capitalized terms that are defined in the body of this Agreement, Attachment "A" lists the Sections of this Agreement in which such terms are defined.

• 2. GRANT OF FRANCHISE. We hereby grant you a license to own and operate a Body & Brain Center (your "Business" or your "Center") using our Intellectual Property from a single location that we approve in writing. We reserve all rights not expressly granted to you under this Agreement.
• 3. TERRITORIAL RIGHTS AND LIMITATIONS. Once we have approved the site for your Center, we will grant you a protected territory that will be identified on Part C of Attachment "B" (your "Territory"). Your Territory will include a minimum population of 70,000. We will not operate, or grant a franchise to a third party to operate, a Body & Brain Center or a Dahn Yoga Center that is physically located within your Territory during the Term, except as otherwise provided in this Section with respect to Captive Venues and Alternative Channels of Distribution. We reserve the right to: (i) operate Body & Brain Centers, or grant franchises or licenses to third parties to operate Body & Brain Centers, in Captive Venues that are located in your Territory; and (ii) sell competitive or identical goods or services (including under the Marks), or grant franchises or licenses to third parties to sell those goods or services (including, without limitation, Body & Brain home-based franchises), through Alternative Channels of Distribution, irrespective of whether the sales take place in your Territory.

4. TERM AND RENEWAL

• 4.1 Generally. The term of this Agreement (the "Term") will begin on the Effective Date and expire five (5) years thereafter. If this Agreement is the initial franchise agreement for your Center, you may enter into successor Body & Brain Center franchise agreements as long as you meet the conditions for renewal specified below. Each successor franchise agreement shall be the current form of franchise agreement that we use in granting Body & Brain franchises as of the expiration of the Term or renewal term, as applicable. The terms and conditions of the successor franchise agreement (including financial and territorial terms) may vary materially and substantially from the terms and conditions of this Agreement. Each renewal term will be for either three (3) or five (5) years, at your option. The maximum total term (including initial term and all renewal terms) shall be 15 years. You will have no further right to operate your Center following the expiration of the 15th year unless we grant you another franchise in our sole discretion. If this Agreement is a successor franchise agreement, the renewal provisions in your original franchise agreement will govern your remaining renewal rights, if any.
• 4.2 Renewal Requirements. In order to enter into a successor franchise agreement, you and the Owners (as applicable) must: (i) notify us in writing of your desire to enter into a successor franchise agreement not less than 180 days nor more than 360 days before the expiration of the Term or renewal term, as applicable; (ii) not be in default under this Agreement or any other agreement with us or any affiliate of ours at the time you send the renewal notice or the time you sign the successor franchise agreement; (iii) sign the successor franchise agreement and all ancillary documents that we require franchisees to sign; (iv) sign a General Release; (v) pay us a $1,000 renewal fee; and (vi) take any additional action that we reasonably require. The renewal fee shall be fully earned by us and non-refundable once the successor franchise agreement has been signed.
  • 4.3 Interim Term.

Source: Item 23 — RECEIPT (FDD pages 43–178)