What happens if a Kitchen Solvers franchisee does not comply with the required quality standards?

ICTIONS ON SOURCES OF PRODUCTS AND SERVICES**

To help assure a uniform image and uniform quality of products and services in all KITCHEN SOLVERS® businesses, you must maintain and comply with our quality standards. Although you are not required to purchase or lease real estate from us, if you lease office space for your business or choose to have an office outside your home or a showroom, you must improve and equip the space in accordance with our then current approved design, specifications and standards. You also must use equipment (which includes hardware and software for the Technology Suite as described in Item 11), signage, fixtures, furnishings, an accounting firm, payroll and human resources services, products, supplies and advertising and sales promotion materials that meet our specifications and/or standards. You must offer for sale all programs, products and services we require in the manner and style we require.

The Franchise Agreement requires you to sell or use only those products and services that we have approved in writing. The purpose of this requirement is to ensure that all franchisees adhere to the uniformity and quality standards associated with KITCHEN SOLVERS® businesses. Upon request, we will periodically provide you with the names of approved vendors and suppliers for products, goods, supplies, fixtures, and equipment. The approved products will include "Primary Products and Services" for your Business such as new cabinet units, doors, drawer fronts, closet organizers, panels, trim and molding required for installing new cabinets or cabinet refacing and other supplies, products, and equipment. The approved suppliers for the Primary Products and Services may be Preferred Vendors as further described below.

We may modify the standards and specifications for products and services from time to time and add or delete from the list of approved vendors and suppliers. Standards may include minimum standards for delivery, performance, warranties, design, appearance and other restrictions. We may disapprove of a previously approved vendor, item, product and/or service at any time and you must discontinue offering for sale any such disapproved vendor, item, product and/or service immediately upon receipt of written notice. You may not manufacture any products for sale at or from your Business, including Primary Products, without our prior written consent. We reserve the right to limit the number of vendors and suppliers. From time to time, and at any time, we, an affiliate, or a third-party vendor or supplier may be the only approved supplier for certain products. You will pay the then-current price in effect for all purchases you make from us, our affiliate, or any third-party vendor we designate. As of the issuance date of this disclosure document, neither

we nor any affiliate is the sole supplier of any items other than the Supplies Package. We and our affiliates reserve the right to become an approved or designated supplier (including an exclusive supplier) of any product or service at any time in the future, without restriction.

You may make written request for approval of a specific product of an additional qualified vendor or supplier. Except as noted below, we may, but are not required to, grant our approval of the product if doing so will not create an inordinate number of vendors/suppliers (usually not more than 2) of the product. In addition, each vendor/supplier of a product must meet the following requirements: its product must comply with the applicable specifications and/or standards; the vendor/supplier's facilities must be adequate to meet the needs of franchisees;

Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 21–24)