Can an Epcon Communities franchisee own, develop, construct, or have interest in age-restricted real estate development projects?

Except in limited circumstances, you may not during the term of the Franchise Agreement, own, develop, construct or have any interest in any real estate development project that is age-restricted or for which the targeted buyers are the 55+ home buyer, including, but not limited to, detached and/or attached ranch-style homes (with or without basements or a second floor) that are similar to the homes and communities depicted in our Development System.

• 10.6 Franchisee shall not, during the term of this Agreement, without the prior written consent of Franchisor, directly or indirectly, either as a principal, agent, employee, officer, director or member of any corporation or other business entity, as a partner or sole proprietor, or in any other way, own, develop, construct or have any interest in any real estate development project that is age-restricted or for which the targeted buyers are the 55+ home buyer, and includes, without limitation, detached and/or attached ranch-style homes (with or without basements or a second floor) that are similar to the homes and communities depicted in Franchisor's Development System; provided however, this provision shall not apply to the involvement by Franchisee in the development of other Epcon Communities Projects by other franchisee business entities, or to any ownership by Franchisee of less than three percent (3%) of the outstanding stock of any publicly held corporation.

For a period of two (2) years following the effective date of termination or expiration of this Agreement, whether by lapse of time, sale and/or assignment of the Epcon Communities franchise granted hereunder, or other cause, Franchisee shall not, directly or indirectly, either as a principal, agent, employee, officer, director or member of any corporation or other business entity, as a partner or sole proprietor, or in any other way engage in the ownership, development or construction of any real estate development project that is age restricted or for which the targeted buyers are the 55+ home buyer and includes, but is not limited to, detached and/or attached ranch-style homes (with or without basements or a second floor) that are similar to the homes and communities depicted in Franchisor's Development System, within (a) ten (10) miles of the geographic border of any "Initial Market Area" granted to any franchisee pursuant to any Initial Market Area Agreement, or any other agreement that is effective between such franchisee and Franchisor, (b) ten (10) miles of the geographic border of any "Market Area" granted to any franchisee pursuant to any Market Area Agreement, or any other agreement that is effective between such franchisee and Franchisor, (c) ten (10) miles of the geographic border of any "Reserved Market Area" reserved for any franchisee or prospective franchisee under any Market Hold Agreement or other agreement that is in effect between such party and Franchisor, or, (d) ten (10) miles of any real estate development project of Epcon Communities, LLC or of any business entity affiliated with Epcon Communities, LLC.

For purposes of this Section 13.7, the term "Franchisee" shall include any officer, director, shareholder, member or holder of an ownership interest in Franchisee, if Franchisee is a corporation, limited liability company or other business entity, and any partner of Franchisee, if Franchisee is a partnership.

Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 55)