What criteria might Extreme Art Studio use to evaluate a proposed new supplier?

the right to charge you our then-current new product/supplier application fee and require you to reimburse us for our expenses (not to exceed the reasonable cost of the research and inspection, and the actual cost of the test) to make the evaluation. We have the right to inspect the proposed supplier's facilities, and to require

product samples from the proposed supplier to be delivered at our option either directly to us or to a third party we designate for testing. We shall notify you in writing of the approval or rejection of the proposed supplier within a reasonable time after completion of the investigation of the proposed supplier. If we fail to respond within 60 days, your request will be deemed denied. We may, in our sole discretion, elect to withhold approval of the supplier. You acknowledge that we are likely to reject your request for a new supplier without conducting any investigation if the proposed new supplier is for items bearing our proprietary Marks or if we already have designated an exclusive supplier for the item proposed to be offered by the new supplier. We reserve the right to periodically re-inspect the facilities and products of any approved supplier and to revoke our approval if the supplier does not continue to meet any of our criteria. We also reserve the right to charge suppliers a royalty for the right to manufacture products for use in Extreme Art Studio Businesses.

Source: Item 22 — CONTRACTS (FDD page 49)