What rights does Alloy have regarding the operation, administration, development, and change of the System?

Your Owner(s) are identified on the Data Sheet. Every time there is a change in the persons who are your Owners, you must, within 10 days from the date of each change, update the Data Sheet. As used in this Agreement, any reference to Owner includes all Owners.

• D. "System" means the ALLOY System, which consists of specific equipment, fixtures, furnishings, materials and supplies; methods, uniform standards, specifications and procedures for operations; procedures for management; training and assistance; and merchandising, advertising and promotional programs and other proprietary information, all of which we may change, improve and further develop. The System is identified by the Trademarks. The System includes a proprietary software application (the "Alloy App"). The Alloy App will provide a franchisee with tools to manage and communicate with coaches and clients through a personal profile.
• E. "Trademarks" means the ALLOY trademark and service mark that has been registered in the United States and elsewhere, and the other trademarks, service marks, trade names, the trade dress and other commercial symbols that we authorize you to use in the operation of the Facility from time to time, each as we may modify and update from time to time. Trade dress includes the designs, color schemes and image we authorize you to use from time to time.

GRANT OF DEVELOPMENT RIGHTS

• 1. The following provisions control with respect to the rights granted hereunder:
  • A. We grant to you, under the terms and conditions of this Agreement, the right to develop and operate the number of ALLOY Facilities set forth in Appendix B (the "Facilities") within the territory described on Appendix C (the "Development Territory").
  • B. You are bound by the development schedule set forth in Appendix B (the "Development Schedule"). Time is of the essence for the development of each Facility in accordance with the Development Schedule. Each Facility must be developed and operated pursuant to a separate Franchise Agreement that you enter into with us pursuant to Section 4.B below.
  • C. If you are in compliance with the Development Schedule, we will not develop or operate or grant anyone else a franchise to develop and operate a ALLOY facility (except for Special Sites as defined in Section 2.D or as otherwise set forth in this Agreement) in the Development Territory prior to the earlier of (i) the expiration or termination of this Agreement; (ii) the date on which you must execute the Franchise Agreement for your last Facility pursuant to the terms of the Development Schedule or (iii) the date on which the Authorized Location for your final Facility under this Agreement is determined. Notwithstanding anything in this Agreement, upon the earliest occurrence of any of the foregoing events (a) your right to develop any additional Facility will expire and (b) we will be entitled to develop and operate, or to franchise others to develop and operate, ALLOY facilities in the Development Territory, except as may be otherwise provided under any Franchise Agreement that has been executed between us and you and that has not been terminated. At the time you execute your final Franchise Agreement under the Development Schedule, you must have an Authorized Location for the Facility to be developed under the final Franchise Agreement.
  • D.

Source: Item 23 — RECEIPTS (FDD pages 69–245)