What rights does Learningrx retain with respect to Learningrx Centers, the System, and the Marks?

As noted above, and as specified in the Franchise Agreement, we will not establish, franchise or license others to establish a LearningRx Center in the Territory during the term of the Franchise Agreement so long as you are in compliance with the Franchise Agreement. However, and despite those promises and obligations, we and our affiliates retain all rights with respect to LearningRx Centers, the System, the

Marks, the sale of similar or dissimilar services, and any other activities we deem appropriate whenever and wherever we desire, including:

• 1. to own, franchise, license or operate LearningRx Centers or remote training services at any location outside of the Territory, regardless of the proximity to your LearningRx Center.

We will not establish within your Territory another franchisee or company-owned outlet which may also use the Marks;

• 1. to use the Marks and the System to sell any products or services, similar to those which you will sell, except products provided "trainer to student," through any alternate channels of distribution within or outside of the Territory.

This includes, but is not limited to, retail locations and other channels of distribution such as stores, shops, kiosks, malls, airports, and college campuses, at special events, and other channels of distribution such as, television, mail order, catalog sales, wholesale to unrelated retail outlets, or over the Internet.

We exclusively reserve alternative channels of distribution such as the Internet, catalog sales, telemarketing or other direct marketing, as channels of distribution for us.

You may not independently use alternative channels of distribution to make sales within or outside your Territory;

• 1. to use and license the use of other proprietary and non-proprietary marks or methods which are not the same as or confusingly similar to the Marks, whether in alternative channels of distribution or in the operation of a business offering educational services, at any location, including within the Territory, which may be similar to or different from the business operated by you;
• 1. to purchase or be purchased by, or merge or combine with, any business, including a business that competes directly with the LearningRx Center you operate, wherever located;
• 1. to acquire and convert to the System operated by us any businesses offering services and products related to providing educational services, including such businesses operated by competitors or otherwise operated independently or as part of, or in association with, any other system or chain, whether franchised or corporately owned and whether located inside or outside of the Territory;
• 1. to implement multi-area marketing programs including regional pricing and service programs, which may allow us or others to solicit or sell to clients, or otherwise dictate service and pricing strategy, anywhere.

We also reserve the right to issue mandatory policies to coordinate these multi-area marketing programs including the right to establish minimum or maximum pricing for such programs, as permitted by law; and

• 1. to permit pre-existing PACE Licensees and Clinical Licensees, if any, to continue to operate in your Territory if their zips codes are included in your Territory, or outside your Territory regardless of proximity to your Territory, under the Marks.

Source: Item 12 — TERRITORY (FDD pages 33–35)