Under what conditions does a Benjamin Franklin Plumbing franchisee have a protected territory?

your request using the same standards that we apply to reviewing the proposed location of new Franchised Businesses. Unless otherwise agreed in writing, relocation does not change your Territory.

You will have a protected territory ("Territory") during the term of your Franchise Agreement, provided you are in full compliance with the terms of the Franchise Agreement, including certain Minimum Performance Requirements (described below) and your obligation to primarily service customers in your Territory. "Protected" means that we will not operate a business under the Marks and the System in the Territory or authorize others to operate Franchised Businesses within the Territory, except as described below. This does not prohibit us from advertising or soliciting in your Territory for the purpose of recruiting prospective employees or independent contractors.

You do 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 control.

Typically, your Territory is based on total population blocks of approximately 100,000 individuals and defined using postal zip codes present at the time your Territory is defined, although it can vary. You will be able to choose your Territory based on available pre-defined territories, subject to our approval. We will use the most recent population information available in the U.S. Census Data, or other population statistical sources of our choosing to determine populations. Once we have determined your Territory, it will be defined in Appendix A to your Franchise Agreement.

We and our affiliates retain all rights not expressly granted to you in the Franchise Agreement. Among other things, regardless of the proximity to or the effect on your Franchised Business, we and our affiliates can:

• establish, operate, franchise, and license others to operate businesses under the Marks at any location outside of the Territory;
• operate a business under the Marks inside the Territory if: (i) we (or our affiliate) are operating a business under the Marks in the Territory as of the date you sign the Franchise Agreement; or (ii) we have notified you before you sign the

Franchise Agreement that we (or our affiliate) intend to operate a business under the Marks in the Territory;

• use the Marks in other lines of business, anywhere in the world;
• operate and grant to others the right to operate, similar businesses or any other businesses offering similar or dissimilar products and services through similar or dissimilar channels of distribution, at any locations inside or outside the Territory, under trademarks or service marks other than the Marks;
• develop, manufacture, have manufactured, advertise, market, sell and distribute, at retail or wholesale, and license others to manufacture, sell or distribute, goods or services that are identical or similar to and/or competitive with those provided at your Franchised Business, whether under the Marks or any other name or mark, through dissimilar channels of distribution, including but not limited to through the internet, mobile applications, telemarketing, retail stores, and wholesale clubs, or other distribution outlets (other than Franchised Businesses) both inside and outside the Territory;
• establish and operate, and to grant others the right to operate, businesses offering dissimilar products and services both inside and outside the Territory under the Marks; and
• acquire, be acquired by, or merge with other brands or outlets, even if the concepts or outlets are similar to the business operated under the System, and even if they have locations in the Territory. We will also have the right, in our sole discretion, to convert one or more outlets of the acquired, acquiring or merged brand to a Franchised Business within the Territory.

We have no obligation to compensate you in connection with any of these activities.

In addition, if you license a franchise territory that has an existing customer base due to out-ofterritory sales by one or more existing franchisees, we may be obligated to allow the existing franchisee(s) the right to continue providing services to those customers for a period of time of up to twenty-four months (the "Authorized Time Period"). We will provide you with notice of this existing customer base and provide you with data provided to us by the existing franchisee(s) within forty-five (45) days after we receive it. After the expiration of the Authorized Time Period, any remaining customers in this group will be transitioned to you.

Activities Outside of the Territory. You may not perform services or sell products related to the Franchised Business outside of the Territory without our prior written consent, which we may give and withdraw as we deem appropriate, and which we may condition on you obtaining a separate phone number or other requirements. You may not solicit or advertise to customers outside of the Territory without our permission. "Solicit" includes, but is not limited to, solicitation in person, by telephone, by mail, through the internet, social media, email or other electronic means, and by distribution of brochures, business cards or other materials or any other advertising.

Source: Item 12 — TERRITORY (FDD pages 57–60)