What happens if Crave Cookies Franchising terminates another agreement with a Crave Cookies franchisee?

officers;

• (ix) Franchisee refuses to cooperate with or permit any audit or inspection by Crave Cookies Franchising or its agents or contractors, or otherwise fails to comply with Section 10.5 or Section 11.2;

• (x) Franchisee has received two or more notices of default and Franchisee commits another breach of this Agreement, all in the same 12-month period;

• (xi) Crave Cookies Franchising (or any affiliate) terminates any other agreement with Franchisee (or any affiliate) due to the breach of such other agreement by Franchisee (or its affiliate) (provided that termination of a Multi-Unit

• Development Agreement with Franchisee or its affiliate shall not give Crave Cookies Franchising the right to terminate this Agreement);

• (xii) Franchisee or any Owner is charged with, pleads guilty or no-contest to, or is convicted of a felony;

• (xiii) Franchisee or any Owner is accused by any governmental authority or third party of any act, or if Franchisee or any Owner commits any act or series of acts, that in Crave Cookies Franchising's opinion is reasonably likely to materially and unfavorably affect the Crave Cookies brand;

• (xiv) Franchisee fails to meet the health inspection standards described in Section 7.3(e) two or more times in any 36-month period; or

• (xv) Franchisee fails to achieve a passing score on an inspection conducted by Crave Cookies Franchising, LLC two or more times in any 36-month period.

• 14.3 Effect of Termination. Upon termination or expiration of this Agreement, all obligations that by their terms or by reasonable implication survive termination, including those pertaining to non-competition, confidentiality, indemnity, and dispute resolution, will remain in effect, and Franchisee must immediately:

  • (i) pay all amounts owed to Crave Cookies Franchising based on the operation of the Business through the effective date of termination or expiration;
  • (ii) return to Crave Cookies Franchising all copies of the Manual, Confidential Information and any and all other materials provided by Crave Cookies Franchising to Franchisee or created by a third party for Franchisee relating to the operation of the Business, and all items containing any Marks, copyrights, and other proprietary items; and delete all Confidential Information and proprietary materials from electronic devices;
  • (iii) notify the telephone, internet, email, electronic network, directory, and listing entities of the termination or expiration of Franchisee's right to use any numbers, addresses, domain names, locators, directories and listings associated with any of the Marks, and authorize their transfer to Crave Cookies Franchising or any new franchisee as may be directed by Crave Cookies Franchising, and Franchisee hereby irrevocably appoints Crave Cookies Franchising, with full power of substitution, as its true and lawful attorney-in-fact, which appointment is coupled with an interest; to execute such directions and authorizations as may be necessary or appropriate to accomplish the foregoing; and
  • (iv) cease doing business under any of the Marks.

• 14.4 Remove Identification. Within 30 days after termination or expiration, Franchisee shall at its own expense "de-identify" the Location so that it no longer contains the Marks, signage, or any trade dress of a Crave Cookies business, to the reasonable satisfaction of Crave Cookies Franchising. Franchisee shall comply with any reasonable instructions and procedures of Crave

Cookies Franchising for de-identification. If Franchisee fails to do so within 30 days after this Agreement expires or is terminated, Crave Cookies Franchising may enter the Location to remove the Marks and de-identify the Location. In this event, Crave Cookies Franchising will not be charged with trespass nor be accountable or required to pay for any assets removed or altered, or for any damage caused by Crave Cookies Franchising.

14.5 Liquidated Damages. If Crave Cookies Franchising terminates this Agreement based upon Franchisee's default (or if Franchisee purports to terminate this Agreement except as permitted under Section 14.1), then within 10 days thereafter Franchisee shall pay to Crave Cookies Franchising a lump sum (as liquidated damages and not as a penalty) calculated as follows: (x) the average Royalty Fees and Marketing Fund Contributions that Franchisee owed to Crave Cookies Franchising under this Agreement for the 52-week period preceding the date on which Franchisee ceased operating the Business; multiplied by (y) the lesser of (1) 104 or (2) the number of weeks remaining in the then-current term of this Agreement. If Franchisee had not operated the Business for at least 52 weeks, then (x) will equal the average Royalty Fees and Marketing Fund Contributions that Franchisee owed to Crave Cookies Franchising during the period that Franchisee operated the Business. The "average Royalty Fees and Marketing Fund Contributions that Franchisee owed to Crave Cookies Franchising" shall not be discounted or adjusted due to any deferred or reduced Royalty Fees and Marketing Fund Contributions set forth in an addendum to this Agreement, unless this Section 14.5 is specifically amended in such addendum. Franchisee acknowledges that a precise calculation of the full extent of Crave Cookies Franchising's damages under these circumstances is difficult to determine and the method of calculation of such damages as set forth in this Section is reasonable. Franchisee's payment to Crave Cookies Franchising under this Section will be in lieu of any direct monetary damages that Crave Cookies Franchising may incur as a result of Crave Cookies Franchising's loss of Royalty Fees and Marketing Fund Contributions that would have been owed to Crave Cookies Franchising after the date of termination; however, such payment shall be in addition to all damages and other amounts arising under Section 14.3 and Section 14.4, Crave Cookies Franchising's right to injunctive relief for enforcement of Article 13, and any attorneys' fees and other costs and expenses to which Crave Cookies Franchising is entitled under this Agreement. Except as provided in this Section, Franchisee's payment of this lump sum shall be in addition to any other right or remedy that Crave Cookies Franchising may have under this Agreement or otherwise.

14.6 Purchase Option. When this Agreement expires or is terminated, Crave Cookies Franchising will have the right (but not the obligation) to purchase any or all of the assets related to the Business, and/or to require Franchisee to assign its lease or sublease to Crave Cookies Franchising. To exercise this option, Crave Cookies Franchising must notify Franchisee no later than 30 days after this Agreement expires or is terminated. The purchase price for all assets that Crave Cookies Franchising elects to purchase will be the lower of (i) the book value of such assets as declared on Franchisee's last filed tax returns or (ii) the fair market value of the assets. If the parties cannot agree on fair market value within 30 days after the exercise notice, the fair market value will be determined by an independent appraiser reasonably acceptable to both parties. The parties will equally share the cost of the appraisal. Crave Cookies Franchising's purchase will be of assets only (free and clear of all liens), and the purchase will not include any liabilities of Franchisee. The purchase price for assets will not include any factor or increment for any trademark or other commercial symbol used in the business, the value of any intangible

assets, or any goodwill or "going concern" value for the Business. Crave Cookies Franchising may withdraw its exercise of the purchase option at any time before it pays for the assets. Franchisee will sign a bill of sale for the purchased assets and any other transfer documents reasonably requested by Crave Cookies Franchising.

Source: Item 22 — CONTRACTS (FDD page 47)