Can Card My Yard require franchisees to obtain new equipment or systems?

• (2) You must refurbish, repair or replace, at your expense, all equipment, Computer Systems, signs, fixtures, furnishings, supplies and other items required for the operation of the Card My Yard business as we may reasonably require and must otherwise upgrade the Card My Yard business to reflect the then-current standards and image of the System;

E. Sourcing.

• (1) You agree to comply with all of our standards and specifications for the purchase of all inventory, supplies, materials, fixtures, furnishings, equipment, Computer Systems, and other products used or offered for sale at the Card My Yard business. If we have approved or designated suppliers (which may include us or our Affiliates or third party manufacturers, distributors and other sources) for any such item, you agree to obtain these items from those suppliers. Our approved or designated suppliers are those who demonstrate on a continuing basis the ability to meet our standards and specifications; who have adequate quality controls and the capacity to supply the needs of the Card My Yard business franchise network promptly and reliably over an extended period of time; and who have been approved in writing by us and who have not thereafter been disapproved by us. We may designate ourselves, our Affiliates or a third party as an approved or designated supplier, or as the sole approved or designated supplier of any item. You agree that we and our Affiliates may derive revenue based on your purchases and leases (including, without limitation, from charging you for products and services we or our Affiliates provide to you and from payments made to us or our Affiliates by suppliers that we designate or approve for some or all of our franchisees). We currently require you to purchase yard letters/signs (or related materials and equipment) totaling at least $500 each year from us.

Changes to the Computer System specifications may require you to incur costs to purchase,lease and/or license new or modified computer hardware and/or software and to obtain service and support for the Computer System during the term of this Agreement.

Within sixty (60) days after you receive notice from us, you agree to obtain the components of the Computer System that we require.

You further acknowledge and agree that we have the right to charge a reasonable systems fee for any software or systems modifications and enhancements specifically made for us that are licensed to you and other maintenance and support services that we or our Affiliate may furnish to you.

Source: Item 23 — RECEIPTS (FDD pages 84–259)