Center from a fixed Center Location located within a specified territory. Relying on the representations made by Franchisee and/or Franchisee's Owners in any submitted application and during the application process and, subject to the terms and conditions of this Agreement, Franchisee's request has been approved by Franchisor, subject to the following terms and conditions:

• (1) During the Term of this Agreement and subject to the rights of Franchisor including, but not limited to, the Reserved Rights, Franchisor grants to Franchisee and Franchisee accepts, the nonexclusive license, right and obligation to develop and operate, one MRCOOL Center in conformity with the System and this Agreement from a single fixed Center location, selected by Franchisee but requiring the approval of Franchisor ("Franchisee's Center Location") and, as designated by Franchisor in Franchisor's discretion and Reasonable Business Judgment, within a Designated Territory;
• (2) If, as of the Effective Date, Franchisee has selected a proposed Center Location that Franchisor approves as Franchisee's Center Location, then Franchisee's Center Location and Designated Territory, if any, shall be identified in Schedule 1 of this Agreement. To be effective, Schedule 1 must be completed and signed by Franchisor. Franchisee's execution of Schedule 1 with a specific location for Franchisee's Center Location shall constitute Franchisee's obligation to develop and operate the Franchised Business at the designated Franchisee Center Location;
• (3) If, as of the Effective Date, Franchisee has not selected a proposed Center Location, and/or has not obtained Franchisor's approval of the proposed Center Location, and/or Schedule 1 to this Agreement is left incomplete or is not signed by Franchisor, Franchisee must locate, identify and secure a Center Location for the Franchised Business in accordance with the terms of this Agreement, including the requirement that Franchisee must obtain Franchisor's approval of

Franchisee's Center Location. If, after the Effective Date, Franchisee proposes and Franchisor approves of Franchisee's proposed Center Location, such approval must be in writing and must be evidenced by Franchisor's execution of Schedule 1 with a specific Center Location designated and identified in Schedule 1. At the time of executing a completed Schedule 1 and, thereby, approving Franchisee's proposed Center Location, Franchisor, in Franchisor's discretion and Reasonable Business Judgment, shall designate and determine Franchisee's Designated Territory;

• (4) If, as of the Effective Date or other appropriate periods after the Effective Date, Franchisee has not selected a proposed Center Location that is approved by Franchisor but, Franchisee has identified an area in which Franchisee may look to secure a Center location for the Franchised Business, Franchisor, in Franchisor's discretion and Reasonable Business Judgment, may enter into the Site Selection Acknowledgment attached to this Agreement as Exhibit 3. If executed by Franchisor, within the Exhibit 3 Site Selection Acknowledgment, Franchisor shall designate a geographic area (the "Site Selection Area") within which Franchisor, during the Site Selection Period, shall not, on behalf of any third party, approve any new Center Location. Franchisee agrees that the Site Selection Acknowledgment does not constitute Franchisor's approval of a proposed Center Location, does not constitute Franchisor's designation of Franchisee's Designated Territory, does not afford Franchisee any territorial rights in or to the Site Selection Area, and does not extend and/or modify any obligation on the part of Franchisee to timely secure an approved Center Location in accordance with the terms of this Agreement;
• (5) At all times, Franchisee's rights in and to the real property and the business premises of Franchisee's Center Location shall be subordinate and subject to Franchisee's and Franchisee's landlord's agreement to and execution of the Center Location Lease Agreement Rider attached to this Agreement as Exhibit 4 and, Franchisee's agreement and execution of the Collateral Assignment of Lease attached to this Agreement as Exhibit 5;
• (6) Franchisee may only offer and sell the Approved Services and Products from Franchisee's Center Location in accordance with the requirements set forth in the Operations Manual;
• (7) Franchisor, in Franchisor's Reasonable Business Judgment and for any reason or no reason at all, may prohibit Franchisee from soliciting customers located outside Franchisee's Designated Territory;
• (8) Except as otherwise provided in this Agreement including, but not limited to, the Reserved Rights, provided that, at all times Franchisee is and remains in compliance with all of the terms of this Agreement, during the Term of this Agreement, neither Franchisor nor any affiliate of Franchisor will establish or operate, or grant a franchise to any third party to establish or operate, a Center using the Licensed Marks and System at a Center Location that is located within Franchisee's Designated Territory, provided, that a Designated Territory has been designated and approved by Franchisor in accordance with the terms of this Agreement, but excluding Closed Markets. Franchisee may face competition from other MRCOOL Centers and other System franchisees with Center locations and/or designated territories, including Centers that are located within Closed Markets and/or located adjacent to and/or within a close proximity to Franchisee's Center Location and/or Designated Territory. Franchisee agrees that although Franchisor may disapprove of any marketing medium that is distributed and/or reaches outside of Franchisee's Designated Territory, that Franchisor is not obligated to do so and that Franchisee may face competition from other MRCOOL Centers and System franchisees that market and promote their MRCOOL Center through internet, mail, public relations, and other marketing activities and mediums that are distributed to or within Franchisee's Designated Territory. Franchisee agrees that

Franchisee shall not receive any compensation whatsoever if Franchisor or another System franchisee solicits customers from within Franchisee's Designated Territory; and

(9) The foregoing rights granted in this Article 2.A. are subject to and contingent upon each and every, term and condition of this Agreement, the rights of any prior user, and are non-exclusive and subordinate to the Reserved Rights.

2.B. TERM

Unless previously terminated pursuant to the terms of this Agreement, the term of this Agreement will be for a period of 10 consecutive years, commencing from the Effective Date (the "Term").

2.C. GUARANTEES, CONFIDENTIALITY AND RESTRICTIVE COVENANTS

If Franchisee is, at any time, a Corporate Entity, Franchisee agrees that each Owner and their respective Spouse shall execute, sign and deliver to Franchisor the Franchise Owner and Spouse Agreement and Guaranty attached to this Agreement as Exhibit 1 and, in doing so, among other things, will individually, jointly, and severally, guarantee Franchisee's obligations under this Agreement and personally bind themselves to confidentiality and non-competition covenants and restrictions.

2.D. RESERVATION OF RIGHTS

Franchisor on behalf of itself, its affiliates, parents, and its assigns retains all rights, on any and all terms and conditions that Franchisor deems advisable and without any compensation or consideration to Franchisee to engage in the following activities (the "Reserved Rights"): (a) operate and grant to others the right to operate a Franchised Business, MRCOOL Center and/or other Centers using the System and Licensed Marks at locations outside Franchisee's Designated Territory;

Source: Item 23 — RECEIPTS (FDD pages 55–263)