Does Basecamp Fitness require franchisees to purchase software support from approved sources?

[Item 8: RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES]

ITEM 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

All equipment, furnishings, fixtures, signs, software, software support and security monitoring, supplies, branded items, marketing, maintenance services, insurance and products you purchase for use or sale in your Basecamp Studio must meet our specifications. Additionally, all membership types you offer as well as workouts provided through your Basecamp Studio must meet our specifications and, where allowed by applicable law, comply with our pricing guidelines. Those specifications may include minimum standards for delivery, performance, design, appearance, and quality. We will issue the specifications to you before you begin operating. We may include these specifications in the manual that we provide to you online, or we may issue them separately. While we do not have specifications for local advertising you create to promote your studio, we do require that you obtain our prior approval at least 4 weeks before you use any advertising materials you prepare. You may not establish or have established any digital or electronic medium or method of communication, including a website, web page, review or opinion page, social media and/or social networking site, channel, avatar, profile, including an online business profile, account, hashtag, user name or application, whether web-based or otherwise, or keyword advertising, pay-per-click

advertising or other search engine marketing, relating to or making reference to us, your Basecamp Studio, or to the Basecamp Fitness System without our approval. We reserve the right to refuse, reject, adjust or require changes to any advertising material you prepare. You must provide us with full admin access (including with log-in information) to all social media accounts, profiles and pages, business managers, and ad accounts related to your Basecamp Studio or that use our marks. You must provide ownership-level access to any Google Business profiles.

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• 1. We have a sole supplier of studio management, billing, payment and scheduling software which you must use to operate your Basecamp Studio.

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If you want to purchase items for your Basecamp Studio that we have not previously approved, or items that differ from our specifications, you must notify us in writing. If we request, you must submit samples and other information we require for testing or to otherwise determine whether the product, material or supply meets our specifications and quality standards. We do not impose any fee for our consideration of an item not previously approved.

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When we have a designated vendor (other than a mandatory vendor), if you want to purchase from other vendors the items or services for which that vendor has been designated, you must notify us in writing and obtain our approval. If you seek approval of a new supplier (or if the supplier applies directly to us for approval), we will require the supplier pay us a nonrefundable fee of $300 before we will consider approving their application. This fee is intended to defer our cost of reviewing the supplier. (We do not require you to pay any fee.) We may also require the supplier to sign a supplier agreement with us.

Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 28–32)