What section of the Apricot Lane Franchise Agreement addresses site approval?

sideration of the undertakings and commitments of each party to the other party hereby agree as follows:

SECTION 1: GRANT, LOCATION AND INITIAL FRANCHISE FEE

A. Grant

FRANCHISOR hereby grants to FRANCHISEE, upon the terms and conditions herein contained, the right, franchise and privilege (the "franchise") to use the Mark "APRICOT LANE" as provided hereinafter (the "Designated Mark") and such other Marks as FRANCHISOR may authorize from time to time in the operation of a Specialty Store at a single approved location as provided in Section 1.B below. If a location for the Specialty Stores has not been selected and approved on signing this Agreement, the Designated Mark will be inserted in this Section 1.A no later than when a location is selected and approved as provided under the "Open License" terms and in Section 1.B below. The grant is limited to the right to operate a Specialty Store under the Designated Mark at the location designated in Section 1.B for retail over-the-counter sales to consumers of approved merchandise and services as hereinafter provided and any sales by the Franchised Business through any other means such as at wholesale, by mail order, through catalogs, electronic commerce, any other distribution channel, or at fairs or trade shows is prohibited without the express prior written consent of FRANCHISOR. If FRANCHISOR approves such sales, FRANCHISEE's sales shall comply with all conditions set forth in such consent.

B. Location

provided that if no specific location has been identified, then FRANCHISEE has an "Open License," which means that FRANCHISEE has a right to establish a Specialty Store in the future at a site mutually agreed upon in a designated geographic area under the terms and conditions

provided for in Exhibit A to this Agreement. Once an agreed location is secured for operation of the Specialty Store, it will be set forth above. FRANCHISEE acknowledges that the franchise awarded by this Agreement is only for the operation of a Franchised Business under the Designated Mark at the location set forth above and at no other location whatsoever. FRANCHISOR and FRANCHISEE expressly agree that if the specific location and Designated Mark for the Franchised Business are not determined at the time this Agreement is signed, that circumstance alone does not and shall not constitute a failure to specify essential terms of this Agreement or cause this Agreement to be unenforceable. FRANCHISEE hereby undertakes the obligations to secure premises for the Specialty Store approved by FRANCHISOR and to open and operate the Franchised Business under the System at that location as provided in this Agreement.

C. Initial Franchise Fee

In consideration of the franchise granted herein, FRANCHISEE shall pay to FRANCHISOR an initial franchise fee of .

Source: Item 23 — RECEIPTS (FDD pages 51–222)