How do the restrictions on suppliers for a Southern Steer franchise, as outlined in Item 8, impact the franchisee's obligations detailed in Item 9?

[Item 8: ITEM. 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES]

You must purchase the POS System (which includes computer hardware, iPad, and all necessary guest check printers, credit card "swipe/read" terminals, printers, and modems.), and gift cards from our designated suppliers. You will pay the monthly Technology Fee and POS System Fee .

Signage, Uniforms, Equipment, Recipe/Safety Software, Paper Products and Printed Marketing Materials.

You are required to purchase certain interior and exterior signage, digital menu boards, uniforms for employees, thermometer, recipe/safety software, and paper products (such as napkins, plates, straws, etc.) set out in the Brand Manual for use in Your Southern Steer Business from Our designated suppliers or from suppliers We approve. We also may require that You use our designated supplier for printed marketing materials, including brochures, business cards, menu boards, and the like. You will pay an annual Signage Fee for the digital menu boards and a quarterly Recipe/Safety Fee.

Revenue from Franchisee Purchases

As of January 31, 2025, neither We nor Our affiliates have derived any revenue from sales Goods, Supplies and Services.

Proportion of Required Purchases and Leases

We estimate that purchases of equipment, food, beverages and products purchased in accordance with Our standards and specifications will constitute up to 80% of Your initial expenditures to open Your Southern Steer Business, and approximately 90% of Your total purchases during the operation of the Southern Steer business.

Benefits Provided by Designated Suppliers to Us

We do not currently receive payments from any designated suppliers based on purchases by You or other franchisees. However, the Franchise Agreement does not prohibit Us from doing so. We may receive income in the form of rebates, discounts, allowances or other payments or credits from designated or approved suppliers that sell products, services, equipment to franchisees and We have the right to determine how those payments will be used. In some cases, prices charged by suppliers to company or affiliate-owned Southern Steer Business may be less than prices charged to franchised Southern Steer Business based on volume, credits, administrative costs, or other factors.

Purchasing Arrangements; Cooperatives; Negotiated Prices and Material Benefits

[Item 8: ITEM. 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES]

ITEM. 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

Approved Suppliers/Specifications

You must establish and operate Your Southern Steer Business in compliance with Your Franchise Agreement and Our confidential Brand Manual that We loan to You. To ensure that the highest degree of quality and service is maintained, You must conform to Our specifications, standards and methods and You must purchase all goods, services, supplies, food products, furniture, signage, fixtures, equipment, software, POS System, third-party delivery services, inventory and supplies (collectively, "Goods, Supplies and Services") from vendors that We approve and who demonstrate, to Our continuing satisfaction, the ability to meet Our then-current standards.

We will provide You with written standards and specifications for the layout of Your Southern Steer Business premises, decor of Your Southern Steer Business and Your Goods, Supplies and Services. We determine Our uniformity and quality standards and specifications, in Our sole discretion. We may modify Our written standards and specifications, and You must comply with any modifications.

Alternate Supplies and Services and Suppliers

Goods, Supplies and Services must satisfy Our written standards and specifications established by Us. This requirement is necessary to ensure that You adhere to the uniformity requirements and quality standards associated with all Southern Steer Business. Additionally, food products designated by Us from time to time include or comprise Our proprietary recipes. We will provide a written list of approved suppliers for Our Goods, Supplies and Services, and will notify You of any additions to or deletions from this list. We may impose limits on the number of suppliers or brands for any Good, Supply and/or Service.

[Item 8: ITEM. 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES]

If You want to purchase certain Goods, Supplies and Services that are subject to Our approved supplier requirements from a supplier who has not been previously approved by Us, then You must, request approval from Us in writing. We must approve such supplier prior to You making any purchase from such supplier. You must send Us representative samples or specifications of that supplier's Goods, Supplies and Services and certain other information about the supplier's business. We will also have the right to inspect the supplier's facilities and otherwise evaluate the proposed supplier and its Goods, Supplies and Services. You must pay the cost of all inspections and evaluations, including the actual cost of any testing. The criteria for supplier approval are available to franchisees upon request. Among other things, the suppliers must have adequate quality controls, the capacity to supply Your needs promptly and reliably and must comply with Our guidelines. We reserve the right to re-inspect the facilities and Goods, Supplies and Services of any approved supplier and to revoke Our approval if the supplier fails to continue to meet any of Our then-current standards. Our supplier approval procedure does not obligate Us to approve any particular supplier. However, We will notify You within 30 days after We complete the inspection and evaluation process of Our approval or disapproval of any proposed supplier. We may modify Our then-current standards for suppliers at any time. We will provide You with these new supplier standards upon Your written request.

There are certain name brand Goods, Supplies and Services that are selected by Us for consistency in quality and other considerations. To ensure that You adhere to the uniformity requirements and quality standards associated with all Southern Steer Business, You must purchase these items for Your Southern Steer Business, but You may purchase them from any approved distributor that can supply them. We will provide a written list of these selected Goods, Supplies and Services. We will also notify You of any additions to or deletions from this list.

You must permit Us and Our agents, at any reasonable time, to remove a reasonable number of samples of food or non-food items from Your inventory, free of charge for testing (at Your cost) by Us or by an independent laboratory, to determine whether the samples meet Our then-current standards and specifications.

Required Purchases from Us or Our Affiliate