What sections of the Goldfish Swim School franchise agreement contain the non-disclosure and non-competition covenants that the franchisee must adhere to?

Agreement, does assign, ownership of that item, and all related rights to that item, to Franchisor and shall sign any assignment or other document as Franchisor requests to assist Franchisor in obtaining or preserving intellectual property rights in the item. Franchisor shall disclose to Franchisee concepts and developments of other franchisees that are made part of the System. As Franchisor may reasonably request, Franchisee shall take all actions to assist Franchisor's efforts to obtain or maintain intellectual property rights in any item or process related to the System, whether developed by Franchisee or not.

7.3 Exclusive Relationship

Franchisee acknowledges that Franchisor would be unable to protect the Trade Secrets and other Confidential Information against unauthorized use or disclosure and would be unable to encourage a free exchange of ideas and information among Goldfish Swim School franchisees if owners of Goldfish Swim Schools and members of their immediate families or households were permitted to hold an interest in or perform services for any Competitive Business. Therefore, during the term of this Agreement, neither Franchisee nor any holder of a legal or beneficial interest in Franchisee (or any member of their immediate families or households), nor any officer, director, executive, manager or member of the professional staff of Franchisee, either directly or indirectly, for themselves, or through, on behalf of or in conjunction with any person, partnership, corporation, limited liability company or other business entity, shall:

• 7.3.1 Divert or attempt to divert any business or customer of the Franchised Swim School to any Competitive Business, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks or the System; or
• 7.3.2 Own an interest in, manage, operate, or perform services for any Competitive Business wherever located.

7.4 Nondisclosure and Non-Competition Agreements with Certain Individuals

Franchisor has the right to require any holder of a legal or beneficial interest in Franchisee (and any member of their immediate families or households), and any officer, director, executive, manager or member of the professional staff of Franchisee to execute a nondisclosure and non-competition agreement, in a form the same as or similar to the

Nondisclosure and Non-Competition Agreement attached as Exhibit 2, upon execution of this Agreement or prior to each such person's affiliation with Franchisee, and a Confidentiality and Nondisclosure Agreement from all employees to whom Confidential Information is disclosed or who have access to or handle Confidential Information in substantially the form as provided to Franchisee in the Confidential Brand Standards Manual. Upon Franchisor's request, Franchisee shall provide Franchisor with copies of all nondisclosure and non-competition agreements signed pursuant to this Section. Such agreements shall remain on file at the offices of Franchisee and are subject to audit or review as otherwise set forth herein. Franchisor shall be a third-party beneficiary with the right to enforce covenants contained in such agreements. In the event that you or your employees, agents, consultants or contractors receive notice of any request, demand, or order to transfer or disclose all or any portion of the Confidential Information, you shall immediately notify us thereof, and shall fully cooperate with and assist us in prohibiting or denying any such transfer or disclosure. Should such transfer or disclosure be required by a valid, final, non-appealable court order, you shall fully cooperate with and assist us in protecting the confidentiality of the Confidential Information to the maximum extent permitted by law.

7.5 Reasonableness of Restrictions

Franchisee acknowledges that the restrictive covenants contained in this Section are essential elements of this Agreement and that without their inclusion, Franchisor would not have entered into this Agreement. Franchisee acknowledges that each of the terms set forth herein, including the restrictive covenants, is fair and reasonable and is reasonably required for the protection of Franchisor, the System and the Marks and Franchisee waives any right to challenge these restrictions as being overly broad, unreasonable or otherwise unenforceable.

8. TRAINING AND ASSISTANCE

8.1 Initial Training

Franchisor shall make an initial training program available to the Designated Manager, the on-site general manager if different from the Designated Manager, and at least one (1) other required manager (as determined by the Franchisor in its sole discretion), and the Control Person or one (1) or more owners of Franchisee designated by Franchisor. If the Marketing Lead is not the Control Person or other owner designated by Franchisor to attend the entire initial training program, the Marketing Lead must attend and satisfactorily complete no less than the marketing portions of the initial training program. The initial training program is designed to protect Franchisor's brand and covers the material aspects of the operation. At least (60) days prior to the opening of the Franchised Swim School, the Designated Manager, the onsite general manager if different from the Designated Manager, and at least one (1) other manager (as determined by the Franchisor in its sole discretion), and the Control Person or one (1) or more owners of Franchisee designated by Franchisor must attend and successfully

complete, to the Franchisor's satisfaction, a training program pertaining to the operation and administration of the Franchised Swim School including but not limited to, sales and marketing methods, financial controls, maintenance of quality standards, customer service techniques, record keeping, reporting procedure, and other operational function. The initial training may include CPR (cardiopulmonary resuscitation), First Aid, AED (automated external defibrillator) and may provide a lifeguarding certification for shallow water pools but does not include other certifications required by Franchisor (such as certified pool operations certifications, required for all of your management staff) and as required by applicable law prior to Franchisee's operation of the Franchised Swim School. If the above referenced certifications are not provided during initial training, Franchisee must obtain such certifications prior to the opening of the Franchised Swim School. Franchisor shall conduct the initial training program at its headquarters or at other designated locations. Franchisor shall not charge tuition or similar fees for initial training, however, all expenses incurred by Franchisee in attending such program including, but not limited to, travel costs, room and board expenses and employees' salaries, shall be the sole responsibility of Franchisee. If Franchisee believes that Franchisor has not met its training obligations set forth above, Franchisee must notify Franchisor within fifteen (15) days following its initial training. If Franchisee fails to deliver notice to Franchisor as provided in this section, Franchisee shall be deemed to have acknowledged that all initial training required to be provided by Franchisor was provided. Franchisee shall be responsible for training its management and other employees. Franchisor may require all owners of Franchisee to attend some or all of the initial training.

8.2 Opening Assistance

In conjunction with the beginning of operation of the Franchised Swim School, Franchisor shall make available to Franchisee, at Franchisor's expense, one (1) of Franchisor's representatives for no more than three (3) days for your first Franchised Swim School and one (1) day for your or your affiliate's second Franchised Swim School (which duration we determine in our discretion), experienced in the System, for the purpose of familiarizing Franchisee's staff with the Goldfish Swim School techniques and for the purpose of providing general assistance and guidance in connection with the opening of the Franchised Swim School. Franchisor will not provide any opening assistance for any of Franchisee's franchised swim schools after Franchisee's second franchised swim school, it being understood that Franchisee will be responsible for all responsibilities of opening the third franchised swim school and every franchised swim school thereafter. If Franchisee requests additional assistance with respect to the opening or continued operation of the Franchised Swim School, and should Franchisor deem it necessary and appropriate to comply with such request, Franchisee shall pay Franchisor's thencurrent standard rates, plus expenses, for such additional assistance. If Franchisee believes that Franchisor has not met its training obligations set forth above, Franchisee must notify Franchisor within fifteen (15) days following its opening assistance training. If Franchisee fails to deliver notice to Franchisor as provided in this section, Franchisee shall be deemed to have

acknowledged that all initial training required to be provided by Franchisor was provided. The Designated Manager shall be present at the Franchised Swim School for all periods in which a Franchisor representative is present at the Location.

8.3 Failure to Complete Initial Training Program

If Franchisee is an individual and Franchisor determines in Franchisor's discretion that the Designated Manager/Franchisee and/or the Control Person or other owner of Franchisee is unable to satisfactorily complete the training program described above, Franchisor has the right to terminate this Agreement. If this Agreement is terminated pursuant to this Section 8.3, 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, partners, owners, employees and agents (in their corporate and individual capacities).

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