ations, methods, procedures, techniques, and management systems, all of which may be changed, improved and further developed from time to time by Franchisor, but specifically excludes any employee policies or procedures that Franchisor may make available to Developer (or its Affiliate) for its optional use.

2 GRANT OF DEVELOPMENT RIGHTS

• (a) Development Rights. Subject to the terms and conditions of this Agreement, and provided that Developer is in full compliance with this Agreement, Franchisor grants Developer the right to develop the number of Franchised Business(es) set forth on and pursuant to the development schedule included on the Rider attached hereto (the "Development Schedule"), within the geographic area described on the Rider attached hereto (the "Development Territory"). Time is of the essence for the development of each Franchised Business in accordance with the Development Schedule.

• (b) Exclusions to Development Schedule. Developer acknowledges and agrees that the following shall not be added or count towards the calculation to determine whether Developer has satisfied any cumulative number of Franchised Businesses required to be opened as provided in the Development Schedule:

  • (1) any business that operates under any marks or names other than Casa de Corazon;
  • (2) any Casa de Corazon early childhood learning center developed outside of the Development Territory; or
  • (3) any Franchised Business Developer (and/or its Affiliate) owns that is located inside of the Development Territory that is closed within six (6) months of the date it opens (regardless of the reason for such closure). Developer (and/or its Affiliate) may not close any Franchised Business without Franchisor's prior written consent.

• (c) Development Territory. Provided Developer and its Affiliates are in full compliance with this Agreement (including with respect to the cumulative number of Franchised Businesses opened and in operation as required by the Development Schedule) and all other agreements between Developer (or any of its Affiliates) and Franchisor (or any of Franchisor's affiliates), including any franchise agreement between any of the foregoing parties, then, during the Term only, except as otherwise provided in this Agreement, neither Franchisor nor any of its affiliates will operate, or authorize any other party to operate, a Spanish immersion intercultural early childhood learning center under the Casa de Corazon mark, that is physically located within the Development Territory. Developer acknowledges that the foregoing restrictions do not prevent Franchisor or its affiliates from any activity not specifically set forth in the foregoing restrictions, including:

  • (1) Operating, or allowing others to operate, similar or identical businesses located outside the Development Territory, whether under the Names and Marks or other trade or service marks, even if the businesses compete with Developer's or its Affiliate's Franchised Business(es);
  • (2) Operating, or allowing others to operate, businesses inside the Development Territory under the Names and Marks or other trade or service marks that do not provide the same or substantially similar services to those provided under a franchise agreement with Franchisor;
  • (3) Selling products to third parties even if such products are sold or provided to Developer or its Affiliates for use in Developer's or its Affiliate's Franchised Business(es), whether located in the Development Territory or otherwise and whether under the Names and Marks or other trade or service marks;

Source: Item 23 — RECEIPTS (FDD pages 51–215)