees are estimates of Your costs in obtaining any architectural and design services necessary for the construction of the Restaurant. You must adapt Our prototypical plans and specifications for the construction of the Restaurant.

(8) We require that You use in the Restaurant the Positouch computer hardware and software, which includes complete back-office system: 2 flat touch screens, 2 notebooks pc, 2 thermal printers, remote printer, modem, UPS, PC 2.4 GHz, 40GB, 512 MB RAM, Win XP Pro, flat screen monitor, deskjet printer, Positouch software, assembly, testing and installation and training and wiring. Typically, You will use two terminals per Restaurant and three printers, including one remote printer; however, many of Our locations use up to three terminals. We have the right, as described in Item 11, to poll Your system at Our discretion. You must pay the cost for Us to initiate access to Your system through Our monitoring software. We estimate the cost to range from $500 to $1,000 per Restaurant.

You will be required to subscribe to Hanakai's Corporate Intranet System.

o You and your manager(s) will be required to log into our intranet system on a daily basis o The intranet provides reports, daily updates, news, information, and training materials. All of our templates and forms are available on the intranet for download.

You will be required to subscribe to Hanakai's online book keeping and accounting systems

o You and/or your manager(s) will be required to log into Hanakai's online accounting systems

on a daily basis o Daily sales and end of day reports are required to be inputted into our accounting systems on

a daily basis.

(9) You must have a facsimile machine to communicate with Us and to accept fax menu/catering orders, and it must be able to cut pages as they are received or print on single sheet paper.

(10) We provide initial training to Your Operating Principal and General Manager at no additional charge. These estimates include only Your out-of-pocket costs associated with the training of the Operating Principal and General Manager (including travel, room, and board). These amounts do not include any fees or expenses for training any other personnel. Training is for two weeks. These costs will vary depending on Your selection of lodging and dining facilities and mode and distance of transportation.

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(11) You must purchase business cards, brochures and other written materials for use in the franchise business. You will typically purchase amounts that may last as long as six months. You may purchase these materials from Us or independent vendors that have been approved by Us.

(12) These are estimates of the costs for obtaining local business licenses which typically remain in effect for one year. These figures do not include occupancy and construction permits which were included in the leasehold improvement costs. The cost of these permits and licenses will vary substantially depending on the location of the franchised business. The estimates also include Your utility deposits. Since the availability and expenses of acquiring a liquor license vary substantially from jurisdiction to jurisdiction, you should consult the appropriate governmental authority concerning the availability of such license and the associated expenses for your Restaurant before you sign a Franchise Agreement. The cost of a liquor license can range from $5,000 to $10,000, depending on the location and jurisdiction.

(13) These figures are estimates of the cost of the annual premiums for the insurance You must obtain and maintain for the franchised business as described in Item 8.

(14) You must spend $7,500 on a grand opening advertising campaign. We reserve the right to approve all advertisements used in Your grand opening advertising campaign, and Your campaign must be conducted in the 60 day period comprising 30 days prior to and 30 days following opening of Your Restaurant.

(15) These fees are for miscellaneous real estate costs, such as broker incentives and market analysis studies.

(16) We have relied on Our Affiliate's principal's five years of experience in compiling these estimates. These amounts are Our estimate of the amount needed to cover Your expenses for the start-up phase of Your business including: professional fees in connection with obtaining and establishing the franchise business; two months' lease payments; three months' payroll for a manager, two assistant managers and four hourly employees; utilities and telephone service for three months, Your minimum of $3,000 required to be in your checking account for EFT purposes and other costs. We estimated the start-up phase to be three months from the date the Restaurant opens for business. These figures are estimates and We cannot assure You that You will not have additional expenses starting the Restaurant. Your actual costs will depend on factors such as Your management skill, experience and business acumen; local economic conditions; the local market for products; the prevailing wage rate; competition; and the sales level reached during the start-up phase. These amounts do not include any estimates for debt service.

Except as specifically stated above, the amounts given may be subject to increases based on changes in market conditions, Our cost of providing services and future policy changes. At the present time, We have no plans to increase payments over which We have control.

We have not included a separate table for the initial investment if You sign a Development Agreement. Other than the initial fee for the Development Agreement, actual start-up costs pertaining to the actual Restaurants opened under the Development Agreement are as estimated above, subject to potential increases over time or other changes in circumstances. If You execute a Development Agreement, Your professional fees such as legal and financial may be higher.

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ITEM 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

You must purchase or lease and install all fixtures, furnishings, equipment (including electronic cash registers, computer hardware and software), decor items, signs and related items We require, all of which must conform to the standards and specifications in Our Manuals or otherwise in writing (as defined in Item 11), unless You have first obtained Our written consent to do otherwise. You may not install or permit to be installed on the Restaurant premises any fixtures, furnishings, equipment, decor items, signs, games, vending machines or other items without our written consent or do not comply with our specifications. If You lease any of the property described above from a third party, We must approve the lease in writing before it is signed. We will not approve the lease unless it permits Your interest in the lease to be assigned to Us if the Franchise Agreement terminates or expires and that prohibits the lessor from imposing an assignment or related fee on assignment.

To ensure that the highest degree of quality and service is maintained, You must operate the Restaurant in strict conformity with the methods, standards and specifications that We prescribe in the Manuals or otherwise in writing. You must maintain in sufficient supply and use and sell at all times only those food and beverage items, ingredients, products, materials, supplies and paper goods that meet Our standards and specifications. All menu items must be prepared in accordance with the recipes and procedures specified in the Manuals or other written materials. You must not deviate from these standards and specifications by the use or offer of non-conforming items or differing amounts of any items, without obtaining Our written consent first. You must sell and offer for sale only those menu items, products and services that We have expressly approved for sale in writing. You must offer for sale all products and services required by Us in the manner and style We require, including dine-in and carry-out services and the sale of pre-packaged food products. You must not deviate from Our standards and specifications without obtaining Our written consent first. You must discontinue offering for sale any items, products and services We may disapprove in writing at any time. We can, and expect to, modify Our standards and specifications as We deem necessary. We will provide You notice of any changes in the Manuals.

You must permit Us or Our agents, at any reasonable time, to remove a reasonable number of samples of food or non-food items from Your inventory or from the Restaurant free of charge for testing by Us or by an independent laboratory to determine whether the samples meet Our then-current standards and specifications. Besides any other remedies We may have, We may require You to pay for the testing if We have not previously approved the supplier of the item or if the sample fails to conform to Our specifications (see Item 6).

Except for proprietary products and promotional materials provided by Us or Our designated suppliers (or delivery vehicles that You may use in the operation of the Restaurant), You must obtain all food and beverage items, ingredients, supplies, materials, fixtures, furnishings, equipment (including electronic cash register, computer hardware and software), and other products used or offered for sale at the Restaurant solely from suppliers who demonstrate, to Our continuing reasonable satisfaction, the ability to meet Our then-current standards or in accordance with Our standards and specifications. Our criteria for supplier approval may be found in the Manuals. Among other things, the suppliers must have adequate quality controls and the capacity to supply Your needs promptly and reliably. If You wish to purchase, lease or use any products or other items from an unapproved supplier, You must submit a written request for approval, or must request the supplier to do so. We have to approve any supplier in writing before You make any purchases from that supplier. We can require that Our representatives be permitted to inspect the supplier's facilities, and that samples from the supplier be delivered, either to Us or to an independent laboratory, for testing. You must pay the cost of the inspection, and the actual cost

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of the test must be paid by You or the supplier (see Item 6). We reserve the right to re-inspect the facilities and products of any approved supplier and to revoke Our approval if the supplier fails to continue to meet any of Our then-current standards. Our supplier approval procedure does not obligate Us to approve any particular supplier. However, We will notify You within 30 days after We complete the inspection and evaluation process of Our approval or disapproval of any proposed supplier.

We require You to offer delivery and catering services and any vehicle that You use to deliver Restaurant products and services to customers must meet Our standards for appearance and ability to satisfy the requirements imposed on You under the Franchise Agreement. You must place the signs and decor items on the vehicle We require and must at all times keep the vehicle clean and in good working order. You must require each person providing those services to comply with all laws, regulations and rules of the road and to use due care and caution operating and maintaining the motor vehicles. Except as noted above, We do not have any standards or exercise control over any motor vehicle that You utilize.

We have and may continue to develop for use in the System certain products which are prepared from confidential proprietary recipes and other proprietary products which bear Our Marks, such as proprietary sauces, soup concentrates, teas and other specialty food products. Because of the importance of quality and uniformity of production and the significance of those products in the System, it is to Your and Our benefit that We closely control the production and distribution of those products. Accordingly, if those products become a part of the System, You will use only Our proprietary recipes and other proprietary products and will purchase those items solely from Us or from a source designated by Us all of Your requirements for those products. You must purchase from Us for resale to Your customers certain merchandise identifying the System that We require, such as pre-packaged food products and Hanakai memorabilia and promotional products, in amounts sufficient to satisfy Your customer demand. You must also obtain certain upgrades for Your electronic cash register system.

All advertising and promotional materials, signs, decorations, paper goods (including menus and all forms and stationery used in the Restaurant) and other items We designate must bear the Marks (see Item 13) in the form, color, location and manner We prescribe. In addition, all Your advertising and promotion in any medium must be conducted in a dignified manner and must conform to the standards and requirements in the Manuals or otherwise. You must obtain Our approval before You use any advertising and promotional materials and plans if We have not prepared or approved them during the 12 months before their proposed use.

You must obtain Our approval of the site for the Restaurant before You acquire the site. You must also obtain Our approval of any contract of sale or lease for the Restaurant before You execute the contract or lease. We will not approve any lease unless a rider to the lease, prepared by Us, is signed by You, by Us and by the landlord. The rider will contain the following provisions:

1. During the term of the Franchise Agreement, the premises will be used only for the operation of the Restaurant.

2. The landlord consents to Your use of the Marks and signs, decor items, color schemes and related components of the System.

3. The landlord agrees to give Us copies of any and all letters and notices sent to You related to the lease and the premises, at the same time that these letters and notices are sent to You.

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4. We may enter the premises to make any modification necessary to protect the System and Marks or to cure any default under the Franchise Agreement or under the lease, without being guilty of trespass or any other crime or tort. The landlord will not be responsible for any expenses or damages owing from Our conduct of those activities.

5. If We exercise Our option to obtain Your lease, You must assign the lease to Us or Our affiliates when the Franchise Agreement expires or terminates, and the landlord will consent to this assignment and will not charge any assignment fee or accelerate rent under the lease.

6. If the lease is assigned, We or any affiliate designated by Us will agree to assume from the date of assignment all of Your obligations remaining under the lease, and We or Our affiliate will assume Your occupancy rights, and the right to sublease the premises, for the remainder of the term of the lease.

7. You will not assign the lease or renew or extend the lease's term without obtaining Our written consent first.

8. The landlord and You will not amend or otherwise modify the lease in any manner that could materially affect any of the above requirements without obtaining Our written consent first.

9. The terms of the lease rider will supersede any conflicting terms of the lease.

Before You open the Restaurant for business, You must obtain the insurance coverage for the Restaurant specified below. This insurance coverage must be maintained during the term of the Franchise Agreement and must be obtained from a responsible carrier or carriers acceptable to Us.

1. Comprehensive General Liability Insurance, including broad form contractual liability, broad form property damage, personal injury, advertising injury, dram shop liability, completed operations, products liability and fire damage coverage, in the amount of $2,000,000 combined single limit.

2. "All Risks" coverage for the full cost of replacement of the Restaurant premises and all other property in which We may have an interest with no coinsurance clause.

3. Crime insurance for employee dishonesty in the amount of $10,000 combined single limit.

4. Business Interruption insurance in a sufficient amount to cover profit margins, maintenance of competent and desirable personnel and fixed expenses for a period of at least 90 days.

5. Automobile liability coverage, including coverage of owned, non-owned and hired vehicles, with coverage in amounts not less than $2,000,000 combined single limit.

6. Workers' compensation insurance in amounts provided by applicable law or, if permissible under applicable law, any legally appropriate alternative providing substantially similar compensation to injured workers, subject to the conditions set forth in the Franchise Agreement.

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7. Other insurance required by the state or locality in which the Restaurant is

located and operated.

You may, after obtaining Our written consent, elect to have reasonable deductibles under the coverage required under paragraphs 1 - 6 described above. Also, related to any construction, renovation or remodeling of the Restaurant, You must maintain builders risks insurance and performance and completion bonds in forms and amounts, and written by a carrier or carriers, satisfactory to Us. All of the policies must name Us, Our affiliates and the respective officers, directors, shareholders, partners, agents, representatives, independent contractors, servants and employees of each of them, as additional insureds and must include a waiver of subrogation in favor of all those parties.

We may, when appropriate, negotiate purchase arrangements, including price terms, with designated and approved suppliers on behalf of the System. As of the date of this Offering Circular, there are no purchasing or distribution cooperatives for any of the items described above in which We require You to participate.

We may receive discounts on purchases of electronic cash register and software from approved suppliers, which discounts will be made available to You if You purchase through these suppliers. We may also receive discounts from approved suppliers of equipment for the Restaurant which We will make available to You as well. We may obtain certain materials such as cups, napkins, business cards, stationery, flyers, brochures and other promotional materials and memorabilia using Our Marks that You must obtain from Us or sources approved or designated by Us. You must purchase from Us or sources designated by Us certain proprietary sauces, soup concentrates, teas, Japanese products and trademarked food products. We may sell these items to You or have You purchase them through designated sources at Our cost, plus shipping, handling, a reasonable mark up by the supplier and an amount to compensate Us for Our administrative overhead in connection with these arrangements.

Because we did not franchise Hanakai Sushi Bar & Grill Restaurants during the last fiscal year, no revenues were derived from any required purchases or leases.

We expect to derive revenue from franchisees' required purchases from suppliers in the next and following fiscal years through a program of rebates from some of Our designated or approved suppliers. We estimate that these rebates will range from 1% to 5% of such purchases. These rebates serve to partially reimburse Us for Our costs in the initial sourcing, approval and ongoing monitoring of compliance with Our quality standards of Our suppliers. We do not anticipate receiving rebates from all of our designated or approved suppliers because in many cases We will instead negotiate proportional reductions in the invoice price of the products sold to Us. We do not undertake any obligation to negotiate the proportional price reductions as each supplier has their own position on the granting (and tracking/accounting for) of price reductions vs. rebates.

You must purchase or lease virtually all goods and services necessary to establish and operate the Restaurants from Us or Our designees, from suppliers approved by Us, or in accordance with Our specifications. We estimate that Your purchases and leases from Us, Our affiliates, approved suppliers and in accordance with Our specifications will be approximately 90% to 100% of Your costs to establish and operate the franchised business.

When determining whether to grant new or additional franchises, We consider many factors, including compliance with the foregoing requirements.

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ITEM 9 FRANCHISEE'S OBLIGATIONS

THIS TABLE LISTS YOUR PRINCIPAL OBLIGATIONS UNDER THE FRANCHISE AND OTHER AGREEMENTS. IT WILL HELP YOU FIND MORE DETAILED INFORMATION ABOUT YOUR OBLIGATIONS IN THESE AGREEMENTS AND IN OTHER ITEMS OF THIS OFFERING CIRCULAR.

Obligation	1 Item in Offering 1 Section in Agreement Circular
a. Site selection and acquisition/ lease	Section II of Franchise Agreement	Items 8 and 11
b. Pre-opening purchases/leases	Sections VI, VII and VIII of Franchise Agreement	Items 5, 6, 7, 8 and 11
c. Site development and other pre-opening requirements	Section II of Franchise Agreement	Items 1, 8 and 11
d. Initial and ongoing training	Section VI of Franchise Agreement	Items 5, 6 and 11
e. Opening	Section VI of Franchise Agreement	Items 5, 6 and 11
f. Fees	Sections IV and VIII of Franchise Agreement and Section II of Development Agreement	Items 5 and 6
g. Compliance with standards and policies/Manuals	Sections II, III, VI, VIII, IX, X, XI and XII of Franchise Agreement	Items 11 and 14
h. Trademarks and proprietary information	Sections IX and X and Attachment D of Franchise Agreement, Attachment B to Development Agreement	Items 11, 13 and 14
i. Restrictions on products/services offered	Section VII of Franchise Agreement	Items 8 and 16
j. Warranty and customer service requirements	Section VII of Franchise Agreement	Item 8
k. Territorial development and sales quotas	Section III of Development Agreement	Item 12
I. Ongoing product/service purchases	Section VII of Franchise Agreement	Items 6 and 8
m. Maintenance, appearance and remodeling requirements	Sections II, VII and XIV of Franchise Agreement	Items 8 and 11
n. Insurance	Section XII of Franchise Agreement	Items 7 and 8
o. Advertising	Section VIII of Franchise Agreement	Items 6, 8 and 11
p. Indemnification	Section XV of Franchise Agreement and Section X of Development Agreement	Item 6
q. Owner's participation/ management/staffing	Sections VI, XIV, XV and XDC of Franchise Agreement and Section VI of Development Agreement	Items 1,11 and 15

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