What obligations does a Cinnaholic franchisee have regarding advertising (Item 9) and how does this relate to the franchisor's advertising assistance described in Item 11?

Franchisee recognizes the mutual benefit to Franchisee, Franchisor and other franchisees of the CINNAHOLIC® System of the uniformity of the appearance, services, products and advertising of the CINNAHOLIC® System and acknowledges and agrees that such uniformities are necessary for the successful operation of CINNAHOLIC® Bakeries. Franchisee also acknowledges and agrees that products and services sold under the Marks and at CINNAHOLIC® Bakeries have a reputation for excellence. This reputation has been developed and maintained by Franchisor, and Franchisee acknowledges and agrees that it is of the utmost importance to Franchisor, Franchisee, and all other franchisees of the CINNAHOLIC® System that such reputation be maintained. To this end, Franchisee covenants and warrants with respect to the operation of the Bakery that Franchisee and its employees and agents will comply with all of the requirements of the CINNAHOLIC® System and the Operations Manual and will throughout the term of this Agreement:

• (i) Operate the Bakery and prepare and sell all products and services sold therein in accordance with the specifications, standards, business practices and policies of Franchisor now in effect or hereafter promulgated, and comply with all requirements of Franchisor, the CINNAHOLIC® System and the Operations Manual as they are now or hereafter established, including, without limitation, any health, sanitation and cleanliness standards and specifications.

Services During Operation. During the operation of your Bakery, we will:

• (a) Give you periodic guidance (as we deem necessary) about (i) the methods and procedures to be utilized at the Bakery; (ii) advertising and promotion; (iii) recipes, food formulas and specifications; (iv) bookkeeping and accounting; (v) purchasing and inventory control; (vi) inspections; and (vii) new developments and improvements to the CINNAHOLIC® franchise system. (See Development Agreement, Section 9 and Franchise Agreement, Section 12.)
• (d) Give you access to advertising and promotional materials we develop. (See Franchise Agreement, Section 11.2.)

You must participate in any promotional and advertising programs that we establish.

11.2. Advertising Fund. In addition to all other amounts required to be paid hereunder, during the term hereof, Franchisee must pay to Franchisor, or such other entity designated by Franchisor, an amount based upon Gross Sales to be designated by Franchisor from time to time, in its sole discretion, provided such amount shall not exceed 2% of Gross Sales (the "Advertising Fee"), which amount shall be used by the Advertising Fund (as such term is hereinafter defined). The Advertising Fee shall be the same for all CINNAHOLIC® franchisees. Payment of the Advertising Fee shall be made on or before Tuesday of each week and be based upon Gross Sales of the Bakery for the preceding week. Advertising Fees shall be paid concurrently with the payment of the Royalty Fees.

The particular Advertising Cooperative(s) in which Franchisee may be required to participate shall be designated by Franchisor in its sole discretion (which designations may be based upon, without limitation, the particular Designated Market Area or the Area of Dominant Influence, as those terms are used in the advertising industry, where the CINNAHOLIC® Bakeries operated by Franchisee are located).

Franchisee, however, may not be required to spend more than 2% of Gross Sales per annum in connection with any Advertising Cooperative.

Any payments to an Advertising Cooperative shall be in addition to the amounts required to be paid or spent under Sections 11.1 and 11.2 hereof.

11.5. Approval of Advertising. Any and all advertising and marketing materials (whether developed in connection with an Advertising Cooperative or otherwise) not prepared or previously approved by Franchisor shall be submitted to Franchisor at least two weeks before any publication or run date for approval, which may be arbitrarily withheld. Franchisor may grant or withhold its approval, in its sole discretion. Franchisor will provide Franchisee with written notification of its approval or disapproval within a reasonable time. In the event Franchisor does not notify Franchisee of its approval or disapproval within 10 days of Franchisor's receipt of the materials, the materials shall be deemed approved. Franchisee must discontinue the use of any approved advertising within five days of Franchisee's receipt of Franchisor's request to do so.