What right does Beard Papas grant to the franchisee regarding the operation of a Shop?

• 1. Grant of Franchise We will grant you the right to operate a Shop at a single Shop Location within a designated territory. (Franchise Agreement, Article 2);
• 1. Franchise Agreement Designated Territory Once you secure a Shop Location that we approve, we will define the Designated Territory for your Shop and include the geographic boundaries and/or a description of your Designated Territory within Schedule 1 of the Franchise Agreement. (Franchise Agreement, Article 2 and Schedule 1);
• 1. Multi-Unit Development Agreement Development Area If you have entered into a Multi-Unit Development Agreement, we will designate your Development Area. The Shops to be developed by you must be located within the Development Area. Once you select a Shop Location that we approve within the Development Area, within the Franchise Agreement for each respective Shop we will define the Designated Territory and include the geographic boundaries and/or a description of your Designated Territory for each respective Shop. (Multi-Unit Development Agreement, Section 2). Our approval or disapproval of future Shop locations that may be developed under a Multi-Unit Development Agreement will be based on our then current site selection criteria;
• 1. Manuals We will provide you with access to our confidential and proprietary Manuals. You must operate the Franchised Business in accordance with the Manuals and all applicable laws, rules and regulations. At all times, we reserve the right to supplement, modify and update the Manuals. (Franchise Agreement, Article 4.C.). As of the Issuance Date of this Disclosure Document, the operations manual consists of 110 pages and the table of contents to the operations manual is attached as Exhibit C to this

Disclosure Document (Franchise Agreement, Article 4). The major subjects contained in the operations manual consists of establishing, developing, marketing and operating the Franchised Business;

• 1. Site Review, Approval and Designated Territory We will review the proposed site that you select for your Shop and will notify you of our approval or disapproval. Once you select a site that we approve for the location of your Shop, we will designate your Designated Territory. However, if you negotiate and we agree to designate and grant to you a Designated Territory prior to your selection of a Shop, then you must locate your Shop within the Designated Territory and at a site that we approve. You must obtain our approval of your Shop Location. Additional information about site selection is discussed in more detail below in this Item 11;

Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 31–38)