From whom must a Bambu franchisee purchase inventory?

10.2 Required Purchases

a. Inventory. Prior to commencement of the shoppe's operation, and throughout the term of this Agreement, Franchisee shall purchase and stock the shoppe with products, menu items, ingredients of menu items and merchandise in such mix and quantities sufficient to meet customer demand, in compliance with Bambu's standards and specifications as may be described in the OOM and other FRC Materials and only from Suppliers as may be designated or approved by Bambu. Bambu requires Franchisee to make purchases of specific products, items and merchandise from Bambu, Bambu's affiliates, or Bambu's designated Suppliers, some of which may be private labeled with the Marks, and may require Franchisee to make purchases of other specific products, items and merchandise from Bambu, Bambu's affiliates, or

Bambu's designated Suppliers in the future. Franchisee acknowledges that the brand's acceptance is based on the quality of the products used in the shoppe and that Bambu requires only approved or designated products be used in order to maintain both quality and consistency throughout the Bambū system.

• 14.5 Approved or Designated Suppliers.

Franchisee shall purchase all products, equipment, materials, supplies and programs required for the operation of the Bambū shoppe from Bambu, from Bambu's designated affiliates, or from Suppliers designated or approved by Bambu.

If there is no designated or approved Supplier for a particular product, piece of equipment, ingredient, food item, supply, material or program, Franchisee shall propose, for prior written approval by Bambu, such other suppliers who meet all of Bambu's specifications and standards as to quality, composition, finish, appearance and service, and who shall adequately demonstrate their capacity and ability to supply Franchisee's needs in the quantities, at the times, and with the reliability requisite to an efficient operation of the Bambū shoppe.

Bambu reserves the right to derive revenue from Franchisee's purchases of food items, products or programs, whether the purchase is from Bambu, Bambu's affiliate or another designated or approved source and irrespective of whether a formal purchase or buying arrangement has been established.

• 14.6 Request to Approve Supplier.

In the event Franchisee desires to purchase or use inventory, products, equipment, supplies, materials, services or programs from suppliers other than those previously approved by Bambu, Franchisee shall, prior to purchasing from or otherwise utilizing any supplier give Bambu a written request to approve the supplier.

In the event Bambu rejects Franchisee's requested new supplier, Bambu must, within 60 days of the receipt of Franchisee's request to approve the supplier notify Franchisee in writing of its rejection.

Bambu may continue from time to time to inspect any suppliers' facilities and products to assure compliance with Bambu's standards and specifications.

Permission for such inspection shall be a condition of the continued approval of such supplier.

Bambu may in its sole discretion elect to withhold approval of the supplier for any reason it determines, including for purposes of protecting its trade secrets or on the basis of the terms offered to Bambu itself or its franchisees from the proposed supplier compared to any current designated or approved supplier.

In order to make such

determination, Bambu may require that samples from a proposed new supplier be delivered to Bambu for testing prior to approval and use. Bambu may impose a charge equal to $150 per hour per each representative of Bambu involved in the testing and investigation of a proposed new supplier request, and Franchisee shall also be required to pay the reasonable costs incurred by Bambu in connection with the testing and investigation.

Source: Item 23 — Receipts (FDD pages 52–209)