What is the relationship between the 'Authorized Care Provider Regulation' and the 'Spa' for a C3 Wellness Spa?

"Authorized Care Provider Regulation" shall have the meaning defined in the "Recitals" section of this Agreement and is further supplemented, as follows: the term "Authorized Care Provider Regulation" shall further refer to and mean all applicable federal, state and local rules and regulations that relate to the ownership and operation of a Spa, the Approved Spa Products and Services, Spa Facilities and Management Services, Spa Management Agreements, and the operations of a Spa Management Business including, but not limited, laws related to actions that an Authorized Care Provider may or may not engage in regarding ownership, diagnosis, treatment, supervision, delegation,

flow of funds and the actions that Franchisee may or may not engage in. Without limitation to the foregoing, Authorized Care Provider Regulation shall include all health law regulations and rules including, but not limited to, to health privacy laws that include the Health Insurance Portability and Accountability Act of 1996.

Franchisor shall exclusively designate and determine the Approved Spa Products and Services and Franchisor, in Franchisor's Reasonable Business Judgment, may change, modify, reduce or supplement the Approved Spa Products and Services offered and sold by Spas and/or Spa Location Franchises.

Notwithstanding anything contained herein to the contrary, to the extent that the Approved Spa Products and Services are governed by and/or subject to Authorized Care Provider Regulation and/or any other federal, state or local rules or regulations that prohibit and/or otherwise restrict Franchisor's determination as to the required Approved Spa Products and Services, the foregoing definition shall be interpreted to provide Franchisor with the fullest discretion and ability to specify and designate the Approved Spa Products and Services without violating the Authorized Care Provider Regulation and applicable laws, rules and regulations.

At all times Franchisee is responsible for ensuring that, at all times, Franchisee shall comply with Authorized Care Provider Regulations and all other applicable laws, rules, and regulation related to a Spa.

WHEREAS, Franchisee has been advised that, among other things, the Approved Spa Products and Services and the Spa Facility and Management Services, involve products, services and activities of a nature and type that require the administration, supervision, management, and oversight of Authorized Care Providers, including licensed medical professionals and health care providers and that whether or not Franchisee may own and operate a Spa Location Franchise and, if applicable, the types of activity that Franchisee's Spa Location Franchise may engage in is subject to and requires compliance with significant federal, state and local rules and regulations related to the practice of medicine and other licensing requirements (collectively referred to as the "Authorized Care Provider Regulation");

WHEREAS, Franchisee has been advised that prior to signing this Agreement that prior to developing a Spa Location Franchise, that Franchisee should retain Franchisee's own independent legal counsel to advise Franchisee as to all applicable Authorized Care Provider Regulation, whether or not Franchisee may own a Spa Location Franchise and, if applicable, the types of activities that Franchisee's Spa Location Franchise may or may not engage in.

• (1) FRANCHISEE REPRESENTS THAT FRANCHISEE HAS BEEN ADVISED THAT BEFORE SIGNING THIS AGREEMENT FRANCHISEE HAS INDEPENDENTLY EVALUATED AND INTERPRETED – WITH FRANCHISEE'S OWN LEGAL COUNSEL – APPLICABLE AUTHORIZED CARE PROVIDER REGULATIONS AS THEY RELATE TO FRANCHISEES OWNERSHIP AND OPERATION OF A SPA LOCATION FRANCHISE;
• (2) NOTHING IN THIS AGREEMENT, THE OPERATIONS MANUAL, OR OTHERWISE SHALL BE INTERPRETED AS PERMITTING FRANCHISOR TO EXERT CONTROL OVER THE DELIVERY OF HEALTH CARE SERVICES, INCLUDING BUT NOT LIMITED TO, AS APPLICABLE, THE PERFORMANCE, CARE AND/OR DELIVERY OF THE SPA PRODUCTS AND SERVICES. TO THE EXTENT THAT ANY ONE OR ALL OF THE SPA PRODUCTS AND SERVICES REQUIRE THE JUDGMENT, TREATMENT AND/OR ACTION OF AN AUTHORIZED CARE PROVIDER, SUCH JUDGMENT, TREATMENT AND/OR ACTION SHALL BE EXCLUSIVELY DETERMINED BY THE AUTHORIZED CARE PROVIDER AND THIS AGREEMENT AND THE OPERATIONS MANUAL SHALL BE INTERPRETED AS MANDATING SAME;
• (3) UNDER NO CIRCUMSTANCE DOES OR SHALL THE SYSTEM OR THE COMPONENTS OF THE SYSTEM INCLUDE STANDARDS, PROCEDURES AND/OR REQUIREMENTS RELATED TO THE DELIVERY OF HEALTH CARE SERVICES AND/OR THE TREATMENT OF ANY PATIENTS. TO THE EXTENT THAT THE SPA PRODUCTS AND SERVICES CONSTITUTE THE DELIVERY OF HEALTH SERVICES REQUIRING AN AUTHORIZED CARE PROVIDER THEN THE AUTHORIZER CARE PROVIDER SHALL EXCLUSIVELY DETERMINE THE LEVEL OF CARE TO BE PROVIDED;
• (4) TO THE EXTENT THAT THE BUSINESS MANAGEMENT SYSTEM AND THE BUSINESS MANAGEMENT SYSTEM DATA CONTAIN CONFIDENTIAL AND PRIVILEGED DATA THAT UNDER APPLICABLE AUTHORIZED CARE PROVIDER REGULATION CANNOT BE TRANSMITTED OR SHARED WITH FRANCHISOR THEN THIS FRANCHISE AGREEMENT SHALL BE INTERPRETED SO AS TO COMPLY WITH SUCH APPLICABLE REGULATION;

Source: Item 23 — RECEIPTS (FDD pages 59–293)