[Item 12: Territory]

Unless you entered into a Multiple Unit Franchise Agreement, we generally will not grant to you any options, rights of first refusal or similar rights to acquire additional franchises within a particular territory.

If you cannot open your Store by the deadline stated in the Franchise Agreement, you may request an extension to the time in which you must open the Store. You must pay us a non-refundable $10,000 extension fee when you make the request, along with the Omni-Channel Fee. If we decide, in our discretion, to grant your request, the extension will be limited to the period of time we permit, not to exceed 6 months.

Ascent, our affiliate, has established a supply chain program that acquires batteries, light bulbs and related products for resale (through third parties) to Batteries Plus® franchisees. See Item 8 for further discussion.

Omni-Channel Program. We have implemented the Omni-Channel Program, which is designed to promote the offer and sale of various batteries, light bulbs and related items, as well as device repair and related services through one or more electronic channels of distribution to retail, key accounts and business customers. You must participate in this Program, and comply with the terms of the Omni-Channel Program (or any future or successor electronic commerce programs) and periodically will establish rules (as described in the Operations Manual) under which you may recognize revenues from the sale of products and services to customers in your Protected Area. We may sell products and services to customers in your Protected Area through the Omni-Channel Program. We may terminate, modify or replace the Omni-Channel Program at any time, although we cannot unilaterally modify certain e-commerce territory rights you receive under the Franchise Agreement.

[Item 22: Contracts]

Franchisee will be required to participate in such Program and must comply with the terms of the Omni-Channel Program (or future or successor electronic or digital commerce program(s)) as described in the Operations Manual.

Franchisee understands that Franchisor will establish the rules under which Franchisee will participate in the Omni-Channel Program and that Franchisor may terminate, modify or replace the Omni-Channel Program at any time.

Franchisee must pay Franchisor an Omni-Channel access fee in the amount of Ten Thousand Dollars ($10,000) before it opens the Store.

In addition, Franchisee must pay Franchisor the then-current fees associated with the Omni-Channel Program.

As of the Effective Date, Franchisee must pay a maintenance fee of Two Hundred Dollars ($200) per month.

The monthly maintenance fee is due at the same time and the same manner as the Royalty and Service Fee.

Franchisor may change or alter the monthly maintenance fee or impose other fees with thirty (30) days' written notice to Franchisee.

• L.

Key Accounts Program.

Franchisor operates, within the Omni-Channel Program, a "Key Accounts Program" designed to address the needs of certain multi-state, multiple location or specialized service customers including group purchasing organizations, insurance providers and other large volume users with customized needs or multiple shipping/service destinations.

Franchisee must participate in the Key Accounts Program and comply with the terms of the Program as described in the Operations Manual or as Franchisor otherwise describes in writing.

Franchisee understands that Franchisor will establish the rules under which Franchisee will participate, and be compensated for participation, in the Key Accounts Program and that Franchisor may terminate, modify, or replace the Key Accounts Program at any time.

Franchisee must pay Franchisor its then-current fees associated with the Key Accounts Program.

• M.

Participation in Internet Website.

Franchisee will participate in a Batteries Plus® website listed on the Internet or other online communications and participate in any Franchisor-controlled intranet system.

Franchisor will, at its discretion, determine the content and use of a Batteries Plus® website and intranet system and will establish rules under which franchisees may or will participate.

Franchisor will

[Item 16: Restrictions on What the Franchisee May Sell]

ITEM 16

RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL

You must offer and sell in your Store all, and only, those batteries, light bulbs and related products, equipment and services that we have approved (See Item 8). You must at all times maintain an inventory of approved batteries, light bulbs and related products and equipment in such quantities and variety that we direct. We may add new products or services that you must offer at your Store. Our right to modify the approved list of goods and services to be offered at a Store is not limited.

We may conduct market research and testing to determine consumer trends regarding new batteries, light bulbs, and other products and services. You must participate in our market research programs, test market new products and services in the Store and provide us with timely reports and other relevant information regarding market research. We may require that you purchase a reasonable quantity of the tested products and promote and make a reasonable effort to sell these products.

As described in Item 12 above, we launched the Omni-Channel Program in 2015, through which we will operate (among other activities) a Key Accounts Program. Each new franchisee must participate in the Omni-Channel Program, including the Key Accounts Program, and service key accounts customers in their service and revenue area. In addition, key accounts customers may establish certain service requirements for products and services sold to them.

[Item 12: Territory]

Key Accounts Program. Within our Omni-Channel Program, we currently operate a "Key Accounts Program" designed to address the needs of certain multi-state or multiple location customers including group purchasing organizations, insurance providers and other large volume users with multiple shipping/service destinations. You must participate in the Key Accounts Program and comply with the terms of the Program as described in the Operations Manual or as we otherwise describe in writing. We may sell products to key accounts customers located in your Protected Area under the terms of the Key Accounts Program. You must agree to service key accounts customers within a certain service and revenue area. We have established the rules under which you will participate in this program, including the servicing of accounts, recognition of revenues received from key accounts customers and other matters. We may terminate, modify, or replace the Key Accounts Program at any time.

Commercial Sales Program. You may offer and sell products and services to commercial customers (other than customers under the Key Accounts Program) located inside and outside the Protected Area, only pursuant to our then-current policy on commercial sales as described in the Operations Manual or otherwise in writing ("Commercial Sales Area"). There are no territorial protections for commercial sales, and other Batteries Plus® franchisees may offer and sell products and services to commercial customers located within your Protected Area.

Minimum Annual Net Revenues Quotas

You must meet a minimum annual Net Revenues quota during each full calendar year following the date the Store opens. If you do not do so, we may modify or eliminate your Protected Area. The minimum annual Net Revenues quotas are as follows:

[Item 7: Estimated Initial Investment]

• (7) You must pay us an Omni-Channel Program access fee at or around the time you open your Store for access to our Omni-Channel Program.
• (8) Miscellaneous expenses include local permit and license fees, and legal and accounting fees.
• (9) You must own or lease one delivery vehicle in each market area (as defined in Item 12) to deliver product to customers in operating your commercial accounts business. The lower amount assumes that you will lease a new or used vehicle, or will use a vehicle that you already own to make deliveries, while the higher estimate assumes that you will purchase a vehicle to make these deliveries. We currently recommend a late model, used Ford Transit or similar model van as a delivery vehicle.
• (10) This amount includes an estimate of the New Store Marketing Campaign contribution. You must participate in the New Store Marketing Campaign as more fully described in Item 5.
• (11) During the first calendar year (or portion thereof) following the brick and mortar Store opening date, you will have a Minimum Store Promotion Requirement equal to a pro rata amount of $20,000 based upon the number of weeks during the calendar year in which the Store was in operation. When the physical Store opens for retail sales, you will pay us $20,000 as your initial Minimum Store Promotion Requirement and we will apply those funds towards your Digital Marketing and Local Media Program contributions. Once such amounts are used, you will pay your Digital Marketing and Local Media Program contributions monthly.
• (12) The typical size of a Batteries Plus® Store ranges from 1,000 to 1,600 square feet. Historically, certain franchisees have developed Batteries Plus® Stores of up to 1,600 square feet or more. For several items discussed below, your cost will increase as the number of square feet increases. The size of your Store is principally determined by requirements or restrictions that your landlord and appropriate municipality or zoning boards may impose, and availability and cost of leasable space.

We estimate that you may pay from $20 to $45 per square foot in the rental expense (including common area maintenance (CAM) and taxes) for your Store premises. The exact amount of rental expense will vary greatly, depending on the location of the Store premises, the portion of rent representing the value of leasehold improvements at the Store premises, local market conditions and other factors.

[Item 8: Restrictions on Sources of Products and Services]

ITEM 8

RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

To ensure a uniform image and uniform quality of products and services throughout the Batteries Plus® system, you must maintain and comply with our quality standards.

Supply Chain Program for Batteries, Light Bulbs, Repair Components and Related Products and Services

You must purchase for sale at your Store private label and branded batteries, light bulbs, repair components and related products as well as services from us, our designees or from other suppliers we approve. We (including our affiliate, Ascent) or our designees may be the designated or sole source of supply for certain batteries, light bulbs, repair components and related products as well as services. Ascent currently is the sole source of supply for certain batteries, light bulbs, repair components and related products as well as certain services. In addition, for certain device services that you cannot perform at the Store, including the repair and replacement of screens and batteries, you must send the device to Ascent for repair.

We have established a supply chain program, through Ascent, that is designed to make available to you and other Batteries Plus® franchisees quality private label and branded batteries, light bulbs, repair components and related products as well as certain services. Ascent negotiates supply contracts for the manufacture of our private label and branded batteries, light bulbs, repair components and related products. Ascent then arranges for the acquisition and distribution of these products to Batteries Plus® franchisees directly or through approved third-party suppliers. You will be required to pay for products purchased from Ascent by electronic transfer of funds. Ascent may purchase products directly and resell them to franchisees at a higher price.

Recycling Services

We have identified East Penn, Gopher Smelting, RSR & Sanders Lead as our currently approved suppliers for SLI batteries recycling. We have designated Battery Solutions, LLC ("Battery Solutions") as our preferred supplier for other battery recycling. Battery Solutions offers a box and a pallet program to commercial establishments in which to place used batteries for recycling. We have designated Veolia ES Technical Solutions ("Veolia") as our preferred supplier for light bulb and ballast recycling. Veolia offers a box and a pallet program to commercial establishments in which to place used light bulbs for recycling.

Location of your Store; Real Estate Lease

[Item 22: Contracts]

BACKGROUND

• A. The Company and Licensee have entered into a Franchise Agreement (the "Franchise Agreement") under which Licensee will operate a Batteries Plus® franchised business at a designated site (the "Franchised Business"). Under the Franchise Agreement, Licensee must use the software designated by the Company in operating the Franchised Business.
• B. The Company has licensed software for use in back-office computers for tracking, analyzing and reporting sales, inventory and other operational information, customized for use in the Franchised Business (the "Back Office Software"). The Company also has developed other customized or proprietary software, including proprietary software that allows Batteries Plus® franchisees to more fully participate in the Company's "Omni-Channel Program" (the "Omni-Channel Software"). The Back Office Software, Omni-Channel Software and other customized or proprietary software provided to Licensee are collectively referred to as the "Software."
• C. The Company has contracted with a third-party cloud hosting service to host the Software on a wide-area network in a data center environment that offers security, high-availability and back-up services (the "Hosting Service"). Licensee desires to access the Software through the Hosting Service for Licensee's Franchised Business.

AGREEMENT

In consideration of the foregoing and the agreements stated below, the parties agree as follows:

1. ACCESS TO SOFTWARE

The Company grants to Licensee a non-transferable and non-exclusive right to access the Software through the Hosting Service for use solely in connection with the operation and management of the Franchised Business.

2. RESTRICTIONS ON USE

Source: Item 16 — Restrictions on What the Franchisee May Sell (FDD pages 48–49)