TASK DEFINITION: In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.
PROBLEM: Exhibit 10.07 [*] Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Manufacturing Agreement

Between

Sonos, Inc.

And

IAC





TABLE OF CONTENTS 1.0 DEFINITIONS 3 2.0 SCOPE OF RELATIONSHIP 8 3.0 OWNERSHIP; GRANT OF RIGHTS; TRADEMARKS USAGE 8 4.0 MANUFACTURING OPERATIONS; COMPLIANCE 9 5.0 FORECASTS, PURCHASE ORDERS AND DELIVERY 12 6.0 PRODUCT ACCEPTANCE, INVOICING, QUARTERLY PRICING UPDATES, AND SHIPPING TERM 13 7.0 PRICES; PAYMENT TERMS 14 8.0 NPI; FUTURE PRODUCTS 18 9.0 REPAIR SERVICES; PROVISION FOR EXTENDED WARRANTY 18 10.0 REPRESENTATIONS AND WARRANTIES 19 11.0 INDEMNITY 19 12.0 CONFIDENTIALITY 20 13.0 USE OF CONTRACTORS; COMPLIANCE WITH LABOR LAWS 22 14.0 LIMITATION OF LIABILITY 22 15.0 TERM AND TERMINATION 23 16.0 MISCELLANEOUS 24 Exhibit Exhibit Description A Statements of Work B Program Managers C Flexibility and Cancellation Guidelines D NPI Process E RMA and Repair Procedures F Sonos Supplier Performance Review G Product Pricing Formula H ERS Statement of Work I Engineering Change Process Page 2 of 38





Manufacturing Agreement

This Manufacturing Agreement, including the Exhibits (Agreement), effective as of September 4, 2014 (Effective Date), is by and between Sonos, Inc., a Delaware corporation, having its principal offices at 223 E. De La Guerra Street, Santa Barbara, CA, 93101, USA (Sonos), and Inventec Appliances Corporation, having principal offices at 37, Wugong 5t h Road, Wugu District, New Taipei City, 24890, Taiwan, R.O.C. (IAC).

RECITALS

A. Sonos is in the business of designing, developing and selling consumer electronics products for use in the distribution and playback of digital content.

B. IAC is in the business of, among other things, manufacturing products such as those developed by Sonos on an OEM basis.

C. Sonos and IAC desire to enter into a relationship pursuant to which IAC and its Affiliates will manufacture for Sonos and its Affiliates the Sonos Products on the terms and conditions set forth herein.

AGREEMENT

In consideration of the foregoing and the mutual promises and covenants contained herein, the parties agree as follows: 1.0 DEFINITIONS.

1.1. Affiliate means any entity controlled by, controlling, or under common control with Sonos or IAC, as the case may be, now or in the future (control shall be deemed to mean having a right to 50% of the entity's profits or ownership of at least 50% of the voting rights in the entity).

1.2. Arena means the BOM management IT system used by Sonos, and will be used by IAC to access BOM and other Component information required by IAC to manufacture Products.

1.3. AVL means the Approved Vendor List, which is a list representing those suppliers and vendors of Third Party Components that are approved by Sonos for use by IAC in the manufacture of Products, or those suppliers and vendors that are approved by Sonos for the procurement by IAC of tooling, equipment, fixtures, etc required for the manufacture or test of Products.

1.4. BOM means the bill of materials for a given Product.

1.5. Build Start Date means the date that a Product Build is scheduled to begin.

1.6. Build Complete Date means the date that a Product Build is scheduled to be completed with respect to all Product Units in such Product Build.

1.7. Component(s) means Sonos Sourced Components and IAC Sourced Components. Components shall be identified by Sonos' part numbers as defined in Arena.

1.8. Component Defect means a Component that is not in compliance with the published specification for such Component or is causing a Product to not conform with the Statement of Work for such Product. Page 3 of 38





1.9. Component Lead Time means the time between the date IAC places a purchase order with a Component supplier for a Component and the date that Component arrives to IAC's factory.

1.10. Defective Product means any Product that does not comply with the Specifications, the Purchase Order, Statement of Work or other provisions of this Agreement.

1.11. Deliverables shall mean any tangible or intangible items to be delivered by one party to the other party.

1.12. Delivery Date means the date that a Product Build (or portion thereof) is delivered by IAC to the Destination Port.

1.13. Designated Carrier means any entity that has been designated in writing by Sonos to perform or procure the transport of Product Units by rail, road, air, sea, inland waterway or by combination of such modes.

1.14. Destination Port means the port (which may be a shipping port or airport) where a given Product Build (or portion thereof) is designated for delivery by Sonos.

1.15. Documentation means any user and technical materials that Sonos makes available for the Products.

1.16. Effective Date means the date this Agreement is executed by the Parties.

1.17. Engineering Change, Engineering Change Order or ECO means a change to the design of a Product after Mass Production has begun. ECOs may be initiated by either party, but must be approved by Sonos prior to implementation.

1.18. Epidemic Failure shall have the meaning set forth in Exhibit E.

1.19. Excess Component(s) means any Third Party Component for which IAC has taken delivery and incurred a payment obligation that (i) is (a) a Unique Component, (b) an Obsolete Component, or (c) were to be consumed for Products that were rescheduled or cancelled in accordance with Exhibit C, and (ii) has not subsequently been consumed for Products within [*] after IAC takes physical delivery of the Component.

1.20. Future Product means any product in development by Sonos that may become a Product under the terms of this Agreement. A Future Product is not considered a Product until (i) NPI is complete, (ii) a Statement of Work has been signed by both parties with respect to such Future Product, and (iii) Mass Production commences on such Future Product.

1.21. IAC Contributions means the Technology made or otherwise provided by IAC under this Agreement.

1.22. IAC Manufacturing Facility means the IAC facility where Product Units are manufactured. The initial IAC Manufacturing Facility is [*]. Production of Product Units shall not be moved to a different IAC Manufacturing Facility without Sonos' prior written consent.

1.23. IAC Property shall mean (i) any and all Technology developed by IAC and/or its Affiliates prior to the Effective Date or outside of the scope and independent of its performance of this Agreement, (ii) any modifications, derivatives or improvements to the items in (i) made solely by IAC or its Affiliates that constitute manufacturing processes and (iii) all Intellectual Property Rights in the items in (i) and (ii).. Page 4 of 38 *Confidential Treatment Requested





1.24. IAC Subcontractor shall mean any third party subcontractor selected by IAC to perform services on behalf of IAC under this Agreement.

1.25. Hardware Quality Test Plan shall mean all required reliability testing of a Product throughout the NPI process. A Hardware Quality Test Plan will be provided by Sonos to IAC for each Product, and included in the relevant Statement of Work.

1.26. Intellectual Property Rights means with respect to a given piece of Technology, all current and future worldwide patents and other patent rights, utility models, copyrights, mask work rights, trade secrets, and all other intellectual property rights and the related documentation or other tangible expression thereof.

1.27. Lead Time means the time between the date a Purchase Order is acknowledged by IAC and the shipment ex-factory date. The default Lead Time is agreed to be [*], unless a shorter Lead Time is specified in the applicable Statement of Work for the Product.

1.28. Manufacturing Date means the date a Product Unit is manufactured, packaged and ready for shipment.

1.29. Marks means the trademarks, service marks, trademark and service mark applications, trade names, logos, insignia, symbols, designs or other marks identifying a party or its products.

1.30. Mass Production means production line manufacturing in quantity of a Product for commercial release to Sonos customers.

1.31. New Product Introduction or NPI means the process by which IAC and Sonos bring a Product or Future Product to the IAC Manufacturing Facility for the purpose of commencing Mass Production of such Product. The standard NPI process is outlined in Exhibit D hereto.

1.32. NRE Services means the development and related engineering services provided by IAC during the NPI process. The services shall not include non-engineering related activities, such as facility costs, materials costs, direct labor costs, etc.

1.33. Obsolete Component means a Third Party Component that is rendered obsolete by an ECO or a Product end of life, and cannot be used in any other Sonos Product.

1.34. Parties means Sonos and IAC.

1.35. Product means each product (including any hardware, software, technology, and Components) identified in detail in an applicable Statement of Work, attached hereto from time to time, to be manufactured by IAC for Sonos pursuant to the terms of this Agreement.

1.36. Product Build means a Mass Production manufacturing build for a specified number of Product Units designated in a Purchase Order. A Product Build is not complete until all Product Units specified in the Purchase Order are complete. Page 5 of 38 *Confidential Treatment Requested





1.37. Product Customizations shall mean any derivatives, improvements or modifications to any Product made by either party (or a subcontractor of such party) in the course of performance of this Agreement. Product Customizations does not mean the manufacturing processes utilized by IAC or an IAC Subcontractor to make such derivatives, improvements, or modifications to a Product. Any Product Customizations made by IAC or an IAC Subcontractor shall be on a work for hire (using the meaning given to such term under United States copyright law) basis to the maximum extent permissible under applicable law, and all Intellectual Property Rights therein shall be owned solely by Sonos.

1.38. Product Unit means a single, individual Mass Production unit for any given Product.

1.39. Production Process Change Order means a proposed change by either party to the Mass Production manufacturing process for a given Product. Production Process Change Orders may include proposed modifications, among other things, to printed circuit board assembly and test, Product sub-assemblies, Product final assembly, Product test or quality assurance procedures.

1.40. Purchase Order or PO means a written or electronic purchase order issued by Sonos to IAC for purchase of a Product.

1.41. Purchase Price Variance or PPV means the difference between the price for a Product Unit specified on an IAC invoice and the actual cost that should have applied for such Product Unit according to the terms of this Agreement and as determined at a later date.

1.42. Quality Plan means for any given Product the series of tests and inspections that must be performed by IAC during the manufacturing process to ensure that the Product meets the applicable Specifications. Each Product shall have a separate Quality Plan that is set forth in the applicable Statement of Work. While each Quality Plan shall be jointly developed and determined between and by Sonos and IAC, Sonos owns the Quality Plan and reserves the final decision-making regarding its contents.

1.43. Rolling Forecast means a forecast of Sonos' estimated future requirements for any Product to be manufactured by IAC for Sonos, [*]. Other than the Sonos obligations described under this Agreement, a Rolling Forecast is a non-binding projection of Sonos' future requirements for a Product.

1.44. Semi-Monthly Invoice Date means the middle and final business day, respectively, of a given month. On such date, IAC is entitled to send an invoice to Sonos for the Product Units that have shipped during the first half or second half of the month, as applicable.

1.45. Shipping Term means the default shipping term as set forth in Section 6.5. Such Shipping Term shall govern any Product manufactured by IAC for Sonos under this Agreement, unless otherwise agreed in writing by Sonos, or instructed in writing by Sonos, and expressly stated in an applicable Purchase Order and confirmed in the corresponding invoice.

1.46. Software shall mean software developed by Sonos or licensed from a third party by Sonos that is used in the operation of a Product, whether embedded in a Component or otherwise.

1.47. Sonos Destination means a Sonos Fulfillment Center (as defined below) or the delivery location of a Sonos customer.

1.48. Sonos Fulfillment Center means a designated warehouse location run by or for Sonos from which Sonos warehouses or assembles Product Units, fulfills its customers' orders and/or processes returns. Sonos Fulfillment Centers may be located anywhere in the world. Page 6 of 38 *Confidential Treatment Requested





1.49. Sonos Sourced Component(s) means all Third Party Components required for the manufacture of Products that the pricing and supply contract, including all terms and conditions, are negotiated and controlled by Sonos. IAC shall procure Sonos Sourced Components at the pricing, terms and conditions as directed by Sonos, unless otherwise agreed in writing between the Parties. Sonos Sourced Components are listed in the attached Statement of Works, and may be updated from time to time in writing by Sonos to IAC.

1.50. IAC Sourced Component(s) means all Third Party Components required for the manufacture of Products that the pricing and supply contract, including all terms and conditions, are negotiated and controlled by IAC. IAC Sourced Components are listed in the attached Statement of Works, and may be updated from time to time in writing by Sonos to IAC.

1.51. Sonos Property shall mean (i) all items provided by Sonos or its Affiliates, (ii) any and all Technology developed by Sonos and/or its Affiliates prior to the Effective Date, independent of performance of this Agreement or in the course of performance of this Agreement, (iii) the Products and Product Customizations (including software as further described in the Statement of Work), and (iv) all Intellectual Property Rights related to any of the foregoing.

1.52. Sonos Tool means a custom tool, piece of equipment, fixture, jig or similar item either provided by Sonos or created by IAC or an IAC Subcontractor solely for the manufacture of a Product or Future Product, which Sonos Tool cannot be used for any other purpose or repurposed for future use by a different IAC customer. Sonos Tools shall be considered Sonos Property and be used solely on Sonos Product.

1.53. Specifications shall mean the technical and other specifications for a Product set forth in an applicable Statement of Work.

1.54. Standard Components shall mean Third Party Components which are not Unique Components. Standard Components can typically be used by IAC for another of its customers, or can be reallocated by the Component supplier for use by a customer other than IAC. Unless a Component is designated as a Unique Component in the applicable Statement of Work, it is assumed to be a Standard Component.

1.55. Statement of Work means the document, attached hereto as an Exhibit A, that describes a Product, its specifications and all other related information and requirements necessary to produce such Product in a manner consistent with Sonos' expectations.

1.56. Technology means all inventions, processes, tools, devices, prototypes, schematics, designs, documentation, methodologies, software and hardware.

1.57. Third Party Components means all hardware, technology, software or materials that IAC incorporates into the Products that are procured by IAC or an IAC Affiliate. For the purpose of this Agreement, hardware, software, technology and materials supplied to IAC by an IAC Affiliate for IAC's manufacture of Products shall be considered a Third Party Component. Additionally, any hardware or other materials (but excluding Sonos or third party software) that are provided, consigned, or sold to IAC by Sonos shall be considered a Third Party Component.

1.58. Third Party Finished Goods shall mean finished products that are produced for Sonos by an entity other than IAC. A Third Party Finished Good is typically complete except for being placed into consumer packaging. For the purpose of this Agreement, a finished product produced by an IAC Affiliate, or a finished product provided, consigned, or sold to IAC by Sonos, shall be considered a Third Party Finished Good. Page 7 of 38





1.59. Third Party Property shall mean equipment, designs, materials and other property embodied in Third Party Components that are procured by IAC or Sonos (as designated in the applicable Statement of Work) and incorporated into the Product.

1.60. Transfer Product means a Sonos product that is commercially available prior to IAC commencing NPI for such product.

1.61. Unique Components shall mean Third Party Components which must be ordered, designed and customized specifically for a given Product and cannot be used by IAC for its other customers. Unique Components, if any, for a given Product are designated in the applicable Statement of Work.

1.62. ERS SOW shall mean a statement of work that describes the processes agreed by the Parties regarding the settlement of evaluated receipts and the management and acknowledgement of Purchase Orders. The ERS SOW is attached to this Agreement as Exhibit H, and may be updated periodically as mutually agreed by the Parties and in accordance with Section 16.7 of this Agreement.

2.0 SCOPE OF RELATIONSHIP.

2.1. Manufacturing of Products. Subject to the terms and conditions of this Agreement, IAC shall procure, directly or indirectly, certain Third Party Components (as identified on the Statement of Work and maintained in Arena), manufacture, assemble, and test Products which Sonos and/or its Affiliates may order from IAC, respectively. The various Products shall be manufactured by IAC according to the respective Statement of Work, as set forth in an applicable Exhibit A. IAC agrees to supply Product(s) in conformance with the applicable Statement of Work for the duration of this Agreement. IAC agrees to build and ship Product Units directly to a Sonos Destination. IAC will handle all necessary fulfillment, external packaging, customs clearance and shipping procedures necessary to deliver the Product Unit(s) directly to the designated Sonos Destination, anywhere in the world, in accordance with the shipping terms specified in Section 6.5, or any other terms that may be mutually agreed upon between the Parties in writing.

2.2. Product Bundling. If requested by Sonos, IAC agrees that it will perform final consolidation, packaging and related activities, at Sonos' expense, for Third Party Finished Goods that require bundling with Sonos Products manufactured by IAC. Such Third Party Finished Goods will be delivered fully assembled and may be in temporary or sub-packaging. For the avoidance of doubt, the BOM for any Third Party Finished Good shall be excluded from the pricing formula in Section 7.1.

3.0 OWNERSHIP; GRANT OF RIGHTS; TRADEMARKS USAGE.

3.1. Ownership by IAC. IAC shall own, and hereby retains, all right, title, and interest in and to the IAC Property.

3.2. Ownership by Sonos. Sonos shall own, and hereby retains, all right, title, and interest in and to the Sonos Property. Except for preexisting IAC Property and any third party's Intellectual Property, IAC shall and does hereby irrevocably assign, and shall and does cause IAC Affiliates and IAC Subcontractors to irrevocably assign, to Sonos all of IAC's, IAC Affiliates' or IAC Subcontractors' worldwide right title and interest in and to the Sonos Property , if any, whether developed solely by Sonos or jointly between Sonos or a Sonos Affiliate and IAC, an IAC Affiliate, or an IAC Subcontractor, that Page 8 of 38





may arise through the performance of its obligations under this Agreement. IAC shall cooperate fully with Sonos and execute such further instruments, documents and agreements and give such further written assurances, as may be reasonably requested by Sonos, at Sonos' expense, to perfect the foregoing assignment and obtain and enforce assigned Intellectual Property Rights.

3.3. Licenses by Sonos to IAC.

3.3.1. License to Manufacture. Subject to all terms and conditions of this Agreement, Sonos hereby grants to IAC and its Affiliates a non-exclusive, worldwide, nontransferable, royalty free right and license under Sonos' Intellectual Property Rights, to manufacture the Products solely for Sonos.

3.3.2. Software License. Subject to all terms and conditions of this Agreement, Sonos hereby grants to IAC and its Affiliates a non- exclusive, worldwide, nontransferable, royalty-free right and license to make copies of the software specified in the applicable Statement of Work solely as necessary to install and embed such software in the Product. IAC shall: (i) ensure that all copies are exact copies and conform in all respects to the original master copy provided by Sonos; (ii) make only one (1) copy of such software per each Product manufactured; (iii) reproduce any proprietary notices contained in such software and not remove, alter or obfuscate any such proprietary notices; (iv) not modify or create derivative works of such software; and (v) not reverse engineer, decompile or otherwise attempt to derive the source code of such software.

3.3.3. Necessary Export Permissions. The above license grants shall be deemed to include all necessary rights and licenses, if any, to permit IAC to export the Products to Sonos or Sonos' designee.

3.4. Third Party Property. Each party shall be responsible for the payment of any royalties or other fees for any Third Party Property associated with a Third Party Component procured by such party (as set forth in the applicable Statement of Work), including any required rights to use, manufacture, copy, sell, offer for sell, distribution and export or import the Product.

3.5. Trademarks License. Sonos hereby authorizes IAC to use and to cause its Affiliates to use, the Marks as specified by Sonos on the Products and relevant documents solely for the purpose of this Agreement. Except for the limited rights granted in this Section 3.5, nothing in this Agreement grants, or should be construed to grant, any right, title, or interest in or to the Sonos Marks to IAC. At no time shall IAC challenge or assist others to challenge the Sonos Marks, or registrations thereof, or attempt to register any trademarks, service marks, trade names or other marks confusingly similar to the Sonos Marks. All goodwill associated with the Sonos Marks shall inure solely to the benefit of Sonos.

4.0 MANUFACTURING OPERATIONS; COMPLIANCE.

4.1. Program Managers. Sonos and IAC will each appoint at least one Program Manager (Program Manager). The names, addresses, email IDs, and telephone numbers of the Program Managers are attached to this Agreement as Exhibit B. The Program Managers shall act as liaisons and principal points of contact between the parties with respect to their respective performances of this Agreement. All communications between the Parties with respect to development of Products shall be directed to the Program Managers. The Program Managers may provide the Parties from time to time with the names and telephone numbers of additional specific contact persons (e.g., to communicate specific information regarding support, enhancements, etc.) when such direct contact is preferable. In the event that either party appoints a new Program Manager, such party shall promptly notify the other in writing, provided that Sonos reserves the right to request that IAC replace any Program Manager that is not performing at a satisfactory level, and such requests shall not be unreasonably refused by IAC. Page 9 of 38





4.2. Production Process Change Order Request. IAC shall not make any changes to any manufacturing process with respect to any Product without first obtaining in writing from Sonos approval for a Production Process Change Order. IAC shall submit a request to make a change containing sufficient engineering data in support of the request. Within [*] of receiving such request, Sonos shall respond to IAC's request and shall either approve or disapprove the change, request more information, request samples built using the new manufacturing process for testing purposes, or the parties may mutually agree to extend the deadline for implementation of the proposed change. The foregoing request/approval process shall also apply during NPI for any Transfer Product or Future Product.

4.3. Sonos' Engineering Change Order (ECO) Request. When an Engineering Change is required by either party, the requesting party shall provide the other party with all applicable and sufficient documentation, specifications, and the requested effective date of such engineering change. IAC shall respond initially within [*] or any other longer period agreed between the Parties, advising Sonos as to (i) implementation and the effective date of such change, (ii) associated costs and effect to on-hand materials, on-order materials and work in process which shall be borne by Sonos, (iii) the impact of the change upon existing Product pricing and shipment schedules for the entire period for which Purchase Orders are outstanding, and (iv) the costs and expenses of obsolete materials caused by implementing such engineering change which shall be borne by Sonos, subject to the provisions of Section 7.9. Costs associated with Engineering Change Orders shall be agreed in writing between the Parties prior to implementation. The foregoing request/approval process shall also apply during NPI for any Transfer Product or Future Product. The Engineering Change process agreed upon between the Parties is described in detail in Exhibit I attached to this Agreement.

4.4. Notification Requirement. If at any time either party discovers an error, bug or other problem that such party believes will require a Production Process Change Order or Engineering Change Order, the discovering party will notify the other immediately and begin the process of fixing the issue in accordance with either Section 4.2 or 4.3, as appropriate. Sonos reserves the right to halt Mass Production of a given Product if Sonos determines, in its reasonable and good faith judgment, that there is a problem in manufacturing such Product that requires immediate remedial action. [*]. Unless otherwise authorized by Sonos in writing, the Mass Production line will remain stopped until the cause of the failure is understood, a solution is implemented and thoroughly tested and Sonos approves in writing to resume Mass Production.

4.5. Quality Programs; Disaster Recovery Plan. IAC shall maintain various quality control programs consistent with best practices for the industry, each of which will be provided to Sonos if requested. When applicable, any additional or substitute quality requirements agreed to by the Parties shall be made to such programs and plans. IAC shall also have a disaster recovery plan in place detailing IAC's plans, procedures, and designated resources for timely response to and recovery from potential civil, natural, and physical plant disasters that could reasonably be expected to disrupt production and delivery to Sonos. The plan shall be approved by Sonos for each Product to ensure the supply of such Products to Sonos is not interrupted. Such plans may include multiple sources of supply for each Component and back-up manufacturing facilities. Any changes to the disaster recovery plan shall be subject to Sonos' prior written concurrence.

4.6. Inspection of IAC Plants; Subcontractors. Upon [*] prior written notice from Sonos, Sonos or its representatives will have the right to inspect and audit, at Sonos' expense, IAC's factory, purchasing processes, manufacturing processes, quality program, physical inventory count and supporting documentation, including reports, quality test data and training documents and certificates of Page 10 of 38 *Confidential Treatment Requested





conformance as related to Products at any time during the term of this Agreement. For information stored electronically and where IAC cannot give Sonos access to its systems, IAC will provide printouts of any requested documentation. If such an inspection is requested, IAC will reasonably furnish all relevant supporting documentation to verify compliance with its stated manufacturing and quality processes. Inspections shall be conducted at a reasonable time and during normal hours of operation. Such inspections and audits by Sonos or a Sonos authorized audit firm will be limited to [*], except for any case of an identified quality issue whereby Sonos will have the right to inspect IAC's facility and to review applicable documentation and processes at any time, provided Sonos provides IAC with written notice [*] in advance of the Sonos inspection. Subject to the prior written approval of IAC's vendor or IAC Subcontractor, Sonos or its representatives may also inspect such vendor or subcontractor.

4.7. Safety Standard Changes. IAC shall promptly notify Sonos if, to its knowledge, any upgrade, substitution or other change to any Third Party Component is required to make the Component meet applicable safety standards or other governmental statutes, rules, orders or regulations. Sonos and IAC will discuss the costs of any subsequent upgrade, substitution or other required change in an equitable manner based on good faith discussions between the parties.

4.8. Compliance with Laws and Regulations for Manufacturing; Fair Labor Practices. IAC shall comply with all applicable laws and regulations related to the manufacturing and/or production of the Products in jurisdictions in which IAC manufactures the Products, including labor and employment, environmental, safety, tax and other similar regulations. In addition, IAC currently complies and will continue to comply with any applicable regulations regarding foreign child labor laws and other abusive labor practices.

4.9. EICC Membership. IAC shall maintain a membership in good standing with the Electronic Industry Citizenship Coalition (EICC) throughout the term of this Agreement. If IAC presently does not have an EICC membership, then after SONOS joins the EICC and unless otherwise agreed in writing between the Parties, one shall be obtained within six (6) months from the Effective Date. In the event IAC loses or discontinues their EICC membership during the term of this Agreement, Sonos must be notified in writing within three (3) business days, including the reason or reasons the membership has been disrupted. IAC shall cure any membership disruption within six (6) weeks time from the date of its occurrence.

4.10. Compliance with Product Requirements. Sonos is responsible for identifying and securing approvals from regulatory, safety and/or standards organizations agencies in the various jurisdictions in which it sells or intends to sell the Products. IAC shall use commercially reasonable efforts to provide any and all assistance requested by Sonos to obtain such approvals from the relevant agencies and organizations, of which will be at Sonos' cost. IAC shall mark the Products and, as applicable, the Components, with regulatory, safety and standards organizations marks which signify compliance with the requirements of those organizations that Sonos has specified. IAC has the responsibility for obtaining any required regulatory, safety or other approvals for Components, provided that Sonos shall provide reasonable assistance in obtaining such approvals from any Sonos-appointed vendors.

4.11. Origin Certification; Marking; HTS. Upon Sonos' request, IAC will provide Sonos with an appropriate certificate stating the country of origin for the Products and Components, provided that IAC can obtain such certification from the Components vendor. IAC shall mark the container or pallet with the country of origin in compliance with customs' requirements. IAC agrees that it will follow Sonos' guidelines for Harmonized Tariff Schedule (HTS) classifications that may be required for either export or import of the Products. Page 11 of 38 *Confidential Treatment Requested





4.12. Manufacturing Test Information. IAC shall provide Sonos with electronic tracking of Product assembly data (sub and final assemblies), Product test results, quality audits (dates, scope, findings, actions), packaging, shipping and ECO implementation details. [*].

4.13. On Site Presence. Sonos always has the right to have its employees or authorized representatives on IAC's manufacturing floor for the general purpose of overseeing and collecting manufacturing information related to the Mass Production, repair, or rework of Products.

4.14. Performance Expectations. Sonos and IAC agree to work together to develop and achieve the supplier performance expectation as outlined by the Sonos Supplier Performance Review described in Exhibit F. [*]. IAC agrees to discuss and document in the performance review meetings any productivity improvement accomplishments and future plans relating thereto. Each party shall be responsible for its own costs associated with participating in these activities.

5.0 FORECASTS, PURCHASE ORDERS AND DELIVERY.

5.1. End of Life. If Sonos elects to discontinue the sale of any Product (End of Life or EOL), Sonos shall notify IAC in writing at least [*] prior to the approximate date on which Sonos intends to EOL the product, including the date and quantity of the last Product Build and any additional requirements for future, anticipated returns.

5.2. Purchase Orders. From time to time [*], an authorized Sonos Planning Manager defined in Exhibit B shall send to IAC a binding Purchase Order in accordance with the Lead Time for a given Product. Sonos' Purchase Orders shall be submitted to IAC in writing or by any reasonable means, including but not limited to EDI, postal delivery, courier delivery, facsimile transmission or electronic mail. Each Purchase Order shall include:

(a) Identification of Product ordered by Sonos part number;

(b) Quantity to be purchased;

(c) Requested Product ex-factory date; and

(d) Sonos Destination and other specific instructions.

5.3. Placement of Purchase Orders; Rolling Forecasts. All Purchase Orders under this Agreement shall be subject only to the terms and conditions hereof. IAC shall not be bound by any term or condition on a Purchase Order that is inconsistent with this Agreement or any of its exhibits except to the extent mutually agreed in writing by the Parties. In the event the terms of any such Purchase Order, confirmation or similar document conflict with or are additional to the terms of this Agreement, the terms of this Agreement alone shall apply and shall govern regardless of execution of such document by one or both parties. [*]. Unless requested by Sonos more frequently, IAC shall update Sonos [*] with current lead times and cancellation terms, as applicable, for all Components required to manufacture Products. Upon Sonos' request, IAC will provide documentation from the manufacturer of any Component proving the accuracy of applicable Component lead-times and cancellation terms, as applicable.

5.4. Acknowledgment of Purchase Orders by IAC. The process describing Purchase Order acknowledgment is found in Exhibit H. If a Purchase Order shortens the Lead Time or Sonos requests an adjustment to a Purchase Order, IAC will use commercially reasonable efforts to adjust the Purchase Order or accommodate such shorter Lead Time. Any reasonable and actual costs incurred by IAC to accommodate a shorter Lead Time shall be borne by Sonos, provided that Sonos has approved such costs in advance in writing. If Sonos does not approve such costs, the Products shall be shipped no later than the originally scheduled shipment date. Page 12 of 38 *Confidential Treatment Requested





5.5. Flexibility Guidelines. [*].

5.6. Delays. If IAC knows it cannot meet the ex-factory date for a given Purchase Order, IAC shall immediately notify Sonos in writing of such event. In such event, both parties will jointly develop alternatives to resolve any late delivery of Product in order to minimize adverse consequences resulting from such late delivery. If only a portion of the Product Build is available for shipment to meet the ex-factory date, IAC will notify Sonos and ship the available Products unless otherwise directed by Sonos. In the event that such delay is solely caused by IAC (an IAC Delay), IAC shall notify Sonos in writing [*] in advance of the change and provide a recovery plan within [*]. If the IAC Delay causes Products to ship more than [*] from the original ex-factory date, IAC shall pay for any resulting increase in the freight cost over that which Sonos would have been required to pay by the standard shipment method.

5.7. Allocation. In the event of a reduced allocation, whether due to a Force Majeure event or otherwise, IAC shall provide Sonos and its Affiliates with written notice if it anticipates or has reason to believe that IAC's output of the Product shall not be sufficient to meet all of Sonos' and/or its Affiliates' requirements for any period. Sonos shall receive at least the same priority, with respect to IAC's allocation of production capacity and Components, as any other IAC customer.

5.8. Duty to Fulfill Purchase Orders. IAC agrees to fulfill all Purchase Orders in accordance with the terms of this Agreement prior to the termination or cancellation of this Agreement, even if the Delivery Dates of Products under such Purchase Orders occur after the date of expiration or termination.

5.9. Delivery. All Product Units specified in a Purchase Order shall be shipped complete, both as to quantity and overall Product contents, in accordance with the applicable Statement of Work.

5.10. [*].

6.0 PRODUCT ACCEPTANCE ,INVOICING, QUARTERLY PRICING UPDATES, AND SHIPPING TERM.

6.1. Production Line Testing and Acceptance. Acceptance for a given Product is typically governed by adherence to the applicable Quality Plan. Any Product that passes the Quality Plan is deemed accepted by Sonos, unless Sonos has indicated that it wishes to perform a separate acceptance inspection to verify compliance with the Quality Plan, in which case acceptance will be deemed to take place after satisfactory completion of such inspection. Transfer of title of Product to Sonos does not indicate acceptance by Sonos of that Product. Such acceptance, however, does not modify or otherwise limit in any respect the product warranty provided by IAC to Sonos under Section 10.2 hereof.

6.2. Rejection. Any Product that does not meet the various tests specified in the applicable Sonos Quality Plan shall be deemed rejected. If rejected, IAC shall have the option, at its sole expense and cost, to either (i) take such remedial measures as shall be necessary to enable the Product to comply with the Sonos Quality Plan, or (ii) scrap the Product and build a replacement Product Unit that conforms to the Quality Plan. IAC shall make such decision in a timely manner, but in no event take longer than five (5) working days to reach such decision, so that the overall progress of the Product Build is not delayed. Under no circumstances will Sonos be obligated to pay for any Product (or any Components incorporated therein) that has not passed the applicable Quality Plan.

6.3. Invoicing. Upon transfer of title of Product to Sonos and compliance with the process described by Exhibit H, IAC shall invoice Sonos with reference to the governing Purchase Order and Sonos shall pay such invoice in accordance with the payment terms described in Section 7.5. Page 13 of 38 *Confidential Treatment Requested





Concurrent with the submission of the invoice, IAC shall transmit to Sonos the executed bill of lading and/or other shipping documents or statement for the Products. All invoices under this Agreement shall be subject only to the terms and conditions hereof. Sonos shall not be bound by any term or condition on an invoice that is inconsistent with this Agreement or any of its exhibits except to the extent mutually agreed in writing by the parties. In the event the terms of any such invoice or similar document conflict with or are additional to the terms of this Agreement, the terms of this Agreement alone shall apply and shall govern regardless of execution of such document by one or both parties.

6.4. [*] Pricing Updates. [*], Sonos and IAC shall apply the cost model formula described in Exhibit G to determine a price for each Product that will be applied to invoices [*]. [*]. In order to capture the latest prices for Components [*], IAC shall provide Sonos with the BOM cost for each Product no later than [*]. Sonos will review the BOM cost data and the Parties will work in good faith to resolve any discrepancies and update their respective systems with the agreed upon Product pricing [*].

6.5. Shipping Term; Title and Risk of Loss. Unless otherwise specified to the contrary on a Purchase Order (and subsequently acknowledged in writing by IAC), shipping terms are [*] and include all elements of the INCOTERMS 2010 definition with the following modifications:

[*]

7.0 PRICES; PAYMENT TERMS.

7.1. Product Prices. Unless otherwise mutually agreed, the price to be paid by Sonos for any Product manufactured by IAC hereunder will be quoted based on the calculation of the pricing formula described in Exhibit G and the Shipping Term described by Section 6.5. Subject to Section 7.6, the Price for any given Product shall be governed by the pricing formula set forth in Exhibit G and based on pricing formula inputs that are applicable on the date a Product is manufactured by IAC. In cases where a Product's price paid by Sonos is not equal to the applicable pricing formula calculation, the difference will be settled by the PPV process described herein. [*].

7.1.1. Items Specifically Excluded from Price and/or Pricing Formula. The parties agree that the following items shall not be charged to Sonos in the Price of any Product, whether separately itemized or amortized into an item of the Pricing Formula:

(a) [*]

(b) [*]

(c) [*]

(d) [*]

7.2. Component, Tooling and Labor Pricing Provisions.

7.2.1. Component and Sonos Tools Pricing. [*].

7.2.2. Component and Sonos Tools Shipping Costs. [*].

7.2.3. Production Line Labor Pricing. Labor pricing for IAC operators shall be competitive in the region IAC is operating in. Actual labor pricing shall be applied by IAC in calculating Product pricing using the cost model described in Exhibit G.

7.2.4. First Pass Yield Costs. For each Product, the Statement of Work will establish a mutually agreed upon first pass yield rate. [*] allocation of costs shall be as follows: Page 14 of 38 *Confidential Treatment Requested





Cause of Yield Loss Responsible Party [*] [*] [*] [*] [*] [*] [*] [*]

7.3. Sonos Tools. To the extent that Sonos requires the creation or procurement of a Sonos Tool, Sonos shall pay IAC by [*] upon acceptance of the invoice provided by IAC in accordance with Exhibit H and/or other applicable SOW, which acceptance may not be unreasonably withheld. [*]. Upon payment to IAC, Sonos shall take full title and ownership of the applicable Sonos Tool, including any specifications associated with the Sonos Tool. IAC will execute any documents necessary to document or perfect Sonos' ownership of the Sonos Tool. If the Sonos Tool is created by an IAC Subcontractor, IAC shall secure such ownership rights in accordance with its responsibilities specified in Section 13.1 of the Agreement. [*]. IAC will hold the Sonos Tools as a bailee only and will not permit any lien or other encumbrance to be placed against it when in IAC's care, custody and control. IAC will apply Sonos asset tags provided by Sonos to all Sonos Tools. Under no circumstances will IAC move Sonos Tools from the location designated by Sonos, without Sonos' prior written consent, or deny Sonos access to the Sonos Tools. Immediately upon Sonos' request or termination of this Agreement, IAC will deliver the Sonos Tools to [*]. IAC agrees to return the Sonos Tools in the same condition it was provided to IAC, except for normal wear and tear. IAC agrees to use Sonos Tools solely for Sonos' benefit. IAC will not use Sonos Tools for any other purpose or permit a third party to use the Sonos Tools except as set forth in this Agreement. The Sonos Tools provided by Sonos is provided to IAC as is and Sonos disclaims all warranties, express or implied, including the implied warranties of merchantability and fitness for a particular purpose. Sonos reserves the right to inspect any Sonos Tools in IAC's control at any time, provided it gives IAC at least forty-eight (48) hours advance notice. Sonos shall not be required to pay for any tool, equipment, fixture, jig or similar item that is not a Sonos Tool.

7.3.1. Sonos Tool Maintenance; Damaged Sonos Tool. IAC agrees to use commercially reasonable efforts to maintain Sonos Tools in good, satisfactory working condition and to keep Sonos Tools fully covered under IAC's property insurance at all times and without expense to Sonos. IAC will be responsible for physical loss of or damage to the Sonos Tools while in the possession or control of IAC. IAC is solely responsible for installing, testing, and maintaining Sonos Tools in its control in good working condition and in compliance with applicable manufacturing specifications, for purchasing and maintaining spare parts to repair such Sonos Tools with a minimum of downtime, and for any risk of loss in connection with the Sonos Tools. Normal maintenance of Sonos Tools will be at Sonos' expense. In the event that a Sonos Tool is damaged beyond what is considered normal wear and tear, it shall be the responsibility of IAC or its designated suppliers to notify Sonos within one (1) working day. It shall be the [*] responsibility of [*] to bear the full repair or replacement cost of a damaged Sonos Tool, [*]. All Sonos Tool repairs shall be made to the satisfaction of applicable manufacturing specifications.

7.4. Taxes. All Prices are in U.S. dollars and do not include withholding taxes and the like. [*]. All other items of tax based in whole or in part on the income of a party shall be the sole responsibility of such party. [*].

7.5. Product Payment Terms. Payment terms are [*] from the date of acceptance by Sonos of an applicable invoice from IAC in accordance with Exhibit H and/or other applicable SOW, which acceptance may not be unreasonably withheld. IAC may not submit an invoice for a Product prior to Page 15 of 38 *Confidential Treatment Requested





that Product's transfer of title to Sonos. All payments shall be made in U.S. currency, unless otherwise agreed in writing by the parties, by check or wire transfer (as may be agreed upon by the parties) to an account designated by IAC. Invoices for shall be remitted to: Sonos, Inc., Attn: Accounts Payable, 223 E. De La Guerra Street, Santa Barbara, CA, 93101, USA, and shall also sent by electronic mail on the date of the invoice to: [*]. Any alteration to the payment terms must be mutually agreed in writing by the Parties.

7.6. On-Going Cost Reductions. [*] shall use commercially reasonable efforts to achieve on-going reductions in the costs of the BOM for each Product. [*].

7.6.1. [*].

7.7. Cost Calculation Process and Review. [*], IAC and Sonos shall meet to review any changes that have occurred in the total cost for each Product since the prior review and according to the cost model formula described in Exhibit G. [*].

7.8. Purchase Price Variance (PPV). Consistent with Section 6.4 of this Agreement, Sonos and IAC shall compare the cost model formula results between the invoiced pricing for Products [*] and the actual cost data that applied to the formula for the period. [*] Additionally, IAC and Sonos may agree to settle other costs that are incurred [*] in the next PPV calculation. Based on the results of the PPV calculation, the Parties will execute a credit or debit (positive or negative) memo for the entire Purchase Price Variance amount to be applied against the next payment(s) made by Sonos. IAC agrees to provide Sonos with any requested documentation relevant to the PPV calculation, including but not limited to copies of invoices from Components suppliers.

7.9. Component Procurement, Supply Management, Component Buffer Inventory, and Excess Components. Sonos desires to empower IAC to place Component purchase orders and otherwise manage the Component supply chain necessary to execute the on-time manufacture and shipment of Products. IAC shall be responsible to maintain accurate and up to date Component Lead Times and cancellation terms for all Components required to manufacture Products, and to place purchase orders for all Components according to Component Lead Times and the most recent Sonos Purchase Orders and Rolling Forecast. For Components that more than one supplier is qualified for usage in Products (multi-sourced Components), IAC shall execute Component purchase orders according to the volume share instruction given by Sonos. For such multi-sourced Components, IAC and Sonos shall agree to a process to, on [*], review and revise according to Sonos' instruction the purchase order volume share to be placed by IAC between qualified Component suppliers. In the event of a change in quantities of Products in a Sonos Purchase Order or Rolling Forecast, IAC shall respond quickly to adjust its purchase orders for all Components and to confirm revised supply plans with all Component suppliers. Within [*] of receiving a new Sonos Rolling Forecast, IAC shall review Product manufacturing capacity and Component availability and provide Sonos a written shipment commitment plan (including shipment quantities by date). This plan should meet Sonos' latest Rolling Forecast unless Product manufacturing capacity or Component availability does not support the Rolling Forecast, in which case the Parties will work together to resolve such issues. Unless Sonos otherwise instructs IAC in writing, IAC shall not reduce or cancel purchase orders on any other Components due to such Component shortage. In the event that IAC notifies Sonos that it is in possession of Excess Components, (and subject to the maximum liability parameters set forth in Exhibit C), IAC will use commercially reasonable efforts to reduce its inventory of Excess Components, including, without limitation, returning such Excess Components to the supplier, using such Components for IAC's support and repair obligations, selling the Excess Components (subject to the limitations in this section) and/or using the Excess Components for other Products or the products of other customers of IAC or an IAC Affiliate. [*]. If IAC can only sell an Excess Component at a loss, it must obtain prior written authorization from Sonos for such sale, Page 16 of 38 *Confidential Treatment Requested





unless the aggregate amount of the loss Sonos would incur is [*]. Unless otherwise instructed by Sonos in writing, IAC is not authorized at any time to sell Custom Components to any third party or IAC Affiliate. [*], IAC shall send to Sonos a written report detailing any remaining Excess Components. If requested by Sonos, IAC agrees to provide all documentation (purchase order date, quantity ordered, Component lead-time, etc.) supporting IAC's determination that the inventory is considered Excess Components. [*]. In the event Sonos instructs IAC to scrap any Components, IAC shall notify Sonos at least twenty-four (24) hours in advance of scrapping the Components and Sonos reserves the right to witness such scrap.

7.9.1. Component Buffer Inventory. IAC agrees to maintain [*] of buffer inventory for Components to support possible short lead time increases in Product quantities. The [*] of Component inventory is IAC's responsibility to manage, and can be achieved through any one of the following methods: 1) [*] 2) [*] 3) [*]

The Component buffer inventory amount shall be calculated by [*]. As this [*] increases or decreases, IAC will manage the Component buffer inventory up or down as required. All Component inventories will be utilized by IAC for the manufacture of Products on a [*] basis. For Component buffer inventory stored at a Component supplier factory, Sonos and IAC shall develop a process to regularly validate that the correct levels of Component buffer inventory are in fact in place. [*]. As a Product approaches end of life, Sonos will instruct IAC in writing to reduce or eliminate all Component buffer inventories in order to minimize the risk of an Excess Component occurrence.

7.9.2. Clear to Build Reporting. On a [*] basis and covering at least [*] of the then-current Sonos Rolling Forecast, IAC shall provide Sonos with a written Clear to Build report for each Product. This report shall include each Component required for that Product and incorporate each Component supplier's supply commitment to IAC. The report shall compare the supplier supply commitments to IAC's Component requirements in order to meet the current Rolling Forecast. While the detailed format of the report will be agreed between Sonos and IAC, the intent of the Clear to Build report is to proactively highlight potential Component supply shortages so that they can be resolved in advance of becoming an impact to IAC's manufacture of Products. IAC agrees, if requested by Sonos, to publish an updated Clear to Build report more frequently than [*] during periods where significant Component shortage risks are present.

7.9.3. Component Discontinuance Purchase. In the event IAC or Sonos receives a manufacture discontinuance or end of life notice for a Component and the Component being discontinued does not have a replacement or substitute approved by Sonos prior to the last time buy date from the manufacturer, IAC agrees to purchase and store such discontinued Component during the term of this Agreement at a quantity specified in writing by Sonos and a Sonos PO is placed on IAC for the specified Component quantity. [*].

7.10. Audit Right. During the term of this Agreement, and for a period of [*] thereafter, IAC shall keep accurate and complete records of any items that are used in calculating a payment obligation of Sonos. No more than once per year during the Term, Sonos shall have the right, [*], to examine and audit IAC's books and records related to Sonos [*]. In the event such records are stored electronically Page 17 of 38 *Confidential Treatment Requested





on a system that IAC cannot give Sonos access to, IAC will provide print-outs of the requested documents. [*]. Any such audit will be conducted in a manner that does not unreasonably interfere with IAC's business activities. [*]. Sonos agrees that IAC may take reasonable precautions to preserve the identity of any IAC customer that might otherwise be compromised during such an audit.

8.0 NPI; FUTURE PRODUCTS

8.1. New Production Introduction. The outline of the New Product Introduction process is set forth on Exhibit D hereto, and shall be the basis for how existing Products or Future Products are prepared for Mass Production.

8.2. Statements of Work. As specified in Exhibit D, Sonos and IAC will formally add Products to this Agreement by executing a Statement of Work. Each party shall use its best reasonable effort to agree upon and sign the Statements of Work within a reasonable period of time. Unless a Statement of Work specifically refers to and amends a term of this Agreement, the terms and conditions of this Agreement will control and take precedence over any conflicting terms in a Statement of Work. If any Future Product becomes a Product prior to a Statement of Work being signed for that Product, the terms of this Agreement shall still apply to that Product.

8.3. Quality Plan. A Quality Plan will be created by the Parties for each Product and included in the applicable Statement of Work. The Quality Plan shall include in detail and where applicable: (a) All manufacturing and test process details, (b) All process variables and their control methods, (c) statistical process control methods used for monitoring and improvements, (d) quality and performance targets to be achieved as specified by Sonos, and (e) the necessary corrective actions planned. Each Quality Plan will be developed and owned jointly between the Parties, but Sonos will remain the owner of the Quality Plan and has final decision making authority of its contents.

9.0 REPAIR SERVICES; PROVISION FOR EXTENDED WARRANTY.

9.1. Technical Assistance. Each party shall make available to the other, [*], ongoing technical assistance with respect to the Product.

9.2. Repair Services. Pursuant to Exhibit E, IAC shall provide the RMA and repair services to Sonos upon request for a minimum of [*] from the date on which Sonos discontinues the sale of any Product on the terms and conditions set forth therein. Fees for such services, when required to be paid, shall be pursuant to the provisions in Exhibit E. It is expressly understood and agreed to by IAC that this Agreement does not grant IAC an exclusive privilege or right to repair or replace any or all Product purchased by Sonos under this Agreement. Sonos may perform the repairs or Sonos may elect to contract with other suppliers for the required repair or replacement services.

9.3. Extended Warranty. If requested by Sonos, IAC agrees to provide extended warranty coverage, [*]. The cost of such extended warranty coverage shall be mutually agreed upon in writing by the Parties on an individual Product basis, and included in the revised Statement of Work for each specified Product. Page 18 of 38 *Confidential Treatment Requested





10.0 REPRESENTATIONS AND WARRANTIES.

10.1. Mutual Warranty. Each party warrants and represents to the other that (i) it has the full corporate power and authority to enter into and carry out its obligations under this Agreement, and (ii) the execution and delivery of the Agreement by such party, and the performance by such party of its obligations pursuant to the Agreement, will not result in any material violation of or constitute a default under, any material agreement or obligation to which such party is currently bound.

10.2. Product Warranty by IAC. IAC hereby represents and warrants that for a period of [*] after the Manufacturing Date (the Warranty Period), a Product Unit will be free from defects in manufacturing process and defects in workmanship, will conform to general expectations of performance of wireless audio products and will conform to the Statement of Work for the applicable Product. For any Product Unit which is agreed between the Parties (such agreement to be made fairly and reasonably) to be non conforming to the above product warranty, IAC will, [*]. The warranty granted in this Section 10.2 will not apply to Product Units that have been misused, modified, damaged, abused, improperly stored (by a party other than IAC, an IAC affiliate, or an IAC subcontractor), tampered with or otherwise altered by any party other than IAC, an IAC Affiliate or an IAC Subcontractor. The above warranty is provided to Sonos as a standard warranty, [*]. If Sonos requests an extension of the Warranty Period, the parties will negotiate in good faith to determine an appropriate charge to extend the Warranty Period.

10.3. Third Party Component Warranty by IAC. IAC hereby warrants that (i) any IAC Sourced Component shall comply with the European Union Directive 2002/95/EC on the Restriction on the Use of Certain Hazardous Substances in electrical and electronic equipment or other similar environmental regulations that IAC is aware of, and (ii) any IAC Sourced Component shall be original. IAC will pass to Sonos all Component suppliers' warranties to the extent that they are transferable.

10.4. DISCLAMER. EXCEPT AS EXPRESSLY SET OUT IN THIS SECTION, EACH PARTY MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, REGARDING THE PRODUCT OR ANY SERVICES TO BE PROVIDED UNDER THIS AGREEMENT, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR NON-INFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE.

11.0 INDEMNITY.

11.1. Indemnification by Sonos. Subject to Section 11.4, Sonos shall defend, indemnify and hold harmless IAC and its Affiliates, and their officers, directors, employees, shareholders, agents, successors and assigns from and against any and all loss, damages, liabilities, settlements, costs and expenses (including reasonable legal expenses and the expenses of other necessary professionals) as incurred, resulting from or arising out of breach of :

(i) any representation or warranty provided by Sonos under this Agreement.

(ii) the gross negligence or willful misconduct of Sonos, or its employees, directors, representatives, or agents;

(iii) Sonos's failure to observe any applicable laws, regulations and/or statutory requirements

(iv) any product liability claim with respect to [*] other than [*].

11.2. Indemnification by IAC. Subject to Section 11.4, IAC agrees to defend, indemnify and hold harmless Sonos and its Affiliates, and their officers, directors, employees, shareholders, agents, successors and assigns from and against any and all loss, damages, liabilities, settlements, costs and expenses (including reasonable legal expenses and the expenses of other necessary professionals) as incurred, resulting from or arising out of (i) a manufacturing defect or any product liability claim caused by workmanship [*], or (ii) a breach of any representation or warranty provided by IAC under this Agreement. Page 19 of 38 *Confidential Treatment Requested





11.3. Intellectual Property Infringement.

11.3.1. Subject to Section 11.4, Sonos shall defend, indemnify and/or settle and hold harmless IAC and its Affiliates, and their officers, directors, employees, shareholders, agents, successors and assigns from and against any and all loss, damages, liabilities, settlements, costs and expenses (including reasonable legal expenses and the expenses of other necessary professionals) as incurred, resulting from or arising out of any third party claim, action, suit or proceeding (collectively and individually, a Claim) alleging that the Product (excluding any IAC Property) infringes any third party Intellectual Property Right, and shall pay all damages or settlement amounts finally awarded to the extent based upon such a Claim.

11.3.2. Subject to Section 11.4, IAC shall defend, indemnify and/or settle and hold harmless Sonos and its Affiliates, and their officers, directors, employees, shareholders, agents, successors and assigns from and against any and all loss, damages, liabilities, settlements, costs and expenses (including reasonable legal expenses and the expenses of other necessary professionals) as incurred, resulting from or arising out of any Claim alleging that the IAC Property or use thereof infringe any third party Intellectual Property Right, and shall pay all damages or settlement amounts finally awarded to the extent based upon such a Claim.

11.4. Procedure. The party seeking relief under this Section 11 (Indemnitee) shall: (i) promptly notify the other party (Indemnitor) in writing of any Claim; (ii) provide Indemnitor with sole control of the defense and/or settlement thereof; and (iii) provide Indemnitor, at Indemnitor's request and expense, with reasonable assistance and full information with respect thereto. Indemnitee shall have the right to participate, at its own expense, with counsel of its own choosing in the defense and/or settlement of such Claim. The indemnification obligations of the parties in this Section 11 shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the consent of Indemnitor, which consent shall not be unreasonably withheld or delayed. The failure to deliver written notice to Indemnitor within a reasonable time after the commencement of any Claim, if prejudicial to its ability to defend such Claim, shall relieve Indemnitor of any liability to Indemnitee under this Section 11.

11.5. Pass-Through of Indemnities. If a party becomes the subject of a Claim of infringement with respect to a Third Party Component, to the extent the other party has the right to pass through an indemnity with respect to such Third Party Component, such other party shall pass through the indemnity to the party that is the subject of the Claim.

12.0 CONFIDENTIALITY.

12.1. Definition. Confidential Information shall mean any information that is transmitted or otherwise provided by or on behalf of the disclosing party, whether orally or in writing, to the receiving party during the course of its performance under this Agreement which is identified as Confidential at the time of disclosure or that should reasonably have been understood by the receiving party because of legends or other markings, the circumstances of disclosure or the nature of the information itself, to be proprietary and/or confidential to the disclosing party. All IAC Property, Sonos Property and Future Products, and any information related to such Future Products, shall always be deemed to be Confidential Information of the respective party providing such information. Confidential Information may be disclosed in written or other tangible form or by oral, visual or other means, including Page 20 of 38





documents, computer code, prototypes, samples, plans and equipment. Confidential Information may also include information of a third party that is in the possession of one of the parties and is disclosed to the other party under this Agreement. Confidential Information shall not, however, include any information that (i) was publicly known and made generally available in the public domain prior to the time of disclosure by the disclosing party through no faults of the receiving party; (ii) becomes publicly known and made generally available after disclosure by the disclosing party to the receiving party through no faults of the receiving party; (iii) is already in the possession of the receiving party at the time of disclosure by the disclosing party as shown by the receiving party's files and/or records; or (iv) is obtained by the receiving party from a third party lawfully in possession of such information and without a breach of such third party's obligations of confidentiality.

12.2. Agreement as Confidential Information. The parties shall treat the terms and conditions and the existence of this Agreement as Confidential Information. Each party shall obtain the other's consent prior to any publication, presentation, public announcement or press release concerning the existence or terms and conditions of this Agreement. Notwithstanding the foregoing, Sonos may disclose that IAC is manufacturing its Products to potential investors, partners and customers. The Parties specifically acknowledge that disclosure of this Agreement or the relationship contemplated hereby, without the prior written consent of the other party, would have a material, adverse impact on the other party's relationship with its existing manufacturing partner.

12.3. Non-use and Non-disclosure. Each party agrees not to use any Confidential Information of the other party for any purpose except as necessary to perform its obligations under this Agreement. Each party agrees not to disclose any Confidential Information of the other party to any third party, except that, a receiving party may disclose the other party's Confidential Information to those employees of the receiving party who are required to have the information in order to perform under this Agreement and who have agreed in writing to confidentiality obligations at least as protective of the disclosing party as those set forth herein. If a receiving party is required by a final authorized order from a recognized and applicable government body or from a court with competent jurisdiction to make any disclosure that is prohibited or otherwise constrained by this Agreement, the receiving party will provide the disclosing party with prompt written notice of such requirement so that the disclosing party may seek a protective order or other appropriate relief. Subject to the foregoing sentence, such receiving party may furnish that portion (and only that portion) of the Confidential Information that the receiving party is legally compelled or is otherwise legally required to disclose; provided, however, that the receiving party provides such assistance as the disclosing party may reasonably request in obtaining such order or other relief. Neither party shall reverse engineer, disassemble or decompile any prototypes, software or other tangible objects that embody the other party's Confidential Information and that are provided to the party under this Agreement.

12.4. Maintenance of Confidentiality. Each party agrees that it shall take reasonable measures to protect the secrecy of and avoid disclosure and unauthorized use of the Confidential Information of the other party. Without limiting the foregoing, each party shall take at least those measures that it takes to protect its own confidential information of a similar nature, but in no case less than reasonable care (including, without limitation, all precautions the receiving party employs with respect to its own confidential materials). No party shall make any copies of the other party's Confidential Information except upon the other party's prior written approval. Each party shall reproduce the other party's proprietary rights notices on any such authorized copies, in the same manner in which such notices were set forth in or on the original or otherwise that can clearly express the other party's proprietary rights. A party receiving Confidential Information shall promptly notify the party disclosing such Confidential Information of any use or disclosure of such Confidential Information in violation of this Agreement of which the receiving party becomes aware. Confidentiality shall be maintained for a period of [*] after expiration of this Agreement. Page 21 of 38 *Confidential Treatment Requested





12.5. IAC's Manufacturing Lines Building Sonos Products. With the exception of authorized contractors approved by the Parties required to perform equipment maintenance or other required work on IAC's manufacturing lines that are assembling and testing Sonos Products, no third party personnel will be allowed access to (including a walk-through or tour) IAC's lines that are manufacturing Products. Any exceptions to this must be approved in advance and in writing between a Sonos Program Manager and IAC Program Manager listed in Exhibit B.

13.0 USE OF CONTRACTORS; COMPLIANCE WITH LABOR LAWS.

13.1. IAC may retain IAC Subcontractors to furnish services to it in connection with the performance of its obligations hereunder and, if required, permit such IAC Subcontractors to have access to Sonos' Confidential Information, provided that such IAC Subcontractors have signed agreements with IAC with restrictions on the use and dissemination of such information at least as restrictive as the confidentiality provisions contained herein. Before engaging any IAC Subcontractor, IAC shall first notify and get written approval from Sonos for the use of such IAC Subcontractor. Sonos shall not unreasonably delay or withhold such approval. IAC represents and warrants that the quality of the services and/or work product of any IAC Subcontractor shall be of at least the same quality as the services and/or work product delivered by IAC hereunder. In addition, IAC shall secure any and all Intellectual Property Rights that may pertain to the Sonos Products that are created by such IAC Subcontractor, and hereby transfers and assigns all such Intellectual Property Rights. IAC agrees that it will not prohibit Sonos from purchasing Components or Sonos Tools directly from any IAC Subcontractor, using existing terms or on terms established between Sonos and such IAC Subcontractor.

13.2. No Product will be (i) produced, manufactured, assembled, tested, or packaged by forced, prison, or child (defined as age 14 or below or the minimum working age within the applicable jurisdiction, whichever is older) labor, or (ii) transshipped for the purpose of mislabeling, evading quota or country of origin restrictions, or avoiding compliance with labor laws.

13.3. IAC and all persons furnished by IAC shall comply at their own expense with all applicable Environmental, Occupational Health and Safety laws, ordinances, regulations and codes, including the identification and procurement of required permits, certificates, licenses, insurance, approvals and inspections in performance under this Agreement.

14.0 LIMITATION OF LIABILITY.

EXCEPT IN THE EVENT OF A VIOLATION OF SECTION 3 (OWNERSHIP; GRANT OF RIGHTS: TRADEMARKS USAGE), OR FOR EACH PARTY'S OBLIGATIONS UNDER SECTION 11 (INDEMNITY), OR BREACH OF SECTION 12 (CONFIDENTIALITY), UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER UNDER ANY CONTRACT, STRICT LIABILITY, NEGLIGENCE OR OTHER LEGAL OR EQUITABLE THEORY, FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS IN CONNECTION WITH THE SUBJECT MATTER OF THIS AGREEMENT. EXCEPT IN THE EVENT OF A VIOLATION OF SECTION 3 (OWNERSHIP; GRANT OF RIGHTS: TRADEMARKS USAGE), OR FOR EACH PARTY'S OBLIGATIONS UNDER SECTION 11 (INDEMNITY), OR BREACH OF SECTION 12 (CONFIDENTIALITY), IN NO EVENT SHALL EITHER PARTY'S TOTAL LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT EXCEED THE AMOUNTS PAID BY SONOS FOR THE PRODUCTS IN THE [*] PERIOD IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE LIABILITY. THIS SECTION DOES NOT LIMIT EITHER PARTY'S LIABILITY FOR PERSONAL INJURY, DEATH, OR DAMAGE TO TANGIBLE PROPERTY. Page 22 of 38 *Confidential Treatment Requested





15.0 TERM AND TERMINATION.

15.1. Term. Unless terminated earlier as provided herein, this Agreement shall terminate on the date three (3) years from the Effective Date. This Agreement shall be automatically renewed for additional successive one (1) year periods, unless written notice of non-renewal is received no later than six (6) months prior to the expiration of the then current term.

15.2. Termination for Cause. This Agreement may be terminated by a party for cause immediately upon the occurrence of and in accordance with the following:

15.2.1. Insolvency Event. Either party may terminate this Agreement by delivering written notice to the other party upon the occurrence of any of the following events: (i) a receiver is appointed for any party or its property; (ii) any party makes a general assignment for the benefit of its creditors; (iii) any party commences, or has commenced against it, proceedings under any bankruptcy, insolvency or debtor's relief law, which proceedings are not dismissed within sixty (60) days; or (iv) any party is liquidated or dissolved.

15.2.2. Default. Either party may terminate this Agreement effective upon written notice to the other if the other party violates any material covenant, agreement, representation or warranty contained herein in any significant respect or defaults or fails to perform any of its obligations or agreements hereunder in any material respect, which violation, default or failure is not cured within thirty (30) days after notice thereof from the non-defaulting party stating its intention to terminate this Agreement by reason thereof.

15.3. Termination for Convenience. Either Party may terminate this Agreement hereunder for any reason at its convenience upon one hundred eighty (180) days prior written notice. In such case, Sonos' sole liability shall be limited to payment of the amount due under this Agreement, all the Component(s) procured by IAC, and any finished and work-in-process Products provided such Components and Products liabilities were incurred in compliance with this Agreement.

15.4. Termination or Expiration of Agreement. For the avoidance of doubt, the termination or expiration of this Agreement shall be without prejudice to any rights or obligations which have already arisen under this Agreement, its Exhibits or any Purchase Order prior to such termination or expiration.

15.5. Transfer. If a termination notice is delivered pursuant to 15.2, 15.3, 15.4 or if Sonos decides to transfer the manufacturing of a Product from IAC during the Term of the Agreement, IAC shall cooperate fully with Sonos to effect the transfer of the manufacturing of the Products (without any obligation that IAC transfers IAC Property from IAC to Sonos, or a third party designated by Sonos, in order to help minimize any potential disruption in the continuity of supply. In the event that such transfer is the result of a termination notice pursuant to 15.2, 15.3 or 15.4 and such transfer is not completed by the termination date pursuant to 15.2, 15.3 or 15.4, the parties shall, acting reasonably and in good faith, agree to continue to cooperate fully to effect the transfer and extend the Term of this Agreement on such appropriate terms as the parties may agree for one or more ninety (90) day periods (the succession of which must be notified to IAC in writing within thirty (30) days of the expiration of the first ninety (90) day period and within the same timeframe for each period thereafter), until such time as the transfer is completed.

15.6. Survival of Rights and Obligations Upon Termination. Sections 1, 3.1, 3.2, 3.4, 7.10, 9.2, 9.3, 10, 11, 12, 13, 14, 15.4, 15.5, 15.6, 16 and Exhibit E shall survive termination or expiration of this Agreement. Page 23 of 38





16.0 MISCELLANEOUS.

16.1. Force Majeure. Except for the obligation to make payments herein, neither party shall be liable for delays in delivery or performance of its obligations, or for failure to deliver or perform its obligations under this Agreement due to a cause or circumstances beyond its reasonable control, including, without limitation, an act of nature, act of civil, government, or military authority, act of terrorism, governmental priority, strike or other labor disturbance, flood, fire, explosion, epidemic, other hostilities, or failure of the Internet (not resulting from the actions or inactions of such party). For clarification purposes, an industry wide inability to obtain a Third Party Component is a force majeure event; however, all other material shortages shall not be considered force majeure events. The party claiming excuse because of force majeure shall use its commercially reasonable efforts to promptly correct such failure or delay in performance and shall promptly notify the other party to this Agreement of any delay or failure to perform which may be excused by this provision, which notification will also specify the expected date of resumption of performance. In the event of any such delay, the date of performance shall be extended for a period equal to the time lost by reason of the delay. If, however, either party is unable to perform its obligations under this Agreement for reasons excused by this provision for a period in excess of ninety (90) consecutive days, the other party may terminate this Agreement without penalty upon written notice to the other Party.

16.2. No Third Party Beneficiaries. Unless otherwise expressly provided, no provisions of this Agreement are intended or shall be construed to confer upon or give to any person or entity other than Sonos and IAC any rights, remedies or other benefits under or by reason of this Agreement.

16.3. Attorneys Fees. In addition to any other relief awarded, the prevailing party in any action arising out of this Agreement shall be entitled to its reasonable attorneys' fees and costs.

16.4. Relationship of parties. The parties hereto are independent contractors. Neither party has any express or implied right or authority to assume or create any obligations on behalf of the other or to bind the other to any contract, agreement or undertaking with any third party. Nothing in this Agreement shall be construed to create a partnership, joint venture, employment or agency relationship between Sonos and IAC.

16.5. Notices. Any notice required or permitted to be given by any party under this Agreement shall be in writing and shall be personally delivered or sent by a reputable overnight mail service (e.g., Federal Express), or by first class mail (certified or registered), or by facsimile confirmed by first class mail (registered or certified), to the Program Manager of the other party. Notices will be deemed effective (i) five (5) working days after deposit, postage prepaid, if mailed, (ii) the next day if sent by overnight mail, or (iii) the same day if sent by facsimile and confirmed as set forth above. A copy of any notice shall be sent to the following:

Sonos, Inc. 223 E. De La Guerra Street Santa Barbara, CA, 93101, USA Attn: [*] Email: [*] Fax: [*]

16.6. Assignment. No party may assign its rights or delegate its obligations hereunder, either in whole or in part, without the prior written consent of the other party, other than an assignment by Sonos or IAC of its rights and obligations hereunder to a wholly-owned subsidiary. Notwithstanding the foregoing, either party may assign, without the other's express written approval, all its rights and Page 24 of 38 *Confidential Treatment Requested





delegate all its obligations as part of a merger, reorganization or sale of all or substantially all its assets other than to a direct competitor of the non- assigning Party. Any attempted assignment or delegation in violation of this section by either party without the prior written consent of the other will be void. The rights and liabilities of the parties under this Agreement will bind and inure to the benefit of the parties' respective successors and permitted assigns.

16.7. Waiver and Modification. Failure by any party to enforce any provision of this Agreement will not be deemed a waiver of future enforcement of that or any other provision. Any waiver, amendment or other modification of any provision of this Agreement will be effective only if in writing and signed by the parties.

16.8. Construction. The Parties agree that any principle of construction or rule of law that provides that an agreement shall be construed against the drafter of the agreement in the event of any inconsistency or ambiguity in such agreement shall not apply to the terms and conditions of this Agreement. Titles and headings to articles and sections of this Agreement are inserted for convenience of reference only and are not intended to affect the interpretation or construction of this Agreement. The terms this Agreement, herein, hereof, hereunder and similar expressions refer to this Agreement and not to any particular section or other portion hereof. Unless otherwise specified, days means calendar days. Any use of the term including in this Agreement shall be construed as if followed by the phrase without limitation.

16.9. Severability. If for any reason a court of competent jurisdiction finds any provision of this Agreement to be unenforceable, that provision of the Agreement will be enforced to the maximum extent permissible so as to affect the intent of the parties, and the remainder of this Agreement will continue in full force and effect.

16.10. Dispute Settlement; Governing Law. Any dispute or claim arising out of or in relation to this Agreement, or the interpretation, making, performance, breach or termination thereof, shall first be referred to the responsible executives of each party, each of whom shall use their best reasonable efforts in good faith to reach a mutually agreeable solution. If the parties are unable to resolve the dispute or claim despite such efforts, the dispute or claim shall be settled by binding arbitration under the International Rules of the American Arbitration Association as presently in force (Rules) and by three (3) arbitrators appointed in accordance with such Rules. Judgment on the award rendered may be entered in any court having jurisdiction thereof. The place of arbitration shall be Los Angeles, California USA. Any monetary award shall be in U.S. dollars and the arbitration shall be conducted in the English language. The parties may apply to any court of competent jurisdiction for temporary or permanent injunctive relief, without breach of this Section 16.10 and without any abridgment of the powers of the arbitrator.

This Agreement shall be governed by the law of California, U.S.A. and the arbitrators shall apply California law to the merits of any dispute or claim, without reference to conflict of law principles. The arbitration proceedings shall be governed by federal arbitration law and by the Rules, without reference to state arbitration law. The parties hereby exclude the application of the United Nations Convention on Contracts for the International Sale of Goods

16.11. Entire Agreement. This Agreement, including all exhibits which are incorporated herein by reference, constitutes the entire agreement between the parties with respect to the subject matter hereof, and supersedes and replaces all prior and contemporaneous understandings or agreements, written or oral, regarding such subject matter.

16.12. Counterparts. This Agreement may be executed in two counterparts, each of which shall be an original and together which shall constitute one and the same instrument. Page 25 of 38





16.13. Insurance Coverage. [*] will have insurance policies with reputable insurers to provide coverage and amounts that secure its obligations and potential liabilities under this Agreement. [*] is responsible for all premiums, deductibles and retentions for such insurance. After this Agreement expires or terminates, [*] will either have an active policy or purchase an extended reporting period that has coverage for claims first made and reported to the insurer within 2 years after this Agreement expires or terminates. These insurance requirements will not limit [*] liability under this Agreement. Page 26 of 38 *Confidential Treatment Requested





IN WITNESS WHEREOF, the parties hereto have executed this Agreement by persons duly authorized as of the date and year first above written. SONOS, INC. IAC

By: /s/ Craig Shelburne By: /s/ Joyce Chang Name: Craig Shelburne Name: Joyce Chang Title: Title: Page 27 of 38





Exhibit A

Statement of Work for each transfer or future Sonos Product will be attached as part of Exhibit A. (to be added later, should not hold up contract signature)

Exhibit A-1 PLAY:1 Statement of Work

Exhibit A-2 Next transfer or future program. Page 28 of 38





Exhibit B

Program Managers

Sonos, Inc. Name Title Telephone and E-mail

[*] Senior Factory Program Manager Cell: [*] [*]

[*] Factory Program Manager Cell: [*] [*]

[*] Factory Program Manager Cell: [*] [*]

IAC: Name Title Telephone and E-mail

Planning Manager(s)

Sonos, Inc. Name Title Telephone and E-mail

[*] Senior Operation Manager Cell: [*] [*]

[*] Planning Manager Cell: [*] [*]

[*] Planning Manager Cell: [*] [*]

[*] Planning Manager Cell: [*] [*]

Address :

Suite 802, Tower A, Venture International Park, No. 2679 Hechuan Road, Minhang District, Shanghai, China 201103 Page 29 of 38 *Confidential Treatment Requested





Exhibit C

Flexibility and Cancellation Guidelines

C.1. Purchase Orders and Rolling Forecast. Upon prior written notice by a Sonos Planning Manager to IAC, Sonos may cancel or reschedule Purchase Orders or adjust the Rolling Forecast as follows: Number of Calendar Days from Scheduled Product Shipment Date Quantity Allowed to Reschedule to a Later Date Quantity Allowed to Upside Quantity Allowed to Cancellation [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]

C.2 Maximum Liability of Sonos; Best Efforts. In the event of a cancellation by Sonos of Purchase Orders (cancellation) or a reduction in the Rolling Forecast quantities without rescheduling those quantities to a later date (reduction), IAC must [*] mitigate any losses it may suffer by reason of such cancellation or reduction. In any event, the maximum Sonos liability for such cancellation or reduction will be limited to [*], provided that [*]. Prior to payment under this section, Sonos may audit all relevant documents to ensure that actual losses reasonably approximating the Purchase Order cancellation or Rolling Forecast quantity reduction charge have been suffered by IAC as the result of the cancellation or quantity reduction. [*].

C.3 Upside Flexibility. In the event Sonos increases a Purchase Order or Rolling Forecast quantities with [*] notice to IAC, IAC agrees to [*] support the increased quantities. Consistent with Section 7.9.1, IAC agrees to maintain [*] of buffer Component inventories for each Product that can be applied to supporting any short lead-time Sonos requests for increased Product quantities. Page 30 of 38 *Confidential Treatment Requested





Exhibit D

NPI Process D.1 Future Product Specifications. [*]. D.2 Future Product Confidentiality. [*]. D.3 Development Efforts. [*].

Diagram 1: NPI Phase-Gate Process (Typical)

[*] Page 31 of 38 *Confidential Treatment Requested





Table 1: NPI Phase Description

[*] D.4 Development Samples. [*]. D.5 Design Verification Testing. [*]. D.6. IAC's NPI Responsibilities. [*].

Table 2. Contract Manufacturer NPI Responsibility

[*]

D.7. Sonos Tools. To the extent that Sonos requires the creation or procurement of a Sonos Tool, Sonos shall pay IAC for the cost of such Sonos Tool [*]. IAC shall invoice Sonos at least [*] prior to such date, or on the date the Sonos Tool is accepted by Sonos if IAC has created the Sonos Tool itself. Prior to acceptance, all specifications and assembly drawings should be provided to Sonos for review. Upon payment to IAC, Sonos shall take full title and ownership of the applicable Sonos Tool, including any specifications and final assembly drawings associated with the Sonos Tool. If the Sonos Tool is created by an IAC Subcontractor, IAC shall secure such ownership rights in accordance with its responsibilities specified in Section 13.1 of the Agreement.

D.8 Reports. As appropriate, each party shall provide the other with periodic reports detailing its work on a Product, any anticipated problems and any indication of delay in fixed or tentative schedules. At a minimum, the Program Managers shall meet once a week, in person or by telephone, as mutually agreed, for a formal progress presentation, describing in detail the status of work, including projections for time of completion, steps necessary to return to the schedule in case of any delay, and discussion of possible resolution of any problems which have arisen.

D.9 NPI for Transfer Products. For Transfer Products, portions of the foregoing NPI process will apply, depending upon the complexity of the conversion of the existing manufacturing operations for the Transfer Product over to IAC.

D.10 Charge for NPI. [*] acknowledges that unless otherwise clearly specified in this Exhibit D as being a cost that will be borne by [*], the NPI Process (for either Future Products or Transfer Products), including all services provided by IAC and/or costs incurred by IAC as set forth in this Exhibit D, are provided with reasonable charge to Sonos, if such service is not defined in an applicable SOW and/or the roles and responsibilities matrix described above in Table 2. Any such costs must be approved in advance by Sonos in writing. Page 32 of 38 *Confidential Treatment Requested





Exhibit E

RMA and Repair Procedures Table E.1 RMA Warranty Coverage Provisions

Timing1 Nature of Defect Responsible Party2 Replacement Stock3 Warranty Period Coverage [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]

E.1 Explanation of Table Footnotes. 1. [*] 2. [*] 3. [*]

E.2 Definitions.

[*]

E.3 Repair Process. The following steps shall be followed by the parties: 1. [*] 2. [*] 3. [*] 4. [*] 5. [*] 6. [*] 7. [*] 8. [*] 9. [*] 10. [*]

E.4 High Failure and Epidemic Failure Rate Procedures. In the case of either a High Failure or an Epidemic Failure, IAC's obligations shall be, within three (3) business days, to propose an action plan to fix the failure of any affected Products and to implement this action plan upon Sonos' acceptance thereof, which action plan may include sending engineers over to designated sites to repair the Defective Products. [*].

E.5 Shipments; Determination of Responsibility. [*].

E.6 Repair Cost. The cost of any repair for which Sonos is responsible (for example, because of a design defect or outside of warranty return) shall be based upon the BOM for the Components included in the repair plus labor, with mutually agreed upon repair labor rates applied. [*].

E.7 Repair Labor Pricing. Repair labor pricing will be agreed in writing between the Parties and will be based upon market competitive labor rates for the location(s) in which IAC is performing the repairs. Page 33 of 38 *Confidential Treatment Requested





E.8 Repair Warranty.

All repair work conducted within the general product warranty period specified in Section 10.2 and is performed to repair a defect that constitutes a breach of the warranties provided by IAC in Sections 10.2 or 10.3 shall carry a warranty [*]. For clarification, this repair warranty warrants that the work corrected in all respects the identified defect and does not cover other defects unrelated to the repair work that may later occur.

All repair work conducted outside of the general product warranty period specified in Section 10.2 and all repair work conducted to correct a defect that is not covered by the warranties provided by IAC in Sections 10.2 or 10.3, shall carry a warranty of [*] that the work corrected in all respects the identified defect. For clarification, this repair warranty does not cover other defects unrelated to the repair work that may later occur.

E.9 Repair Reporting and Status. IAC shall make available to Sonos detailed repair information for each RMA unit including but not limited to repair work performed on the unit, SA and FA test results, packaging, and shipping. The information shall be linked to the manufacturing data of the Product Unit electronically through its serial number. In addition, a summary report shall be provided to Sonos for approval of responsible party determination. The report should include, but not necessarily be limited to, Product type, Serial Number, Defect Symptoms, Analysis, Corrective actions, Suggested responsible party and status. Page 34 of 38 *Confidential Treatment Requested





Exhibit F

Sonos Supplier Performance Review F.1 Introduction.

Sonos supplier management strategy is based on developing strong working relationships with its suppliers. The results Sonos seek will not occur from random sourcing or selecting suppliers solely on competitive quotations. It will result from working closely with the best existing suppliers to improve quality, productivity, cost, and all other elements of supplier performance.

The basic strategy entails establishing mutual performance expectations and metrics, providing supplier performance feedback, initiating corrective actions to ensure continuous improvements, and rewarding the best suppliers with the opportunity for future new business. The Sonos Supplier Performance Review program provides a framework for effective communication between Sonos and its suppliers regarding the specific elements of supplier performance. The result of establishing our expectations and supplier performance feedback will ensure maximum customer satisfaction and increased profitability for all contributors to the system. To accomplish these objectives, Sonos aims to: • Establish and strengthen long-term partnerships that result in mutual success between the Parties • Set expectations and metrics that are aggressive yet realistic and achievable • Utilize a team approach to achieve performance improvements • Be open to 2-way feedback and commit ourselves to continuous improvement, just as we expect from our supply and manufacturing partners

Successful supplier performance in the areas of Quality, Business, Engineering, Supply Chain & Operational Excellence is expected and necessary for both parties to achieve repeat business, increased sales and profitable growth. F.2 Supplier Performance Review Metrics.

IAC must maintain a competitive advantage by providing products of the highest quality and a competitive total cost, with operations that demonstrate best in class manufacturing, quality, engineering and supply chain innovation and execution. The Parties will mutually agree in good faith upon valid performance metrics, goals, and a relevant scoring template and process.

The Parties agree to meet [*] to review IAC's performance and scoring for the period. It is targeted to alternate meeting locations between Sonos' USA HQ office and IAC's factory. Dates and locations for such reviews will be agreed between the Parties with reasonable notice. Page 35 of 38 *Confidential Treatment Requested





Exhibit G

Product Pricing Formula Item Code Calculation [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] G.1 Pricing Formula Definitions:

[*]

All inputs to the Pricing Formula should be based upon validated actual data. Sonos reserves the right to audit and measure any manufacturing or test process or cycle time, as well as review any relevant IAC documentation to verify that Product pricing is calculated accurately. Consistent with Section 6.4 of this Agreement, Sonos and IAC will review all inputs to the above Pricing Formula for each Product on a quarterly basis, and adjust Product pricing as necessary to become effective in the next quarter. Page 36 of 38 *Confidential Treatment Requested





Exhibit H

ERS Statement of Work

ERS SOW to be added later Page 37 of 38





Exhibit I

Engineering Change Process

Engineering Change Process to be added later Page 38 of 38





[*] Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

SONOS, INC.

AMENDMENT TO MANUFACTURING AGREEMENT

September 24, 2014

WHEREAS, Sonos, Inc. (hereinafter Sonos) and Inventec Appliances Corporation (hereinafter IAC) have entered into a certain Manufacturing Agreement dated September 4, 2014 (the Agreement); and

WHEREAS, both Sonos and IAC desire to modify certain terms of the Agreement as specified below.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and for other good and valuable consideration the sufficiency of which is hereby acknowledged by both parties hereto, the parties agree to amend and modify the Agreement as set forth below: 1. Section 6.5 of the Agreement is hereby replaced in its entirety with the following:

6.5 Shipping Term; Title and Risk of Loss. Unless otherwise specified to the contrary on a Purchase Order (and subsequently acknowledged in writing by IAC), shipping terms are [*] and include all elements of the INCOTERMS 2010 definition with the following modifications:

[*] 2. Exhibit D of the Agreement is hereby replaced in its entirety with Exhibit D attached hereto. 3. Except for terms amended, replaced or added herein, all of the provisions of the Agreement shall remain unchanged, in full force and effect.

[Signature Page Follows] *Confidential Treatment Requested





IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first set forth above. INVENTEC APPLIANCES CORPORATION

By: Name: Title:

SONOS, INC.

By: /s/ Craig A. Shelburne Craig A. Shelburne





Exhibit D

NPI Process

D.1 Future Product Specifications. [*].

D.2 Future Product Confidentiality. [*].

D.3 Development Efforts. [*].

Diagram 1: NPI Phase-Gate Process (Typical)

[*] *Confidential Treatment Requested





Table 1: NPI Phase Description

[*]

D.4 Development Samples. [*].

D.5 Design Verification Testing. [*].

D.6. IAC's NPI Responsibilities. [*].

Table 2. Contract Manufacturer NPI Responsibility

[*]

D.7. Sonos Tools. To the extent that Sonos requires the creation or procurement of a Sonos Tool, Sonos shall pay IAC for the cost of such Sonos Tool [*]. IAC shall invoice Sonos at least [*] prior to such date, or on the date the Sonos Tool is accepted by Sonos if IAC has created the Sonos Tool itself. Prior to acceptance, all specifications and assembly drawings should be provided to Sonos for review. Upon payment to IAC, Sonos shall take full title and ownership of the applicable Sonos Tool, including any specifications and final assembly drawings associated with the Sonos Tool. If the Sonos Tool is created by an IAC Subcontractor, IAC shall secure such ownership rights in accordance with its responsibilities specified in Section 13.1 of the Agreement.

D.8 Reports. As appropriate, each party shall provide the other with periodic reports detailing its work on a Product, any anticipated problems and any indication of delay in fixed or tentative schedules. At a minimum, the Program Managers shall meet once a week, in person or by telephone, as mutually agreed, for a formal progress presentation, describing in detail the status of work, including projections for time of completion, steps necessary to return to the schedule in case of any delay, and discussion of possible resolution of any problems which have arisen.

D.9 NPI for Transfer Products. For Transfer Products, portions of the foregoing NPI process will apply, depending upon the complexity of the conversion of the existing manufacturing operations for the Transfer Product over to IAC.

D.10 Charge for NPI. [*] acknowledges that unless otherwise clearly specified in this Exhibit D as being a cost that will be borne by [*], the NPI Process (for either Future Products or Transfer Products), including all services provided by IAC and/or costs incurred by IAC as set forth in this Exhibit D, are provided with reasonable charge to Sonos, if such service is not defined in an applicable SOW and/or the roles and responsibilities matrix described above in Table 2. Any such costs must be approved in advance by Sonos in writing. *Confidential Treatment Requested





[*] Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

SONOS, INC.

AMENDMENT TO MANUFACTURING AGREEMENT

November 1, 2015

WHEREAS, Sonos, Inc. (hereinafter Sonos) and Inventec Appliances Corporation (hereinafter IAC) have entered into a certain Manufacturing Agreement dated September 4, 2014 (the Agreement); and

WHEREAS, both Sonos and IAC desire to modify certain terms of the Agreement as specified below.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and for other good and valuable consideration the sufficiency of which is hereby acknowledged by both parties hereto, the parties agree to amend and modify the Agreement as set forth below: 1. Section 4.15 set forth below is hereby added to the Agreement following Section 4.14: 4.15 Locking Procedures. IAC represents and warrants that it shall comply with all locking and unlocking procedures communicated to IAC by Sonos for any Sonos Product. Sonos may update these procedures at any time by providing IAC with written notice of the revised procedures, and the original and revised procedures are hereby incorporated into this Agreement. The testing of Product Units shall be managed to ensure that a dev unlocked unit is relocked in preparation for storage when it is no longer actively in use, or is destroyed. No dev unlocked units shall be removed from the IAC manufacturing facility without the specific written consent of Sonos in each instance. In the event that a dev unlocked Product Unit is required to be transported outside of the IAC manufacturing facility, IAC hereby agrees that it will ensure that the Product Unit is dev relocked prior to transport. IAC shall never use a Product Unit for production if, at any point, IAC or Sonos has dev unlocked the Product Unit. 2. Section 4.16 set forth below is hereby added to the Agreement following Section 4.15: 4.16 Scrapping Procedures. IAC represents and warrants that it shall comply with all scrapping procedures communicated to IAC by Sonos for any Sonos Product. Sonos may update these procedures at any time by providing IAC with written notice of the revised procedures, and the original and revised procedures are hereby incorporated into this Agreement. 3. For purposes of Section 10.4 and 11 of the Agreement, the additional representations and warranties outlined herein shall be treated as if they are a part of Section 10 of the Agreement.





4. Except for terms amended, replaced or added herein, all of the provisions of the Agreement shall remain unchanged, in full force and effect.

[Signature Page Follows]





IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first set forth above. INVENTEC APPLIANCES CORPORATION

By: Name: Title:

SONOS, INC.

By: /s/ Craig A. Shelburne Craig A. Shelburne





[*] Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

SONOS, INC.

AMENDMENT TO MANUFACTURING AGREEMENT

October 1, 2017

WHEREAS, Sonos, Inc. (hereinafter Sonos) and Inventec Appliances Corporation (hereinafter IAC) have entered into a certain Manufacturing Agreement dated September 4, 2014, as amended (the Agreement); and

WHEREAS, both Sonos and IAC desire to modify certain terms of the Agreement as specified below.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and for other good and valuable consideration the sufficiency of which is hereby acknowledged by both parties hereto, the parties agree to amend and modify the Agreement as set forth below: 1. Section 1.12 is hereby replaced in its entirety with the following: 1.12 Delivery Date means the date that a Product Build (or portion thereof) is presented for acceptance by a Designated Carrier at the IAC Manufacturing Facility. 2. Section 6.5 of the Agreement is hereby replaced in its entirety with the following:

6.5 Shipping Term; Title and Risk of Loss. Unless otherwise specified to the contrary on a Purchase Order (and subsequently acknowledged in writing by IAC), shipping terms are [*], and include all elements of the INCOTERMS 2010 definition, subject to the specifics outlined in the table presented below.

[*]

Upon completion of its responsibilities above and delivery to the Designated Carrier, title will transfer to Sonos and IAC may submit an invoice for payment in accordance with Section 7.5. 3. Section 7.5 of the Agreement is hereby replaced in its entirety with the following:

7.5. Product Payment Terms. Payment terms are [*] from the date of acceptance by Sonos of an applicable invoice from IAC, which acceptance may not be unreasonably withheld. IAC may not submit an invoice for a Product prior to that Product's transfer of title to Sonos. All payments shall be made in U.S. currency, unless otherwise agreed in writing by the parties, by check or wire transfer (as may be agreed upon by the parties) to an account designated by IAC. Invoices for shall be remitted to: Sonos, Inc., Attn: Accounts Payable, 614 Chapala St., Santa Barbara, CA, 93101, USA, and shall also sent by electronic mail on the date of the invoice to: [*]. Any alteration to the payment terms must be mutually agreed in writing by the Parties. *Confidential Treatment Requested





4. Except for terms amended, replaced or added herein, all of the provisions of the Agreement shall remain unchanged, in full force and effect.

[Signature Page Follows]





IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first set forth above. INVENTEC APPLIANCES CORPORATION

By: Name: Title:

SONOS, INC.

By: /s/ Craig A. Shelburne Craig A. Shelburne Secretary 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?

SOLUTION: At no time shall IAC challenge or assist others to challenge the Sonos Marks, or registrations thereof, or attempt to register any trademarks, service marks, trade names or other marks confusingly similar to the Sonos Marks.

PROBLEM: AMENDMENT NO. 3 TO STREMICK'S HERITAGE FOODS, LLC and PREMIER NUTRITION CORPORATION MANUFACTURING AGREEMENT

This Amendment No. 3 (the Third Amendment), entered into by and between Stremicks Heritage Foods, LLC (Heritage) Premier Nutrition Corporation (Premier) is effective as of July 3, 2019 (Third Amendment Effective Date) and amends that certain Manufacturing Agreement between Heritage and Premier dated July 1, 2017 as amended (Agreement). Heritage and Premier are each referred to herein as a Party and collectively as the Parties.

WHEREAS, Heritage and Premier entered into the Agreement;

WHEREAS, the Parties wish to amend the Agreement in accordance with the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the promises and of the mutual covenants, representations and warranties contained in the Agreement and set forth herein, the Parties hereby agree that the following changes shall be made to the Agreement:

1. The Parties hereby agree to remove Schedule C-1 in its entirety and replace it with the following:

Schedule C-1. The following is attached to an incorporated into the Agreement as Schedule C-1:

Schedule C-1([***])

[***]

2. Except as otherwise specified above in this Amendment, all other terms, conditions and covenants of the Agreement shall remain in full force and effect.

IN WITNESS WHEREOF, the Parties have caused this Amendment to be signed by their respective duly authorized representatives as of the Amendment Effective Date. Premier Nutrition Corporation Stremick's Heritage Foods, LLC.

By: /s/ Darcy Davenport By: /s/ Sam Stremick Name: Darcy Davenport Name: Sam Stremick Title: President Title: President

Source: BELLRING BRANDS, INC., S-1, 9/20/2019 
Question: Highlight the parts (if any) of this contract related to Effective Date that should be reviewed by a lawyer. Details: The date when the contract is effective

SOLUTION: July 3, 2019

PROBLEM: FORM OF FRANCHISE AGREEMENT Location of the Premises: Agreement Date Franchisee Business Address

Type of Legal Entity (if applicable) State in which entity organized (if applicable) Shareholder / Partner / Member Name Ownership Percentage % (the Operating Principal) % % % %

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





TABLE OF CONTENTS SECTION PAGE 1. RIGHTS GRANTED 2 2. TERM; SUCCESSOR FRANCHISE AGREEMENTS 4 3. FEES 4 4. OPENING DEADLINE 6 5. TRAINING 10 6. OPERATIONS 11 7. PROPRIETARY MARKS 18 8. BUSINESS RECORDS AND REPORTING 19 9. MARKETING FUND AND ADVERTISING 21 10. TECHNOLOGY 23 11. OPERATING MANUAL 26 12. CONFIDENTIAL INFORMATION 26 13. TRANSFERS BY US 26 14. TRANSFERS BY YOU 27 15. TERMINATION 29 16. OBLIGATIONS ON TERMINATION OR EXPIRATION 31 17. RESTRICTIONS ON COMPETITION 33 18. RELATIONSHIP OF THE PARTIES 34 19. INDEMNIFICATION 35 20. CONSENTS AND WAIVERS 35 21. NOTICES 35 22. ENTIRE AGREEMENT AND AMENDMENTS 35 23. CONSTRUCTION OF THE AGREEMENT, SEVERABILITY, AND SURVIVAL 36 24. GOVERNING LAW 36 25. DISPUTES 36 26. ACKNOWLEDGMENTS 37 Appendix A - Opening Deadline, Delivery/Catering and Advertising Area, and Site Selection Area Appendix B - Personal Guarantee Appendix C - Sample of Non-Disclosure and Non-Competition Agreement - i -

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





Pizza Fusion Holdings, Inc. Franchise Agreement This Franchise Agreement (the Agreement) is entered into as of the Agreement Date shown on the cover page between Pizza Fusion Holding, Inc., a Florida corporation, and the individual or legal entity identified on the cover page (Franchisee). If Franchisee is a corporation, partnership, or limited liability company, then the Franchisee's owner(s) are also identified on the cover page. In this Agreement, we, us and our refers to Pizza Fusion Holding, Inc., the franchisor. You and your refers to the Franchisee. Owners means the person(s) listed on the cover page and all other persons whom we may subsequently approve to acquire an interest in Franchisee. Operating Principal means the person designated as the Operating Principal on the cover page and who meets the criteria in Section 6.15 of this Agreement. RECITALS A. We are in the business of franchising others to operate Pizza Fusion restaurant businesses, which feature a competitively priced menu of organic and all-natural gourmet pizza and related food specialties, and standards and methods of operation designed to be green, and which are operated in buildings that bear our interior and/or exterior trade dress (each a Restaurant or Franchised Business). B. We have developed a distinctive set of specifications and operating procedures (collectively, the System) for Restaurants. The distinguishing characteristics of the System include: dough, sauce, and other recipes and products that are prepared or manufactured in accordance with our proprietary and/or secret recipes, trade secrets, standards, and specifications that we deem secret (Secret Recipe Products) and other designated and approved products; standards and procedures for business operations, including green design, construction, and operating practices; equipment layouts, graphics packages and signage, distinctive interior and exterior design and accessories, quality and uniformity of products and services offered; procedures for management and inventory control; training and assistance; advertising and promotional programs; and customer development and service techniques. These are not necessarily all of the elements of the System. We may change, improve, add to, delete from, and further develop the elements of the System from time to time. C. We identify the businesses operating under the System by means of the Pizza Fusion name and certain other trademarks, service marks, trade names, signs, logos, and other indicia of origin (collectively, the Proprietary Marks). We may designate other trade names, service marks, and trademarks (and also periodically delete old names and marks) as Proprietary Marks. D. You understand the importance of our high standards of quality, appearance, and service and the necessity of operating your Franchised Business in accordance with this Agreement and our standards, specifications and procedures. Therefore, the parties, who each intend to be legally bound by this Agreement, and for good and valuable consideration, now agree as follows: Page 1 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





1. RIGHTS GRANTED 1.1. Grant of Franchise. 1.1.1 We grant you the right, and you accept the obligation, to use the Proprietary Marks and the System to operate one Restaurant (the Franchised Business) at the Premises, in accordance with the terms of this Agreement. The term Premises means the location shown on the cover page to this Agreement or a location that is determined under process set out in Section 4.1 [Site Selection and Approval] below. 1.1.2 Your rights under this Agreement have limits, such as the following: (a) You have no right to operate the Franchised Business at any location other than the Premises, as described in Section 1.2 [Activities of Franchised Business] below; (b) You have no right to sublicense either the Proprietary Marks or the System to anyone else; and (c) You have no right to use the Proprietary Marks or the System in any manner except as expressly authorized under this Agreement. 1.2. Activities of Franchised Business. 1.2.1 You may operate the Franchised Business only from the Premises, only in accordance with the requirements of this Agreement and the procedures and terms and conditions set forth in the Pizza Fusion Manuals, and only to sell Products to: (a) retail customers for consumption on the Premises or for personal, carry out consumption; and (b) catering and delivery customers who are located within the area specified in Exhibit A as the Delivery/Catering and Advertising Area. We may specify terms and conditions for catering and delivery activities, which may include guidelines and requirements relating to insurance coverage, vehicle use in such activities, and use of a third party phone order processing center as we may require. Without our prior written approval, you may not engage in any other type of sale, including, but not limited to: selling, distributing, or otherwise providing, any services or products to third parties at wholesale, or for resale or distribution by any third party; and selling, distributing or otherwise providing any products and/or services through catalogs, mail order, toll free numbers for delivery, or electronic means (e.g., the Internet). You acknowledge and agree that the sole purpose of the Delivery/Catering and Advertising Area is to specify the geographic area in which you will be authorized to provide catering and delivery services and conduct advertising under the terms of this Agreement, and that the designation of the Delivery/Catering and Advertising Area does not grant, and will not be implied to grant, any territorial rights or protections to you or the Franchised Business, and we reserve all other rights as set forth in Section 1.3 [Our Limitations and Our Reserved Rights] below. 1.2.2 You may advertise and market the Franchised Business and directly solicit customers only within your Delivery/Catering and Advertising Area (subject to Section 9.3 [Regional Fund] below). You agree not to: (a) advertise or market the services of your Franchised Business outside of the Delivery/Catering and Advertising Area; and/or (b) engage in direct solicitation of customers outside of the Delivery/Catering and Advertising Area. The term direct solicitation includes, but is not limited to, solicitation in person, by telephone, by mail, by e-mail, the internet, or other electronic means, advertising, marketing, and by distribution of brochures, business cards or other materials. 1.2.3. If any of your advertising within the Delivery/Catering and Advertising Area is in media that will or may reach a significant number of persons outside of the Delivery/Catering and Advertising Area, you must notify us in advance and obtain our prior written consent (in addition to the requirements in Section 9.3 [Regional Fund] below). We may periodically establish rules and policies regarding such advertising. Page 2 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





1.3. Our Limitations and Our Reserved Rights. The rights granted to you under this Agreement are not exclusive. We and our affiliates have the right to conduct any business activities, under any name, and at (or from) any location notwithstanding those business activities' actual or threatened impact on sales of the Franchised Business. For example, we may, among other things, on any terms and conditions we deem advisable, and without granting you any rights therein, do any or all of the following: 1.3.1 We have the right to establish, and license others to establish, Franchised Businesses at any location notwithstanding their proximity to the Franchised Business or the Premises or their actual or threatened impact on sales of the Franchised Business. 1.3.2 We have the right to establish, and license others to establish, businesses under other systems or other proprietary marks, which businesses may offer or sell products and services that are different from the principal products and services offered from the Franchised Business, and which businesses may be located within or outside the Premises, notwithstanding such business' proximity to the Franchised Business or the Premises or their actual or threatened impact on sales of the Franchised Business. 1.3.3 We have the right to acquire and operate any business of any kind or be acquired by another business, notwithstanding such business' actual or threatened impact on sales of the Franchised Business. 1.3.4 We have the right to establish, and license others to establish, Restaurants at any Institutional Facility (as defined below), notwithstanding such Restaurants' proximity to the Franchised Business or their actual or threatened impact on sales of the Franchised Business. The term Institutional Facility is agreed to mean any outlet that primarily serves the customers located within the facility, such as captive audience facilities and limited purpose or limited access facilities, and includes among other things: airports; train or bus stations; travel plazas; factories; federal, state or local government facilities (including military bases); hospitals and other health-care facilities; stadiums and arenas; recreational facilities; schools, colleges and other academic facilities; convention centers; seasonal facilities; shopping malls; theaters; museums; and workplace cafeterias. 1.3.5 We have the right to sell and distribute, directly or indirectly, through any channels of distribution (including, but not limited to, supermarkets, gourmet shops, mail order, and on the internet) any products or services (including products and services that are the same or similar to those offered by Restaurants and using the Pizza Fusion name), from any location or to any purchaser or customer, advertise in any area (including in your Delivery/Catering and Advertising Area) and/or serve customers who reside within your Delivery/Catering and Advertising Area. You acknowledge that customers have total freedom to select the Pizza Fusion Restaurant that they wish to patronize. 1.3.6 We have the right to provide, and license others to provide, products or services to Major Accounts (as that term is defined below) at any location, notwithstanding such Major Accounts' proximity to the Franchised Business or the Premises or their actual or threatened impact on sales at the Franchised Business. The term Major Account is agreed to mean any customer we designate as such, based upon our sole determination that, because such customer conducts its business at multiple locations and we deem this customer to be of strategic importance, the account, services and pricing of such customer shall be negotiated and secured either (i) by us or (ii) with our assistance, approval and oversight; as further described in Section 6.12 [Major Accounts] below. 1.4. Limitations. You agree not to engage in any of the sales activities that we have reserved to ourselves in Sections 1.3 [Our Limitations and Our Reserved Rights] above. Page 3 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





2. TERM; SUCCESSOR FRANCHISE AGREEMENTS 2.1. Term. This Agreement expires ten (10) years from the Agreement Date (the Term), unless it is terminated sooner as provided in other sections of this Agreement. 2.2. Successor Franchise Agreements. When this Agreement expires, you will have the option to continue the franchise relationship with us for two (2) additional terms of ten (10) years each. We may require you to satisfy any or all of the following as a condition of continuing the franchise relationship with us: 2.2.1. You must give us written notice of your desire to exercise your option not more than twelve (12) months and not less than nine (9) months before this Agreement expires. 2.2.2. You and all Owners must execute the standard form of Pizza Fusion Franchise Agreement that we are then offering to new franchisees (or the standard form that we most recently offered to new franchisees, if we are not at that time actively offering new franchises) (the Successor Franchise Agreement). The terms of the Successor Franchise Agreement may be substantially different from the terms of this Agreement and may require the payment of different fees. 2.2.3. You must pay all amounts owed to us, to our affiliates, and to your major suppliers; you must not be in default of this Agreement or any other agreement with us, our affiliates, or our suppliers; and you must have substantially and timely complied with all of your obligations throughout the term of each such agreement. 2.2.4. If we inspect your Franchised Business and give you notice at least six months before the end of the term of any required maintenance, refurbishing, renovating, and upgrading (including purchasing one or more new delivery vehicles); then you must complete all such required maintenance, refurbishing, renovating, and upgrading to our reasonable satisfaction no later than 60 days before expiration of the term. 2.2.5. You must pay us a discounted successor franchise fee in the amount of $7,500 or twenty-five percent (25%) of our then- current initial franchise fee (whichever is more). 2.2.6. You and all of your Owners must execute and deliver to us a general release, in a form we require, of any and all claims against us, our affiliates, and our past, present and future officers, directors, shareholders and employees arising out of or relating to your Franchised Business. 2.2.7. You, the Operating Principal, and/or your designated employees must successfully complete any additional or refresher training courses that we may require. 3. FEES 3.1. Initial Franchise Fee. You must pay us an initial franchise fee of $30,000 when you sign this Agreement. The initial franchise fee is paid in consideration of the rights granted in Section 1 and is fully earned at the time paid. You acknowledge that we have no obligation to refund the initial franchise fee in whole or in part for any reason. 3.2. Royalty 3.2.1. You must pay us a royalty fee (Royalty) equal to six percent (6%) of your Gross Revenues. The Royalty is in consideration of your right to use the Proprietary Marks and the System in accordance with this Agreement, and not in exchange for any specific services we render. If by reason of state or other law, we are prohibited from receiving a percentage of certain components of Gross Revenues (including alcoholic-beverage sales), you must pay us an equivalent amount by increasing the Royalty percentage applied to Gross Revenues exclusive of the prohibited components. Page 4 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





3.2.2. You must calculate and pay the Royalty weekly, based on your Gross Revenues for the previous Period. For purposes of this Agreement, unless otherwise designated by us in writing, a Period begins on Monday and ends on the following Sunday. 3.2.3. Gross Revenues means all revenue from the sale of all services and products and all other income of every kind and nature related to, derived from, or originating from the Franchised Business, including proceeds of any business interruption insurance policies, whether for cash or credit, and regardless of collection in the case of credit; provided, however, that Gross Revenues does not include any coupon sales (for which customers do not pay for product), customer refunds, sales taxes or other taxes you collected from customers and actually transmitted to the appropriate taxing authorities. 3.3. Advertising Contributions. During any Period that the Marketing Fund (as defined in Section 9.1 [Pizza Fusion Marketing Fund] below) is in effect, you must make a contribution as described in Section 9.1 [Pizza Fusion Marketing Fund] below equal to three percent (3%) of your Gross Revenues for the preceding Period. Additionally, during any Period that a Regional Fund (as defined in Section 9.3 [Regional Fund] below) for the area in which your Franchised Business is located is in effect, you must make a contribution as described in Section 9.2 [Local Marketing] below in such amounts as we specify in writing up to two percent (2%) of your Gross Revenues for the preceding Period; in addition, you may be required to contribute to a Regional Fund up to an additional two percent (2%) of Gross Revenues of your Franchised Business if the members of that Regional Fund vote to increase the total contribution, as provided in Section 9.3.5 [Regional Fund] below. Required contributions to the Marketing Fund and Regional Fund are referred to as Advertising Contributions. 3.4. Index. The parties agree that all fixed dollar amounts set out in this Agreement are subject to adjustment, up or down, depending on changes in the Index. For the purpose of this Agreement, the term Index is agreed to mean the Consumer Price Index (1982-84=100: all items; CPI- U; all urban consumers) published by the U.S. Bureau of Labor Statistics (or if the Index is no longer published, a successor index that we may reasonably specify in the Manuals or otherwise in writing). We have the right to decide whether or not to make adjustments to fixed dollar amounts set out in this Agreement and if we decide to invoke that right, we will make changes not more than once each year by sending you written notice of the change. 3.5. Due Date for Payment. Your Royalty payments and Advertising Contributions are due by the first (1st) day after the end of each Period (or the next business day if the first day is a Sunday or federal holiday) (as of the Agreement Date, the due date is Monday of each week). You must pay all other amounts due to us as specified in this Agreement or, if no time is specified, such amounts are due upon receipt of an invoice from us. 3.6. Method of Payment. You must make all payments to us by the method or methods that we specify from time to time. We require payment via wire transfer or electronic debit to your bank account, and you must maintain sufficient balance in your operating account to meet the payment requirements. You must furnish us and your bank with all authorizations necessary to effect payment by the methods we specify. You may not, under any circumstances, set off, deduct or otherwise withhold any Royalty fees, Advertising Contributions, interest charges, or any other monies payable under this Agreement on grounds of our alleged non-performance of any obligations. Additionally, you authorize us to charge against any of your credit cards any amounts due to us or to any of our affiliates. You agree to supply us a written list of all of your credit cards (including card number, name, and expiration date) and to update that list periodically, if there are changes to the information. Page 5 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





3.7. Delinquency. If any Royalties or other amounts owed to us are not paid in full by the due date, we have the right to charge interest on the overdue amount at the rate of one and one-half percent (1.5%) per month (or the maximum rate permitted by applicable law, if less than 1.5%) from the date such amount was due until paid in full. Unpaid interest charges will compound annually. In addition, we will have the right to charge a late fee for each occurrence of a payment that is more than 30 days past due, which fee will be $100 for the first such occurrence, $200 for the second such occurrence, and $300 for the third and each subsequent occurrence during the Term of this Agreement. The late fee is to compensate us for our administrative costs incurred in enforcing your obligation to pay us. 3.8. Dishonored Payments. For any amount that you must pay to us or our affiliates, if we are not able to successfully complete a wire transfer or electronic debit for such payment as described Section 3.6 [Method of Payment] above, or if a check that you issue for such payment is returned by the bank against which it was drawn, due to insufficient funds in your account(s), closure of your account(s) or any other reason resulting in the nonpayment (each a Dishonored Payment), we have the right to charge a fee of $100 per occurrence (a Dishonored Payment Charge). We will notify you of each Dishonored Payment and any Dishonored Payment Charge that we impose. We may add the Dishonored Payment Charge to the amount to be paid via the next wire transfer or electronic debit. The Dishonored Payment Charge applies in addition to any late fee and interest that we have the right to charge, or any other remedy to which we are entitled, under this Agreement, at law, or in equity. 3.9 Taxes. You are responsible for all taxes levied or assessed on you or the Franchised Business in connection with your activities under this Agreement. 3.10 Obligations Absolute. You agree that your obligations to pay us (as well as our affiliates) under this Agreement or any other agreement in connection to the Franchised Business are absolute and unconditional, and not subject to abatement or setoff for past or future claims that you may assert. 3.11 Security Agreement. Upon our written request, you agree to grant to us a first-priority security interest in all of your assets (including all proceeds thereof and after-acquired property), as security for all your monetary and other obligations to us or our affiliates arising under or relating to this Agreement or any other agreement. Such assets include all furniture, fixtures, machinery, equipment, inventory and all other property, (tangible or intangible), that you now own or later acquire, used in connection with the Franchised Business, and wheresoever located as well as all contractual and related rights you have under this Agreement and all other agreements between the parties. If we request, you must execute such financing statements, continuation statements, notices of lien, assignments or other documents as we may require in order to perfect and maintain our security interest, including but not limited to a UCC-1 Financing Statement. Alternatively, you authorize us to execute any of the foregoing financing statements, continuation statements, notices of lien, assignments, and/or other documents on your behalf, or on our own (in our name), describing the collateral in such manner as we consider appropriate. You hereby grant us an irrevocable power of attorney, coupled with an interest, to execute, in your name, any of such financing statements, continuation statements, notices of lien, assignments or other documents. You must pay all filing fees and costs for perfecting our security interest. 4. SITE SELECTION, PREPARATION, AND OPENING DEADLINE 4.1. Site Selection and Approval. You will be responsible, at your own expense, for finding and then acquiring, by lease or purchase, a suitable site at which to develop and operate your Franchised Business (the Premises). Any sites that you propose must be within the area identified in Exhibit A (the Site Selection Area). You acknowledge and agree that: (a) the sole purpose of designating a Site Selection Area is to identify the geographic area in which you intend (and, upon our written approval, will be authorized) to operate a Franchised Business under the terms of this Agreement; (b) the designation of the Site Selection Area does not grant, and will not be implied to grant, any territorial rights or protections to you or to the Franchised Business; and (c) we reserve all rights as set forth elsewhere in this Agreement, including but not limited to those described in Section 1.3 [Our Limitations and Our Reserved Rights] above. Before committing to a site, you must obtain our written approval of the site to serve as the Premises, as described in Section 4.2 [Site Lease or Acquisition] below. Page 6 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





4.1.1. We will give you certain assistance in connection with your selection of Premises and establishment of your Franchised Business: (a) We will provide to you a copy of our standard site selection criteria and guidelines, including our minimum standards for Franchised Businesses. (b) We will have the right to provide to you the degree of site selection counseling and assistance that we deem appropriate. If we (either on our own initiative or at your request) consider on-site evaluation necessary or appropriate, you agree to reimburse us for the reasonable expenses that we incur in connection with providing that on-site evaluation (including the cost of travel, lodging and meals). (c) We will provide, at no charge, our standard image specifications for the construction of the Franchised Business, improvement of the premises, and for the layout of fixtures, furnishings, equipment, and signs. On or before the date you open the Franchised Business, you must return to us the plans and specifications we provided to you (and any copies that you may have made or shared with other parties). 4.1.2 You must submit a site review report and such other information or materials as we may reasonably require (including but not limited to, photographs, demographic information, an option contract, letter of intent, or other evidence satisfactory to us that confirms your favorable prospects for obtaining the site). We will review site approval submissions on a first-in basis. (a) If we do not approve in writing the proposed site, you must, within 30 days after our disapproval of the proposed site, submit a new proposed site within the Delivery/Catering and Advertising Area for our review and approval. (b) By no later than 90 days after the Agreement Date, you must have obtained our written approval of a site. If you have not done so, we may elect to terminate this Agreement, and we will not refund to you the Initial Franchise Fee or any other money paid to us. (c) We will not unreasonably withhold approval of any site that meets our standards. You may not lease or otherwise acquire the right to occupy the proposed site without our prior written approval. 4.2 Site Lease or Acquisition. You must, within 30 days after we approve a site for the Franchised Business (but in no event later than 120 days after the Agreement Date), either by lease or purchase the approved site for the Premises, as further described below. 4.2.1 If you will occupy the Premises under a lease or sublease, you must submit the lease to us for our review and our prior written approval. Your lease (or rider to a lease) must include provisions that will: (a) Allow us the right to elect to take an assignment of the leasehold interest upon termination or expiration of your rights under this Agreement, and that allow us (or our designee) to operate a Pizza Fusion restaurant upon the premises for the remaining term of the lease or sublease; (b) Require the lessor to provide us with a copy of any written notice of deficiency under the lease sent to you, at the same time as notice is given to you (as the lessee under the lease), and which grants to us the right (but not obligation) to cure any deficiency by you under the lease within fifteen (15) business days after the expiration of the period in which you had to cure any such default should you fail to do so; Page 7 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





(c) Recognize your right to display and use the Proprietary Marks in accordance with the specifications required by the Manual, subject only to the provisions of applicable law; (d) Require that the premises be used solely for the operation of a Franchised Business; and (e) Acknowledge that, if this Agreement is terminated or expires (without you renewing your franchise rights): (i) you must take certain steps to de-identify the location as a Pizza Fusion Restaurant; and (ii) lessor will cooperate with us in enforcing your obligation to de-identity, including allowing us, our employees and/or agents to enter the premises and remove signs, décor and materials that bear or display our Proprietary Marks, designs, or logos. 4.2.2 You must deliver to us a copy of the signed lease or sublease to us within fifteen (15) days after it has been signed by you and by the lessor. You may not execute or agree to any modification of the lease or sublease that would affect our rights without our prior written approval of the modification. 4.3 Location Development and Preparation. You must construct, furnish, and open the Franchised Business as required by this Agreement and must open the Franchised Business not later than six (6) months after securing the necessary authorization and approval for permits and/or certificates. Time is of the essence. 4.3.1 You agree that you will do all of the following things: (a) make sure that you have obtained all necessary zoning permits as well as all required building, utility, health, sign permits and licenses, and any other required permits and licenses; (b) buy or lease Products and other materials as required under this Agreement (as well as the other specifications that we provide in writing); (c) in accordance with Section 4.3.2 [Location Development and Preparation] below, prepare all plans and complete construction, or remodeling, of the Franchised Business, and complete installation of all equipment in compliance with plans and specifications for the Franchised Business that we have approved, as well as all applicable federal, state and local laws, codes and regulations (including, without limitation, the applicable provisions of the ADA, zoning requirements, and permitting requirements), ordinances, building codes and permit requirements; (d) purchase and install at the Premises all interior and exterior signage, from such suppliers, that we may designate. From time to time, we have the right to require that you purchase and install replacement or additional Signage; (e) obtain all customary contractors' sworn statements and partial and final waivers of lien for construction, remodeling, decorating and installation services; (f) obtain and maintain in force during the entire period of construction the insurance required under this Agreement or as otherwise specified in the Manuals; (g) satisfy all of our pre-opening requirements, whether set out in this Agreement, the Manuals, or as we may otherwise specify; (h) You must obtain a Certificate of Occupancy within 10 days after completing construction, unless we agree in writing to extend this deadline; and Page 8 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





(i) within thirty (30) days after the store opening, you agree to provide us a full written breakdown of all costs associated with the development of your Franchised Business in the form that we may reasonably require. 4.3.2 Before starting and during any construction or renovation of the Premises, you must, at your own expense, meet all of the following requirements: (a) You must employ a qualified, licensed architect or engineer who we have designated or approved in writing to prepare, for our approval, preliminary plans and specifications for site improvement and construction of the Franchised Business based upon prototype design and image specifications we furnished to you. We will not unreasonably withhold our approval of special plans and specifications, prepared at your expense, when the Approved Location will not accommodate our standard plans and specifications, provided that such plans and specifications conform to our general design criteria. You will be responsible for the design and layout that your architect or engineer prepares. If we express an opinion about the plans or indicate our approval, it will be merely for the purpose of our own determination that your plans will satisfy our internal standards, specifications, and layout. We will not be in a position to provide any assurances, and therefore can not be deemed to have given any information about, whether your plans satisfy any federal, state, and local laws, codes and regulations (including, without limitation, the Americans with Disabilities Act (ADA)). (b) After obtaining any required governmental approvals and clearances, you must submit to us, for our approval, final plans for construction based upon the preliminary plans and specifications. Once approved by us, such final plans may not be changed or modified without our prior written consent. (c) You must employ a qualified, licensed general contractor to construct the Franchised Business and complete all improvements. (d) Your architect or engineer must also comply with all applicable zoning, signage, seating capacity, parking requirements and alcoholic-beverage (i.e., beer and wine products that we designate or approve) licensing and storage requirements. (e) Within 10 days after commencing construction, you must provide us with written notice of the date you began construction. 4.3.3 We may require that you provide us a written certification from your registered architect that the Franchised Business has been constructed, furnished, equipped, and decorated in accordance with approved plans and specifications. 4.3.4 We may recommend that you use a construction project manager that we designate for constructing the Premises. If we do so and you choose not to use our recommended construction manager, you must hire a general contractor who is reasonably acceptable to us and who must have the following minimum insurance coverage: (a) commercial general liability in an amount of $2,000,000 combined single limit; (b) comprehensive automobile liability for owned, hired and non-owned motor vehicles in an amount of $1,000,000 combined single limit; (c) workers' compensation, occupational diseases and disability benefits in accordance with applicable statutory requirements; (d) employers' liability in an amount of $1,000,000; (e) employee fidelity bond of $2,000,000; and (f) umbrella form excess liability insurance in excess of the limits provided by the commercial general liability policy required above with limits of $3,000,000 per occurrence and annual aggregate. Page 9 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





4.3.5 Before you can open for business, you must satisfy all of our pre-opening requirements, whether they are set out in this Agreement, the Manuals, or as we may otherwise specify, and you must obtain our written approval prior to opening the Franchised Business. You must open the Franchised Business within seven days after obtaining our written approval for opening, unless we agree in writing to extend this deadline. 4.4. Our Review. Any reviews that we conduct under this Section 4 are only for our benefit. You acknowledge that our review and approval of a site, lease, sublease, design plans or renovation plans for a Franchised Business do not constitute a recommendation, endorsement, or guarantee of the suitability of that location or the terms of the lease, or sublease, or purchase agreement. You agree that you will take all steps necessary to determine for yourself whether a particular location and the terms of any lease, sublease, or purchase agreement for the site are beneficial and acceptable to you. 4.5 Opening Deadline. You must begin operating the Franchised Business by the opening deadline specified in Appendix A. The date you actually open the Franchised Business is the Opening Date. 4.6 Relocation and other Uses of the Premises. You may not relocate the Franchised Business from the Premises without our prior written consent. You may only use the Premises for the purpose of operating your Franchised Business and for no other purpose. You may not sublet or otherwise allow any other party to operate any enterprise at your Premises without our prior written approval. 5. TRAINING 5.1. Initial Training Program 5.1.1. Before you begin operating, the two persons who you designate (and who we find acceptable) to provide managerial responsibilities (each a Manager Trainee) must all successfully attend (at the same time) and successfully complete our initial training program (we may designate portions of the training program that each person must attend and successfully complete), which is held at our headquarters and/or another location(s) that we specify. One Manager Trainee must be your Operating Principal (who meets the criteria in Section 6.15 of this Agreement), unless we mutually agree otherwise. You may designate another person who will be active in the day-to-day activities and management of the Franchised Business to be the second Manager Trainee. You may ask that additional employees be allowed to attend the portions of the initial training that are designed for your employees, and we will have the right to approve or disapprove that request. All trainees must be persons that we find acceptable at all times to serve in their respective capacities. As of the Effective Date, our training program has two components, as follows: (a) An Advanced Operations Course for your Operating Principal, which consists of up to twelve days for your Operating Principal and is conducted at our training facilities in Broward County, Florida, or at another location that we may specify in writing. (b) A Basic Operations Course for any Manager Trainee other than your Operating Principal, which consists of up to twelve days of training and is conducted at our training facilities in Broward County, Florida, or at another location that we may specify in writing. Your Manager Trainees (other than your Operating Principal), and such of the Franchisee's other employees as we designate must attend this component of training. 5.1.2. We will issue a certificate of completion for each Manager Trainee who completes the initial training program we require to our satisfaction (each such person will be referred to as a Certified Manager). We have the right to determine whether a person has or has not successfully completed training. If you (or your personnel) fail to complete initial training to our satisfaction, we may permit you (or they) to repeat the course or allow you to send a substitute to the next available scheduled training session; however, we will have no obligation to extend the opening deadline in Section 4 for this purpose. Page 10 of 39

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5.1.3. We have the right to reduce the duration or content of the training program for any trainee who has prior experience with our concept or in similar businesses. We also may allow you to train certain of your managers (which may include Certified Managers) and successors in those positions at your location. 5.1.4. Failure to complete the initial training program constitutes grounds for termination, as provided in Section 15 of this Agreement. 5.2. Opening Training and Assistance. We provide up to fourteen (14) days of pre-opening training and opening assistance at your Premises. The Operating Principal and the other Manager Trainee and such of your other employees as we designate must attend this component of training, which will begin approximately seven days before the Opening Date and conclude approximately seven days thereafter. 5.3. Additional Training by Us. We may require your Certified Managers and/or other designated persons to successfully complete additional training courses during the Term of this Agreement at a location that we specify (including an annual conference for franchisees in the System). We may also offer optional training programs. You may also request that we provide additional training at the location of your Franchised Business, and we will provide such training if we determine that we are able to do so. We may charge you a training fee and our out-of-pocket expenses for all additional training programs, whether mandatory or optional, or whether you request or we require such training, which fee shall be as set forth in the Manual or otherwise in writing. 5.4. Training by You. We have the right to specify training programs related to the System that you must conduct for your employees using approved training materials or that we will provide at our headquarters. For any training of your personnel that we conduct, you are responsible for expenses incurred while they attend training, including salaries, benefits, travel, lodging, meals, and other related expenses. We reserve the right to charge you for training additional personnel. 5.5. Training Materials and Methods. All training materials that we provide to you remain our property. We have the right to provide training programs in person, on tape, via the Internet or other electronic means, or by other means and media, as we determine. 5.6. Expenses. We will provide instructors, facilities, and materials for the initial training program at no charge, provided that all of your personnel are trained during the same training session. We reserve the right to charge a reasonable fee for training additional personnel (in excess of two), re-training persons who are repeating the course or replacing a person who did not pass. For all training, including initial training, you are responsible for any travel expenses, living expenses, wages, and other expenses incurred by your trainees. 6. OPERATIONS 6.1. Compliance with Standards. You agree to comply with all mandatory specifications and procedures set forth from time to time in our confidential operating manual (the Manual). You acknowledge that the accounting practices, record keeping, software, services, and operation of your Franchised Business are important to us and our other franchisees. However, you acknowledge that we have the right to vary our standards and specifications, in our reasonable judgment, to accommodate circumstances of individual franchisees. 6.2. Products and Services You May Offer. You may offer customers only the products and services that we have expressly authorized Franchised Businesses to offer, as we have the right to specify in the Manual from time to time. We have the right to change the authorized products and services, and we may designate specific products or services as optional or mandatory (including alcoholic beverages). You acknowledge that we may approve some services, products, and other items for certain franchisees and not others based on legitimate business reasons. You must use menus that meet our then-current specifications as to content, materials, finish, style, pattern, and design. Page 11 of 39

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6.3. Secret Recipe Products. We have developed and may continue to develop additional Secret Recipe Products. The Secret Recipe Products are our proprietary products. In order to maintain the high standards of quality, taste, and uniformity of these products and protect the proprietary nature of these products, you agree to purchase the Secret Recipe Products only from us, our affiliates or from sources that we designate or approve and license 6.4 Sourcing of Other Products, Equipment and Supplies. 6.4.1. Without limiting Section 6.3 [Secret Recipe Products] above, we have the right to require that all of the food items, equipment (including but not limited to vehicles used in connection with the Franchised Business), supplies, materials, and other products and services used or offered for sale at your Franchised Business: (a) meet specifications that we establish from time to time; and/or (b) be purchased only from suppliers that we have expressly approved; and/or (c) be purchased only from a single source (which may include us or our affiliates or a buying cooperative that we organize). To the extent that we establish specifications, require approval of suppliers, or designate specific suppliers for particular items, we will publish our requirements in the Manual. 6.4.2. If you would like to use or offer food items (other than the Secret Recipe Products), equipment, supplies, materials, and other products and services that we have not approved, or purchase from a vendor, supplier, distributor, or other source (together, supplier(s)) that we have not approved, then you must submit to us a written request for approval. We have the ongoing right to inspect any proposed supplier's facilities and to test samples of the proposed products or services. You agree to pay us an amount not to exceed the reasonable cost of the inspection and our actual cost of testing the proposed product or service, including personnel and travel costs, whether or not we ultimately approve the supplier. We have the right to grant, deny, or revoke approval of products, services, and suppliers. We will notify you in writing of our decision as soon as practicable following our evaluation. We reserve the right to reinspect the facilities and products of any approved supplier and to revoke approval if we find that the supplier fails to meet any of our then-current criteria. If you receive a notice of revocation of approval, you agree to immediately stop buying products or services from the disapproved supplier and, in the case of revocation based on failure of products to meet our standards, you agree to dispose of your remaining inventory of the disapproved supplier's products as we direct. 6.4.3. If you wish to test market an item that we have not approved, then, so long as we have given you our prior written approval, you may do so for so long, and on such terms, that we mutually agree upon (a Test), and the item so tested, and all associated formulae, plans, and materials, will become our property. If, following the Test, we determine that we will approve the tested item, then for so long as we deem that item to be an approved item under this Agreement, you will have the right to use that item under the terms of this Agreement; and we will have the right to use and market that item as we see fit, including but not limited to use in our own Restaurants as well as that of other licensees and franchisees, without compensation to you. You agree to sign such documents (and require your employees and any independent contractors that you have engaged to sign such documents) as we may require in order to implement the provisions of this Section 6.4.3 [Sourcing of Other Products, Equipment and Supplies]. 6.4.4. We and our affiliates may receive payments or other compensation from suppliers on account of such suppliers' dealings with you and other franchisees; and, we may use all amounts so received for any purpose we and our affiliates deem appropriate. 6.5. Delivery Vehicles. If you wish to use a vehicle to provide delivery services (a Delivery Vehicle) as part of your Franchised Business, you must comply with the specifications and standards that we may periodically prescribe in the Manuals for Delivery Vehicles. Our specifications and standards may include, among other things: designating Delivery Vehicles specific make and model; limitations on the Useful Life for a Delivery Vehicle and standards for maintenance or repair services. Page 12 of 39

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6.5.1. The term Useful Life means the period of time after which you must stop using the Delivery Vehicle for the Franchised Business. We have the right to determine the Useful Life of any Delivery Vehicle, which may include reasonable standards as to how many model years old the vehicle may be, the appearance of the vehicle, and the performance of the vehicle. After the Useful Life, you must remove all Proprietary Marks and any other indicia associating the Delivery Vehicle with the System, and immediately purchase or lease a new Delivery Vehicle. 6.5.2. We have the right to specify the makes and models of Delivery Vehicles approved for use by our franchisees, and anticipate that we will make changes over time to reflect and take advantage of advances in technology and/or alternative energy powered vehicles. 6.6. Alcohol Permits. Before you begin operating the Franchised Business you must obtain, and at all times thereafter you must maintain, all licenses and permits required to sell, dispense, and store beer and wine beverages and be prepared to offer and sell such beer and wine products to customers at the Premises as we designate as mandatory product offerings, unless you obtain from us a written waiver of this requirement. You must comply with all laws and regulations relating to the selling, dispensing, and storing of alcoholic beverages. You must also comply with the standards, specifications, and terms that we may establish regarding the offer, sale, and presentation of alcoholic beverages, as require or approved products. You must obtain and maintain appropriate insurance coverage for you and for our benefit, including any minimum coverages that we may establish. 6.7. Image Standards. You must keep the Premises, vehicles, equipment, and uniforms used in the Franchised Business and/or by your employees in the highest degree of cleanliness, orderliness, appearance, sanitation, and repair in accordance with our standards and specifications, including but not limited to those set out in our Manuals. 6.8. Employees. Your employees must wear uniforms, or comply with such other dress code as we may require, and otherwise identify themselves with the Proprietary Marks at all times in the manner we specify while on a job for the Franchised Business. 6.9. Employment Responsibilities. You have sole responsibility for all employment decisions and functions related to your Franchised Business, including hiring, firing, compensation, benefits, work hours, work rules, record-keeping, supervision, and discipline of employees. You must take such steps as are necessary to ensure that your employees preserve good customer relations; render competent, prompt, courteous, and knowledgeable service; and meet any minimum standards that we may establish from time to time in the Manual, which may include standards as to the minimum number of employees, which we may determine, necessary to meet the anticipated volume of business and to achieve the goals of the System. 6.10. Customer Service Program. You acknowledge that providing superior customer service is a vital component of the System. You must participate in customer service programs, which we have the right to specify from time to time in the Manual. Such programs may include the use of independent evaluation service to conduct mystery customer quality control, customer satisfaction surveys, or any other quality control or evaluation programs. If you receive an unsatisfactory or failing report in connection with any such program, you must immediately implement any remedial actions we require and pay us all expenses we incurred to have the evaluation service evaluate the Franchised Business, and all expenses we may have incurred to inspect the Franchised Business thereafter. 6.11. Customer List. You must create and maintain, in such manner as we may from time to time require, a current customer list (the Customer List) containing as to each of your customers, such customer's name, e-mail address, location address, telephone number and zip code (9 digits). You must provide a copy of such list to us on a quarterly basis (or at such other intervals as we may prescribe). The Customer List is, and remains, our exclusive property, you hereby assign to us all rights you now have or hereafter may acquire in the Customer List. After the expiration or termination of this Agreement, you may not retain, use or disclose the Customer List, or any of the information contained therein, without our written authorization. Page 13 of 39

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6.12. Major Accounts 6.12.1. You acknowledge that our negotiation of Major Accounts, including rates and services to be performed, enhances the potential value of the System and inures to your benefit as well as to our benefit and that of other Restaurant franchisees. As noted in Section 1.3 [Our Limitations and Our Reserved Rights] above, we reserve the right to provide products and services to all Major Accounts. We may offer you the right to provide products and services to a Major Account within your Delivery/Catering and Advertising Area. If you accept the obligation to provide products and services to a Major Account, you must service such Major Account on our behalf, in accordance with the pricing and other terms that we negotiate with the Major Account customer. You may not enter into any relationship with a Major Account customer that we deem to conflict with the customer's Major Account arrangement with us. We will have the right to handle all billing and collection for services performed under a Major Account arrangement. Certain Major Account customers may require that we provide additional volume rebates, which we will negotiate with the customer on a case-by-case basis. You will have the option not to provide products or services to any Major Account customer that is offered to you. 6.12.2. We may terminate your right to provide products and services to a Major Account customer at any time by giving you at least 30 days' prior written notice, and you may terminate your right to provide products and services to a Major Account at any time by giving us at least 30 days' prior written notice. If we elect not to offer you the opportunity to provide products or services to a Major Account, if you decline the option to accept a Major Account, if your right to provide products or services to a Major Account terminates, or if you fail to satisfy the conditions and obligations of any Major Account agreement, we have the right to service and/or authorize others to service Major Account customers within your Delivery/Catering and Advertising Area without any compensation to you. We have no obligation to permit you to provide products or services to a Major Account or to transfer any Major Account customer to you if you are subsequently willing and able to provide service. 6.13. Inspections. We have the right, at any time during normal business hours: (i) to conduct inspections of the Franchised Business; (ii) to interview your employees, work crews, and customers; and (iii) to review your business records, including those maintained electronically or off premises. We can initiate these actions with or without prior notice to you. You must cooperate with such inspections by giving our representatives unrestricted access and rendering such assistance as our representatives may reasonably request. If we notify you of any deficiencies after the inspection, you must promptly take steps to correct them. If you fail to correct any deficiencies within a reasonable time, we have the right to correct such deficiencies and to invoice you for our expenses. 6.14. Compliance with Laws. You agree to operate the Franchised Business in full compliance with all applicable municipal, county, state, and federal laws, rules, regulations, and ordinances. You have sole responsibility for such compliance despite any information or advice that we may provide. (To the extent that the requirements of those laws are in conflict with the terms of this Agreement, the Manuals, or our other instructions, you must: (a) comply with those laws; and (b) immediately give us written notice of the conflict.) 6.15. Operating Principal and Management Supervision 6.15.1. If you are a corporation, partnership or LLC, you must have an individual owner serve as your Operating Principal. The Operating Principal must own a majority of the voting and ownership interests in the franchisee entity, unless you obtain our prior written approval for the Operating Principal to hold a smaller interest. The Operating Principal must complete our training program, must have authority over all business decisions related to the Franchised Business, and must have the power to bind you in all dealings with us. You may not change the Operating Principal without our prior approval. Page 14 of 39

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6.15.2. At all times that the Franchised Business is operating, it must be under the personal, on-premises supervision of the Operating Principal who is a Certified Manager, or another individual who is a Certified Manager. You may not permit the Franchised Business to be operated, managed, directed, or controlled by any other person without our prior written consent. At least one Certified Manager must devote, on a full-time basis, his or her best efforts to managing and operating the Franchised Business. Unless we agree otherwise in writing, before the Operating Principal or any other manager may manage the Franchised Business, he or she must become a Certified Manager (as provided in Section 5.1.2 [Initial Training Program]) and acquire any food-safety-program certification that the local, state or municipality may require, as well as any other licenses, permits, and certifications that we may require from time to time. 6.15.3 If the Certified Manager is an individual other than Operating Principal, and such Certified Manager ceases to satisfy his or her obligations under this Agreement due to death, disability, termination of employment, or for any other reason, the Operating Principal must satisfy such obligations until you designate a new Certified Manager of the Franchised Business, who is acceptable to us and has successfully completed the initial training program we require. 6.15.4. All persons with a 5% or greater ownership interest in the franchise must sign a personal guaranty on the form attached to this Agreement as Appendix B. 6.16 Maintenance of Premises. You must at all times maintain the Franchised Business in a high degree of sanitation, repair, and condition, and must make such additions, alterations, repairs, and replacements (but no others without our prior written consent) as may be required for that purpose, including, without limitation, such periodic repainting or replacement of obsolete signs, furnishings, equipment, and decor as we may reasonably direct. 6.17 Ongoing Upgrades and Refurbishments. Throughout the term of this Agreement, you must maintain all of the fixtures, furnishings, equipment, decor, and signs that we prescribe from time to time in the Manuals or otherwise in writing. If we determine that additional or replacement equipment is needed because of a change in menu items or method of preparation and service, a change in technology, customer concerns, health or safety considerations, or because of any other reason, you agree that you will install the additional equipment or replacement equipment within the reasonable time we specify. 6.18 Five-Year Refurbishment and Renovations. At our request, but not more often than once every five (5) years (and not before the fifth year after you begin operating), unless sooner required by your lease, you must refurbish the Premises, at your expense, to conform to the restaurant design, façade, signage, trade dress, color schemes, and presentation of the Proprietary Marks in a manner consistent with the then- current image for new Pizza Fusion restaurants. Such refurbishment may include structural changes, installation of new equipment and signs, remodeling, redecoration, and modifications to existing improvements, and, shall be completed pursuant to such standards, specifications, and deadlines as we may reasonably specify. 6.19. Insurance. 6.19.1. Types and Amounts of Coverage. Throughout the entire Term, you must maintain such types of insurance, in such amounts, as we may require. Such insurance is in addition to any other insurance that may be required by applicable law, your landlord, or otherwise. Policies that we require must be written by an insurance company reasonably satisfactory to us with an A.M. Best rating of A or better, and, must name us as an additional insured party. At a minimum, such policies must include the following: (a) commercial general liability insurance, completed-operations and independent-contractors coverage in the amount of $1,000,000, per person/per occurrence for bodily injury and property damage combined with a general aggregate of $3,000,000. Page 15 of 39

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(b) workers'-compensation coverage in the amount of at least $100,000/$500,000/$100,000, unemployment insurance and employer's liability insurance, as well as such other insurance as may be required by statute or rule of the state in which the Franchised Business is located; (c) fire, lightning, vandalism, theft, malicious mischief, flood (if in a special flood-hazard area), sprinkler damage, and the perils described in ex-tended-coverage insurance with primary and excess limits of not less than the full-replacement value of the supplies, furniture, fixtures, equipment, machinery, inventory, and plate glass having a deductible of not more than $1,000 and naming us as a loss payee; (d) automobile liability insurance-including coverage of vehicles not owned by you, but used by employees in connection with the Franchised Business, with a combination of primary and excess limits of not less than $1,000,000; (e) commercial blanket bond in the amount of $100,000; and (f) such other insurance, in such amounts, as we reasonably require for our and your protection. At any time, we may adjust the amounts of coverage required under such insurance policies and require different or additional kinds of insurance, including excess liability insurance. 6.19.2. Evidence of Insurance. By the dates specified below, an approved insurance company must issue a certificate of insurance showing compliance with the insurance requirements in this Section 6.19 [Insurance] and you must furnish us with a paid receipt showing the certificate number: (a) 30 days before beginning construction of the Premises; (b) if the Premises are constructed and presently owned or leased by you, 10 days from the Agreement Date; or (c) if the Premises are not presently owned or leased, 10 days after ownership of the Premises is conveyed to you or you sign a lease for the Premises. The certificate of insurance must include a statement by the insurer that the policy or policies may not be canceled, subject to nonrenewal, or materially altered without at least 30 days' prior written notice to us. Upon our request, you must supply us with copies of all insurance policies and proof of payment. Every year, you must send us current certificates of insurance and copies of all insurance policies. 6.19.3. Requirements for Construction and Renovation. In connection with any construction, renovation, refurbishment, or remodeling of the Premises, you must cause the general contractor to maintain commercial general liability insurance (with comprehensive automobile liability coverage for both owned and non-owned vehicles, builder's risk, product liability, and independent contractors coverage) with a reputable insurer. Such insurance must be in the amount of at least $1,000,000 and must name us and you as an additional named insured party, as our respective interests may appear. You must also cause the general contractor to maintain workers' compensation and employer's liability insurance as may be required by law. 6.19.4. Our Right to Participate in Claims Procedure. We, or our insurer, may participate in discussions with your insurance company or any claimant (in conjunction with your insurance company) regarding any claim. 6.19.5. Waiver of Subrogation. To the extent this Section may be effective without invalidating, or making it impossible to secure, insurance coverage from responsible insurance companies that are doing business in your state (even though an extra premium may result), with respect to any loss covered by insurance we and you then carry, neither party's insurance companies have any right of subrogation against those of the other. Page 16 of 39

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6.19.6. Effect of Our Insurance. Any insurance that we maintain does not in any way limit or affect your obligation to obtain and maintain the foregoing policy or policies in the amounts specified in this Section. Our performance of your obligations will relieve you of liability under the indemnity provisions set forth in this Agreement. 6.19.7. Your Failure to Maintain Insurance. If, for any reason, you fail to procure or maintain the insurance required by this Agreement (as we may revise from time to time), we have the right (but not the duty) to procure such insurance. If we do so, we may charge the cost of such insurance, plus interest at the contract interest rate, to you. Upon demand, you must immediately pay us such charges, together with a reasonable fee for our expenses in so acting. 6.19.8. Group Insurance. We may make available to you insurance coverage through group or master policies we arrange (such as relating to property and casualty, workers' compensation, liability and health, life and disability insurance). 6.20. Vendors. You agree to promptly pay, when due, all trade creditors and vendors (including but not limited to any that are affiliated with us) that supply goods and/or services to you in connection with operating your Franchised Business. 6.21. General Advice. We will make available to you information about new developments, techniques, and improvements in the areas of operations, management, and marketing, to the same extent as we make the information available to other Restaurant franchisees in good standing. We may fulfill our obligation in this section through the distribution of printed or filmed material, an Extranet or other electronic forum, meetings or seminars, individual or group counseling, training programs, telephone communications, or other forms of communications. 6.22 Special Assistance. If you request, and we can reasonably accommodate such request, we will furnish non-routine guidance and assistance to deal with your unusual or unique operating problems at reasonable per diem fees and charges that we periodically establish, as well as our out-of-pocket expenses. 6.23 Credit Cards and Other Methods of Payment. At all times, you must maintain credit-card relationships with the credit- and debit-card issuers or sponsors, check or credit verification services, financial-center services, and electronic-fund-transfer systems that we designate as mandatory, and you must not use any such services or providers that we have not approved in writing or for which we have revoked our approval. We have the right to modify our requirements and designate additional approved or required methods of payment and vendors for processing such payments, and to revoke our approval of any service provider. You must comply with all our credit-card policies, including minimum purchase requirements for a customer's use of a credit card as prescribed in the Manual. 6.24 Conferences. We may conduct annual conferences or conventions, which may include training sessions. We may require your Operating Principal, Certified Managers, and other designated employees to attend the conferences. You will be solely responsible for all costs incurred by you and your employees in attending any conferences or conventions. 6.25 Pricing. We may, from time to time, but only to the extent permitted by law, establish and impose maximum and minimum prices for the goods and services that you are permitted to sell or offer to sell. If we do so, you must not set your prices below the minimum level that we have established, and not above the maximum level that we have established. 6.26 Certification of Performance. After we perform our preopening obligations under this Agreement, we may request that you execute a certification (the Certification of Performance), in a form we reasonably request, confirming such performance. If we make this request, you must execute and deliver the Certification of Performance to us within three-business days of our request. If, however, you do not reasonably believe that we have performed all our preopening obligations under this Agreement, you must, within said three-day period, provide us with written notice specifically describing the obligations that we have not performed. Not later than three-business days after we complete all the obligations specifically described in your notice, you must execute and deliver the Certification of Performance to us. You must do so even if we performed such obligations after the time performance was due under this Agreement. The term preopening obligations means such of our obligations to you under this Agreement that must be performed before the Opening Date for the Franchised Business. Page 17 of 39

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7. PROPRIETARY MARKS 7.1. Your Right to Use the Proprietary Marks. Your right to use the Proprietary Marks applies only to the Franchised Business operated from the Premises as expressly provided in this Agreement. During the Term of this Agreement and after its expiration or termination, you agree not to directly or indirectly contest, or aid in contesting, the validity or ownership of the Proprietary Marks or take any action detrimental to our rights in the Proprietary Marks. 7.2. Your Acknowledgments. You acknowledge that: (a) the Proprietary Marks serve to identify our services and the businesses operating under the System; (b) your use of the Proprietary Marks under this Agreement does not give you any ownership interest in them; and (c) all goodwill associated with and identified by the Proprietary Marks inures exclusively to our benefit and is our property. Upon the expiration or termination of this Agreement, no monetary amount will be attributable to goodwill associated with your activities as a franchisee under this Agreement. 7.3. Limitations on Use of the Proprietary Marks. You agree: 7.3.1. To use only the Proprietary Marks we designate, and only in the manner we authorize; 7.3.2. To use the Proprietary Marks only for the operation of the Franchised Business and only at the Premises, or in advertising we have approved for the business conducted at the Premises; 7.3.3. To operate and advertise the Franchised Business only under the name Pizza Fusion without prefix or suffix; 7.3.4. To ensure that the Proprietary Marks are used together with the symbol (such as ®, ™, or SM) that we require from time to time. 7.3.5. To permit us or our representatives to inspect your operations to assure that you are properly using the Proprietary Marks; 7.3.6. To use the Proprietary Marks to promote and to offer for sale only the products and services that we have approved, and not use any Proprietary Marks in association with the products, materials or services of others; 7.3.7. You agree not to use or permit the use or display of the Proprietary Marks as part of any Internet domain name or website, or any other electronic identifier (including but not limited to e-mail addresses, account names in a social media site, and the like) of you or the Franchised Business in any forum or medium; 7.3.8. Not to use the Proprietary Marks to incur any obligation or indebtedness on our behalf; 7.3.9. Not to use any of the Proprietary Marks as part of your corporate or legal name; Page 18 of 39

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7.3.10 That your use of the Proprietary Marks does not give you any ownership or other interest in or to the Proprietary Marks (except the license granted by this Agreement); 7.3.11 To accept the validity of the Proprietary Marks as they exist now and in the future and agree that you will not contest the validity of any of the Proprietary Marks at any time; and 7.3.12 To comply with our instructions in filing and maintaining trade name or fictitious name registrations, and sign any documents we deem necessary to obtain protection of the Proprietary Marks or to maintain their continued validity and enforceability. 7.4. Changes to the Proprietary Marks. We have the right, upon reasonable notice, to change, discontinue, or substitute for any of the Proprietary Marks and to adopt new Proprietary Marks for use with the System without any liability for any diminishment of the brand. You agree to implement any such change at your own expense within the time we reasonably specify. 7.5. Third-Party Challenges. The parties agree as follows: 7.5.1 You agree to promptly notify us if you learn of any suspected infringement of the Proprietary Marks, any challenge to the validity of the Proprietary Marks, or any known challenge to our ownership of, or your right to use, the Proprietary Marks. 7.5.2 You understand and agree that we will have the sole right to direct and control any administrative proceeding or litigation involving the Proprietary Marks, including any settlement of such a matter. You also understand and agree that we have the sole right, but not the obligation, to take action against uses by others that may constitute infringement of the Proprietary Marks. 7.5.3 If you have used the Proprietary Marks in accordance with this Agreement and our other written instructions, then we will defend you, at our expense, against any third party claim, suit, or demand involving the Proprietary Marks arising out of your use of those marks. If you have used the Proprietary Marks but not in accordance with this Agreement and our other written instructions, then we will still defend you, but at your expense, against such third party claims, suits, or demands; and you agree to pay all of our expenses (including but not limited to attorney's fees and any settlements or judgments) when we ask that you do so. In any case, though, you will be responsible for your staff's payroll and related costs. 7.5.4 If we undertake the defense or prosecution of any litigation relating to the Proprietary Marks, you agree to execute any and all documents and do the things that our counsel deems necessary to carry out such defense or prosecution (including, but not limited to, becoming a nominal party to any legal action). 8. BUSINESS RECORDS AND REPORTING 8.1. Business Records. You agree to keep complete and accurate books, records, and accounts of all business conducted under this Agreement, in the form and manner prescribed in the Manual or other written instructions. You must preserve all of your books and records in at least electronic form for seven (7) years from the date of preparation. 8.2. Reports and Financial Statements. 8.2.1 You agree to submit financial and operational reports and records and documents to us at the times and in the manner specified in the Manual or other written instructions. You agree to submit, (a) within twenty (20) days after the end of each calendar month, a balance sheet and income statement, and (b) within ninety (90) days of the end of each fiscal year, an annual balance sheet and income statement. Upon our request, each such financial statement must accompanied by an unqualified review opinion from an independent certified public accountant acceptable to us. You or the Operating Principal must certify that the income statement and balance sheet are correct and complete and that they have been prepared in accordance with generally accepted accounting principles in the US (or, if we request, international financial reporting standards if, by then, IFRS have been adopted in the US). You must also submit to us a complete photocopy of the Franchised Business' annual federal and state income tax returns when you file such reports with the appropriate tax authorities. Page 19 of 39

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8.2.2 If we request in writing, you agree that your financial institution is authorized to send us a monthly statement of all activity in the designated account (and such other reports of the activity in the operating account as we reasonably request) at the same time as it sends such statements to you. You also agree to sign such documents as your financial institution may require in order to implement this provision. 8.2.3 If you maintain other accounts of any type for the Franchised Business, you agree to provide us with a written description of those accounts and to provide to us copies of the monthly statements for all such accounts and the details of all deposits to, and withdrawals from, those accounts. 8.3. Examination and Audit Rights. We have the right, both during and after the Term of this Agreement, to inspect, copy and audit your books and records, your federal, state and local tax returns, and any other forms, reports, information or data that we may reasonably designate. We will provide you 10 days written notice before conducting an in-person financial examination or audit. We may conduct the examination or audit at our offices or those of a third-party, in which case we may require you to send us your records. If the examination or audit reveals an understatement of Gross Revenues, you must immediately pay us any Royalty fees, Advertising Contributions, or other amounts owing, plus interest as provided in Section 3.8 [Dishonored Payments]. If Gross Revenues have been understated by more than 2% for the period covered by the examination or audit, you must also: (1) reimburse us for the full reasonable cost of the examination or audit, including, travel, lodging, meals, and wages of our representatives and the legal and accounting fees of any attorneys or independent accountants we use for the examination or audit; and (2) at our request, thereafter provide us with periodic audited financial statements. If you have understated Gross Revenues by 2% or more on three or more occasions in any twelve-month period, or by 5% or more for any period of four (or more) consecutive weeks, we have the right to terminate this Agreement with no opportunity for cure. The foregoing remedies are in addition any other remedies and rights available to us under this Agreement or applicable law. 8.4. Governing Documents. If you are a corporation, partnership, LLC, or LLP, or transfer this Agreement to a corporation, partnership, LLC, or LLP, then, upon our request, you must provide to us a list of holders of direct or indirect equity interests and their percentage interests, as well as copies of your governing documents and any other corporate documents, books, or records. The Owners may not enter into any shareholders' agreement, management agreement, voting trust or other arrangement that gives a third party the power to direct and control your affairs without our prior written consent. Throughout the Term of this Agreement, your governing documents must provide that no transfer of any ownership interest may be made except in accordance with Section 14 of this Agreement. Any securities that you issue must bear a conspicuous printed legend to that effect. 8.5. Back-office. We have the right to require that you use an independent bookkeeper and/or independent accounting firm that we designate, in writing, for all such requirements of your Franchised Business. If we make such a designation, you agree to promptly work and cooperate with the designated bookkeeper and/or accountant. Page 20 of 39

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9. MARKETING FUND AND ADVERTISING 9.1 Pizza Fusion Marketing Fund 9.1.1. We have the right, but not the obligation, to establish, maintain, and administer a fund for the marketing of the Pizza Fusion brand and Restaurants (the Marketing Fund). You must contribute each Period (commencing from the time we establish the Marketing Fund) to the Marketing Fund as provided in Section 3.3 [Advertising Contributions]. 9.1.2. We have the right to determine the proper operation and other decisions of the Marketing Fund. We may use your contributions and any earnings on the Marketing Fund for any costs associated with advertising, marketing, public relations, and/or promotional programs and materials, and any other activities we believe would benefit Franchised Businesses generally, including advertising campaigns in various media; creation and maintenance of one or more Websites; direct mail advertising; market research, including secret shoppers and customer satisfaction surveys; employing advertising and/or public relations agencies; purchasing promotional items; conducting and administering promotions, contests, giveaways, public relations events, community involvement activities, etc.; and providing promotional and other marketing materials and services to our franchisees. We have the right to direct all marketing programs, with the final decision over creative concepts, materials, and media used in the programs and their placement. We do not guarantee that you will benefit from the Marketing Fund in proportion to your contributions to the Marketing Fund. 9.1.2. We will deposit all contributions to the Marketing Fund in an account separate from our other funds and will not use them to defray any of our general operating expenses, except for reasonable administrative costs and overhead we incur in activities reasonably related to the administration of the Marketing Fund or the management of Marketing Fund-supported programs (including full or partial salaries of our personnel who devote full- or part-time services to Marketing Fund activities). 9.1.3. We will make available to you, at a reasonable cost, any promotional materials produced with Marketing Fund monies, and we will deposit the proceeds of those sales into the Marketing Fund account. We are not required to have an independent audit of the Marketing Fund completed. We will make available an unaudited statement of contributions and expenditures for the Marketing Fund 60 days after the close of our fiscal year to franchisees that make a written request for a copy. 9.2. Local Marketing. Beginning on the Opening Date, during each consecutive three-calendar-month period during the Term, you must spend three percent (3%) or more of your Gross Sales on local marketing of the Franchised Business. You must make these local marketing expenditures on a quarterly basis, based upon your Gross Sales calculated for the current year on an annualized basis. Your local spending obligation is in addition to your Marketing Fund contributions. Upon our request, you agree to submit to us, for our approval, an annual proposal and quarterly proposals detailing your plan for implementing your local marketing budget. At our request, you must submit appropriate documentation to verify compliance with the minimum spending obligation. All local advertising, marketing, and promotions by you must be in such media, and such types and format as we may approve; must be conducted in a dignified manner; and, must conform to such standards and requirements as we may specify. You must not use any advertising, marketing materials, or promotional plans unless and until you have received written approve from us, pursuant to the procedures and terms set forth in Section 9.5 [Advertising Approval] below. We have the right to periodically designate in the Manual the types of expenditures that will or will not count toward the minimum annual spending requirement. You must advertise the Franchised Business in all major directories in your Delivery/Catering and Advertising Area, including local online directories, as specified in the Manual. If you advertise jointly with other franchisees, your share of the cost will count toward your local spending requirement under this Section 9.2 [Local Marketing]. Page 21 of 39

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9.3. Regional Fund. We have the right to designate any geographical area for purposes of establishing a regional marketing fund (Regional Fund). If we have established a Regional Fund for the geographic area in which your Franchised Business is located by the time you commence operations hereunder, you must immediately become a member of such Regional Fund. If we establish a Regional Fund for the geographic area in which your Franchised Business is located the Term of this Agreement, you must become a member of such Regional Fund within thirty (30) days after the date on which the Regional Fund commences operation. In no event will you be required to be a member of more than one Regional Fund. The following provisions shall apply to each such Regional Fund: 9.3.1 Each Regional Fund will be organized and governed in a form and manner, and will commence operations on a date, that we have approved in advance in writing. 9.3.2 Each Regional Fund will be organized for the exclusive purpose of administering regional marketing programs and developing, subject to our approval, standardized promotional materials for use by the members in local marketing and promotion. 9.3.3 No advertising, marketing, or promotional plans or materials may be used by a Regional Fund or furnished to its members without our prior approval pursuant to the procedures and terms as set forth in Section 9.5 [Advertising Approval] below. 9.3.4 You must contribute each Period (commencing from the time we establish the Marketing Fund) to the Marketing Fund as provided in Section 3.3 [Advertising Contributions], together with such statements or reports as we, or the Regional Fund with our prior written approval, may require. If we request, you must submit your Regional Fund contribution and reports to the Regional Fund directly to us for distribution to the Regional Fund. 9.3.5 A majority of the Restaurant owners in the Regional Fund may vote to increase the amount of each Restaurant owner's Regional Fund contribution by up to an additional two percent (2%) of each Restaurant's Gross Revenues. Voting will be on the basis of one vote per Restaurant, and any locations that we operate in the region, if any, will have the same voting rights as those owned by our franchisees. You must contribute to the Regional Fund in accordance with any such vote by the Regional Fund to increase each Restaurant's contribution by up to two percent (2%) of the Gross Revenues of your Franchised Business. 9.3.6 We will credit the contributions you make to the Regional Fund against the amounts you must spend on local advertising under Section 9.2 [Local Marketing] above. 9.3.7 Although once established, each Regional Fund is intended to be of perpetual duration, we maintain the right to terminate any Regional Fund. A Regional Fund will not be terminated, however, until all monies in that Regional Fund have been expended for marketing and/or promotional purposes. 9.4 Initial Advertising Campaign. You agree to conduct a Grand Opening Advertising Program for the Franchised Business throughout the first four weeks after the Opening Date, spending an amount not less than $12,000. You must obtain our prior written approval as provided in Section 9.5 [Advertising Approval] below before implementing any advertising plans and/or making any use or placement of advertising and promotional materials as part of the Grand Opening Advertising Program. You acknowledge that the Grand Opening Advertising Program may not be sufficient in all cases to develop adequate exposure to the services offered by your Franchised Business, and that it may be necessary for you to supplement the Grand Opening Advertising Program with additional advertising and promotional expenditures and efforts. Page 22 of 39

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9.5. Advertising Approval. You agree to conduct all advertising in a dignified manner and to conform to the standards and requirements we specify from time to time in the Manual or other written materials. We will make available to you approved advertising and promotional materials, including signs, posters, collaterals, etc. that we have prepared. We will have the final decision on all creative development of advertising and promotional messages. You must submit to us in writing, for our approval before your use, all proposed plans, promotion materials, and advertising that we did not prepare or approve in the previous year. If you do not receive our written approval within 10 business days from the date we received the material, the material is deemed disapproved. We reserve the right to require you to discontinue the use of any advertising or marketing materials. 9.6. Special Promotions. You agree to participate in and comply with special promotional activities that we may prescribe from time to time for Franchised Businesses generally or in specific geographic areas or for specific types of venues. You agree to bear your own costs of participating locally in such promotions. 10. TECHNOLOGY 10.1. Computer System. We have the right to specify or require that certain brands, types, makes, and/or models of communications, computer systems, and hardware to be used by, between, or among Franchised Businesses, including without limitation: (a) back office and point of sale systems, data, audio, video, and voice storage, retrieval, and transmission systems for use at Franchised Businesses, between or among Franchised Businesses, and between and among your Franchised Business and us, our designee and/or you; (b) Cash Register Systems (defined below); (c) physical, electronic, and other security systems; (d) printers and other peripheral devices; (e) archival back-up systems; and (f) internet access mode (e.g., form of telecommunications connection) and speed (collectively, the Computer System). You agree to abide by our requirements with respect to the Computer System. 10.1.1 We have the right, but not the obligation, to develop or have developed for us, or to designate: (a) computer software programs and accounting system software that you must use in connection with the Computer System (Required Software), which you must install; (b) updates, supplements, modifications, or enhancements to the Required Software, which you must install; (c) the tangible media upon which such you must record or receive data; (d) the database file structure of your Computer System; and (e) an Extranet for informational assistance, which may include, without limitation, the Manuals, training other assistance materials, and management reporting solutions; and (f) answering service requirements and/or system-wide phone order processing of all delivery orders, and/or to designate vendors that will provide such order processing. 10.1.2 You agree to install and use the Computer System and Required Software in the manner that we require. 10.1.3 You agree to implement and periodically upgrade and make other changes to the Computer System and Required Software as we may reasonably request in writing (collectively, Computer Upgrades). Page 23 of 39

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10.1.4 You agree to comply with the specifications that we issue with respect to the Computer System and the Required Software, and with respect to Computer Upgrades, at your expense. You also agree to afford us unimpeded access to your Computer System and Required Software in the manner, form, and at the times that we request. 10.2 Data. You agree that all data that you collect from customers and potential customers in connection with the Franchised Business (Customer Data) is deemed to be owned exclusively by us, and you also agree to provide the Customer Data to us at any time that we request as you to do so. You have the right to use Customer Data while this Agreement or a Successor Franchise Agreement is in effect, but only in connection with operating the Franchised Business and only in accordance with the policies that we establish from time to time. You may not sell, transfer, or use Customer Data for any purpose other than operating the Franchised Business and marketing Pizza Fusion products and services. However, if you Transfer the Franchised Business (as provided in Section 14.2 [No Transfer without Our Prior Written Consent] below), as part of the Transfer, you may Transfer use of the Customer Data to the buyer for value. 10.3 Ownership of Data. We have the right to specify, from time to time, in the Manual or otherwise in writing, the information that you must collect and maintain on the Computer System, and you agree to provide us with the reports that we may reasonably request from the data so collected and maintained. You agree to download to us daily, or in such other intervals that we may require, all information and materials that we may require in connection with your operation of the Franchised Business, and shall display such information and materials in the manner we may prescribe, including, without limitation, to employees of the Franchised Business. All data pertaining to, derived from, or displayed at the Franchised Business (including without limitation data pertaining to or otherwise about Franchised Business customers) is and shall be our exclusive property, and we hereby grant you a royalty-free non-exclusive license to use that data during the Term of this Agreement. 10.4 Privacy Laws. You agree to abide by all applicable laws pertaining to the privacy of consumer, employee, and transactional information (Privacy Laws). 10.4.1 You agree to comply with our standards and policies pertaining to Privacy Laws. If there is a conflict between our standards and policies pertaining to Privacy Laws and actual applicable law, you shall: (i) comply with the requirements of applicable law; (ii) immediately give us written notice of said conflict; and (iii) promptly and fully cooperate with is and our counsel in determining the most effective way, if any, to meet our standards and policies pertaining to Privacy Laws within the bounds of applicable law. 10.4.2 You agree not to publish, disseminate, implement, revise, or rescind a data privacy policy without our prior written consent as to said policy. 10.5 Website. We will maintain a Website for benefit of ourselves and our franchisees. You agree not to establish a Website or permit any other party to establish a Website that relates in any manner to your Franchised Business or referring to the Proprietary Marks. We have the right, but not the obligation, to provide one or more references or webpage(s) to your Franchised Business, as we may periodically designate, within our Website. (The term Website means one or more related documents, designs, pages, or other communications that can be accessed through electronic means, including but not limited to the Internet, World Wide Web, social networking sites (including but not limited to Facebook, Twitter, LinkedIn, Google Wave, etc.), blogs, vlogs, and other applications, etc.). If we ever do approve in writing a request for you to use a separate Website, then we have the right to require that you meet any or all of the following requirements: 10.5.1 You agree that any Website that you own or that is maintained for your benefit will be deemed advertising under this Agreement, and will be subject to (among other things) our prior written approval. 10.5.2 You shall not establish or use any Website without our prior written approval. Page 24 of 39

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10.5.3 Before establishing any Website, you must submit to us, for our prior written approval, a sample of the proposed Website domain name, format, visible content (including, without limitation, proposed screen shots), and non-visible content (including, without limitation, meta data and meta tags) in the form and manner we may reasonably require. 10.5.4 You agree not to use or modify any such Website without our prior written approval as to such proposed use or modification. 10.5.5 In addition to any other applicable requirements, you agree to comply with the standards and specifications for Websites that we may periodically prescribe in the Manuals or otherwise in writing. 10.5.6 If we require you to do so, you agree to establish hyperlinks to our Website and others as we may request in writing. 10.6 Cash Register Systems. You must record all sales on computer-based point of sale systems on such other types of cash registers that we have the right to designate or approve in the Manual or otherwise in writing (Cash Register Systems). The Cash Register System is deemed to be part of your Computer System. You must utilize computer-based point-of-sale cash registers which are fully compatible with any program or system which we have the right to designate and you must record all Gross Revenues and all revenue information on such equipment. 10.7 Gift Cards. If we require, you agree to participate in a gift card program that we specify. For this purpose, you must purchase the software, hardware, and other items needed to sell and process gift cards, as we may specify in writing in the Manuals or otherwise. You must also pay such monthly and per-swipe transaction fees as may be required by the vendor of the gift card system. You must sell or honor gift cards only in accordance with our written standards. You must not sell, issue, or redeem gift certificates other than gift cards we have approved in writing. 10.8 Use of the Proprietary Marks. You agree not to use or permit the use or display of the Proprietary Marks as part of any Internet domain name or website, or any other electronic identifier (including but not limited to e-mail addresses, account names in a social media site, and the like) of you or the Franchised Business in any forum or medium. 10.9 Identification of the Franchised Business. You must use, and only use, the email address and other identifiers we designate in connection with the business of the Franchised Business. You agree not to transmit or cause any other party to transmit advertisements or solicitations by e-mail or other electronic media without first obtaining our written consent as to: (a) the content of such e mail advertisements or solicitations; and (b) your plan for transmitting such advertisements. In addition to any other provision of this Agreement, you will be solely responsible for compliance with any laws pertaining to sending e-mails including but not limited to the Controlling the Assault of Non-Solicited Pornography and Proprietary Marketing Act of 2003 (known as the CAN-SPAM Act of 2003). 10.10 Changes to Technology. Because changes to technology are dynamic and not predictable within the term of this Agreement, and in order to provide for inevitable but unpredictable changes to technological needs and opportunities, you agree: (a) that we will have the right to establish, in writing, reasonable new standards to address new technologies, and to implement those changes in technology into the System; and (b) to abide by our reasonable new standards as if this Section 10 were periodically revised for that purpose. 10.11 E-Mail and Fax Communication. You agree that exchanging information with us by e-mail and fax is an important way to enable quick, effective, and efficient communication, and that we are entitled to rely upon each other's use of e-mail and faxes for communicating as part of the economic bargain underlying this Agreement. To facilitate the use of e-mail and fax to exchange information, you authorize the transmission of e-mail by us and our employees, vendors, and affiliates (on matters pertaining to the business contemplated hereunder) (together, Official Senders) to you and your employees during the term of this Agreement. Page 25 of 39

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10.11.1 In order to implement the terms of this Section 10.11 [E-Mail and Fax Communication], you agree that: (a) Official Senders are authorized to send e-mails and faxes to you and your employees; (b) you will cause your officers, directors, and employees (as a condition of their employment or position with you) to give their consent (in an e-mail, electronically, or in a pen-and-paper writing, as we may reasonably require) to Official Senders' transmission of e-mails and faxes to those persons, and that such persons shall not opt-out, or otherwise ask to no longer receive e-mails, from Official Senders during the time that such person works for or is affiliated with you; and (c) you will not opt- out, or otherwise ask to no longer receive e-mails and/or faxes, from Official Senders during the term of this Agreement. 10.11.2 The consent given in this Section 10.11 [E-Mail and Fax Communication] will not apply to the provision of notices under this Agreement by either party using e-mail (unless the parties otherwise agree in a pen-and-paper writing signed by both parties). 11. OPERATING MANUAL We will furnish you with one copy of, or electronic access to, the Manual, on loan, for as long as this Agreement or a Successor Franchise Agreement remains in effect. We reserve the right to furnish all or part of the Manual to you in electronic form or online and to establish terms of use for access to any restricted portion of our website. You acknowledge that we own the copyright in the Manual and that your copy of the Manual remains our property. You agree to treat the Manual, training materials, and any other manuals or materials created or approved by us for use with the System as secret and confidential. You agree not to copy, duplicate, record or otherwise reproduce the Manual or other materials provided by us, in whole or in part. In addition, you agree not to make any confidential information or materials supplied by us available to any unauthorized person. We have the right to amend and supplement the Manual from time to time by letter, electronic mail, bulletin, videotape, audio tapes, software, or other forms of communication. You agree to keep your copy of the Manual up-to-date and to comply with each new or changed standard promptly upon receipt of notice from us. If a dispute develops relating to the contents of the Manual, our copy of the Manual maintained at our headquarters will control. 12. CONFIDENTIAL INFORMATION During and after the term of this Agreement, you may not communicate, divulge, or use for any purpose other than the operation of the Franchised Business any confidential information, knowledge, trade secrets or know-how that may be communicated to you or that you may learn by virtue of your relationship with us and the System. You may divulge confidential information only to your professional advisers and to your employees who must have access to the information to operate the Franchised Business. All information, knowledge and know-how relating to us, our business plans, or the System are deemed confidential for purposes of this Agreement, except information that you can demonstrate came to your attention by lawful means prior to our disclosure; or which, at the time of our disclosure to you, had become a part of the public domain. You must require your employees, and any other person or entity to which you wish to disclose any confidential information, to execute (and deliver to us upon our request) agreements, in the form provided in Appendix C to this Agreement or as we may otherwise require in writing, that they will maintain the confidentiality of the disclosed information. If you do not obtain execution of the covenants required by this Section 12 and, upon our request, deliver those signed agreements to us, that will constitute a default under Section 15.2.13 [Termination By Us Without A Cure Period] below. Page 26 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





13. TRANSFERS BY US We have the unrestricted right to transfer or assign all or any part of our rights and/or our obligations under this Agreement to any person or legal entity without your consent. You agree that we will have no liability after the effective date of transfer or assignment for the performance of, or for any failure to perform, any obligations we have transferred. We also have the absolute right to delegate to others the performance of any of our duties, obligations, or benefits under this Agreement, to third parties (including, without limitation, an area developer under the terms of an area development agreement with us), which will not be parties to an agreement with you. 14. TRANSFERS BY YOU 14.1. Definition of Transfer. In this Agreement, Transfer as a verb means to sell, assign, give away, pledge, or encumber, either voluntarily or by operation of law (such as through divorce or bankruptcy proceedings), any interest in this Agreement the rights and/or obligations under this Agreement, all or substantially all of the assets of the Franchised Business, and/or any direct or indirect interest in the ownership of Franchisee (if the Franchisee is a corporation, partnership, or limited liability company). Transfer as a noun means any such sale, assignment, etc. 14.2. No Transfer without Our Prior Written Consent. Neither you nor any of the Owners may make any Transfer or permit any Transfer to occur without obtaining our prior written consent. We have the right to withhold our consent, except as otherwise provided in Sections 14.3 [Transfer of Entire Business] through 14.8 [Our Right of First Refusal]. We have the right to communicate with and counsel both you and the proposed transferee on any aspect of a proposed Transfer. If a Transfer requires our consent, then that transaction may not take place until at least sixty (60) days after we receive written notice of the proposed Transfer. You agree to provide any information and documentation relating to the proposed Transfer that we reasonably require. Unless otherwise agreed, we do not waive any claims against the transferring party if we approve the Transfer. 14.3. Transfer of Entire Business. For a proposed Transfer of the Franchised Business or this Agreement (or, if Franchisee is a corporation or other entity, a Transfer of ownership interests that would result in a change of control of Franchisee), the following conditions apply (unless waived by us): 14.3.1. You must be in compliance with all obligations to us under this Agreement and any other agreement you have with us and our affiliates as of the date of the request for our approval of the Transfer, or you must make arrangements satisfactory to us to come into compliance by the date of the Transfer. 14.3.2. The proposed transferee must complete all of the following requirements: (a) Demonstrate to our satisfaction that he or she meets all of our then-current qualifications to become a Pizza Fusion franchisee, and, at our request, the proposed transferee must travel (at his or her expense) to our principal office for an interview. (b) Sign our then-current standard form of franchise agreement (or the standard form most recently offered to new franchisees, if we are not then offering franchises to new franchisees) for the then-remaining balance of the Term of this Agreement, and such other ancillary agreements we require for new Franchised Businesses. Their new franchise agreement may materially differ from the terms of this Agreement. (c) Successfully complete our then-current training requirements and pay the then-current fee for training. (d) If the proposed transferee is one of our other franchisees, he or she must not be in default under his or her agreements with us and must have a good record of customer service and compliance with our operating standards. (e) If the transferee is a corporation or other entity, the owner or owners of a beneficial interest in the transferee must execute our then-current form of personal guarantee. Page 27 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





14.3.3. You or the transferee must make arrangements to modernize, upgrade, and conform the Franchised Business, at your and/or the transferee's expense, to our then-current standards and specifications for new Franchised Businesses. 14.3.4. We must be paid, either by you or the transferee, a transfer fee (Transfer Fee) in an amount equal to $7,500 (or twenty- five percent (25%) of the then-current initial franchise fee, if greater). The payment of this transfer fee is in place of any initial franchise fee due under the Franchise Agreement the transferee will enter under Section 14.3.2 [Transfer of Entire Business] above. If the transferee is a spouse, son, or daughter of the transferor and the transfer is for estate-planning purposes, no transfer fee is charged, but the transferor must reimburse us for the out-of-pocket expenses (including attorneys' fees) we incur in connection with reviewing, approving, and properly documenting the transfer. 14.3.5. You and all Owners must execute a general release, in a form satisfactory to us, of all claims against us and our past, present and future affiliates, officers, directors, shareholders, agents and employees. You and the Owners will remain liable to us for all obligations arising before the effective date of the Transfer. 14.3.6. The price and other proposed terms of the Transfer must not, in our reasonable business judgment, have the effect of negatively impacting the future viability of the Franchised Business. 14.4. Transfer of a Partial Ownership Interest. For any proposal to admit a new Owner, to remove an existing Owner, or to change the distribution of ownership shown on the cover page, or for any other transaction that amounts to the Transfer of a partial interest in the Franchised Business, you must give us advance notice and submit a copy of all proposed contracts and other information concerning the Transfer that we may request. We will have the right to require reimbursement of any out-of-pocket expenses that we incur in reviewing the proposed Transfer. We will have a reasonable time (not less than thirty (30) days) after we have received all requested information to evaluate the proposed Transfer. You must satisfy the conditions in Sections 8.6, 14.3.2(a) [Transfer of Entire Business], 14.3.4 [Transfer of Entire Business], 14.3.5 [Transfer of Entire Business], and 14.3.6 [Transfer of Entire Business] above in connection with any such transfer. We may withhold our consent on any reasonable grounds or give our consent subject to reasonable conditions. You acknowledge that any proposed new owner must submit a personal application and execute a personal guarantee in the same form signed by the original Owners. 14.5. Transfer to a Corporation or Other Entity. We will consent to the assignment of this Agreement to a corporation, partnership or limited liability corporation that you form for the convenience of ownership, provided that: (a) the entity has and will have no other business besides operating a Franchised Business (b) you satisfy the conditions in Sections 14.3.2(a) [Transfer of Entire Business], 14.3.3 [Transfer of Entire Business], 14.3.4 [Transfer of Entire Business] and 14.3.5 [Transfer of Entire Business] above; and (c) the Owners hold equity interests in the new entity in the same proportion shown on the cover page. There is no Transfer Fee for a Transfer to a corporation for convenience of ownership. 14.6. Transfer upon Death or Incapacity. If you or any Owner dies, becomes incapacitated, or enters bankruptcy proceedings, that person's executor, administrator, personal representative, or trustee must apply to us in writing within three (3) months after the event (death, declaration of incapacity, or filing of a bankruptcy petition) for consent to Transfer the person's interest. The Transfer will be subject to the provisions of Sections 14.2 [No Transfer without Our Prior Written Consent] through 14.8 [Our Right of First Refusal], as applicable, except there will be no Transfer Fee. In addition, if the deceased or incapacitated person is the Operating Principal, you must within 30 days thereafter, hire and retain a replacement, who is satisfactory to us, to perform such obligations. If a satisfactory replacement is not retained, we will have the right (but not the obligation) to take over operation of the Franchised Business, or to hire and retain a replacement on your behalf, until the Transfer is completed and to charge a reasonable management fee for these services. For purposes of this Section, incapacity means any physical or mental infirmity that will prevent the person from performing his or her obligations under this Agreement: (i) for a period of thirty (30) or more consecutive days; or (ii) for sixty (60) or more total days during a calendar year. In the case of Transfer by bequest or by intestate succession, if the heirs or beneficiaries are unable to meet the conditions of Section 14.3 [Transfer of Entire Business], the executor may transfer the decedent's interest to another successor that we have approved, subject to all of the terms and conditions for Transfers contained in this Agreement. If an interest is not disposed of under this Section 14.6 [Transfer upon Death or Incapacity] within six (6) months after the date of death or appointment of a personal representative or trustee, we may terminate this Agreement under Section 15.2 [Termination By Us Without A Cure Period] below. Page 28 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





14.7. Non-Conforming Transfers. Any purported Transfer that is not in compliance with this Section 14 is null and void and constitutes a material breach of this Agreement, for which we may terminate this Agreement without opportunity to cure. Our consent to a Transfer does not constitute a waiver of any claims that we have against the transferor, nor is it a waiver of our right to demand exact compliance with the terms of this Agreement. 14.8. Our Right of First Refusal. We have the right, exercisable within thirty (30) days after receipt of the notice specified in Section 14.2 [No Transfer without Our Prior Written Consent], to send written notice to you that we intend to purchase the interest proposed to be Transferred. We may assign our right of first refusal to someone else either before or after we exercise it. However, our right of first refusal will not apply with regard to a Transfer under Section 14.5 [Transfer to a Corporation or Other Entity] or a Transfer to your parents, spouse, son, daughter, or mother or father in-law (including Transfers to your parents, spouse, son, daughter, or mother or father in-law as a result of death or incapacity as described in Section 14.6 [Transfer upon Death or Incapacity]). 14.8.1. If the Transfer is proposed to be made pursuant to a sale, we or our designee may purchase the interest proposed to be Transferred on the same economic terms and conditions offered by the third-party. Closing on our purchase must occur by the later of (a) 60 days after the date of our notice to the seller electing to purchase the interest, or (b) the closing date as proposed in the third-party's purchase offer. If we cannot reasonably be expected to furnish the same consideration as the third-party, then we may substitute the reasonable equivalent in cash. If the parties cannot agree within 30 days on the reasonable equivalent in cash, we will designate, at our expense, an independent appraiser and the appraiser's determination will be final. Any material change in the terms of the offer from a third-party after we have elected not to purchase the seller's interest will constitute a new offer subject to the same right of first refusal as the third party's initial offer. 14.8.2. If a Transfer is proposed to be made by gift, we will designate, at our expense, an independent appraiser to determine the fair market value of the interest proposed to be transferred. We may purchase the interest at the fair market value determined by the appraiser. Closing on the purchase will occur within 30 days after our notice to the transferor of the appraiser's determination of fair market value. 14.8.3. If we elect not to exercise our rights under this Section, the transferor may complete the Transfer after complying with Sections 14.2 [No Transfer without Our Prior Written Consent] through 14.6 [Transfer upon Death or Incapacity] above. Closing of the Transfer must occur within 60 calendar days of our election (or such longer period as applicable law may require); otherwise, the third-party's offer will be treated as a new offer subject to our right of first refusal. The Transfer is conditional upon our determination that the Transfer was on terms substantially the same as those offered to us. 15. TERMINATION 15.1. Termination By Us Without Notice. You will be in default under this Agreement and all rights granted by this Agreement will automatically terminate without notice to you if you become insolvent or make an assignment for the benefit of your creditors; if a receiver is appointed; if execution is levied against your business assets; or if suit to foreclose any lien or mortgage or bankruptcy is instituted against you and not dismissed within 60 days. Page 29 of 39

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15.2. Termination By Us Without A Cure Period. We may terminate this Agreement by written notice to you, without giving you an opportunity to cure, upon the occurrence of any of the following events: 15.2.1. You, the Operating Principal, and/or your personnel fail to complete training under Section 5.1 [Initial Training Program] to our satisfaction. 15.2.2. You fail to open for business by the opening deadline specified in Appendix A. 15.2.3. You disclose the contents of the Manual or other trade secrets or confidential information contrary to Sections 11 and 12 of this Agreement. 15.2.4. You refuse to permit, or try to hinder, an examination or audit of your books and records or of the Franchised Business as provided in this Agreement. 15.2.5. You make any material misrepresentation in connection with your application to us for the franchise, or you submit to us any report or statement that you know or should know to be false or misleading. 15.2.6. You understate to us your Gross Revenues, by 2% or more on three or more occasions in any twelve-month period, or by 5% or more for any period of four or more consecutive weeks. 15.2.7. You fail to operate the Franchised Business for three or more consecutive business days on which you were required to operate, unless we determine that the failure was beyond your control. 15.2.8. You or any Owner, officer or director is convicted of a crime that we reasonably believe is likely to harm the reputation of the Pizza Fusion concept. 15.2.9. Any Transfer occurs that does not comply with Section 14, including a failure to transfer to a qualified successor after death or disability within the time allowed by Section 14.7 [Non-Conforming Transfers]. 15.2.10. You are in default three (3) or more times under Sections 15.3 [Termination by Us Following Expiration of Cure Period for Monetary Default] and/or 15.4 [Termination by Us Following Expiration of Cure Period] within any twelve (12) month period, whether or not the defaults are similar and whether or not they are cured. 15.2.11. After curing a default pursuant to Sections 15.3 [Termination by Us Following Expiration of Cure Period for Monetary Default] or 15.4 [Termination by Us Following Expiration of Cure Period], you commit the same default within twelve (12) months, whether or not the second default is cured. 15.2.12. Any condition exists with respect to the Franchised Business that, in our reasonable judgment, seriously jeopardizes public health or safety. 15.2.13. You fail to comply with the covenants in Section 17 below or fail to timely obtain execution of the covenants required under Section 12 above and Section 17.3 [Owners and Employees] below. 15.2.14. You fail to obtain or maintain required insurance. 15.2.15. You cease to operate the Franchised Business for more than seven (7) consecutive days or fourteen (14) days in any calendar year unless we approved a temporary closing or we determine, that the failure to operate was beyond your control, you otherwise abandon the Franchised Business, or you lose the right to possess the Premises or you otherwise forfeit the right to do or transact business as required under this Agreement. If, however, through no fault of you, the Premises are damaged or destroyed by an event such that repairs or reconstruction cannot be completed within ninety (90) days thereafter, you will have thirty (30) days after such event in which to apply for our approval to relocate and/or reconstruct the premises, and we will not unreasonably hold our approval. Page 30 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





15.3. Termination by Us Following Expiration of Cure Period for Monetary Default. You will be in default under this Agreement if you fail, refuse, or neglect to pay when due (including if we are not able to collect payments by electronic fund transfer pursuant to Section 3.6 [Method of Payment] due to insufficient funds in your account(s), closure of your account(s), or any other reason resulting in the nonpayment) any monies owing to us, our affiliates, or any lender that has provided financing to you under this Agreement or any other agreement, or to your landlord and/or any supplier of goods or services to your Franchised Business. You will have ten (10) days after written notice of such default from us within which to remedy the default. You may avoid termination by curing the default to our satisfaction within the 10-day period (or such longer period as applicable law may require). If you do not cure the default within such 10-day period (or such longer period as applicable law may require), this Agreement will terminate automatically and without further notice, effective immediately upon the expiration of the specified time period. 15.4 Termination by Us Following Expiration of Cure Period. For any default not covered under Sections 15.1 [Termination By Us Without Notice], 15.2 [Termination By Us Without A Cure Period], or 15.3 above, you will have thirty (30) days after written notice of default from us within which to remedy the default. You may avoid termination by curing the default to our satisfaction within the 30-day period (or such longer period as applicable law may require). If you do not cure the default within the specified time, this Agreement will terminate automatically and without further notice, effective immediately upon the expiration of the specified time period. Any failure to comply with this Agreement, as amended or reasonably supplemented by the Manual or otherwise in writing, not covered by Sections 15.1 [Termination By Us Without Notice], 15.2 [Termination By Us Without A Cure Period], or 15.3 above constitutes a default, including, but not limited to, the following: 15.3.1. You fail, refuse, or neglect to submit to us the financial and other reports and information required under this Agreement. 15.3.2. You fail to comply with any of the mandatory standards or procedures prescribed by us in this Agreement, the Manual, or otherwise in writing. 15.3.3. You fail, refuse, or neglect to obtain our prior written approval or consent as required by this Agreement (other than a failure to obtain consent to a proposed Transfer, for which we may terminate without a cure period as provided in Section 15.2 [Termination By Us Without A Cure Period]). 15.3.4. For a period of fifteen (15) days, you allow a continued violation of any law, ordinance, rule or regulation of a governmental agency, including the failure to maintain or procure any required licenses, permits, or certifications, in the absence of a good faith dispute over its application or legality and without promptly resorting to an appropriate administrative or judicial forum for relief. 15.3.5. You misuse or make any unauthorized use of the Proprietary Marks or otherwise materially impair our goodwill or rights in the Proprietary Marks. 15.5. Cross-Default. Any default by you (including for this purpose your affiliates) under any other agreement with us will constitute a default under this Agreement, subject to the same provisions for notice and cure, if any, as may be applicable to the default under the other agreement. 16. OBLIGATIONS ON TERMINATION OR EXPIRATION 16.1. Upon termination or expiration of this Agreement for any reason, unless we direct you otherwise: 16.1.1. You agree to promptly pay all sums owing to us, our affiliates and suppliers, including, but not limited to, Royalty payments, contributions to the Marketing Fund, or other fees, damages, expenses, and attorney's fees incurred as a result of your default. Page 31 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





16.1.2. You agree to stop making any use of the confidential methods, procedures, and techniques associated with the System. You also agree to immediately deliver to us the Manual and all training materials, marketing materials, records, files, forms, instructions, signs, equipment, correspondence, copies, Customer Data, and other property in your possession or control that contain confidential information (as defined in Section 12) or that bear the Proprietary Marks and you agree not to retain any unauthorized copies of these materials. You also must deliver to us all customer information that you have compiled. 16.1.3. You agree to immediately cease to use, by advertising or in any other manner, the name Pizza Fusion, all other Proprietary Marks, and all other distinctive forms, slogans, signs, symbols, Websites, domain name, website, e-mail address, and any other identifier (whether or not we have authorized its use) that you used in connection with your operation of the Franchised Business or that are otherwise associated with the Proprietary Marks, System, and/or us. If you subsequently begin to operate another business, you agree that you will not use any reproduction, counterfeit, copy or colorable imitation of the Proprietary Marks that you used either in connection with the Franchised Business or its promotion, which is likely to cause confusion, mistake or deception, or which is likely to dilute our exclusive rights in and to the Proprietary Marks, nor any trade dress or designation of origin or description or representation which falsely suggests or represents an association or connection with us. 16.1.4. You agree to promptly take such action as may be necessary to cancel any assumed name registration or equivalent registration containing the name PIZZA FUSION or any other Proprietary Marks. 16.1.5 You will, at our option, assign to us any interest which you have in the lease or sublease for the Premises. (a) If we do not elect or are unable to exercise our option to acquire, or to acquire the lease or sublease for the Premises, you must make such modifications or alterations to the premises operated hereunder (including, without limitation, the changing of the telephone number) immediately upon termination or expiration of this Agreement as may be necessary to distinguish the appearance of the Premises from that of other Restaurants under the System, and such specific additional changes as we may reasonably request for that purpose. In addition, you must stop making any use of any telephone number and/or any domain name, website, e-mail address, and any other identifier (whether or not we have authorized its use) that you used in connection with your operation of the Franchised Business, and you must promptly execute such documents or take such steps necessary to remove reference to the Franchised Business from all trade or business telephone directories, including physical and online yellow and white pages, or at our request transfer same to us. (b) If you fail or refuse to comply with the requirements of this Section 16.1.5 [OBLIGATIONS ON TERMINATION OR EXPIRATION], we will have the right to enter upon the Premises, without being guilty of trespass or any other tort, for the purpose of making or causing to be made such changes as may be required, at your expense, which you agree to pay upon demand. 16.2. Purchase of Assets. You agree that, at our option, you will sell to us any or all your assets used to operate the Franchised Business (including equipment, fixtures, furnishings, Delivery Vehicles, supplies, and inventory) that we ask in writing to purchase. 16.2.1. The purchase price for such items will be equal to your depreciated cost (determined below) or fair market value, whichever is less. The cost will be determined based upon a five (5) year straight-line depreciation of original costs. For equipment that is five (5) or more years old, the parties agree that fair market value will be deemed to be ten percent (10%) of the equipment's original cost. The fair market value of tangible assets must be determined without reference to good will, going-concern value, or other intangible assets. Page 32 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





16.2.2. We may exercise this option by delivering a notice of intent to purchase to you within 30 days after the expiration or termination of this Agreement. During that 30-day period, you agree not to dispose of, transfer, or otherwise hinder our ability to exercise our rights with respect to your assets. 16.2.3. If we exercise our option to purchase, we may setoff all amounts due to us under this Agreement and the cost of the appraisal (if any), against any payment due to you. 16.2.4. If we do not exercise our rights to purchase your Delivery Vehicle(s), you must immediately make such modifications or alterations to the Delivery Vehicle(s) that may be needed to remove any Proprietary Marks and to otherwise distinguish the appearance of the vehicle(s) from those used by other Restaurants. 16.3. Right to Enter and Continue Operations. In order to preserve the goodwill of the System following termination, we (or our designee) have the right to enter the Premises (without liability to you, your Owners, or otherwise) for the purpose continuing the Franchised Business' operation and maintaining the goodwill of the business. 16.4. Liquidated Damages. If this Agreement is terminated due to your default, you must, upon written demand, pay us a lump-sum payment in an amount calculated as follows: (a) the average of your Royalty fees and Advertising Contributions due for the last 60 months before our delivery of notice of default (or, if lesser, the months you had been operating before our delivery of notice of default), (b) multiplied by the lesser of 60 or the number of months remaining in the term of this Agreement. 16.5. Liquidated Damages. 16.5.1 The payments called for in Section 16.4 [Liquidated Damages] above constitute liquidated damages for causing the premature termination of this Agreement and not a penalty. A precise calculation of the full extent of damages that we will incur if this Agreement terminates because you default cannot be reasonably determined. Nevertheless, the parties agree that the lump-sum payment provided under Section 16.4 [Liquidated Damages] above is reasonable in light of the damages for premature termination that may reasonably be expected to occur in such event. 16.5.2 The amounts contemplated under Section 16.4 [Liquidated Damages] above is not a penalty and is intended by the parties only as a compensatory remedy for past breaches and not as a preventative remedy to deter future breaches. Neither does the sum contemplated in Section 16.4 [Liquidated Damages] above represent a price for the privilege of not performing or its payment represent an alternative manner of performance. Accordingly, as a purely liquidated damage provision, this Section does not preclude, nor is inconsistent with, a court granting us specific performance or any other equitable remedies, such as an injunction, to prevent future breaches. Our rights to liquidated damages and specific performance or any other equitable relief are not mutually exclusive. 16.6. Enforcement Costs. You agree to pay all damages, costs, and expenses, including, but not limited to, reasonable attorneys' fees, that we incur (even if after the expiration or termination of this Agreement) in enforcing this Section 16 or Section 17.2 [After Termination, Expiration, or Transfer] below. 17. RESTRICTIONS ON COMPETITION 17.1. During Term. You acknowledge that this Agreement will give you access to valuable and confidential information regarding the System, including our business development strategy and the operational, sales, promotional and marketing methods of Franchised Businesses. You agree that during the term of this Agreement, you will not, without our prior written consent, either directly or indirectly through any other person or entity: Page 33 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





17.1.1. Own, manage, engage in, be employed by, advise, make loans to, consult for, rent or lease to, or have any other interest in any business that (directly or indirectly) operates, or grants franchises or licenses to operate, a restaurant featuring pizza and related food specialties or that offers products or services substantially similar to those then offered by Restaurants (Competitive Business); 17.1.2. Divert or attempt to divert any business or customer, or potential business or customer, to any Competitive Business; or 17.1.3. Induce any person to leave his or her employment with us. 17.1.4. In any manner interfere with, disturb, disrupt, impair, diminish, or otherwise jeopardize our business or that of any of our franchisees. 17.2. After Termination, Expiration, or Transfer. For two (2) years after the expiration or termination of this Agreement or an approved Transfer to a new franchisee, you may not directly or indirectly own, manage, engage in, be employed by, advise, make loans to, consult for, or have any other interest in any Competitive Business that is, or intends to operate, within three (3) mile radius of the Premises of your Franchised Business or within a three (3) mile radius of any Restaurant then-operating or under construction to operate under the System, except as permitted by any Franchise Agreements that remain in effect between you and us. . 17.3. Owners and Employees. The Owners agree that they will personally bind themselves to this Section 17 by signing this Agreement or the attached Guaranty. With respect to the Owners, the time period in Section 17.2 [After Termination, Expiration, or Transfer] will run from the expiration, termination, or Transfer of this Agreement or from the termination of the Owner's relationship with you, whichever occurs first. You must also require and obtain execution of covenants similar to those set forth in Section 12 above, and this Section 17 (as modified to apply to an individual), from any or all of the following persons: your officers, directors, and their respective spouses and employees. (These persons and the Owners are each a Restricted Party) The covenants required by this Section 17.3 [Owners and Employees] shall be in the form provided in Appendix C to this Agreement. Failure by Franchisee to obtain execution of a covenant required by this Section 17.3 [Owners and Employees] shall constitute a default under Section 15.2.13 [Termination By Us Without A Cure Period] above. 17.4. Indirect Violations Prohibited. You may not attempt to circumvent the restrictions in Sections 17.1 [During Term] and 17.2 [After Termination, Expiration, or Transfer] by engaging in prohibited activity indirectly through any other person or entity. 17.5. Enforcement. You agree that the existence of any claim you may have against us, whether or not arising from this Agreement, will not constitute a defense to our enforcement of this Section 17. You agree to pay all costs and expenses that we reasonably incur in enforcing this Section 17, including reasonable attorneys' fees. You acknowledge that a violation of the terms of this Section 17 would result in irreparable injury to us for which no adequate remedy at law may be available. Accordingly, you consent to the issuance of an injunction prohibiting any conduct in violation of the terms of this Section 17. Such injunctive relief will be in addition to any other remedies that we may have. 18. RELATIONSHIP OF THE PARTIES This Agreement does not create a fiduciary or other special relationship or make you or us an agent, legal representative, joint venturer, partner, employee, or servant of each other for any purpose. You are not authorized to, and agree that you will not, make any contract, agreement, warranty, or representation on our behalf, or create any obligation, express or implied, on our behalf. During the term of this Agreement, you agree to hold yourself out to the public as an independent contractor operating the Franchised Business under license from us, and you agree to disclose your status as independent contractor in all business dealings and exhibit a notice to that effect (the location and content of which we reserve the right to specify) on all promotional materials, invoices and stationery. Page 34 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





19. INDEMNIFICATION You agree to hold harmless, defend, and indemnify us and our past, present and future affiliates, officers, directors, shareholders, agents, attorneys, consultants, and employees against any claims, losses, costs, expenses (including, but not limited to, reasonable attorneys' fees, costs of investigation, settlement costs, and interest), liabilities and damages (collectively, Claims) arising directly or indirectly from, as a result of, or in connection with your activities under this Agreement. With respect to any threatened or actual litigation, proceeding, or dispute that could directly or indirectly affect us or any of the other indemnitees under this Section, if you do not assume the active defense of the matter within a reasonable time, we will have the right, but not the obligation, to: (i) choose counsel; (ii) direct and control the handling of the matter; and (iii) settle any claim against the indemnitees. This Section will survive the expiration or termination of this Agreement, and applies to Claims even if they exceed the limits of your insurance coverage. 20. CONSENTS AND WAIVERS 20.1. Consent. Whenever our prior written consent is required under this Agreement, you agree to make a timely written request to us for such consent. Our approval or consent must be in writing and signed by an authorized officer to be effective. 20.2. Waivers. No delay or failure to exercise any right under this Agreement or to insist upon your strict compliance with any obligation or condition, and no custom or practice that differs from the terms of this Agreement, will constitute a waiver of our right to exercise the contract provision or to demand your strict compliance with the terms of this Agreement. Our waiver of any particular default does not affect or impair our rights with respect to any subsequent default you may commit. Our waiver of a default by another franchisee does not affect or impair our right to demand your strict compliance with the terms of this Agreement. Our acceptance of any payments due from you does not waive any prior defaults. 21. NOTICES Notices related to this Agreement must be in writing and personally delivered, sent by registered mail, or by other means which affords the sender evidence of delivery, or of rejected delivery, to the respective parties. Any notice by a means that affords the sender evidence of delivery, or rejected delivery, shall be deemed to have been given at the date and time of receipt or rejected delivery. We will send notices intended for you to your address on the first page of this Agreement. You agree to send notices intended for us to our principal business address, which is currently 2200 West Cypress Creek Road, 1st Floor, Fort Lauderdale, Florida 33309. Either party can change its notice address by informing the other party in writing of a new address. 22. ENTIRE AGREEMENT AND AMENDMENTS This Agreement and the documents referred to herein constitute the entire agreement between you and us with respect to the Franchised Business and supersede all prior negotiations, representations, correspondence, and agreements concerning the same subject matter. However, nothing in this Agreement is meant to disclaim any representation that we make in the Franchise Disclosure Document that we have given to you. Any amendment to this Agreement will not be binding on either party unless that amendment is writing and signed by both parties. Page 35 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





23. CONSTRUCTION OF THE AGREEMENT, SEVERABILITY, AND SURVIVAL 23.1. Clauses are Severable. Each provision of this Agreement is severable from the others. If, for any reason, any provision is determined by a court to be invalid, the invalidity will not impair the operation of the remaining provisions of this Agreement. The latter will continue to be given full force and effect and bind us and you. 23.2. Survival of Clauses. Each provision of this Agreement that expressly or by reasonable implication is to be performed, in whole or in part, after the expiration, termination, or Transfer of this Agreement will survive such expiration, termination, or Transfer. 23.3 Force Majeure. If the performance of any obligation by any party under this Agreement is prevented, hindered or delayed by reason of Force Majeure, which cannot be overcome by reasonable commercial measures, then the parties shall be relieved of their respective obligations (but only to the extent, that the parties, having exercised best efforts, are prevented, hindered or delayed in such performance) during the period of such Force Majeure. The party whose performance is affected by an event of Force Majeure shall give prompt written notice in the circumstances of such Force Majeure event to the other party by describing the nature of the event and an estimate as to its duration, if possible. As used in this Agreement, the term Force Majeure means any act of God, strike, lock out or other industrial disturbance, terrorist act, war (declared or undeclared), riot, epidemic, fire or other catastrophe, or act of any government. However, your inability to obtain financing or make payments (regardless of the reason) does not constitute Force Majeure. 23.4 Cover Page, Recitals, and Captions. The parties agree to incorporate by reference, and include in the text of this Agreement, the information on the cover page and in the recital paragraphs. The parties also agree that all of the captions in this Agreement are meant only for the convenience of the parties, and none of the captions shall be deemed to affect the meaning or construction of any provision of this Agreement. 23.5 No Third Party Rights. Except as otherwise stated in this Agreement, nothing in this Agreement is intended (nor shall be deemed) to confer upon any party any rights or remedies under or by reason of this Agreement, except for you, us, and such of our respective successors and assigns as may be contemplated (and, as to you, permitted) by Sections 13 and 14 above. 24. GOVERNING LAW This Agreement and the relationship between the parties is governed by and will be construed exclusively in accordance with the laws of the State of Florida (without regard to, and without applying, Florida conflict-of-law rules). 25. DISPUTES 25.1. Submission to Mediation. Except as otherwise provided in Section 25.7 [Remedies Not Exclusive] below, any controversy or claim arising between us will first be submitted to non-binding mediation administered by an established, neutral mediation service with experience in franchise disputes. Both parties must sign a confidentiality agreement before participating in any mediation proceeding. The mediation will take place in the city where our principal offices are located at the time the demand for mediation is filed. Once either party has submitted a dispute to mediation, the obligation to attend will be binding on both parties. Each party will bear its own costs with respect to the mediation. The fee for the mediation, however, will be split equally. 25.2. Forum for Litigation. You and the Owners must file any suit against us, and we may file any suit against you, in the federal or state court where our principal office is located at the time the suit is filed. The parties waive all questions of personal jurisdiction and venue for the purpose of carrying out this provision. Page 36 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





25.3. Mutual Waiver of Class Actions. Any lawsuit, claim, counterclaim, or other action may be conducted only on an individual basis, and not as part of a consolidated, common, or class action. 25.4. Mutual Waiver of Jury Trial. You and we each irrevocably waive trial by jury in any litigation. 25.5. Mutual Waiver of Punitive Damages. Each of us waives any right to or claim of punitive, exemplary, multiple, or consequential damages against the other in litigation and agrees to be limited to the recovery of actual damages sustained. 25.6 Time Period to Bring Claims. Any and all claims and actions arising out of or relating to this Agreement, the relationship between you and us, or your operation of the Restaurant, brought by any party hereto against the other, must be commenced within one (1) year from the occurrence of the facts giving rise to such claim or action, or, it is expressly acknowledged and agreed by all parties, such claim or action will be irrevocably barred. 25.7. Remedies Not Exclusive. Except as provided in Sections 25.1 [Submission to Mediation] through 25.4 [Mutual Waiver of Jury Trial] above, no right or remedy that the parties have under this Agreement is exclusive of any other right or remedy under this Agreement or under applicable law. 25.8. Our Right to Injunctive Relief. Nothing in this Agreement bars our right to obtain injunctive or declaratory relief against a breach or threatened breach of this Agreement that will cause us loss or damage. You agree that we will not be required to prove actual damages or post a bond or other security in seeking or obtaining injunctive relief (both preliminary and permanent) and/or specific performance. 25.9. Attorneys Fees and Costs. You agree to reimburse us for all expenses we reasonably incur (including attorneys' fees): (a) to enforce the terms of this Agreement or any obligation owed to us by you and/or the Owners; and (b) in the defense of any claim you and/or the Owners assert against us upon which we substantially prevail in court, arbitration, mediation, or other formal legal proceedings. 26. ACKNOWLEDGMENTS 26.1. Independent Investigation. You and the Owners acknowledge that: 26.1.1. You have conducted an independent investigation of the business venture contemplated by this Agreement and recognize that it involves business risks and that your results will be largely dependent upon your own efforts and ability; 26.1.2. We expressly disclaim the making of, and you acknowledge that you have not received, any representation, express or implied, as to the potential volume, profits or success of the business venture contemplated by this Agreement; 26.1.3. Any financial performance information presented in our Franchise Disclosure Document is not a warranty or guaranty of the results that you will achieve, and your experience is likely to differ; and 26.1.4. We do not, by virtue of any approvals or advice provided to you, assume responsibility or liability to you or any third- party to which we would otherwise not be subject. Page 37 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





26.1.5 You have sole and complete responsibility for the choice of the Premises; that we have not (and will not be deemed to have, even by virtue of our approval of the proposed Premises) given any representation, promise, or guarantee of your success at the Premises; and that you will be solely responsible for its own success at the Premises. 26.1.6 We make no warranty as to your ability to operate the Franchised Business in the jurisdiction in which the Franchised Business is to be operated. You must seek or obtain advice of counsel specifically with respect to this issue. 26.2. Receipt of Documents. You acknowledge that you received a copy of this Agreement, the exhibit(s) hereto, and agreements relating hereto, if any, with all of the blank lines therein filled in, at least seven (7) days before the date when this Agreement was signed, and with sufficient time within which to review the Agreement, with advisors of your choosing. You further acknowledge that you received our franchise disclosure document required by the Federal Trade Commission's Franchise Rule at least fourteen (14) days before the date this Agreement was signed. 26.3. Personal Obligations of Owners. The Owners acknowledge that, by signing this Agreement or the Personal Guaranty attached as Appendix B, they are binding themselves as individuals to all of the terms and conditions of this Agreement, including without limitation Section 9, Section 14, Section 17, and Section 25. 26.4. System Standards. Although we retain the right to establish and periodically modify System standards, which you have agreed to maintain in the operation of the Franchised Business, you retain the right and sole responsibility for the day to day management and operation of the Franchised Business and the implementation and maintenance of System standards at the Franchised Business. 26.5. Other Offers. You acknowledge and agree that we may modify the offer of our franchises to other franchisees in any manner and at any time, which offers and agreements have or may have terms, conditions, and obligations that may differ from the terms, conditions, and obligations in this Agreement. 26.6. No Conflicting Obligations. Each party represents and warrants to the others that there are no other agreements, court orders, or any other legal obligations that would preclude or in any manner restrict such party from: (a) negotiating and entering into this Agreement; (b) exercising its rights under this Agreement; and/or (c) fulfilling its responsibilities under this Agreement. [Signature page follows.] Page 38 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





The parties, intending to be legally bound, have entered into this Agreement on the date first written above. Pizza Fusion Holdings, Inc. Franchisee By: By: Name: Name: Title: Title: Page 39 of 39

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015





APPENDIX A OPENING DEADLINE AND DELIVERY/CATERING AND ADVERTISING AREA 1. Opening Deadline: ____________________________ [Unless, otherwise agreed upon, the Opening Deadline will be nine months after the Agreement Date]. 2. Delivery/Catering and Advertising Area: (to be completed once Premises known). 3. Site Selection Area (if applicable):

Pizza Fusion Holdings, Inc. Franchisee By: By: Name: Name: Title: Title: -A -

Source: PF HOSPITALITY GROUP INC., 10-12G, 9/23/2015 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?

SOLUTION:
During the Term of this Agreement and after its expiration or termination, you agree not to directly or indirectly contest, or aid in contesting, the validity or ownership of the Proprietary Marks or take any action detrimental to our rights in the Proprietary Marks.