What section outlines the requirements for selecting an approved site for a Goldfish Swim School?

[Item 23: RECEIPTS]

Franchisor has the right to accept or not accept a proposed location based on such factors as it deems appropriate, including, without limitation, the condition of the premises, demographics of the surrounding area including population size of adolescents, proximity to other Goldfish Swim Schools, proximity to Competitive Businesses, lease requirements, traffic patterns, visibility, vehicular and pedestrian access, proximity to major roads, available parking and overall suitability.

Franchisee shall not locate the Franchised Swim School on a selected site without the prior written acceptance of Franchisor.

While Franchisee's proposed location must be within the Designated Territory, in no event does this mean that Franchisor will approve any proposed location that is within the Designated Territory.

Franchisor's right to accept or reject a proposed location is based on its then existing site criteria as outlined in this Franchise Agreement and/or Franchisor's Brand Standards Manual, which may include, but not be limited to, proximity to a designated location within the Designated Territory and the ability of Franchisor or other franchisees of Franchisor to develop locations outside the Designated Territory.

Franchisor does not represent that it, or any of its Affiliate, owners, employees or agents, have special expertise in selecting sites.

Neither Franchisor's assistance nor acceptance is intended to indicate or indicates that the Franchised Swim School will be profitable or successful at the Approved Location.

Franchisee is solely responsible for identifying the Approved Location.

5.2 Failure to Select Site

Should Franchisee fail to select a site for the Franchised Swim School that is accepted by Franchisor within one hundred eighty (180) days after the Effective Date ("Site Selection Period"), Franchisor has the right to terminate this Agreement. If this Agreement is terminated pursuant to this Section 5.2, Franchisor shall return to Franchisee twenty five percent (25%) of the Franchise Fee paid by Franchisee upon Franchisor's receipt of a general release, the same as or similar to the General Release attached as Exhibit 1, releasing any and all claims against Franchisor, any Affiliate and their officers, directors, shareholders, managers, members,

[Item 23: RECEIPTS]

Franchisee shall submit to Franchisor such information as Franchisor may require in order for Franchisor to evaluate Franchisee's proposed site.

Franchisor shall evaluate the site and notify Franchisee of its preliminary acceptance or non-acceptance of the site within a reasonable time (usually fifteen [15] days) of receiving notice of the site from Franchisee.

Franchisee shall submit to Franchisor such information as Franchisor may require in order for Franchisor to evaluate Franchisee's proposed site.

If preliminary acceptance is provided by Franchisor, then Franchisee shall be permitted to submit an offer to purchase or lease (e.g. a letter of intent) with respect to the proposed location.

Franchisee shall not submit any such offer to purchase or lease prior to receiving preliminary acceptance from the Franchisor.

If Franchisor provides preliminary acceptance, Franchisor shall have the right to request any additional materials or information it desires with respect to the proposed location and Franchisee shall provide such information immediately.

Within a reasonable time (usually thirty [30] days) following the receipt of both:

(a) preliminary site acceptance, and (b) any additional materials from Franchisee requested by Franchisor with respect to the proposed location, Franchisor shall provide final acceptance or rejection of such proposed location.

If Franchisor accepts such selection, the site shall be designated as the Approved Location.

If Franchisor does not accept of such selection, Franchisee shall select and notify Franchisor of new sites until Franchisor accepts a site for the Franchised Swim School.

Franchisor shall provide Franchisee with general guidelines to assist Franchisee in selecting a site suitable for the Approved Location.

Franchisee shall ensure that any proposed site meets the then-current Standards and Specifications, including, without limitation demographic criteria, proximity to other existing or potential future Goldfish Swim School locations, proximity to Franchisor's designated location for a location within the Designated Area, parking availability, ceiling heights, composition of the structure, size, composition and location of water lines, size and location of sewer lines, location and capacity of electrical service, location and size of gas service, fire suppression requirements, and soil conditions necessary for the construction of a pool.

Source: Item 23 — RECEIPTS (FDD pages 77–389)