Does Brueggers Bagels have the right to issue franchises for and/or operate similar businesses?

e this Agreement by written notice to you. Our rights under this Section 1.3 will be in addition to any other remedy we may have for failure to meet the Development Schedule.

• 1.4. This Agreement does not grant you any right to use the Proprietary Marks or the System. All rights to use the Proprietary Marks and the System are granted solely under the terms of the Franchise Agreement. You acknowledge that you will have no right or power under this Agreement or under any Franchise Agreement to sub-franchise any other person or legal entity to use the Proprietary Marks or the System.

• 1.5. While this Agreement is in effect, we will not establish Bakeries or franchise others to establish Bakeries within the Development Area, subject to the rights reserved in Sections 1.6 and 1.7 below.

• 1.6. We and our affiliates retain the rights, despite anything to the contrary in Section 1.5 and regardless of the proximity to or effect on any Bakery that you operate:

• 1.6.1. To own, acquire, establish, operate and franchise or license others to operate Bakeries located outside of the Development Area;

• 1.6.2. To own, acquire, establish, operate, and franchise or license others to operate outlets at Non-Traditional Locations under the Bruegger's name or any other name, whether inside or outside of the Development Area. "Non-Traditional Location" means a facility where the primary function is not a Bakery business, such as (but not limited to) a performing arts center, arena, stadium, shopping mall, department store, retail store, wholesale club, grocery store, supermarket, casino, amusement park, fairground, college or university, factory, hospital, penal institution, military base, airport, turnpike, limited access highway rest stop, or other transportation facility;

• 1.6.3. To develop, manufacture, have manufactured, market, sell and distribute, at retail or wholesale, and license others to manufacture, sell or distribute, packaged food products or any other goods or services under the Bruegger's mark or any other name or mark, through any channel of distribution other than a Bakery, including but not limited to the Internet, supermarkets, specialty food stores, convenience stores, wholesale clubs and retail food stores, anywhere in the world; and

• 1.6.4. To use the Bruegger's brand in other lines of business besides the operation of restaurants, anywhere in the world.

• 1.7. Acquisition Sites. While this Agreement is in effect, if we acquire the ownership or assets of any business operating at one or more sites located within the Development Area, which we determine in our sole discretion to convert to a Bakery (an "Acquisition Site"), we will offer to sell you the Acquisition Site for the price we paid for the Acquisition Site (plus the amounts identified in Section 1.7.1), provided that, in our judgment: (1) the sale would not conflict with any existing legal obligation of ours or of the business being acquired; (2) the sale would not preclude the completion of the acquisition on the terms agreed to by us; and (3) the sale would not interfere with any other agreement, arrangement or combination or affect federal or state income tax consequences arising from the acquisition; and provided further, that you agree: (a) to execute, concurrently with your purchase, a Franchise Agreement as modified for use in connection with each Acquisition Site; (b) to convert each Acquisition Site to a Bakery as soon as practicable thereafter (but in no event later than the date specified by us) in accordance with our standards and specifications;

Source: Item 22 — CONTRACTS (FDD page 61)