What does the City Publications Franchisor grant to qualified persons and business entities?

| 285,828 | 225,539 | | TOTAL REVENUES | 1,413,271 | 1,272,502 | 1,140,467 |

WITNESSETH:

WHEREAS, Franchisor has developed, and is continuing to develop, a System identified by the trademark, "CITY PUBLICATIONS", relating to the establishment and operation of direct mail advertising businesses referred to as "CITY PUBLICATIONS Businesses"; and

WHEREAS, the distinguishing characteristics of the System include uniform standards and procedures for business operations; distinctive processes, procedures and strategies for the sale, design, production and distribution of Card Decks; market and territory analysis; customer development and service techniques; uniform standards and specifications for Card Deck advertising copy, graphics and print quality; ongoing development of mailing data; technical assistance; and ongoing research and development; and

WHEREAS, Franchisor grants franchises to qualified persons and business entities to own and operate a single CITY PUBLICATIONS Business under the System and using the Marks; and

WHEREAS, Franchisee desires to operate a Franchised Business, has applied for a franchise and such application has been approved by Franchisor in reliance upon all of the representations made therein; and

WHEREAS, Franchisee understands and acknowledges the importance of Franchisor's high and uniform standards of quality, operations and service and the necessity of operating its Franchised Business in strict conformity with Franchisor's System.

NOW, THEREFORE, Franchisor and Franchisee, intending to be legally bound, agree as follows:

SECTION 1. DEFINITIONS

Whenever used in this Agreement, unless there is something in the subject matter or context inconsistent therewith, the following words and terms shall have the respective meanings ascribed to them as follows:

• "Affiliate" means any business entity that controls, is controlled by, or is under common control with Franchisor;
• "Agreement" means this agreement entitled "CITY PUBLICATIONS FRANCHISE GROUP, INC. Franchise Agreement" and all instruments supplemental hereto or in amendment or confirmation hereof;
• "Appointment Services" means the lead generation and appointment setting assistance Franchisor provides to Franchisee during training. This service is optional and available through approved vendors after completion of training;
• "Advertising Fee" means the fee Franchisor charges Franchisee for National Advertising Services;
• "Card Deck" means the packaged advertisements targeting affluent homeowners within Franchisee's Exclusive Territory which are produced using high quality artwork, designs, four (4) color printing and card stock; the primary product of CITY PUBLICATIONS Businesses;
• "CITY PUBLICATIONS Franchise" or "Franchise" means the right granted to Franchisee by Franchisor pursuant to this Agreement to use the System and the Marks;
• "Competitive Business" means any business that sells, or grants franchises or licenses to others to operate a business that

sells, direct mail advertising or similar services to those offered as part of the CITY PUBLICATIONS System or in which Confidential Information could be used to the disadvantage of Franchisor or its other franchisees; provided, however, that the term "Competitive Business" shall not apply to: (a) any business operated by Franchisee under a Franchise Agreement with Franchisor, or (b) ownership for investment purposes of less than five percent (5%) of the stock of any publicly-traded corporation in which similar services as those offered as part of the System are sold only as an ancillary product, constituting less than ten percent (10%) of the aggregate gross sales of such business.

Source: Item 23 — RECEIPT (FDD pages 39–129)