For Ella Cafe, what is the role of the Principal Executive?

• 2.5 Principal Executive. Franchisee agrees that the person designated as the "Principal Executive" on the Summary Page is the executive primarily responsible for the Business and has decision-making authority on behalf of Franchisee.

The Principal Executive must have at least 10% ownership interest in Franchisee.

The Principal Executive does not have to serve as a day-today general manager of the Business, but the Principal Executive must devote substantial time and attention to the Business.

If the Principal Executive dies, becomes incapacitated, transfers his/her

interest in Franchisee, or otherwise ceases to be the executive primarily responsible for the Business, Franchisee shall promptly designate a new Principal Executive, subject to Franchisor reasonable approval.

If Franchisee is a Business Entity, the Principal Executive will be an individual with at least a 10% equity interest in the Business Entity.

The Principal Executive must have full control over day-to-day Coffee House management and operations.

Unless a District manager is appointed, as described below: (a) the Principal Executive must attend and successfully complete Franchisor's initial training program and all additional training that Franchisor requires, to Franchisor's satisfaction; and (b) the Principal Executive must devote his or her full-time efforts to Coffee House operations and must not engage in any other business or activity, directly or indirectly, that requires substantial management responsibility or time commitment.

Franchisor must approve the Principal Executive as meeting its then-current qualifications for such position.

If the Principal Executive ceases to serve in, or no longer qualifies for, such position, or transfers his or her equity interest, Franchisee must designate another qualified person to serve as Franchisee's Principal Executive within 30 days after the date the prior Principal Executive ceases to serve or no longer qualifies to serve.

Any proposed replacement Principal Executive must successfully complete the initial training program and such other training required by Franchisor and be approved by Franchisor before assuming his or her position as Principal Executive and, in no event, later than 90 days after the previous Principal Executive ceased to serve in such position.

• (b) If the Principal Executive will not devote full-time efforts to the management and operation of the Coffee House governed by this Agreement then, in addition to the Principal Executive, Franchisee must appoint an individual to serve as its District Manager.

Franchisee's District Manager must have full control over day-to-day Coffee House management and operations.

Franchisee's District Manager need not have an equity interest in the Business Entity, but must have completed Franchisor's initial training program and all additional training that Franchisor requires, to Franchisor's satisfaction.

Franchisee's District Manager must devote his or her full-time efforts to Coffee House management and operations and must not engage in any other business or activity, directly or indirectly, that requires substantial management responsibility or time commitment.

The initial training program is provided at no charge for up to 3 individuals including the Principal Executive and will take place at a location and time that Franchisor designates.

At Franchisee's request, Franchisor may permit additional individuals to attend initial training, subject to space availability.

If Franchisee desire to have additional personnel participate in the training program, Franchisor may provide initial training to such additional personnel at any of our scheduled initial training courses at our then-current fee upon commencement of the training program, which is currently $500.00 per day per trainer (maximum 8 hours per day) plus any reasonable out-of-pocket expense for such trainer.

Franchisee is responsible for all costs and expenses of complying with Franchisor's training requirements including, without limitation, wages, travel, lodging, and dining costs for all of Franchisee's employees who participate in the training.

Source: Item 22 — CONTRACTS (FDD page 50)