standards even if additional investment or expenditures are required.

7.2 Best Efforts, Confidentiality and No Conflicts of Interest.

• (a) You or your Business manager must furnish your personal full time and attention and best efforts to the management and operation of your Business.
• (b) During and after the term of this Agreement, you shall not disclose to a third party or use, except to operate the Business during the term of this Agreement, any confidential or proprietary information, or trade secret, that we own or disclose to you. You must require your Business manager (if any) and agents to sign a corresponding confidentiality agreement. You must return the entire Franchise Policy Guidelines to us promptly upon termination or expiration of this Agreement or any transfer.
• (c) During the term of this Agreement, you will not own any interest in, or work for, engage in or assist, directly or indirectly, any real estate brokerage service business other than Counselor, or that competes with Counselor, at or within 50 miles of the Office (or any Additional Office or Extension Office) without Counselor's prior written approval.
• (d) During the term of this Agreement and for a period of twenty-four (24) months after it expires, is terminated or is transferred, you will not alone, or in any capacity

with another person or entity, within the United States and any other geographical area in which Counselor operates, solicit or cause to be solicited any person or entity that is (or was within the previous six (6) months) an agent, employee or independent contractor of Counselor or another Counselor franchisee, for the purpose of hiring or contracting such person or entity to work for you or any other party, or for the purpose of inducing them to leave such party's employment or contract with Counselor or another Counselor franchisee.

• (e) You agree that the covenants contained in this Section 7.2 are reasonable and understand that your willingness to agree to such covenants is an important inducement and consideration for our entering into this Agreement. You must demonstrate compliance with this Section 7.2. Sections 7.2 (b), (c) and (d) also apply to guarantors of this Agreement, your spouse and children if Franchisee is a sole proprietorship, and your officers, directors, employees, partners, and each principal shareholder or owner if Franchisee is a corporation or other entity.
• 7.3 Inspection. Your Business and Office (including any Additional Office and Extension Office) shall be open to us for inspection without notice during the business day.
• 7.4 Agents. You must notify Counselor immediately in writing each time a licensed agent begins operating through your Office (including any Additional Office or Extension Office).

8. FINANCIAL STANDARDS.

• 8.1 Records and Reports. You must keep and give us the information, reports, books and records concerning the Office (including any Additional Office and Extension Office) and Business we specify, on forms or in media we specify periodically. You will allow us to inspect, copy and audit such records, both at the Office (including any Additional Office and Extension Office) and remotely by electronic means. If Franchisee is a partnership, corporation or other entity, you must provide us with copies of Franchisee's organizational documents (including, without limitation, as applicable, its articles of incorporation, bylaws, operating agreement or partnership agreement) and breakdown of ownership. You must report promptly to us any claim involving the Business and any change in the Franchisee's organizational documents.
• 8.2 Insurance. You must maintain types and levels of insurance coverage required by the state in which you operate your Business. You also must maintain other insurance required by law, and by your Office (including any Additional Office and Extension Office) lease or mortgage, and errors and omissions insurance coverage. You must maintain general liability insurance on an occurrence basis with a minimum limit of at least $1,000,000 per occurrence and $2,000,000 in the aggregate, and errors and omission insurance with a minimum limit of at least $1,000,000. Insurance shall be with insurers and on forms acceptable to us, shall name Counselor as an additional insured, and waive subrogation. If we buy such insurance because you fail to do so (which we may, but are not required to, do) you will reimburse us immediately upon request.
• 8.3 Indemnification. You will defend, indemnify and hold harmless Counselor, its affiliates and their respective officers, agents, and employees from all suits, claims, demands, liabilities and costs, including attorneys' fees, in tort, contract, or otherwise, arising out of or in connection with your operation of the Business except to the extent caused by direct and proximate consequences of our negligence. You waive and release all claims against Counselor, its affiliates, and their respective officers, agents, and employees for damages to property or injuries to persons arising out of or in connection with operation of the Business except to the extent caused by direct and proximate consequences of our negligence.

9. TRANSFER OF FRANCHISE.

• 9.1 Transfer Standards. You agree not to change or allow a change, directly or indirectly, in the ownership or Control of (i) your interest in this Agreement, (ii) the Office, any Additional Office, any Extension Office or Business, (iii) a majority of the assets of the Office, any Additional Office, any Extension Office or Business, or (iv) if Franchisee is an entity, any ownership interest in, or Control of, Franchisee or any direct or indirect owner of Franchisee (each, a "transfer"), without having first tendered to us the right of first refusal to acquire this Agreement, such assets or such interests in accordance with Section 9.6 and, if we do not exercise such right, without our consent and without satisfaction of the conditions stated below. You and your transferee must follow the procedures set forth in Section 9.2, below, and the transferee must sign the then-current form of Counselor Franchise Agreement for the unexpired term, unless the Franchisee is an entity and the transfer is a transfer of an ownership interest in Franchisee or any owner of Franchisee. We will consent to a transfer if the conditions specified in this Agreement in our opinion are satisfied and the transferee in our opinion is qualified to operate the Business in compliance with that Agreement. Notwithstanding anything contained herein to the contrary, Counselor's consent will not be required for, and the right of first refusal set forth in Section 9.6 will not apply to, a transfer described in clause (iv) of the first sentence of this Section 9.1 if (x) such transfer (in a single transaction or series of related transactions) will not result in a change in Control of Franchisee or such direct or indirect owner of Franchisee, (y) you provide Counselor with written notice of such transfer, together with such other information concerning such transfer and transferee as we may require, at least thirty (30) days prior to the consummation of such transfer, and (z) if such transfer is a transfer of an ownership interest in Franchisee, such transferee executes the guaranty attached to this Agreement and delivers such guaranty to Counselor within ten (10) days of such transfer. For purposes of this Article 9, "Control" means, with respect to the applicable person or entity, ownership or control, directly or indirectly, of a majority of the voting ownership of such person or entity or the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such person or entity, by contract or otherwise.
• 9.2 Other Conditions to Transfer. You must apply for our consent by submitting written notice of the pending transfer, with a complete application, signed by you and by the proposed transferee, and payment of the transfer fee, at least 60 days before the proposed transfer date.

Source: Item 22 — CONTRACTS (FDD page 32)