Where can I find the specific territory assigned to my Amerispec Inspection Services franchise?

ncrease from year to year. If you fail to attend the convention, you must pay us a fee of $500.

Item 12: Territory

We will designate a Territory in which your Franchised Business will provide services. We consider total population, relative affluence, and, if available, the number of recent Real Estate Transactions ("RETs") to determine a territory in our sole discretion. We use the current United States Census Bureau figures, or other sources we determine within our sole discretion, when considering population estimates. Your Territory will be listed as Exhibit A to your Franchise Agreement.

You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we or our affiliates control.

Performance Criteria

Your Territory will remain unchanged as long as you comply with all your obligations under the Franchise Agreement and meet the following performance criteria (the "Performance Criteria"):

For a new Franchised Business, you must have complied with the Franchise Agreement and achieved (a) revenue growth over the trailing 3 years; (b) at least 3% market share; and (c) a revenue percentage increase from Year 2 to Year 3 that is either (i) equal to or greater than the percentage increase of RETs in your Territory or (ii) equal to or less than the percentage decrease of RETs in your Territory.

For an existing Franchised Business, you must have complied with the Franchise Agreement and achieved (a) at least 3% market share and (b) a revenue percentage increase over a 5-year period that is either (i) equal to or greater than the 5-year average increase in the RET(s) in the Territory or (ii) equal to or less than the 5 year average decrease of RETs in your Territory.

Market share will be calculated by multiplying the number of RETs in the Territory for a 12-month period by the average percentage of RETs that obtain home inspections as determined by ASHI (American Society of Home Inspectors) and dividing that number by the number of home inspections performed by you during that same period.

If you fail to meet the Performance Criteria or fail to comply with any term of the Franchise Agreement, then in addition to any other remedies we may have, including the right to terminate the Franchise Agreement, we will have the right to reduce and/or restructure the size of or eliminate the protected rights in your Territory. In addition, if you are an existing franchisee and are transferring your Franchised Business to a transferee, we may modify or re-define your territory to be consistent with then current standards for issuing new territories, however we will not reduce the geographical scope of your territory for the aforementioned reasons except for failure to meet Performance Criteria.

National Accounts Program

You must be in compliance with the terms and conditions of your Franchise Agreement to participate in the National Accounts Program. If you participate in the National Accounts Program, you will be eligible to receive leads for a designated area (usually a designated zip code). You do not have any right, however, to receive leads for jobs to be performed in these designated zip codes. Rather, we have the absolute right to designate an area and/or distribute leads or not distribute leads according to our judgment. In fact, you may not receive any leads even if you participate in the National Accounts Program. Also, if you do not participate in the National Accounts Program, it is possible that other franchisees or subcontractors will receive leads in your Territory.

Marketing and Other Activities in the Territory

You may market to and solicit customers only within your Territory. Our business is a referral business; therefore, you may also perform services for a customer outside your Territory only if an agent and/or customer initiates the request. Directing marketing or solicitation activities to agents or customers outside of your Territory is prohibited*.* Otherwise, we do not prevent any of our franchisees from advertising their business, or soliciting customers through the internet, direct mail and other direct marketing. We do not pay for soliciting or accepting orders from inside your Territory.

You may operate and market your Franchised Business within the Territory, subject to certain rights reserved by us (as set forth below). We reserve the right to:

• (a) establish and operate, and grant rights to other franchise owners to establish and operate, Franchised Businesses or similar businesses at any locations outside of the Territory and on any terms and conditions we deem appropriate;

• (b) offer and sell, and grant rights to other franchise owners to offer and sell, any products or services that you do not or will not offer in the Territory, whether identified by the Marks or other trademarks or service

• marks, through any distribution channels we deem best, without any obligation to compensate you for selling such products or services in your Territory;

Source: Item 12 — Territory (FDD pages 31–33)