Page 533 - Aida Hovsepian Onboarding

exceed such aggregate supply of conforming inventory of affected, merchantable Products (including finished
Products, work in process, and proprietary raw materials), determined on an item-by-item basis, purchased by the
Co-op and/ or its Selected Buyers in an average thirty (30) day period over the three (3) months immediately prior to
the Specification change. The Co-op and/ or its Selected Buyers may require Supplier to modify such inventory of
Products to meet the new Specifications. Supplier may only adjust pricing on such inventory which the Co-op and/
or its Selected Buyers are obligated to purchase pursuant to this Section as necessary to reflect the actual changes
in Supplier’s costs necessitated by the change in Specifications.

c. Modification/ Termination. If the Servicers change the Specifications or a Product is deleted from the menu at any
time during the Term, then the Co-op may modify or terminate this Agreement with thirty (30) days prior written
notice to Supplier. If the changed Specification or other menu change requires an entirely new Product, then the Co-
op shall allow Supplier a reasonable opportunity to seek the applicable Servicer’s approval of Supplier as a supplier
of the newly defined Product(s). The applicable Servicer has sole discretion of any such approval of Supplier as a
supplier of the newly defined Product(s).

Section 17 - Disposition of Remaining Inventory.
Disposition of Remaining Inventory. Supplier, at its sole expense, shall lawfully and responsibly destruct and dispose of
any System proprietary inventory which Selected Buyers do not purchase as provided in Sections 21(a)(i) or 16(c). Supplier,
at its own risk, may sell any remaining non-proprietary inventory to third parties if Supplier, at its own expense, removes all
packaging or other items bearing the names or trademarks of Selected Buyers or the Servicers or their affiliates, and does
not, directly or indirectly, inform the purchasers of such inventory that it was formerly intended for use by Selected Buyers. In
either event, Supplier shall indemnify the Co-op and Selected Buyers against any claims and expenses, including reasonable
attorneys’ fees, concerning any remaining inventory.

Section 18 - Supplier Income.
a. Supplier shall not, directly or indirectly, pay any Supplier Income in connection with Products purchased under this
Agreement, except for:

b. Supplier shall not credit purchasers of Products for volume purchased under this Agreement in connection with purchases
unrelated to the System.

c. “Supplier Income” means so-called earned income, rebates, kick-backs, volume discounts, tier pricing, purchase
commitment discounts, sales and service allowances, marketing allowances, advertising allowances, promotional
allowances, label allowances, back-door income, various fees, mark-ups, margins, etc.

d. Supplier Income specifically includes, without limitation: (i) payments and allowances to Approved Distributors from Supplier
based on distributor volume which are not reflected as a reduction in distributor cost or prices; (ii) special or atypical payment
terms; (iii) higher prices permitted Approved Distributors to amortize the cost of excess inventory; (iv) special or atypical
favors, gifts, and entertainment; and (v) amounts paid to sponsor the Servicers’, Selected Buyers’, or the Co-op’s meetings or
events.

Section 19 - No Gratuities.
No Gratuities. Supplier shall not offer or provide any gratuities, gifts, payments, or anything of value to the employees,
agents or other representatives of the Co-op, its Selected Buyers, or the Servicers, whether or not in an attempt to influence
such person’s administration of this Agreement or to otherwise gain any unfair advantage over the Co-op, its Selected
Buyers, or the Servicers.

Section 20 - Notices.
Notices. All notices, approvals, consents, and demands required or permitted under this Agreement must be in writing and
are deemed delivered under any of the following procedures: (i) at the time they are delivered by hand, (ii) one (1) business
day after electronically confirmed transmission by facsimile or electronic mail, or (iii) two (2) business days after confirmed
delivery by certified or registered mail or other courier or delivery service. Either party may specify a different address by
notifying the other party in writing of the different address. All communication between the parties must be made in English.