Does a Focalpoint Coaching franchisee need approval for their territory?

01 1116 YYEEK | 9 |

Item 12

TERRITORY

You will operate the Franchised Business within a specific Territory that we first must approve. You will not receive an exclusive territory. You may face competition from other FocalPoint Franchised Business franchise owners, from outlets that we own, or from other channels of distribution or competitive brands that we control. You may operate the Franchised Business only within the approved Territory and may not relocate the Office without our approval. We will describe the Territory in the Franchise Agreement before you sign it. We will determine the size and boundaries of the Territory in our discretion, based upon factors including population density, character of neighborhood, location and number of competing businesses and other factors. While there is no minimum territory size, we typically will define a territory to include approximately 100,000 people (residents and/or workers). You have no options, rights of first refusal, or similar rights to acquire additional franchises within the Territory or in contiguous territories.

We and our affiliates may operate or grant a franchise for the operation of another FocalPoint Franchised Business from an Office located within the Territory during the term of the Franchise Agreement. We and our affiliates retain all rights with respect to FocalPoint Franchised Businesses, the Marks, the sale of identical, similar or dissimilar products and services, and any other activities we deem appropriate whenever and wherever we desire, including, but not limited to:

• (1) the right to operate, and to grant others the right to operate FocalPoint Franchised Businesses located anywhere inside or outside the Territory under any terms and conditions we deem appropriate and regardless of proximity to the Office and the Franchised Business's Territory;
• (2) the right to establish and operate, and to grant to others the right to establish and operate businesses offering similar or dissimilar products and services

through similar or alternative channels of distribution (including the Internet, catalog sales, telemarketing, or other direct marketing), inside or outside the Territory under trademarks or service marks other than the Marks and on any terms and conditions we deem appropriate;

• (3) the right to provide, offer and sell and to grant others the right to provide, offer and sell products and services that are identical or similar to and/or competitive with those products and services provided by FocalPoint Franchised Businesses, whether identified by the Marks or other trademarks or service marks, through alternative distribution channels (including the internet or similar electronic media) both inside and outside the Territory and on any terms and conditions we deem appropriate;
• (4) the right to establish and operate, and to grant to others the right to establish and operate, businesses offering dissimilar products and services, both inside and outside the Territory under the Marks and on any terms and conditions we deem appropriate;
• (5) the right to provide, and to grant others the right to provide, Services to national accounts (meaning a client with more than one office in more than one territory) anywhere inside or outside the Territory under any terms and conditions we deem appropriate and regardless of the client's proximity to the Office. You are not entitled to any compensation from us on account of the national account's business in the Territory;
• (6) the right to operate and to grant others the right to operate FocalPoint Franchised Businesses at "Non-Traditional Sites" within and outside the Territory on any terms and conditions we deem appropriate. "Non-Traditional Sites" are sites that generate customer traffic flow which is independent from the general customer traffic flow of the surrounding area, including military bases, major industrial or office complexes, hotels, hospitals, and school campuses;
• (7) the right to acquire the assets or ownership interests of one or more businesses providing products and services the same as or similar to those provided at FocalPoint Franchised Businesses, and franchising, licensing or creating similar arrangements with respect to these businesses once acquired, wherever these businesses (or the franchisees or licensees of these businesses) are located or operating (including in the Territory); and
• (8) the right to be acquired (whether through acquisition of assets, ownership interests or otherwise, regardless of the form of transaction), by a business providing products and services similar to those provided at FocalPoint Franchised Businesses, or by another business, even if such business operates, franchises and/or licenses competitive businesses in the Territory.

We may exercise any of the retained rights without compensating you. You may not use other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing to make sales inside or outside the Territory. You must advertise and solicit clients for the Franchised Business only within the Territory. You may not operate the Franchised

Business or provide the Services outside the Territory; however, you may provide the Services to a client outside the Territory if the client is (i) a personal acquaintance of yours, (ii) was referred to you, or (iii) resulted from your indirect marketing efforts through digital media.

Source: Item 12 — Territory (FDD pages 36–38)