anchisee shall purchase a reasonable quantity of tested products and effectively promote and make a reasonable effort to sell such products.

b. Standards and Sources of Supplies and Compliance with Preparation Methods, Recipes, and Menu.

• i. Franchisee is required to obtain all his coffee, muffin mix and cream cheese from Franchisor or Franchisor's designated supplier. Franchisee is also required to purchase from Franchisor's designated suppliers a mandatory initial inventory of private label items, including, but not limited to branded disposables, catering packaging and coffee mugs, which will be shipped and billed by Franchisor's designated suppliers. Franchisor also reserves the right to require that other items be purchased exclusively from Franchisor or its designees, in which event Franchisor or its designees may derive revenue from said purchases.

• ii. Other than products which must be purchased from Franchisor, its Affiliates or its designated supplier pursuant to Paragraph 9.b.i. herein, Franchisee agrees that the BAGELS Store will

• (1) use ingredients and prepare and offer for sale other beverages and food products

• (2) use cups, utensils, uniforms, menus, forms, packaging materials, labels and other supplies, and

• (3) offer for sale other products and services

which conform to Franchisor's specifications and quality standards and/or are purchased from suppliers approved from time to time by Franchisor (which may include Franchisor and/or its Affiliates).

• iii. Franchisee agrees to use in the operation of the BAGELS Store only signs, equipment, merchandise, materials and supplies that conform to Franchisor's minimum specifications and quality standards and/or are purchased from suppliers approved from time to time by Franchisor (which may include Franchisor and/or its Affiliates).

• iv. Franchisor may, from time to time, modify the minimum standards and specifications and/or the list of approved brands and/or suppliers. If Franchisee proposes to use or offer any food products or beverages, other products or services, ingredients or supplies (other than those which must be purchased pursuant to Paragraph 9.b.i.) which do not comply with Franchisor's then-current minimum standards or specifications or which are purchased from a supplier that has not been approved, Franchisee shall first notify Franchisor in writing and submit sufficient information, specifications and samples concerning such item or supplier for determination by Franchisor as to whether such item complies with Franchisor's specifications and standards, and/or whether the supplier meets Franchisor's approved supplier criteria. Franchisor shall have the right to charge Franchisee a reasonable fee to cover Franchisor's costs incurred in making such determination. Franchisor shall, within sixty (60) days, notify Franchisee whether or not such proposed item or supplier is approved. Franchisor may from time to time prescribe procedures for submission of requests for approval of items or suppliers and obligations which approved suppliers must assume (which may be incorporated into a written agreement to be executed by approved suppliers). Franchisor may impose limits on the number of suppliers and/or brands for any ingredient or food or beverage product used or served by the BAGELS Store. Franchisor may collect a service fee on items purchased by Franchisee through national marketing contracts negotiated and maintained by Franchisor. Such service fee shall be established and paid to the Marketing Fund in the manner prescribed from time to time by Franchisor.

• v. Franchisee shall not offer and sell any branded items (other than "Branded Products" as defined in Paragraph F of the Recitals) in the BAGELS Store without the prior written consent of Franchisor.

Source: Item 22 — CONTRACTS (FDD pages 86–87)