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Communities
Business Oversight
FRANCfflSE DISCLOSURE DOCUMENT
Epcon Communities Franchising, Inc.
An Ohio Corporation
500 Stonehenge Parkway
Dublin, Ohio 43017
(614) 761-1010
www.epconfranchising.com
www.EpconOpportunity.com

Brief Description of the Franchised Business: You will receive a franchise to use an original
development system and copyrighted architectural plans to develop, construct and market a project
consisting of residential dwellings, with the right, upon payment of additional fees and with Epcon
Communities Franchising, Inc.’s consent, to develop additional projects. Epcon Communities
Franchising, Inc.’s unique development system provides use of intellectual property and guidance for the
development, construction and marketing of a residential “care-free living” community using unique
architectural designs.
The total investment necessary to commence operation of an Epcon Communities franchised business
ranges from $3,006,200 to $4,569,000 for a 30 Unit project. This includes the $50,000 that must be paid
to the franchisor, Epcon Communities Franchising, Inc., and its affiliate, Epcon Communities Marketing
Program, Inc. (assuming 24 months to close on the first Unit in the project).
This disclosure document summarizes certain provisions of your franchise agreement and other
information in plain English. Read this disclosure document and all accompanying agreements carefully.
You must receive this disclosure document at least 14 calendar-days before you sign a binding agreement
with, or make any payment to, the franchisor or an affiliate in connection with the proposed franchise
sale. Note, however, that no governmental agency has verified the information contained in this
document.
You may wish to receive your disclosure document in another format that is more convenient for you. To
discuss the availability of disclosures in different formats, contabt Jennifer Dimel, Franchise Sales
Specialist, at 500 Stonehenge Parkway, Dublin, Ohio 43017 and (614) 761-1010.
The terms of your contract will govern your franchise relationship. Don’t rely on the disclosure
document alone to understand your contract. Read all of your contract carefully. Show your contract and
this disclosure document to an advisor, like a lawyer or an accountant.
Buying a franchise is a complex investment. The information in this disclosure document can help you
make up your mind. More information on franchising, such as “A Consumer’s Guide to Buying a
Franchise,” which can help you understand how to use this disclosure document, is available from the
Federal Trade Commission. You can contact the FTC at 1-877-FTC-HELP or by writing to the FTC at
600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. You can also visit the FTC’s home page at
www.ftc.gov for additional information. Call your state agency or visit your public library for other
sources of information on franchising.
There may also be laws on franchising in your state. Ask your state agencies about them.
Issuance Date: April 17,2019
 STATE COVER PAGE

Your state may have a franchise law that requires a franchisor to register or file with a state franchise
administrator before offering or selling in your state. REGISTRATION OF A FRANCHISE BY A
STATE DOES NOT MEAN THAT THE STATE RECOMMENDS THE FRANCHISE OR HAS
VERIFIED THE INFORMATION IN THIS DISCLOSURE DOCUMENT.

Call the state franchise administrator listed in Exhibit O for information about the franchisor or about
franchising in your state.

MANY FRANCHISE AGREEMENTS DO NOT ALLOW YOU TO RENEW UNCONDITIONALLY

AFTER THE INITIAL TERM EXPIRES. YOU MAY HAVE TO SIGN A NEW AGREEMENT WITH
DIFFERENT TERMS AND CONDITIONS IN ORDER TO CONTINUE TO OPERATE YOUR
BUSINESS. BEFORE YOU BUY, CONSIDER WHAT RIGHTS YOU HAVE TO RENEW YOUR
FRANCHISE, IF ANY, AND WHAT TERMS YOU MIGHT HAVE TO ACCEPT IN ORDER TO
RENEW.

Please consider the following RISK FACTORS before you buy this franchise:

THE FRANCHISE AGREEMENT REQUIRES YOU TO RESOLVE DISPUTES WITH US BY

LITIGATION OR ARBITRATION ONLY IN OHIO. OUT-OF-STATE LITIGATION AND
ARBITRATION MAY FORCE YOU TO ACCEPT A LESS FAVORABLE SETTLEMENT FOR
DISPUTES. IT MAY ALSO COST YOU MORE TO LITIGATE OR ARBITRATE WITH US ffl OHIO
THAN IN YOUR OWN STATE.

THE FRANCHISE AGREEMENT STATES THAT OHIO LAW GOVERNS THE AGREEMENT, AND
THIS LAW MAY NOT PROVIDE THE SAME PROTECTIONS AND BENEFITS AS LOCAL LAW.
YOU MAY WANT TO COMPARE THESE LAWS.

A FRANCHISEE’S TERRITORY IS EXCLUSIVE FOR ONLY ONE YEAR AFTER COMPLETION

OF ALL OF THE BUILDINGS IN THE FRANCHISEE’S PROJECT OR THE DATE STATED IN THE
FRANCHISEE’S MARKET AREA AGREEMENT.

ALL THE OWNERS OF THE FRANCHISE WILL BE REQUIRED TO SIGN PERSONAL

GUARANTEES. THIS REQUIREMENT PLACES THE PERSONAL ASSETS OF THE FRANCHISE
OWNER(S) AT RISK.

THERE MAY BE OTHER RISKS CONCERNING THIS FRANCHISE.

Effective Date: See the next page for State Effective Dates.
 STATE EFFECTIVE DATES

The following states require that the Franchise Disclosure Document be registered or filed with the state,
or be exempt from registration; California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota,
New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington and Wisconsin.

This Franchise Disclosure Document is registered, on file or exempt from registration in the following
states having franchise registration and disclosure laws, with the following effective dates;

California Pending
Illinois Pending
Indiana Pending
Maryland (exemption filing) Pending
Michigan November 17, 2018, as amended April 17, 2019
Minnesota Pending
New York Pending
South Dakota Pending
Virginia Pending
Washington Pending
Wisconsin Pending
 DISCLOSURES REQUIRED BY THE STATE OF MICfflGAN

THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE

SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS
ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE
ENFORCED AGAINST YOU.

(a) A prohibition on the right of a franchisee to join an association of franchisees.

(b) A requirement that a franchisee assent to a release, assignment, novation, waiver, or estoppel which
deprives a franchisee of rights and protections provided in this Act. This shall not preclude a franchisee, after
entering into a franchise agreement, from settling any and all claims.

(c) A provision that permits a franchisor to terminate a franchisee prior to the expiration of its term
except for good cause. Good cause shall include the failure of the franchisee to comply with any lawful
provisions of the franchise agreement and to cure such failure after being given written notice thereof and a
reasonable opportunity, which in no event need be more than 30 days, to cure such a failure.

(d) A provision that permits a franchisor to refuse to renew a franchise without fairly compensating the
franchisee by repurchase or other means for the fair market value at the time of expiration of the franchisee's
inventory, supplies, equipment, fixtures and furnishings. Personalized materials which have no value to the
franchisor and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct
of the franchise business are not subject to compensation. This subsection applies only if: (i) The term of the
franchise is less than five years; and (ii) the franchisee is prohibited by the franchise or other agreement from
continuing to conduct substantially the same business under another trademark, service mark, trade name,
logotype, advertising or other commercial symbol in the same area subsequent to the expiration of the
franchise or the franchisee does not receive at least 6 months advance notice of the franchisor’s intent not to
renew the franchise.

(e) A provision that permits the franchisor to refuse to renew a franchise on terns generally available to
other franchisees of the same class or type under similar circumstances. This section does not require a
renewal provision.

(f) A provision requiring that arbitration or litigation be conducted outside this state. This shall not
preclude tlie franchisee from entering into an agreement, at the time of arbitration, to conduct arbitration at a
location outside this state.

(g) A provision which permits a franchisor to refuse to permit a transfer of ownership of a franchise,
except for good cause. This subdivision does not prevent a franchisor from exercising a right of first refusal
to purchase the franchise. Good cause shall include, but is not limited to:

(i) The failure of the proposed transferee to meet the franchisor's then
current reasonable qualifications or standards;

(ii) The fact that the proposed transferee is a competitor of the

franchisor or subfranchisor.

(iii) The unwillingness of the proposed transferee to agree in writing to

comply with all lawful obligations.
 (iv) The failure of the franchisee or proposed transferee to pay any
sums owing to the franchisor or to cure any default in the franchise
agreement existing at the time of the proposed transfer.

(h) A provision that requires the franchisee to resell to the franchisor items that are not uniquely
identified with the franchisor. This subdivision does not prohibit a provision that grants to a franchisor a right
of first refusal to purchase the assets of a franchise on the same terms and conditions as a bona fide third party
willing and able to purchase those assets, nor does this subdivision prohibit a provision that grants the
franchisor the right to acquire the assets of a franchise for the market or appraised value of such assets if the
franchisee has breached the lawful provisions of the franchise agreement and has failed to cure the breach in a
manner provided in subdivision (c).

(i) A provision which permits the franchisor to directly or indirectly convey, assign, or otherwise
transfer its obligations to fulfill contractual obligations to tlie franchisee unless provision has been made for
providing the required contractual services.

THE FACT THAT TEBERE IS A NOTICE OF THIS OFFERING ON FILE WITH THE
ATTORNEY GENERAL DOES NOT CONSTITUTE APPROVAL, RECOMMENDATION, OR
ENDORSEMENT BY THE ATTORNEY GENERAL.

The Michigan Franchise Investment Law also provides:

A franchisor whose most recent financial statements are unaudited and which show a net worth of
less than One Hundred Thousand Dollars ($100,000) shall, at the request of a franchisee, arrange for the
escrow of initial investment and other funds paid by the franchisee until the obligations to provide real estate,
improvements, equipment, inventory, training or other items included in the franchise offering are fulfilled.
At the option of the franchisor, a surety bond may be provided in the place of escrow.

The escrow agent shall be a financial institution authorized to do business in the State of Michigan.
The escrow agent may release to the franchisor that amount of the escrowed funds applicable to a specific
franchisee upon presentation of an affidavit executed by the franchisee and an affidavit executed by the
franchisor stating that the franchisor has fulfilled its obligation to provide real estate, improvements,
equipment, inventory, training or other items. This sub-section does not prohibit a partial release of escrowed
funds upon receipt of affidavits of partial fulfillment of the franchisor's obligation.

Franchisees should direct any questions concerning this offering to:

Assistant Attorney General

Consumer Protection Division, Franchise Section
G. Mennen Williams Building, First Floor
525 West Ottawa Street
Lansing, MI 48933
(517)373-7117
 TABLE OF CONTENTS
ITEM PAGE
1. The Franchisor and any Parents, Predecessors and Affiliates.........................................................1
2. Business Experience........................................................................................................................4
3. Litigation.........................................................................................................................................7
4. Bankruptcy......................................................................................................................................9
5. Initial Fees.......................................................................................................................................9
6. Other Fees..................................................................................................................................... 10
7. Estimated Initial Investment...........................................................................................................18
8. Restrictions on Sources of Products and Services......................................................................... 29
9. Franchisee’s Obligations...............................................................................................................32
10. Financing.......................................................................................................................................43
11. Franchisor’s Assistance, Advertising, Computer Systems and Training....................................... 44
12. Territory........................................................................................................................................65
13. Trademarks....................................................................................................................................67
14. Patents, Copyrights and Proprietary Information.......................................................................... 70
15. Obligation to Participate in the Actual Operation of the Franchise Business.................................71
16. Restrictions on What the Franchisee May Sell............................................................................. 72
17. Renewal, Termination, Transfer and Dispute Resolution............................................................. 72
18. Public Figures.............................................................................................................................. 100
19. Financial Performance Representations...................................................................................... 100
20. Outlets and Franchisee Information............................................................................................ 108
21. Financial Statements.................................................................................................................... 116
22. Contracts........................................................................... 116
23. Receipts.......................................................................................................................................117

EXHIBITS
A. Financial Statements for Epcon Communities Franchising, Inc.
B. Franchise Agreement
C. Market Area Agreement and Market Area Agreement Extension
D. Personal Covenants and Agreement of Principal, Officer, Director, Owner, Investor or
Partner of Franchisee
E. Personal Covenants and Agreement of One Provided Detailed Knowledge of the
Development System
F. Market Hold Agreement and Market Hold Agreement Extension
G. Sublicense Agreement
H. Market Reservation Agreement and Mutual Release of Market Reservation Agreement
I. Lender Assignment Agreement
J. Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information Access
Agreements
K. Copyright Assignment & Agreement
L. Mortgage
M. Security Agreement
N. List of Epcon Communities Franchisees
O. List of State Administrators
P. List of Agents for Service of Process
Q. List of Copyrights
R. Termination and Release Agreement
S. Initial Market Area Agreement and Addendum to Franchise Agreement
T. State Addenda to the FDD and Agreements
ITEM 1. THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES

The name of the franchisor is Epcon Communities Franchising, Inc., which is referred to in this
disclosure document as “Epcon Communities Franchising, Inc.” or “ECFI” or “we” or “us”. ECFI is an
Ohio corporation, incorporated on April 26, 1995. We do business under the names “Epcon Communities
Franchising, Inc.”, “Epcon Communities Franchising”, “Epcon Homes & Communities” and “Epcon
Communities”. Our principal business address is 500 Stonehenge Parkway, Dublin, Ohio 43017. Our
agent for service of process is Epcon Communities Franchising, Inc., 500 Stonehenge Parkway, Dublin,
Ohio 43017, Attention: JoelD. Rhoades. In addition, if your state is listed in Exhibit?, our agent for
service of process in your state is listed in Exhibit P.

ECFI changed its name on March 14, 2005 from Epmark, Inc. From August 1996 until February
2005, under the name of Epmark, Inc., we offered and sold Epmark franchises.

Affiliates and Parent

EC Holdings Ohio, Inc. (“Holdings Ohio”), an Ohio corporation is an affiliate of ECFI. Holdings
Ohio was formed on June 28, 2018 and its principal address is 500 Stonehenge Parkway, Dublin, Ohio
43017. Holdings Ohio is the sole member of the Ohio limited liability companies, Epcon Communities,
EEC (“Epcon EEC”) and EC New Vision Ohio, EEC (“ECNV Ohio”), which was formed on June 28,
2018. Epcon Communities, Inc. (which changed its name from The EPCON Group, Inc. on March 14,
2006) was converted into Epcon Communities, EEC on August 1, 2018.

In 1986, Epcon Community EEC’s two principals began the work and development projects that
ultimately became the Epcon Communities Development System. Epcon EEC and ECNV Ohio, under a
license from IP86, EEC (disclosed in Item 13), develop and construct residential community projects in
Ohio through a number of single member limited liability companies for which either Epcon EEC or
ECNV Ohio is the sole member using the Epcon Communities Development System.

Epcon EEC and ECNV Ohio are collectively referred to in this disclosure document as “Epcon”.

Throughout its existence, Epcon has been involved in the development and construction of low-
maintenance residential community projects in central Ohio. Generally, Epcon does business under the
names “Epcon Communities” and “Epcon”.

EC Holdings Carolinas, EEC (“Holdings Carolinas”), a North Carolina limited liability company
is an affiliate of ECFI. Holdings Carolinas was formed on June 28, 2018 and its principal address is 500
Stonehenge Parkway, Dublin, Ohio 43017. Holdings Carolinas is the sole member of the North Carolina
limited liability companies Epcon Communities Carolinas, EEC (“Carolinas EEC”) and EC New Vision
Carolinas, EEC (“ECNV Carolinas”), which was formed on June 28, 2018. Epcon Communities North
Carolina, EEC changed its name to Epcon Communities Carolinas, EEC on February 14, 2008. Carolinas
EEC and ECNV Carolinas, under a license from IP86, EEC (disclosed in Item 13), develop and construct
residential community projects in North Carolina and South Carolina through a number of single member
limited liability companies for which either Carolinas EEC or ECNV Carolinas is the sole member using
the Epcon Communities Development System.
 Carolinas LLC and ECNV Carolinas are collectively referred to in this disclosure document as
“Epcon Carolinas”. Generally, Epcon Carolinas does business under the names “Epcon Communities,”
and “Epcon”.

Epcon Communities Marketing Program, Inc., an Ohio nonprofit corporation (“Epcon

Marketing”), is an affiliate and subsidiary of ECFI, formed on March 31, 2006 to facilitate the pooling
and expenditure of funds for the marketing to potential home purchasers, on a system-wide level, of the
projects of Epcon, Epcon Carolinas and ECFI’s franchisees. Epcon Marketing is wholly owned by ECFI.
Its principal business address is 500 Stonehenge Parkway, Dublin, Ohio 43017.

Home Page, Inc. (“Home Page”), an Ohio corporation formed on March 18, 2014, is the parent
of ECFI. Home Page maintains its principal place of business at 500 Stonehenge Parkway, Dublin,
Ohio 43017. On April 15, 2016, Home Page acquired all of the right, title and interest of ECFI in ECFFs
intellectual property rights, including trade names, trademarks, service marks, logos, designs, trade dress,
whether registered or unregistered, copyrights, whether registered or unregistered, and derivatives of the
intellectual property and domain names (collectively the “Intellectual Property”). By agreement between
Home Page and ECFI, Home Page licensed the Intellectual Property to ECFI.

Holdings Ohio, Holdings Carolinas, Epcon LLC, ECNV Ohio, Carolinas LLC, ECNV Carolinas
and Epcon Marketing are the only affiliates of ECFI required to be disclosed in this disclosure document,
and Home Page is the only parent of ECFI required to be disclosed in this disclosure document. ECFI has
no predecessors required to be disclosed in this disclosure document.

Description of Epcon Communities Franchising, Inc.’s Business

ECFI is in the business of licensing franchisees to develop, construct and market attached and
detached residential homes in residential community development projects using an original development
system, copyrighted architectural plans (including plans for two, three or four-Unit attached buildings in
various configurations and plans for single family detached residential Units (defined below)), and other
building designs like illustrations, renderings, blueprints and models, all under uniform and distinctive
methods, plans, standards, specifications and systems, as periodically modified by it (referred to in this
disclosure document as the “Epcon Communities Development System”). A residential dwelling unit in a
condominium or single family development project is referred to in this disclosure document as a “Unit.”

The Epcon Communities Development System includes other special characteristics identified to
the public by ECFFs service marks, trade name, emblems, signs, slogans, insignia and copyrights as have
been designed by ECFI for use with the Epcon Communities Development System (referred to in this
disclosure document as the “Marks”).

When we use the word “you” in this disclosure document, we are referring to you as a
prospective ECFI franchisee and to other ECFI franchisees. If you elect to acquire an ECFI franchise
through a corporation, partnership, limited liability company, or other business entity, the word “you”
also includes the shareholders, partners, members, managers or owners of that entity.

Description of the Epcon Communities Franchise

You will be granted the right to use the Epcon Communities Development System in developing,
constructing and marketing attached and detached residential homes in residential community
development projects at a specified location and within a specified territory using the Marks. Under
certain circumstances, we may grant you an extension of time to use the rights to the Epcon Communities
Development System granted to you under your Market Area Agreement, and under certain
circumstances, even though your rights to use the Epcon Communities Development System have
terminated, you may complete construction of Units at your project (during a period of time not to exceed
two years). The form of Market Area Agreement is attached as Exhibit C.

If you have not identified a specific property for development at the time you sign a Franchise
Agreement with us, we may agree to sign with you an Addendum to the Franchise Agreement and an
Initial Market Area Agreement (the form of each is attached as Exhibit S), which provides for a market
area in which you may be able to locate your project and which gives you additional time to locate
suitable property for your project. When you identify a property for your project, and we agree to that
location, you will be required to sign a Market Area Agreement with us, which will have a smaller market
area than that in the Initial Market Area Agreement.

Until April 2010, we required franchisees to develop a minimum of 50 Units in a project. To

provide greater flexibility to our franchisees, we lowered the minimum unit requirement for projects to
permit our franchisees to take advantage of situations where there is an opportunity to build residential
projects of 10 to 49 units. The protected market area for a project of 10 to 49 Units will be smaller than
the protected market area for a project of more than 49 Units.

The general market for the Units to be developed, constructed and marketed by you includes
those seeking to purchase ranch style homes in low maintenance communities. In some cases, you may
purchase land for the project, develop the land, and construct and market the Units. In other cases, you
may buy ready to build lots in an existing project that is aheady developed. The market for these
products and services is well developed. The sale of these Units is a year round business.

If you become an ECFI franchisee, you must compete with a number of already established
businesses developing, constructing and marketing housing, many of which may have been in business
for a significant period of time, as well as other new and re-sale single family homes, condominiums and
apartment rentals. You should consult the internet and/or a classified telephone directoiy under
“Condominiums”, “Building Contractors” and “Realtors” to determine the number of competitors in the
area.
Epcon Communities development businesses and projects are subject to numerous laws and
governmental regulations that apply to businesses generally. In addition, you must comply with a variety
of federal, state and/or local laws and regulations concerning zoning and building codes, licensing
requirements for contractors, property managers and real estate salespersons, the formation and manage­
ment of condominium associations, occupational health and safety on the construction site, housing
finance, the federal Interstate Land Sales Full Disclosure Act, equal housing laws, the Fair Housing Act
and the Americans with Disabilities Act, as well as the Accessibility Guidelines promulgated under each
of these laws. Before you purchase an Epcon Communities franchise, we suggest that you check on the
existence and the requirements of these laws and regulations in your area. We do not warrant to you that
the architectural plans, specifications, condominium association materials and site plan samples provided
as part of the Epcon Communities Development System will comply with the laws and regulations
applicable in the state and local governmental jurisdictions in which you decide to locate your project.
You must engage a local architect and legal counsel to assist you in determining which state and local
government agencies are involved in regulating real estate development activity in your area and in
making any modifications to the architectural plans, specifications, sample condominium association
materials and site plan samples that are necessary to permit your project to be in compliance with all
applicable laws and regulations. You must provide us with a letter from your architect detailing all of the
changes made to the architectural plans. If you are unable to obtain permits and approvals from
governmental authorities regarding a particular project site, you must choose another site to develop a
project. If governmental authorities require you to make modifications to the plans to gain approval or
obtain a permit, you must comply with these requirements in order to move ahead with your project.

You must pay us the Initial Franchise Fee and you may he required to pay us the Minimum
Monthly Royalty and Project Royalty Fee regardless of whether you commence construction or complete
development of a project or build any Units.

Prior Business Experience of Epcon Communities Franchising, Inc.

ECFI has not itself developed Epcon Communities projects of the type being franchised. From its
formation in April, 1995, until it began offering franchises in August, 1996, ECFI granted licenses to
licensees to use its development system in developing multi-family residential communities. These
licenses were not franchises, because the licensees were prohibited from using the licensor’s service mark
in their activities. As of August, 1996, the company ceased offering licenses to new licensees and
focused on offering and selling franchises.

Epcon, Epcon Carolinas and the principals of Epcon, have for 33 years, since 1986, developed or
are currently developing 89 multi-family residential communities in central Ohio, Florida, North Carolina
and South Carolina (including those currently under construction) of the type being franchised. The total
number of Units developed in the past, and to be developed during 2019, in these communities is
approximately 7,471.

From October, 1988 through April, 1995, Epcon Communities EEC granted licenses to licensees
to use what was then known as the Epcon development system to develop multi-family residential
communities. Epcon Communities, EEC. ceased granting licenses for use of the system in April, 1995
and itself became a licensee of ECFI. Epcon, now as a licensee of IP86, continues to develop multi­
family residential communities using the Epcon Communities Development System. From time to time,
we enter into license agreements with former franchisees and other parties that permit the former
franchisee or other party to use certain plans for the purpose of completing unfinished projects.

We have never offered or granted franchises in any other line of business and are not engaged in
other business activities. Neither Epcon nor Epcon Carolinas has offered or granted franchises in any line
of business. Epcon Marketing has never developed an Epcon Communities project of the type being
franchised and has never offered or granted franchises in any line of business.

ITEM 2. BUSINESS EXPERIENCE

Chief Executive Officer and Director: Philip G. Fankhauser

Mr. Fankhauser has served as the Chief Executive Officer of ECFI since March 2006, and has
served as a Director of ECFI since its formation in April 1995. Mr. Fankhauser has served as President of
EC Holdings Ohio, EEC, EC Holdings Carolinas, EEC, EC New Vision Ohio, EEC, EC New Vision
Carolinas, EEC since June 2018. Mr. Fankhauser has served as the Chief Operating Officer of Epcon
Communities, EEC since March 2006, and President and a Director of Epcon Communities, EEC since
August 1988. Since April 2006, Mr. Fankhauser has served as a Trustee of Epcon Marketing.
Mr. Fankhauser currently serves as President and Chief Operating Officer of Epcon Communities
Carolinas, EEC and has served in both capacities since December 2007. The location for each of Mr.
Fankhauser’s current and former positions is Dublin, Ohio.
President and Director: Edward A. Bacome

Mr. Bacome has served as a Direetor of ECFI sinee its formation in April 1995, and has served as
its President since April 2008. Mr. Bacome has served as Chief Executive Officer of EC Eloldings Ohio,
EEC, EC Holdings Carolinas, EEC, EC New Vision Ohio, EEC, and EC New Vision Carolinas, EEC
since June 2018. Since August 1988, Mr. Bacome has served as a Director of Epcon Communities, EEC,
and served as its Chief Executive Officer since March 2006. Since April 2006, Mr. Bacome has served as
a Trustee of Epcon Marketing, and since December 2007, he has served as Chief Executive Officer of
Epcon Communities Carolinas, EEC. The location for each of Mr. Bacome’s current positions is Dublin,
Ohio.

Treasurer and Chief Financial Officer: David P. Blackmore

Mr. Blackmore has been Chief Financial Officer of both ECFI and Epcon Communities, EEC
since May 2005, and has been Treasurer of both ECFI and Epcon Communities, EEC since August 2005.
Mr. Blackmore has served as Chief Financial Officer of EC Holdings Ohio, EEC, EC Holdings Carolinas,
EEC, EC New Vision Ohio, EEC, and EC New Vision Carolinas, EEC since June 2018. Since April
2006, Mr. Blackmore has served as the Treasurer of Epcon Marketing, and since December 2007, Mr.
Blackmore has been the Chief Financial Officer and Treasurer of Epcon Communities Carolinas, EEC.
The location for each of Mr. Blackmore’s current positions is Dublin, Ohio.

Vice President of Sales: Nanette M. Overly

Since August 2018, Ms. Overly has served as the Vice President of Sales for Epcon
Communities, EEC and ECFI. From January 2007 until August 2018, Ms. Overly held the position of
Vice President of Sales and Marketing for ECFI. Ms. Overly has served as Vice President of Sales of EC
Holdings Ohio, EEC, EC Holdings Carolinas, EEC, EC New Vision Ohio, EEC, and EC New Vision
Carolinas, EEC since June 2018. Currently, Ms. Overly serves as the Vice President of Corporate Affairs
and as a Trustee of Epcon Marketing, positions she has held since April 2006. The location for each of
Ms. Overly’s current positions is Dublin, Ohio.

Director and Vice President and General Counsel: Joel D. Rhoades

Mr. Rhoades has served as a Director of ECFI since August 2007, Vice President of ECFI since
January 2005, and General Counsel for ECFI since March 2003. He served as Secretary of ECFI from
March 2003 to December 2017. Mr. Rhoades currently serves as Regional President, General Counsel
and a Director of Epcon Communities EEC. Mr. Rhoades has served as a Director since March 2006,
General Counsel since March 2003, and Regional President since October 2017. He served as Vice
President of Epcon Communities, Inc. from January 2005 to October 2017 and as Secretary from March
2003 to December 2017. Since December 2007, Mr. Rhoades has served as the Vice President of Epcon
Communities Carolinas EEC and he held the position of Secretary of Epcon Communities Carolinas EEC
from December 2007 to December 2017. Mr. Rhoades has served as the Regional President of EC
Holdings Ohio, EEC, EC Holdings Carolinas, EEC, EC New Vision Ohio, EEC, and EC New Vision
Carolinas, EEC since June 2018. The location for each of Mr. Rhoades’s current and former positions is
Dublin, Ohio.

President of Franchising: Paul W. Hanson

Mr. Hanson has been President of Franchising for ECFI and a Trustee of Epcon Marketing, both
located in Dublin, Ohio, since December 2018. From September 2015 to November 2018, Mr. Hanson
was a Group Vice President for Arthur Rutenberg Homes, Inc. of Clearwater, Florida while loeated in
Indianapolis, Indiana. From November 2012 through September 2015 Mr. Hanson was a Production
Manager for NVR, Inc. in Tampa, Florida.

Secretary: Christopher Buerkle

Mr. Buerkle has been Secretary of ECFI, Epcon Communities, EEC and Epcon Communities
Carolinas, EEC in Dublin, Ohio since December 2017. Since December 2011, Mr. Buerkle has served as
Eegal Counsel for Epcon Communities, EEC in Dublin, Ohio.

Vice President of Marketing: Robert H. Krohn

Mr. Krohn has been the Vice President of Marketing of EC Holdings Ohio, EEC, EC Holdings
Carolinas, EEC, EC New Vision Ohio, EEC, and EC New Vision Carolinas, EEC since December 2018.
He has served as Secretary of Epcon Marketing since May 2018. Since October 2013, he has been the
Marketing Manager of Epcon Marketing, and from October 2013 until July 2018 he was the Marketing
Manager for Epcon Communities, Inc. From July 2018 until December 2018, he served as the Marketing
Manager for EC Holdings Ohio, EEC, EC Holdings Carolinas, EEC, EC New Vision Ohio, EEC, and EC
New Vision Carolinas, EEC. The location for each of Mr. Krohn’s current and former positions is
Dublin, Ohio.

Business Development Manager: Gregory J. Leath

Mr. Eeath has been a Business Development Manager for ECFI, located in Dublin, Ohio, since
March 2019. From August 2016 through March 2019, Mr. Eeath was a Corporate Trainer for Arthur
Rutenberg Homes, Inc., located in Clearwater, Florida. From March 2013 through August 2016,
Mr. Eeath was a Purchasing Manager for The Ernst Group EEC, located in Nashville, Tennessee.

Business Development Manager: Adam Smith

Mr. Smith has been a Business Development Manager for ECFI, located in Dublin, Ohio, since
March 2019. From January 2014 through March 2019, Mr. Smith was President of AC Smith &
Associates, located in Bellville, Ohio.

Assistant General Counsel: Joseph R. Karpowicz

Mr. Karpowicz has served as Assistant General Counsel for Epcon Communities EEC and Epcon
Communities, EEC in Dublin, Ohio since October 2013.

Business Development Specialist: Jennifer Dimel

Ms. Dimel has been a Business Development Specialist for ECFI located in Dublin, Ohio since
January 2018, following a brief employment search from November 2017 until January 2018. From
November 2016 to October 2017, Ms. Dimel was a Regional Account Manager for Heinrich Paper &
Supply in Zanesville, Ohio. From April 2014 to November 2016 she was a Sales Representative for Blue
Grass Quality Meats in Erlanger, Kentucky. From Januaiy 2012 to April 2014 Ms. Dimel was an
Account Manager for Ohio Packing Company in Columbus, Ohio.
ITEM 3. LITIGATION

Certain Pending Actions

Villas of Stone Glen Condominium Association. Inc, v. VOSG. LLC. et al.. Case No. 348-
305043-18, in the District Court of Tarrant County, Texas. This case was filed on January 7, 2019. The
plaintiff has alleged that the defendants, including Epcon Communities Franchising, Inc., as developers,
general contractors and those engaged in the development of the structures and common elements at the
Epcon condominium community developed by franchisee. Integrity Retirement Group, LLC, and known
as the Villas of Stone Glen in Tarrant County, Texas, failed to act reasonably in exercising control over
construction and sales activities to ensure that the work was performed in a good and workmanlike
manner. The plaintiff further asserts that, as a result of the defendants’ failures, the plaintiff suffers from
various construction deficiencies including, but not limited to, defective foundations, grading and
drainage, roofs, retaining wall and perimeter fence. The plaintiff has demanded damages in an
unspecified amount, attorneys’ fees and treble damages under the Texas Deceptive Trade Practices Act
from all defendants, jointly and severally. The franchisee has agreed to defend and indemnify Epcon
Communities Franchising, Inc. The defendants have filed a Motion to Dismiss and to compel arbitration.
The matter is pending.

Lipari v. Epcon Nantz Road. LLC. et ah. Case Number 19-CVS-93, in the Superior Court
Division of Mecklenburg County, North Carolina. This case was filed on January 7, 2019. The
defendants include Epcon Communities, LLC, Philip G. Fankhauser and Edward A. Bacome, as well as
other parties. The plaintiffs have asserted causes of action including fraud in the inducement,
constructive fraud, negligent misrepresentation, unfair and deceptive trade practices, punitive damages,
and respondeat superior. The plaintiffs have alleged that the defendants provided inadequate storm sewer
and drainage improvements, misrepresented that the community in which the plaintiffs’ home is located
had lake access, misrepresented the number of the home’s air conditioning units, and failed to construct
the common areas in the community in a workmanlike manner.' The plaintiffs have demanded attorneys’
fees, court costs, a constructive trust, and an unspecified amount of actual, trebled, and punitive damages.
The defendants have filed Motions to Dismiss and Alternative Motions to Stay Proceeding and Compel
Arbitration. The matter is pending.

Fair Housing Advocates Association v. Epcon Communities. Inc., et al.. HUD Case No. 05-12-
0088-8, Inquiry No. 329941 and Assistant Secretary of Fair Housing and Equal Opportunity (“FHEO”) v.
Epcon Communities. Inc.. HUD Case No. 05-13-0010-8, Inquiry No. 349829. On October 27, 2011 a
formal Complaint was filed with the Midwest Region Office, Region V of the Fair Housing Office of the
U.S. Department of Housing and Urban Development (“Fair Housing Office”) by the advocacy group.
Fair Housing Advocates Association (“FHAA”). On October 15, 2012, the Assistant Secretary of FHEO
filed a similar Complaint with the Fair Housing Office. The Complaints allege that Epcon Communities,
Inc. and other respondents have engaged in one or more discriminatory housing practices under federal
Fair Housing law. The Complaints listed five projects in Ohio developed by ECFI franchisees at which
the discrimination allegedly occurred. Specifically, the Complaints alleged inaccessible common use
areas, such as clubhouse kitchens and mailboxes, and inaccessible parking, a lack of accessible routes to
entrances due to the inclusion of steps and/or noncompliant slopes, a lack of an accessible route in the
form of a sidewalk from the residences to the eommon use areas, as well as items of noncompliance
within the units. Finally, the Complaints allege that Epeon Communities, Inc. has denied or made
unavailable, housing to persons with disabilities, discriminated against persons with disabilities in the
terms, conditions, privileges, or provisions of services and failed to design and construct covered
dwellings in accordance with federal accessibility requirements in violation of the Fair Housing Act.
Letters accompanying the Complaints provided notice that the Fair Housing Office will conduct an
investigation to determine whether the Complaints had merit. On August 8, 2014 an Amended Complaint
was filed by the Assistant Secretary of FHEO that listed thirty-three projects in Ohio developed by ECFI
franchisees and Epcon Communities, Inc. at which the discrimination allegedly occurred, removed Joel
Rhoades as a personally named respondent and added an allegation that the violations were continuing.
No civil lawsuit has been filed and the Complaints are currently being processed administratively by the
Fair Housing,Office. These matters are pending.

Certain Concluded Actions

Villas of Stonehenge Condominium Association v. 9th Street Company. L.L.C. et al.. Case No.
11-0512-CH in the Circuit Court for Kalamazoo County, Michigan. On January 20, 2012, Villas of
Stonehenge Condominium Association (the “Association”), the condominium association for the Villas of
Stonehenge Condominium (the “Condominium”) in Kalamazoo, Michigan filed an Amended Complaint
against Villas of Stonehenge, Inc., a Michigan corporation and the franchisee which developed the
condominium project, Kenneth Watts, the owner of Villas of Stonehenge, Inc., 9th Street Company,
L.L.C., the successor developer of the Condominium (not a franchisee), John Stewart, the owner of 9th
Street Company, L.L.C., Phillip Martin, an officer, director and manager of the Condominium, and ECFI.
ECFI was added as a defendant in a lawsuit that was originally filed on October 5, 2011. The claims
against ECFI included (1) a request for a declaratory judgment that ECFI formed a joint venture and/or a
partnership with the other defendants and that ECFI was jointly and severally liable for any money
judgment or other relief granted against the other defendants, (2) trespass and violation of Michigan
Compiled Laws Section 600.2919, (3) breach of contract, (4) breach of warranty, (5) breach of covenant,
(6) negligence, (7) breach of fiduciary duty, (8) fraud, (9) negligent misrepresentation, (10) innocent
misrepresentation, (11) silent fraud, (12) violation of the Michigan Condominium Act, (13) violation of
the Master Deed, and (14) violation of the Michigan Consumer Protection Act. On September 3, 2013,
by the agreement of all of the parties, the case was dismissed with prejudice in its entirety with respect to
all claims involving ECFI. The settlement agreement to which ECFI is a party provides (a) ECFI did not
admit responsibility or liability for any damages alleged by any party; (b) a payment of $50,000 to the
Association was made by ECFI (and its insurer); ECFI agreed to the grant of a license for use of the
condominium development system to 9th Street Company, L.L.C. to permit it to finish the remaining
units in the Condominium; (d) 9th Street Company, L.L.C. agreed to enter into and abide by the terms of
the license agreement with ECFI; and (e) the Association agreed to fully defend and indemnify ECFI
from any claim filed against ECFI by any of the parties. As to ECFI, the matter is concluded.

Grant Williams et al. v. Epmark. Inc, et al.. Case No. 12CV-09-11404, in the Court of Common
Pleas of Franklin County, Ohio. This action was filed on September 11, 2012 by Grant Williams and
thirteen other individual plaintiffs, as well as four business entity plaintiffs. The defendants listed in the
Complaint are Epcon Communities Franchising, Inc. (formerly Epmark, Inc.), Gibeon Development
Group, LLC, an Ohio limited liability company (“Gibeon Development”), Ed Burgan, John Drumheller,
Craig A. Crossley, Crosstowne Properties, Ltd., Richard Taylor, Tobin Logel and several unnamed
defendants. Defendant Gibeon Development was an ECFI franchisee under a July 2002 Franchise
Agreement and a July 2004 Large Market Franchise Agreement (collectively, the “Franchise
Agreements”). While a franchisee, Gibeon Development formed five separate business entities
(collectively, the “Developer Entities”), each of which was a sub-licensee of Gibeon Development’s
rights under the Franchise Agreements for the purpose of developing a franchised Epcon Communities
condominium development project. This action involves claims by owners of minority member interests
in one or more of the Developer Entities against (a) Gibeon Development, the franchisee, (b) Ed Burgan,
the owner of Gibeon Development, (c) other owners of one or more of the Developer Entities, and Epcon
Communities, Inc., incorrectly named as the franchisor. The plaintiffs have asserted claims of ffaud,
unjust enrichment, tortious interference with business relationships/expectancies, and conspiracy to
commit fi-aud against all of the defendants, as well as claims of breach of fiduciary duty and breach of
contract against certain of the defendants (not including Epcon Communities, Inc.). With respect to
Epcon Communities, Inc., the plaintiffs have asserted that it (i) engaged in a pattern of conduct to defraud
Pin Oak Farms, LLC (the developer of a project in Aiken, South Carolina), by making misrepresentations
of material fact about franchise fees; (ii) was unjustly enriched by its receipt of franchise fees from Pin
Oak Farms, LLC and that it received income that rightfully belonged to investor/members in the
Developer Entities; (iii) tortiously interfered with the banking relationship between Pin Oak Farms, LLC
and its lender by requesting that the lender pay to Epcon Communities, Inc. a closing fee from one of Pm
Oak Farms, LLC’s condominium sales, and by diverting income that rightfully belonged to
investor/members in the Developer Entities; and (iv) conspired with Gibeon Development to prevent
investor/members from discovering the details of the Large Market Franchise Agreement and other
related agreements alleged to exist between Epcon Communities, Inc. and Gibeon Development and the
effects of such agreements on the investments of investor/members. On February 15, 2013, Epcon
Communities, Inc. filed a motion for judgment on the pleadings. On September 30, 2013, the Court
granted Epcon Communities, Inc.’s motion for judgment on the pleadings. The time to appeal this ruling
has not expired because claims against co-defendants remain pending. Prior to the filing of this action, on
September 19, 2011, ECFI had filed an Amended Complaint against Pin Oak Farms, LLC, Grant R.
Williams and James W. Williams (Epcon Communities Franchising. Inc, v. Pin Oak Farms. LLC. Grant
R. Williams and James W. Williams. Case No. 1ICVH 08 10393, in the Common Pleas Court of Franklin
County, Ohio), asserting claims of breach of contract and unjust enrichment in connection with the failure
by Pin Oak Farms, LLC to pay franchise and marketing co-operative fees owed to ECFI, pursuant to the
Franchise Agreement between the parties dated September 8, 2008, and requesting judgment in the
amount of $29,409.32, plus costs, attorney’s fees and interest. The defendants in this action failed to
answer the Amended Complaint and, on October, 28, 2011, the Court granted ECFI’s motion for a default
judgment. On August 14, 2012, the defendants filed a Motion for Relief from Judgment. On February
12, 2013, the defendants’ motion was denied by the Court. The judgment has been satisfied and the matter
is concluded.

Except for the matters described above, no litigation is required to be disclosed in this Item.

ITEM 4. BANKRUPTCY

No bankruptcy information is required to be disclosed in this Item.

ITEM 5. INITIAL FEES

To acquire an Epcon Communities franchise, must pay us an initial franchise fee (the “Initial
Franchise Fee”) in the amount of Fifty Thousand Dollars ($50,000), which is due and payable to us when
the Franchise Agreement is signed by you and us and is non-refundable.

If you, as an individual, or 50% or more of the owners of your corporation, partnership, limited
liability company, or other entity enter into another Franchise Agreement for the development of an
additional project, the Initial Franchise Fee will be Two Thousand Five Hundred Dollars ($2,500),
provided that you have a project under development under your existing Franchise Agreement.

Sometimes there are changes to the ownership of a franchisee business entity after the Franchise
Agreement is signed. Pursuant to our current policies:

a. if a current franchisee or franchisees form a business entity to own a project, and the business
entity is owned by at least 80% of the owners of the current franchisee or franchisees and
 ECFI consents to the additional owners, ECFI will waive the requirement of the payment of
the Initial Franchise Fee;

b. in the event the owner of 50% or more of a current franchisee business entity decides to
purchase a separate franchise, the owner will receive a 20% discount off of the payment of
the Initial Franchise Fee required of new franchisees; or

c. in the event more than 20% of the original ownership of your business entity is transferred to
a third party, and ECFI consents to the transfer, your franchisee business entity will be
required to make an additional payment in the amount of the Initial Franchise Fee.

ITEM 6. OTHER FEES

Type of Fee Amount Due Date Remarks

Minimum Monthly $2,000 per month, but is $0 if Due on or before See Note 1.
Royalty you closed on the sale of a the 15* of each
Unit in the preceding month. month.
$5,000 per month if you
violate the terms of your
Franchise Agreement
regarding transfer.

Project Royalty Fee 1.50% multiplied by the total See Note 2. See Note 2.
anticipated “as-built”
completion value of the Units
in a project; 2.00% multiplied
by the gross sales price of a Due at time of See Note 2.
Payment of Project
Unit for the first 6 Units closed closing of a Unit.
Royalty Fee
in a calendar year; 1.75% of
the gross sales price of each
Unit for the 7th through 12th
Unit closed in a calendar year;
1.50% of the gross sales price
of each Unit for the 13*
through 24* Unit closed in a
calendar year; 1.25% of the
gross sales price of each Unit
for the 25* through 50* Unit
closed in a calendar year; and,
1.00% of the gross sales price
of each Unit for the 5 U‘Unit
and each subsequent Unit
closed in a calendar year.

Marketing Program You must pay Epcon Monthly, by the See Notes.
Fee Marketing a Marketing 15th day of each
Program Fee of $500 per month.
 Type of Fee Amount Due Date Remarks
month for each project. As of
the date of this disclosure
document, the Marketing
Program Fee is discounted
based on the number of
projects that a franchisee
concurrently has under
construction and/or for which
the franchisee is actively
marketing for sale Units in a
project.

Termination Fee If you have not commenced Due with notice of Amount is payable to us
construction within thirty-six termination.
(36) months after signing your
Franchise Agreement, you
may terminate your Franchise
Agreement for a fee of
$25,000.

Mortgage and You are required to reimburse Upon closing of Amounts are payable to us.
Security us for all costs, expenses and your financing with
Agreement fees (including, without your lender or
Recording and limitation, legal fees, and within 15 days of
Administrative Fee filing and recording fees) invoicing.
incurred in obtaining, filing
and recording the mortgage,
security agreement or other
security. We estimate these
costs, expenses and fees will
range from $200 to $1,000.

Market Hold Fee $5,000 for each reservation or Upon your signing See Note 4.
“hold” on one “market area”, of the Market Hold
for a period of six months Agreement. The
from the effective date of the payment for the
Market Hold Agreement, and extension is due
$5,000 for each extension of a before expiration of
Market Hold Agreement for the then current six
six months each (the “Market month term.
Hold Fee”). The fees are non-
refundable

Market Reservation $10,000 deposit, which is Due no later than at See Note 5.
Deposit refundable under certain the signing of the
circumstances. Market Reservation
Agreement.
 Type of Fee Amount Due Date Remarks

National As of the date of this Payable by date of You, an owner of the

Conference disclosure document the conference franchisee business entity or
registration fee is $625 per an approved representative of
attendee. your franchise business is
required to attend this
conference. In addition, you
are responsible for the
attendee’s transportation and
room and board expenses.

Training Fee Will vary under the Immediately upon The fees for any required or
circumstance. We estimate billing. voluntary training will vary
these fees will range from depending on the subject
$1,500 to $2,500. matter of the training and the
use of outside trainers and
speakers. In addition, you are
responsible for each
attendee’s transportation and
room and board expenses.
See Item 11 for details
regarding training.

Additional $200 per hour for consulting Immediately upon We provide at no additional
Consulting services requested by you in billing. charge to you a reasonable
Services Fee excess of those considered amount of consulting services
reasonable by us for a on each project. These
particular project. The fees are services are provided to you
non-refundable. at our business offices, by
telephone, by our Intranet, or
at your place of business.
Rebate Program Amount varies. As of the date Payments due as We have the right to require
of this disclosure document, directed by us. you to participate in a rebate
the most recent fees paid by a program with certain of our
franchisee for participation in approved or designated
the rebate program was an suppliers under which you
administrative fee of 7.5% of receive a rebate from certain
the rebate amounts and an purchases from these
accounting fee of 2.5% of the suppliers. As of the date of
rebate amounts (both amounts this disclosure document, the
are paid to us for our supplier remits your rebate
administration of the rebate amount to us, and we in turn
program). remit the rebate amount to
you, less an administrative
and accounting fee that we
charge to you for our
administration of the rebate
program.
 Type of Fee Amount Due Date Remarks

GuildQuality, Inc. Currently the monthly fee of Due monthly after Amounts are payable to
Membership $30 and a per survey fee of the signing of the GuildQuality, Inc. or other
$125 for any surveys in excess Franchise third parties that we
of three surveys per month. Agreement and designate.
before a Unit is
See Note 6.
closed.

Securities Offering Amount varies. We estimate Immediately upon If you desire to make a public
Review Fee this fee will range from $0 to billing. securities offering of your
$1,000. stock, you must pay us an
amount equal to our expenses
to review and comment on
the proposed offering
documents.

Late Payment Fee Lesser of interest at 18% When payment is

annual rate or maximum rate overdue.
permissible under state law,
for the period beginning on the
day payment is due through
the date payment in full is
made to us, as well as our
costs of collection, including
reasonable attorney’s fees.

Liquidated The greater of (i) the estimated Immediately upon Amounts are payable to us.
Damages For value of the project multiplied occurrence of the This amount is chargeable for
Breach of Articles by 3.0% or (ii) the actual breach. each project developed in
10.3 and 14.3 of completion value of the project breach of Articles 10.3 and
Franchise multiplied by 3.0%. 14.3 of the Franchise
Agreement Agreement.

Litigation Expenses Amounts vary. Immediately upon If we are the prevailing party
to Prevailing Party billing. in a legal dispute with you
in Dispute under the Franchise
Agreement, we are entitled to
receive the total amount of
our litigation expenses,
including attorney’s and
accountant’s fees.
 Type of Fee Amount Due Date Remarks

Indemnification of Amounts vary. Immediately upon You must reimburse us for all
ECFI for Expenses billing. our losses, expenses and
of Claims Against damages, incurred in
You connection with your
ownership of the franchised
business and your use of the
Epcon Communities
Development System.

Except as provided in the following notes, the fees and payments listed above are uniformly
imposed and collected by ECFI. Except for certain circumstances concerning the Market Reservation
Deposit, these fees and payments are nonrefundable.

Note 1: Minimum Monthly Royalty: You must pay us a minimum monthly royalty (the “Minimum
Monthly Royalty”), which is due each month during which your project is under development. A project
is defined as being under development during the period that begins on the date that you are required to
pay the Minimum Monthly Royalty and continues until the date your project is completed (as described in
the Franchise Agreement) or your Market Area Agreement for your project has been terminated by us,
whichever occurs first.

Your obligation to pay the Minimum Monthly Royalty begins on the earlier of:

(i) the fifteenth (15*) day of the month for the month that is the thirty-seventh
month (37*) from the date of your Franchise Agreement, or

(ii) the fifteenth (15*) day of the month immediately following the month in which
there is the first closing of a sale of a Unit in your project.

We have the right to withdraw the Minimum Monthly Royalty from your designated bank account each
month by electronic funds transfer (“EFT”). We may require you to pay the Minimum Monthly Royalty
directly to us in a manner other than by EFT. The Minimum Monthly Royalty is due on or before the
fifteenth (15th) day of each month.

The amount of the Minimum Monthly Royalty is Two Thousand Dollars ($2,000) for any month in which
you did not close on the sale of a Unit in the preceding month.

At the end of each calendar year during the term of your Franchise Agreement, we will review the
Minimum Monthly Royalty payments and Point of Closing Royalty Payments made by you in that
calendar year. If you have paid us more than Twenty-Four Thousand Dollars ($24,000) in Point of
Closing Royalty Payments in that calendar year, provided you are not in default under your Franchise
Agreement or other agreements, we will refund to you any Minimum Monthly Royalty payments paid by
you in that calendar year.

If you violate the terms of your Franchise Agreement relating to transfer of your franchise or ownership
interest of your business entity, you will not be eligible for any refund of Minimum Monthly Royalty
payments.
Note 2: Project Royalty Fee; You must also pay us a project royalty fee (the “Project Royalty Fee”)
equal to 1.50%, multiplied by the total aggregated anticipated “as-built” retail closing price of the
completed Units in a project. You must provide us with the estimated “as-built” completion value no
later than twenty (20) days after the finalization of the site plan for your project. We may, in our sole
discretion, allow you to provide, in addition to, or in lieu of, the “as-built” estimate, an independent
appraisal prepared to obtain financing for the land acquisition and/or construction of the project. If, in our
sole opinion, the estimate or appraisal for financing is inaccurate, we have the right to establish the
anticipated “as-built” completion value of the Units.
Payments of Project Royalty Fee: You must pay to us the following payments, which will be
credited against the total amount of the Project Royalty Fee owed by you to us until the Project Royalty
Fee is paid in full or is otherwise no longer due and owing to us:
(i) Point of Closing Royalty Payments: At the closing of the sale of each Unit in a project,
you must pay to us an amount equal to the percentage determined from the Point of
Closing Royalty Percentage Table provided below (the “Applicable Percentage”)
multiplied by the gross sales price of the applicable Unit, including the sales price of both
real property and personal property, as provided in the HUD-1 Settlement Statement or
the Settlement Disclosure Form for that Unit (the “Point of Closing Royalty Payment”).
If you violate the terms of your Franchise Agreement relating to transfer of your
franchise or ownership interest we have the right to increase the percentage used to
calculate your Point of Closing Royalty Payments to 3.0%.
If, in any calendar year, you collectively close in any of your projects a certain number of Units
the percentage used to calculate your Point of Closing Royalty Payment for each applicable Unit
will be as set out in the following table:

Point of Closing Royalty Percentage

Units Closed Applicable Percentage
1-6 2.0%
7-12 1.75%
13-24 1.50%
25-50 1.25%
51 and more 1.00%

The calculation of the number of Units closed in a particular calendar year that is used to
determine the applicable Point of Closing Royalty Percentages described above will
apply only if:

(1) a project in which a Unit is closed is governed by a franchise agreement with a Point
of Closing Royalty Payment; and

(2) the franchisees under each applicable franehise agreement are identical or
substantially similar, which will be determined in ECFFs sole and absolute
discretion.
Upon our receipt of each Point of Closing Royalty Payment, we will, at your request and
expense, sign a partial mortgage release and/or partial security interest release as against
 the sold Unit. You will receive a credit against the total outstanding amount of the Project
Royalty Fee owed to us for each Point of Closing Royalty Payment that you make to us.

(ii) Volume-Based Reduction to Point of Closing Royalty Payments: At the beginning of

each calendar year, we may in our sole discretion rank all of our franchisees on the basis
of the total amount of Point of Closing Royalty Payments paid to us by franchisees over
the course of the previous three calendar years. The top fifteen percent (15%) of
franchisees in that ranking may receive for that calendar year a reduction in the Point of
Closing Royalty Percentage, provided that in the three (3) previous calendar years (i) they
have closed a total of at least 100 Units during that three year period, and (ii) they have
paid more than $500,000 in total Point of Closing Royalty Payments to us during that
three year period from all of their projects (“Qualifying Franchisees”).

Qualifying Franchisees that closed from 50 Units through 99 Units in the previous
calendar year will pay Point of Closing Royalty Payments on the first twelve (12) Units
closed in the current calendar year using 1.50 as the Applicable Percentage.

Qualifying Franchisees that closed 100 or more Units in the previous calendar year will
pay Point of Closing Royalty Payments on the first twenty-four (24) Units closed in the
current calendar year using 1.25 as the Applicable Percentage.

(iii) Cap on Calculation of Point of Closing Royalty Payments: When calculating the Point of
Closing Royalty Payments for a calendar year, we may, from time to time, limit the
amount of the Gross Sales Price of any Unit. (The Gross Sales Price of a Unit is the sales
price set out in the HUD-1 Settlement Statement or the sale price of the property and the
sale price of any personal property included in the sale, which is set out on the Closing
Settlement Disclosure Form.)

(iv) Limit on Annual Total Point of Closing Royalty Payments: We may, in our sole
discretion, from time-to-time, limit the total amount of Point of Closing Royalty
Payments made by you in a calendar year.
If you violate the terms of your Franchise Agreement relating to transfer of your fi-anchise or
ownership interest in your business entity, you will not be eligible for the Minimum Monthly Royalty
refund, the volume based reduction to Point of Closing Royalty Payments, the cap on the calculation of
Point of Closing Royalty Payments or the limit on the amount of the total Point of Closing Royalty
Payments made by you in a year.
In the event that all of the Project Royalty Fee has not been paid by you before the expiration or
termination of the expiration of the Market Area Agreement, at our election and sole discretion, the
remaining balance of the Project Royalty Fee will become immediately due and payable to us by the end
of that time period. We will be paid a total Project Royalty Fee equal, at a minimum, to the estimated
Project Royalty Fee for each of your projects, regardless of the actual sales prices of Units or status of the
construction of a project.
You must continue making Point of Closing Royalty Payments to us, in excess of the estimated
Project Royalty Fee (even after the balance of the estimated Project Royalty Fee has been paid to us) until
the last Unit in each of your projects is sold. We will retain any Point of Closing Royalty Payments to the
extent that the payments exceed the estimated Project Royalty Fee for a particular project.
Note 3: Marketing Program Fee: You must pay to us, or to Epcon Marketing or another entity
designated by us that has been formed for the purpose of operating a franchise system level marketing
program, a marketing program fee (“Marketing Program Fee”) in the amount of $500 per month for each
of your projects. We currently discount the amount of the Marketing Program Fee that a franchisee pays
based on the number of projects that the franchisee concurrently has under construction and/or for which
the franchisee is actively marketing Units in a project for sale. As of the date of this disclosure document,
a franchisee with multiple projects will pay Marketing Program Fees per month in the following amounts:

Projects Under Development Monthly Marketing Program Fee

During the Month Applicable to Projects For That Month

First and Second Project $500 each Project

Third through Fifth Project $400 each Project
Sixth Project and Each $300 each Project
Additional Project

We reserve the right to discontinue this discount of the Marketing Program Fee at any time and in
our sole discretion. (When estimating the amount for the Marketing Program Fee applicable to a
franchisee’s initial project, it was assumed that the franchisee would have only one Epcon Communities
project).

The first Marketing Program Fee payment is due on the earlier of:

(i) the fifteenth day (15*) of the month for the month that is the thirty-seventh
month from the date of your Franchise Agreement, or

(ii) the fifteenth day (15*) of the month immediately following the month in which
you request to include your Epcon community on the Epcon Communities web
site, and continues on the same day each following month until the last Unit in
the project is sold.

See Items 7 and 11 of this disclosure document for more information regarding the Marketing
Program Fee. We have the right to withdraw the Marketing Program Fee, and other fees payable to us,
from your designated bank account each month by EFT.

We modified the Franchise Agreement in March, 2005 to require all new franchisees to pay a
Marketing Program Fee after a franchise system level advertising program is commenced. Some
franchisees who signed an earlier version of the Franchise Agreement pay $300 per Unit. Some other
franchisees who signed earlier versions of the Franchise Agreement were generally not required to pay a
Marketing Program Fee; however, we required those franchisees to sign an addendum to their Franchise
Agreements mandating their payment to Epcon Marketing of the Marketing Program Fee before they
were permitted to sign additional Market Area Agreements with us.

17
Note 4: Market Hold Fee: If you are a franchisee in good standing and request in writing to us a
reservation or “hold” on a new market area or areas (as defined in Item 12), and we approve that request,
you must sign a Market Hold Agreement (see Exhibit F to this disclosure document) and pay us a market
hold fee for each market area that you reserve. You may extend the reservation or hold, if we agree by
paying us an additional $5,000. If you enter into a Franchise Agreement and Market Area Agreement
with us for the reserved market area prior to expiration of any Market Hold Agreement term, the Market
Hold Fee for that term will be applied toward payment of the applicable fees for the project, up to $5,000.

Note 5: Market Reservation Deposit: If you have not signed a Franchise Agreement with us (and are
not an existing franchisee), but wish to reserve a market area until you decide whether to pursue
becoming a franchisee, we may agree to permit you to reserve a market area for up to six months by
payment to us of a “Market Reservation Deposif’ in the amount of $10,000 and by signing a Market
Reservation Agreement with us (see Exhibit H to this disclosure document). If you sign a Franchise
Agreement and Market Area Agreement before the end of the term of the Market Reservation Agreement,
the Market Reservation Deposit will be applied to the Initial Franchise Fee due under the Franchise
Agreement. You may at any time during the term of the Market Reservation Agreement request in writing
a refund of the Market Reservation Deposit and termination of the Market Reservation Agreement, and
we will return the Market Reservation Deposit to you within 15 business days of receipt of your notice
and the signing of a Mutual Release of Market Reservation Agreement by you and us (a form of Mutual
Release is included in Exhibit H to this disclosure document).

We may, at any time during the term of the Market Reservation Agreement notify you that you
have 21 calendar days to enter into a Franchise Agreement and Market Area Agreement with us for the
Market Area described in the Market Reservation Agreement, and pay us the applicable fee provided by
the Franchise Agreement. If you fail to enter a Franchise Agreement and Market Area Agreement with
us, we will return the Market Reservation Deposit to you within 15 business days after the expiration of
the notice period and the signing of a Mutual Release of Market Reservation Agreement by both you and
us, and the Market Reservation Agreement will terminate.

Note 6: GuildOualitv, Inc. Membership: All new franchisees may be required by us to participate in a
homeowner’s survey program. As of the date of this disclosure document, franchisees are required to use
GuildQuality, Inc. for this service. We suggest that at a minimum franchisees obtain one survey
immediately after closing and one follow-up survey 9 months after closing.

ITEM 7. ESTIMATED INITIAL INVESTMENT

YOUR ESTIMATED INITIAL INVESTMENT

This chart assumes you are developing a project of thirty (30) Detached home Units and you are
purchasing raw land and developing the approved lots yourself. See Note I: General Notes below)

Type of Expenditure Amount Method Of When Due To Whom

Payment Payment Is To Be
Made

Land for 30 Unit Project $600,000 - As Arranged As Arranged Land Sellers and
$1,300,000 other Third Parties
(Note 1)
(Note 1)
 Type of Expenditure Amount Method Of When Due To Whom
Payment Payment Is To Be
Made

Due Diligence and Land $175,000- As Arranged As Arranged Market

Entitlement for 30 Unit $325,000 Researchers,
Project Appraisers,
(Note 2)
Governmental
(Note 2)
Entities, Attorneys
and other Third
Parties

Land Development and $1,600,000- As Arranged As Arranged Various Contractors

Site Improvements for 30 $2,200,000 and Engineers,
Unit Project Governmental
(Note 3)
Entities and Other
(Note 3)
Third Parties

Large Pavilion / $70,000 - $90,000 As Arranged As Arranged Various Contractors

Community Amenity for and Suppliers of
(Note 4)
30 Unit Project Building Materials,
Pool and Furniture
(Note 4)
Suppliers and Other
Third Parties

Vertical Construction Cost $150,000- As Arranged As Arranged Various Contractors

for One Model Home $170,000 and Suppliers of
(located on 1 lot) Building Materials
(Note 5)
(Note 5)

Vertical Construction Cost $150,000- As Arranged As Arranged Various Contractors

for First Home to be $170,000 and Suppliers of
Offered for Sale (located Building Materials
(Note 5)
on 1 lot)
(Note 5)

Up-front Sales & $110,000- As Arranged As Arranged Various

Marketing for 30 Unit $130,000 Contractors,
Project Utilities, Furniture
(Noted)
Suppliers, Media,
(Note 6)
Printers, and other
Third Parties

Sales & Marketing per $20,000 - $30,000 As arranged As Arranged Various Third
 Type of Expenditure Amount Method Of When Due To Whom
Payment Payment Is To Be
Made
Unit for 2 Units (Note 6) Parties and
Employees
(Note 6)

Direct & $60,000-$70,000 As Arranged As Arranged Various Other

Indirect/Overhead Project Parties
(Note 7)
Costs
(Note 7)

Initial Franchise Fee $50,000 Lump Sum Upon signing Payable to Us.
of Franchise
(Note 8) (Note 8)
Agreement.
(Note 8)

Mortgage and Security $200-$1,000 Lump Sum Upon closing Payable to Us.
Agreement Recording of your
(Note 9)
Fees and Administrative financing
Fee with your
lender or 15
(Note 9)
days of
invoicing.

(Note 9)

Minimum Monthly $0 N/A Monthly, by N/A

Royalty the 15* day
(Note 10)
of each
(Note 10)
month.
(Note 10)

Marketing Program Fee $2,000 Installments Monthly, by Payable to Us.

the 15* day
(Note 11) (Note 11)
of each
month.
(Note 11)

Initial Training Sessions $3,000-$4,000 Lump Sum Upon demand Various Other
Parties
(Note 12) (Note 12)
 Type of Expenditure Amount Method Of When Due To Whom
Payment Payment Is To Be
Made

National Conference $6,000-$7,000 Lump Sum Upon demand Payable to Us and

Various Other
(Note 13) (Note 13)
Parties

Additional and Start-up $10,000-$20,000 Varies Varies Architects,

Expenses engineers, market
(Note 14) (Note 14) (Note 14)
research firms,
(Note 14)
attorneys, land
sellers,
governmental
entities and various
other parties.

TOTAL $3,006,200- (Note n) (Note n) (Note n)

$4,569,000
(See Note II: Financing
Considerations below)

Note I: General Notes

The chart above assumes you purchase raw land from a third party and develop the lots for your
project yourself. It is also assumed that:

• Starting at the time the Initial Franchise Fee is paid, you will utilize the first three (3) months
to enter a contingent purchase contract for purchase of a site you have identified.
• Commencing in month four (4) and for the next eight (8) months, you will perform your due
diligence on the site, complete the zoning and entitlement process, prepare preliminary
engineering, and have the prototype plans for the Units and the community amenity adjusted
for your local building code requirements.
• Enrollment on the Epcon Communities web site occurs four (4) months prior to the sale of
the first Unit and assumes that the sale of the first Unit occurs in month twenty-four (24).
• Commencing in month twelve (12) and for the next four (4) months, you will complete and
obtain approval of the final engineering for your project.
• Commencing in month sixteen (16), you will begin land development, obtain approval to
build on the lots within your project site, submit for building permits, collect bids and award
contracts to subcontractors to build a model Unit and one Unit to be offered for sale, and
commence pre-sale activities and marketing.
• The community amenity recommended for a 30-Unit development is the large pavilion. It is
assumed that the pavilion will be constructed on common ground that is provided for in your
site plan.
 • Commencing in month twenty (20), you will construct and complete the community amenity,
the model Unit, and at least one Unit to be offered for sale and obtain certificates of
occupancy for all the buildings in your project. The time period for the construction of a slab-
on-grade Unit with no structural options is approximately one hundred ten (110) days.
• The closing of the first Unit is typically around month twenty-four (24).

This information is provided to help you determine the amount of the initial investment that is
needed to commence your Epcon Communities business. “Commence business” for purposes of this Item
7 is begins on the date that you sign your Franchise Agreement and ends on the date immediately before
your first Unit closing. The expenses shown on the Table above anticipate that you will commence work
on your project immediately upon entering into your Franchise Agreement.

Your initial investment will vary depending upon the size and the cost of your site and project. A
project as small as ten (10) Units is permitted, and some Epcon communities have over one-hundred-fifty
(150) Units. The estimates in Item 7 are for a project of thirty (30) detached Units developed by you on
raw land.

The estimated amounts included in Item 7 are based upon the range of costs incurred by Epcon
and Epcon Carolinas when developing their Epcon communities and are based on their thirty-two (32)
years of industry experience and our twenty-two (22) years of experience working with franchisees.
Some of the items that could increase your initial costs are described in the notes below.

Variation in your development and construction costs will occur from differences such as:
geographic location, differing building code requirements, energy code requirements, climatic conditions,
seismic zones, wind load requirements, snow load requirements, subsurface soil and rock conditions,
subsurface ground water, wetlands, environmental site issues, cultural resource discoveries, zoning
requirements and processes, governmental fees, land cost, local labor rates, materials and shipping
expenses, supply and demand forces, local construction customs, required off-site improvements,
financing costs, and required returns to any investors.

You should secure trade contractor and supplier agreements to more accurately determine the
costs for your project.

The initial investment period of a typical project includes the time required to: identify a site
appropriate for development for an Epcon community; enter into a purchase contract for the land;
complete the required due diligence to assure the property is suitable for your development; conduct a
market study; complete a land plan; complete engineering; complete modifications to the prototype
architectural plans; get the land entitled; purchase the property; develop the site to so that you are able to
construct the project as planned; construct any common amenities such as a clubhouse or other facilities;
construct a model Unit and a Unit to be offered for sale. It is important that you consult with an attorney
and an accountant to assure that you have an understanding of the real estate development processes,
costs and risks.

The cost estimates shown in Item 7 assume that you are developing one (1) project in a standard
market area that will have thirty (30) detached dwelling Units (homes) each of approximately 1,776
finished square footage, a slab-on-grade Portico Unit with no structural options and that your project will
have the large pavilion community amenity.
Note II: Financing Considerations

While it is possible to pay the total initial investment with your own funds, the most common
method in the home building and development industry is to fund the costs to develop and build with the
use of commercial and private financing. There are generally three common sources of a franchisee’s
capital:

• Acquisition & Development (A&D) loan from a commercial lender, which is described more
fully below;
• Revolving line of credit to fund the vertical construction costs of the Units from a commercial
lender, which is described more fully below; and
• Private equity from individuals or groups willing to invest in your project for a negotiated return,
which is described more fully below;
You may use third-party financing for your Epcon project. We do not make any financing
available to you for any of your obligations, with the exception of permitting you to pay the Project
Royalty Fee in installment payments as described in Items 5 and Item 10 of this disclosure document.

Based on our experience, in order for you to obtain financing, lenders will expect you to
contribute, via an “out-of-pockef’ contribution by you, some percentage of capital costs from your
personal assets. The table below includes estimates of these potential out-of-pocket expenditures. These
out-of-pocket expenditures were included in the calculation of the amount of your estimated total initial
investment in the table above.

Estimated Out-of-Pocket Expenditures when Using Financing to Develon Raw Land:^

Estimated Total Initial Investment in the Table Above: $3,006,200 - $4,569,000^

LESS the estimated

$61,000 -$63,000 Payable to Us and
Franchise Costs (the Initial Various Other
Franchise Fee, Minimum Parties
Monthly Royalty, Marketing
Program Fee, initial
Training Sessions, National
Conference)

PLUS: Financing costs to be $73,000 - Various lenders.

financed (A&D loan and $107,000
construction revolving line
of credit costs) (See below)

As described more fully in this Item 7, if you obtain financing for your project, your lender will likely require
you to pay for certain items on an “out-of-pocket” basis. The estimated amount of these out-of-pocket expenses
are included in this table.
To calculate the total amount of estimated out-of-pocket expenses that you may incur when obtaining financing
for your project, we began with the Estimated Total Initial Investment in the last row of the first Table in this
Item 7 (that is, $3,006,200 - $4,569,000) and then subtracted and added the expenses described in this table.
EQUALS: the estimated $3,018,000-
total project costs to be $4,692,000
financed.

LESS: 75% (loan to value $2,263,500 ■

ratio) of the costs to be $3,519,000
financed

Out-of-pocket equity $754,500 -

contribution required from $1,173,000
you to meet financing
requirements, based on an
equity contribution of
twenty-five percent (25%)

PLUS: Lranchising costs $61,000-$63,000

TOTAL estimated out-of- $815,000 -

pocket initial investment $1,236,000
when using financing to
develop your project

Construction Revolving Line of Credit: A revolving line of credit for construction and the
improved land / lot typically includes, points, loan closing costs, title insurance, appraisals, interest,
inspection by an architect or lender needed to approve the loan draw amount and fees incurred through
the draw process. Lending terms vary by institution and borrower credit profile, but commercial bariks
may fund residential construction by loaning the lesser of seventy-five percent (75%) to eighty percent
(80%) of the combined retail value of the house and the land upon which it sets or one hundred percent
(100%) of the combined cost of the house and the land upon which it sets.

Equity Contribution by the Borrower for Financing Requirements: An equity contribution by you
in relation to the A&D loan and for the construction line of credit is required by most commercial lenders,
and typically ranges from twenty percent (20%) to thirty percent (30%) of the costs incurred for most
hard and soft expenses, which typically include expenses related to securing financing and costs incurred
for land acquisition, land entitlement, land development, site improvements and the clubhouse, pavilion
and other site amenities that become part of the commonly owned parcels in the development. Out-of-
pocket expenses paid by you in connection with these categories may be counted by your lender toward
this equity contribution. Lranchise fees and other costs necessary to be paid to develop your Epcon
community are typically paid from a franchisee’s cash-on-hand. The required percentage of the equity
contribution varies by lender and may be influenced by your experience, your net worth, your credit
rating and other factors. In the illustrative example in the table in Note II above, we have calculated the
equity contribution to be twenty-five (25%) of the hard and soft expenses and a seventy-five percent
(75%) loan-to-value ratio.
 Mezzanine Financing Costs for A&D: Mezzanine financing costs for A&D typically includes the
costs that a builder pays to outside investors who provide equity for a project. These investments are
typically made to supplement the equity requirements needed for the A&D loan. Investor’s terms vary
and will be dependent upon variables similar to those that affect your cost of financing through a
commercial lender.

Note 1: RAW LAND. Land must be purchased from a third party to build-out your project. Expenses
in this category typically include the land, but may also include settlement and closing fees, title
search/binder/insurance, attorney fees, and/or any costs customarily the responsibility of the buyer in your
local market. The cost for the land and other land-related expenses vary widely based upon factors such
as location, and the availability of suitable land for your project, surrounding property values, adequacy
and proximity of utility services and proximity to commercial and other services.

Based on our experience in franchising for twenty-two years, and our affiliates, Epcon’s and
Epcon Carolinas, experience in building Epcon communities for thirty-three years, you will most likely
buy raw, unimproved and un-entitled land in the development of your project. While not typical, it is
possible that you may purchase lots or building pads that have already been zoned, entitled, developed
and for which permits have been obtained to allow you to commence construction of your project.
Because the typical purchase of land for a project is that of raw land, the information provided in the
tables and notes in Item 7 assumed that you will purchase raw land for your project. If you purchase
already improved lots or buildings pads, some of the estimated expenses in Item 7 may vary from those
presented in the tables and notes in Item 7. It is your responsibility to determine if, and by how much the
costs for the project that you are considering will vary from the costs estimated in Item 7.

When purchasing raw land, you become responsible for the due diligence, entitlement, zoning,
permitting, the horizontal construction (land development, streets, and underground utilities) and the site
improvements that will benefit the proposed community being constructed.

It is generally expected that density can run from 2.5 to 4.0 Units per acre or perhaps up to 5.0
Units per acre in developments where storm water retainage is managed off-site and set-back
requirements and building separation requirements are minimal.

Note 2: DUE DTT JCENCE AND LAND ENTITLEMENT. Due diligence and land entitlement are
critical processes in the land acquisition process to assure that the property you are considering
purchasing can be developed in the manner and at the cost that you estimate.

The expenses in this category typically include, investigations and confirmations of fees,
permitting, and processes required by various governmental entities, title examination, ALTA survey,
boundary survey and staking, market study, geotechnical borings and testing for soil suitability, traffic
study, wetlands and stream crossing analysis, wildlife preservation, cultural resource analysis,
environmental testing and analysis, zoning, land planning, preliminary engineering, tree survey,
architectural work to prepare the prototype plans for zoning approval and local building permits, required
off-site improvements, and attorney fees for zoning and other consultation. The necessity to obtain off­
site easements, to extend utilities to your site, and the requirement to make off-site improvements such as
turn lanes, road widenings, installation of traffic signals or other off-site work should be investigated
during this phase of your work.

The costs and the types of governmental fees and permits can vary a great deal from locale to
locale and you should familiarize yourself with the costs in your area.

Depending upon the findings of the due diligence, additional studies and expenses may be incurred.
Note 3: LAND DEVELOPMENT AND SITE IMPROVEMENTS. Land development expenses
encompass all horizontal construction costs that are required to bring entitled raw land to a point to where
Units and other amenities are permitted to be constructed. These costs typically include conceptual site
plans, all materials, labor, hard and soft costs, fees, permits, plan reviews, inspections, testing, bonds,
letters of credit, site plans, erosion and stormwater control measures, demolition of existing structures,
temporary access to the site, clearing, mass excavation, retaining walls, temporary and permanent utility
services, streets, roadways, sub-base and base, curbs and underdrains, street lighting and signage, fencing,
and any other facilities or work that is required to complete the land development. Any necessary off-site
improvements that may be required to accommodate the on-site improvements are also considered a cost
of land development.

Site improvement expenses are those related to all commonly owned land and amenities that are
intended to benefit the entire community, and not just a single Unit owner. These expenses typically
include items such as required permits, fees, entry feature(s), landscaping and earth mounding of common
areas, landscape and hardscape, signage, common area fixtures and community mail kiosks.

Note 4: COMMUNITY AMENITY. Expenses related to a community amenity generally include

expenses for a pavilion, clubhouse or other common area facilities that are to be used and enjoyed by the
all of the residents of your Epcon community, including: the final architectural working drawing required
to construct the building; permitting; inspections; vertical construction; furnishings and associated interior
design fees; fire extinguishers; fitness/exercise equipment; television(s); appliances; site landscaping and
irrigation; parking lot; public sidewalks; service sidewalks; swimming pool or lap pool; swimming pool
permit and inspections; pool deck; and all pool equipment and any other recreational facility constructed
within the community.

We provide prototype architectural plans for various community amenities that can be offered by
you depending upon the number of dwelling Units in your community. The following table shows the
amenity recommended for various size communities.

Number of Community Units Amenity Square Footage

Less than 30 Small - Square Pavilion 484
26 to 40 Large - Rectangle Pavilion 770
41 to 60 Small Clubhouse 1,500
61 to 100 Medium Clubhouse 2,731
Over 100 Large Clubhouse 3,706

Generally speaking, the costs for Epcon prototype amenities can range from approximately
$65,000 for the Small Pavilion to $600,000 for the Large Clubhouse. These costs do include the cost of a
swimming pool for the Large Clubhouse nor do they include land value.

Note 5: VERTICAL CONSTRUCTION COST. The vertical construction cost of a Unit includes all
costs associated with the construction of an “average,” slab-on-grade which has a finished floor area of
approximately 1,776 square feet with interior upgrades but no major structural options. The general range
for vertical construction cost per square foot is approximately $75.00 per sf. for a base Unit to over
$90.00 per sf. for a Unit with many structural options.
 Vertical construction costs typically include all hard costs, labor, and material expenses required
to construct a Unit, typically including the following: footers and foundations; building frame and
enclosure; utility and mechanical rough-ins; drywall, interior trim and mechanical fixtures; and
landscaping and turf

Additional soft costs such as the cost for the vertical line of credit are included since there may be
initial investment expenses that you must include.

Note 6: MARKETING & SALES FOR PROJECT. Marketing and sales expenses that are allocated
over the entire 30 Unit project typically include expenses such as a temporary sales office trailer and
associated permits, parking lot, landscaping, temporary utility service extensions, furnishings, operating
expenses, placement/removal of temporary items; presentation gallery signage, equipment and furnishings
in the clubhouse (or in the model Unit garage, if applicable), construction expenses to prepare and convert
the garage to/from a sales office, model home furnishings and accessories, interior design fees, costs to
dismantle the sales office in the clubhouse or garage, model Unit operating expenses including taxes,
utilities, cleaning, building maintenance, and landscaping maintenance, pre-selling campaign expenses
and general project marketing and promotions such as brochures. Expenses for marketing can vary due to
the length of time the project will take to build, commission arrangements with in-house sales staff and
outside brokers, the costs for media advertising, the number of sales brochures used and costs to operate
the sales center. You must include project web pages for each of your communities on the Epcon
Communities web site, as discussed in more detail in Items 6 and 11 of this disclosure document.

Note 7: DIRECT & INDIRECT/OVERHEAD PROJECT COSTS. Direct and indirect/overhead

project costs typically include expenses such as, final site engineering and approvals, permits, final
architectural working drawings derived from prototype plans, attorney fees, salaries of job-site
superintendent or a construction manager and direct labor.

Direct and indirect/overhead project costs also include the creation of the homeowner or
condominium association, creation of condominium documents including: the required services of
architects and engineers; employment of a property manager; general administrative project costs such as
the cost of your computer hardware and software, including the optional software BuildTopia and Lasso
CRM; insurance; accounting services; real estate taxes; and any required funding of the association at
start-up or during the development of your project. Additional expenses will be incurred for contributions
made to the condominium association for fees, dues and expenses for the Units unsold after the
condominium association is formed.

Direct and indirect/overhead project costs further include a general contingency amount, which
varies for each project and is used to cover costs in a project which may not be expected. In developing
company-owned projects, Epcon and Epcon Carolinas use an amount equal to approximately four percent
(4%) of the total costs of the project for its general contingency amount and an inflation rate of five
percent (5%) per year for multi-year projects that do not have trade partner price guarantees that cover the
entire development period.

Note 8: INITIAL FRANCHISE FEE. The Initial Franchise Fee is $50,000. This fee is due in full at the
time you and we sign your Franchise Agreement. See Item 5 of this disclosure document for information
on the Initial Franchise Fee.

Note 9: MORTGAGE AND SECURITY AGREEMENT RECORDING FEE AND

ADMINISTRATIVE FEE. Mortgage and security agreement recording fees and administrative fees are
usually in nominal amounts. Recording fees vary state to state and county to county, and will necessarily

27
depend upon the fees of the governmental entity where your project is located, See Item 6 of this
disclosure document for information on these fees.

Note 10: MINIMUM MONTHLY ROYALTY. The estimated amount of Minimum Monthly Royalty
payments by you to us assumes that the closing of the sale of your first Unit occurs in the twenty-fourth
(24*) month after you sign your Franchise Agreement. Because of this, no Minimum Monthly Royalty
payments would be owed by you to us during this time period. See Item 5 of this disclosure document for
information on the Minimum Monthly Royalty.

Note 11: MARKETING PROGRAM FEE. The Marketing Program Fee is payable to us or Epcon
Marketing in the amount of $500 per month for each of your projects beginning on the earlier of the
thirty-seventh (37*) month after you sign your Franchise Agreement or the month after your project is
first included on the Epcon Communities web site. It is assumed that your enrollment on the Epcon
Communities web site occurs four (4) months prior to the sale of your first Unit and that the closing of the
sale of the first Unit occurs in the twenty-fourth (24*) month after you sign your Franchise Agreement.
For purposes of Item 7, we assumed that you have only one project, and as such, you are not eligible for
the Marketing Program Fee discount described in Item 6 of this disclosure document. See Item 5 of this
disclosure document for information on the Marketing Program Fee.

Note 12: INITIAL TRAINING SESSIONS. This estimated fee refers to programs and sessions offered
by us to new franchisees and their sales associates and construction personnel to help them become
familiar with the Epcon Communities Development System, the types of services typieally provided by
us, and the responsibilities and expectations associated with becoming a franchisee and a member of a
franchisee’s sales and construction staff At least one owner of the franchise business must attend these
sessions, and it is highly recommended that a franchisee’s sales associates and construction personnel
attend the sessions. Some of the required initial training sessions are for franchisee business entity
owners only. These sessions usually lasts two full days. Sales training sessions may be completed online
through our learning modules. Construetion training sessions generally last two days. Franehisee and
construction training sessions are held at our corporate offices in Dublin, Ohio. As of the date of this
disclosure document, there is no fee for any of the training sessions, however you are responsible for
transportation, lodging, and some meals of each attendee. We assume two owners will attend franchisee
training sessions; two owners and one sales person will attend sales training sessions and two owners and
one construction person will attend construction training sessions. The estimated costs above are per
person and include estimated costs of transportation, lodging and food. See Item 11 of this disclosure
document for information on initial training and sales and construction training programs.

Note 13: NATIONAL CONFERENCE. The national conference is typically offered by us during the
first quarter of each year. At least one other owner of the franchise business, must attend the national
conference and it is highly encouraged that your entire staff attend the conference. It is assumed that two
owners, one sales professional, one construction person and one other staff member will attend a two-and-
a-half day conference. The estimated costs above are per person and include the cost of the registration
fee, transportation, lodging and food for five attendees.

Note 14: ADDITIONAL AM) START I P EXPENSES. These figures are estimates of additional and
start-up expenses such as organization costs, entity formation costs and costs for the search for property
upon which to build. This is an estimate only of the range of initial start-up expenses that you may incur
before having zoning and financing for your project approved. Should you not be able to procure
financing or zoning, you may not be able to carry these expenses to another project. It is impossible to
project exact expenses for your specifie area or project, as these expenses are related to a range of factors
which vary from project to project. For example, zoning on one parcel of land may require only a staff
review and less than 3 months, while another parcel may require a year or longer to be properly zoned.
Financing may be obtained easily or may be very difficult. Your credit rating, your job history and other
items may affect how long your financing process may take. The actual amount of additional funds that
you will need depends on a variety of factors, including the time of year when you start your project, your
own management skill, economic conditions, and competition in your area and other factors. The
estimate of additional funds is based on our experience in firanchisrng for twenty-two (22) years, and our
affiliates, Epcon and Epcon Carolinas’, experience in building Epcon Communities for thirty-three (33)
years. The estimate does not include any allowance for an owner’s distribution. These figures are
estimates and we cannot guarantee that you will not have additional expenses starting your business.

General Notes Concernine Item 7: We selected the method used in disclosing the total initial
investment to you because it is the most meaningful presentation and because it conforms to the typical
presentation of cost information within the real estate development industry.

Payments made to us or Epcon Marketing are not refundable. Generally, payments made to parties other
than us or Epcon Marketing are not refundable.

ITEM 8. RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES

We issue to you specifications for approximately 75% of the items and services that you will need
to develop and market your Epcon Communities project.

From time to time, we may issue specifications and standards for goods and services to our
franchisees and/or approved suppliers. If and when we do this, these specifications and standards will be
issued in vsriting and will be provided to our franchisees and approved suppliers by regular mail and/or
email communication. Specifications include standards for quality, performance, durability, safety,
appearance, material composition and other characteristics incident to maintaining the Epcon
Communities Development System.

Items Which Must Be Purchased From a Designated Supplier

and Items Which Must Meet Our Specifications

Home Survey Services

GuildQuality, Inc. is the sole designated supplier of home survey services. The survey is of all
homebuyers and is performed shortly after closing, and then again in a few months after closing. The
survey scores indicate the buyer’s perception of you, your sales staff, your construction staff, the quality
of the Unit, and the perceived value of the Unit, the amenities, and the condominium association. The
most critical question on the survey helps determine if the buyer would recommend the builder to others.
You will receive a copy of the reports, which are intended to communicate to you areas in need of
improvement by you.

Civil Engineer or Land Planner

You must enlist the services of a civil engineer or land planner of your choosing to prepare a
conceptual site plan and to complete your project. The conceptual site plan layout must include building
setbacks and local storm water retention requirements and will be based upon a site-utilization analysis
and density study. The conceptual site plan will not be required to include utility plans, grading plans, or
preliminary or final engineering. We estimate that the conceptual site plan will cost approximately $2,200
to $2,500 for a 12 to 25 acre site.
 Other than purchases from the designated suppliers discussed above, you are not required to
purchase any items or services from suppliers designated or approved by us.

Insurance

You must obtain and maintain, at your own expense, the insurance coverage that ECFI requires,
and you must meet the other insurance-related obligations set forth in the Franchise Agreement. The
Franchise Agreement requires you to maintain builder’s risk and general liability insurance in an amount
not less than $1,000,000 per occurrence and in an amount of not less than $2,000,000 per project annual
aggregate covering more than one person, and with a deductible or self-insured retention on the policy of
not greater than $1,000, or other amounts of coverage and self-insurance as ECFI may periodically
specify, insuring you against any liability that may accrue by reason of your development of Epcon
Communities projects. This policy must include coverage for liability arising from premises-operations,
independent contractors and products-completed operations. The policy may not contain any restrictive
endorsements or policy language which excludes coverage for residential work performed by
subcontractors on your behalf or liability assumed under construction contracts.

The policy must name you and all project entities as named insureds and Epcon Communities
Franchising, Inc. as an additional insured, using ISO Additional Insured Endorsement CG2029 (11-85) or
its equivalent which provides premises and completed operations coverage. You must also carry workers
compensation insurance including an employer’s liability limit of $500,000, and commercial auto liability
(primaiy) providing limits of at least $1,000,000 each occurrence, combined single limits. The cost of
this coverage will vary depending on the insurance carriers, the terms of payment and your history. All
insurance policies must contain a separate endorsement naming ECFI as an additional insured. All
insurance must be placed with an insurance carrier or carriers with an A.M. Best’s rating of “A-” and an
A.M. Best’s Class rating of “xiv” (or better), duly licensed in the state in which the Project is located, or
be approved in writing by us. Your obligation to obtain and maintain the specified insurance coverages
will not be limited in any way by insurance we maintain, nor will it relieve you of liability under any
indemnity provisions of the Franchise Agreement. All public liability policies may be required by us to
contain a provision that allows us to recover under the policy even in the event of your negligence.

OualitvMark™

You are required to fully participate in the QualityMark™ inspection program, or any successor
program instituted by us. QualityMark™ is a trademarked inspection program offered on all Epcon
Communities Units. Under this inspection program, an inspector will perform a meticulous inspection of
each of your Epcon Units within your Epcon Community. This inspection occurs before an Epcon Unit
buyer participates in the Epcon Communities Unit buyer orientation program. The inspection is designed
to determine any defects or deficiencies in the workmanship or features of the Unit. Following the
inspection, all of the trade partners, whose work has been noted as sub-standard on the inspection report,
correct any deficiencies or problems with their work before the Epcon Unit buyer sees the finished Unit.

You must employ or contract for an inspector to provide the inspections required by the
QualityMark™ inspection program. The QualityMark™ inspector must be a person other than the
construction superintendent or anyone who has been involved in the day-to-day construction of the
specific Epcon Community at which the inspection will occur.

Rebate Program

We have the right to require you to participate in a rebate program with certain of our approved or
designated suppliers under which you receive a rebate from certain purchases from these suppliers. As of
the date of this disclosure document, the supplier remits your rebate amount to us, and we in turn remit
the rebate amount to you, less an administrative and accounting fee that we charge to you for our
administration of the rebate program. In 2018, we received $32,503 as administrative and accounting fees
from the rebate amounts.

Purchase Arrangements and Special Pricing

Occasionally, we may negotiate purchase arrangements and special pricing with particular
suppliers for the benefit of the entire Epcon Communities Development System using the potential
combined purchasing power of all of the franchisees and Epcon. For example, we periodically arrange
for printing of sales brochures on a group basis to lower the per item cost. Other examples of products
and services for which the suppliers have granted special prices for groups of Epcon Communities
Development System purchasers are advertising services, appliances, cabinets, floor coverings, faucets,
miscellaneous home improvement products, heating, ventilating and air conditioning systems, lumber,
paint, porches, project site analysis services, frames and windows. You are not required to participate in
group purchases. We do not receive a payment for these purchases or receive products at a lower price
than franchisees pay. We have not established and do not participate in any purchasing or distribution
cooperatives.

We do not receive any compensation or rebates from any designated or approved suppliers. In
certain cases, we do receive payments from suppliers for sponsorship of conventions, meetings and
seminars attended by you. During 2018, we received $137,925 in sponsorship amounts.

We do not provide any material benefits to you based upon your use of designated or approved
sources or suppliers.

Neither ECFI, nor any officers of ECFI own an interest in any supplier listed in Item 8.

We estimate that a franchisee’s required purchases from designated suppliers, approved suppliers
or suppliers whose products must meet our specifications will constitute 43% to 58% of the franchisee’s
cost to establish its franchised business and 12% to 15% of a franchisee’s total operating expenses each
year after, assuming a 30 Unit Project constructed on a developed lot.

We estimate that a franchisee’s required purchases from designated suppliers, approved suppliers
or suppliers whose products must meet our specifications will constitute 57% to 64% of the franchisee’s
cost to establish its franchised business, and 81% to 83% of a franchisee’s total operating expenses
thereafter assuming a 30 Unit Project constructed on raw land.

ECFI had no revenues during 2018 from the required purchase of products, other items and
services by its franchisees. As previously noted in this Item 8, ECFI did receive rebate amounts from
certain suppliers from whom franchisees made purchases, but those rebate amounts, less an administrative
and accounting fee retained by ECFI, were passed through to franchisees by ECFI. In addition ECFI did
receive from franchisees $49,969 for training seminars and its national conference. As noted above in
this Item 8, ECFI does not require you to purchase items from it. ECFI had total revenues of $4,419,612
during its 2018 fiscal year, none of which came from required purchases by franchisees. No affiliates of
franchisor sell or lease products to franchisees.

31
ITEM 9. FRANCfflSEE’S OBLIGATIONS

FRANCfflSEE’S OBLIGATIONS

This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Franchise Agreement and Addendum to Franchise Agreement

Article(s)/Section(s) in
Obligation Disclosure Document Item
Franchise Agreement
a. Site selection and acquisi­ Sections 3.4 and 3.5 Items 7, 11 and 12
tion/lease
b. Pre-opening purchases/leases Article 5 Items 5, 6, 7, 8 and 11
c. Site development and other pre­ Sections 11.3, 5.20 Items 7, 11 and 12
opening requirements
d. Initial and on-going training Section 5.12, 5.13 andl5.2 Items 6, 7, 11 and 15
e. Opening Not Applicable Item 11
f. Fees Sections 3.1, 5.1, 5.2, 5.3, Items 5, 6, 7, 10 and 11
5.4, 7.4, 7.5, 8, 11.2, 12.3,
12.9 and 13.5
g- , Compliance with standards and Sections 4.3 and 8.1 and Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual Article 9
h. Trademarks and proprietary Section 5.9 and Articles 6 Items 13 and 14
information and 10
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Section 11.3 Item 12
sales quotas
1. Ongoing product/service Sections 7.4 and 7.5 Items 6, 8 and 16
purchases
m. Maintenance, appearance and Section 9.2 Item 17
remodeling requirements
n. Insurance Section 16.2, 16.3, 16.4 and Items 6, 7 and 8
16.5
0. Advertising Sections 6.7 and 6.9 and Items 7, 8 and 11
Article 7
P- Indemnification Section 16.1 Item 6
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffing
r. Records and reports Sections 5.3, 5.15, 5.17 and Not Applicable
11.2.3
s. Inspections and audits Section 5.3 Not Applicable
t. Transfer Article 12 Items 6 and 17
u. Renewal Section 11.4 Items 1 and 17
V. Post-termination obligations Sections 10.3, 11.2, 13.5, Item 17
13.6 and 13.7
 Article(s)/Section(s) in
Obligation Disclosure Document Item
Franchise Agreement
w. Non-competition covenants Sections 10.6 and 13.7 Item 17
X. Dispute resolution Sections 10.6 and 13.7 Item 17
y- Other: Compliance with Sections 5.19, 5.20 and 9.2 Item 1
statutory obligations
z. Other: Attendance at all armual Section 5.13 Item 11
conventions or meetings of
Epcon Communities
franchisees
aa. Other: Modification of Sections 5.19, 5.20 and 9.2 Item 1
development system and
architectural plans to comply
with building code, permit
requirements and other laws
bb. Other: Participation in home Sections 5.14 and 5.15 Items 6 and 8
survey service and rebate
program
cc. Other: Participate in Section 5.17 Items 6 and 8
QualityMark program

This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Market Area Agreement and Initial Market Area Agreement

Article(s)/Section(s) in
Market Area Agreement
Obligation Disclosure Document Item
and Initial Market Area
Agreement
a. Site selection and Sections 2, 3, 4, and 6 of Items 7, 11 and 12
acquisition/lease Market Area Agreement;
Sections 2, 3, and 4 of Initial
Market Area Agreement
b. Pre-opening purchases/leases Not Applicable Items 5, 6, 7 and 11
c. Site development and other pre­ Not Applicable Items 7, 11 and 12
opening requirements
d. Initial and on-going training Not Applicable Items 6, 7, 11 and 15
e. Opening Not Applicable Item 11
f. Fees Section 5 of Market Area Items 5, 6, 7, 10 and 11
Agreement; Section 5 of
Initial Market Area
Agreement
g- Compliance with standards and Sections 3 and 8 of Market Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual Area Agreement; Sections 3
and 7 of Initial Market Area
Agreement
 Article(s)/Section(s) in
Market Area Agreement
Obligation Disclosure Document Item
and Initial Market Area
Agreement
h. Trademarks and proprietary Section 8 of Market Area Items 13 and 14
information Agreement; Section 7 of
Initial Market Area
Agreement
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Sections 2, 3, 4, 6 and 7 of Item 12
sales quotas Market Area Agreement;
Sections 2, 3, 4 and 6 of
Initial Market Area
Agreement
1. Ongoing product/service Not Applicable Items 6, 8 and 16
purchases
m. Maintenance, appearance and Not Applicable Item 17
remodeling requirements
n. Insurance Not Applicable Items 6, 7 and 8
0. Advertising Not Applicable Items 7, 8 and 11
P- Indemnification Not Applicable Item 6
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffing
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Not Applicable Items 6 and 17
u. Renewal Section 8 and Section 9 Items 1 and 17
V. Post-termination obligations Not Applicable Item 17
w. Non-competition covenants Not Applicable Item 17
X. Dispute resolution Not Applicable Item 17

This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Sublicense Agreement

Article(s)/Section(s) in
Sublicense
Obligation Disclosure Document Item
Agreement/F ranchise
Agreement*
a. Site selection and Not Applicable Not Applicable
acquisition/lease
b. Pre-opening purchases/leases Section 2 of the Sublicense Items 5, 6, 7, 8 and 11
Agreement; Article 5 of the
Franchise Agreement, except
Sections 5.3 and 5.4
 ArticIe(s)/Section(s) in
Sublicense
Obligation Disclosure Document Item
Agreement/Franchise
Agreement*
c. Site development and other pre­ Section 2 of the Suhlicense Items 7, 11 and 12
opening requirements Agreement; Sections 5.20
and 11.3 of the Franchise
Agreement
d. Initial and on-going training Section 2 of the Sublicense Items 6, 7, 11 and 15
Agreement; Sections 5.12,
5.13. 5.20 and 15.2 of the
Franchise Agreement
e. Opening Not Applicable Item 11
f. Fees Section 2 of the Sublicense Items 5, 6, 7, 10 and 11
Agreement; Sections 3.1, 5.2,
5.4, 5.14, 11.2,12.3 and 12.9
of the Franchise Agreement
g- Compliance with standards and Section 2 of the Sublicense Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual Agreement; Section 8.1 and
Article 9 of the Franchise
Agreement
h. Trademarks and proprietary Sections 2, 4 and 6 of the Items 13 and 14
information Sublicense Agreement;
Sections 5.9 and Articles 6
and 10 of the Franchise
Agreement
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Section 2 of the Sublicense Item 12
sales quotas Agreement; Section 11.3 of
the Franchise Agreement
1. Ongoing product/service Not Applicable Items 6, 8 and 16
purchases
m. Maintenance, appearance and Section 2 of the Sublicense Item 17
remodeling requirements Agreement; Section 9.2 of
the Franchise Agreement
n. Insurance Section 2 of the Sublicense Items 6, 7 and 8
Agreement; Section 16.2 of
the Franchise Agreement
0. Advertising Section 2 of the Sublicense Items 7, 8 and 11
Agreement; Sections 5.9 and
6.9 of the Franchise
Agreement
P- Indenmification Sections 2 and 9 of the Item 6
Sublicense Agreement;
Section 16.1 of the Franchise
Agreement
 Article(s)/Section(s) in
Sublicense
Obligation Disclosure Document Item
Agreement/F ranchise
Agreement*
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffing
r. Records and reports Section 2 of the Sublicense Not Applicable
Agreement; Section 11.2.4 of
the Franchise Agreement
s. Inspections and audits Section 2 of the Sublicense Not Applicable
Agreement; Section 5.1 of
the Franchise Agreement
t. Transfer Section 2 of the Sublicense Items 6 and 17
Agreement; Article 12 of the
Franchise Agreement
u. Renewal Not Applicable Items 6 and 17
V. Post-termination obligations Sections 2 and 5 of the Item 17
Sublicense Agreement;
Sections 10.3, 11.2, 13.5 and
13.6 of the Franchise
Agreement
w. Non-competition covenants Sections 10.6 and 13.7 of the Item 17
Franchise Agreement
X. Dispute resolution Sections 10.6 and 13.7 of the Item 17
Franchise Agreement
y- Other: Compliance with Not Applicable Item 1
statutoiy obligations
z. Modification of development Section 2 of the Sublicense Item 1
system and architectural plans to Agreement; Sections 9.2,
comply with building code, 5.19 and 5.20 of the
permit requirements and other Franchise Agreement
laws

*Real estate developers often form a separate business entity for each of their projects. On the condition
that the individual ownership of the entities remains substantially the same, and as an accommodation to
you to simplify the paperwork involved with forming a separate business entity for your project, ECFI
uses the Sublicense Agreement as a legal mechanism to evidence the contractual relationship between
your initial business entity, your new business entity, and ECFI. Pursuant to Section 1 of the Sublicense
Agreement, the sublicense does not include certain obligations imposed upon you pursuant to the
Franchise Agreement; pursuant to Section 2 of the Sublicense Agreement, the sublicensee agrees to be
bound by all of your other obligations under the Franchise Agreement, as these obligations relate to the
Epcon Communities project developed by the sublicensee.
 This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Non-Disclosure and On-Line Information Access Agreement

Article(s)/Section(s) in
Non-Disclosure and On-Line
Obligation Disclosure Document Item
Information Access
Agreement
a. Site selection and Not Applicable Not Applicable
acquisition/lease
b. Pre-opening purchases/leases Not Applicable Not Applicable
c. Site development and other pre­ Not Applicable Not Applicable
opening requirements
d. Initial and on-going training Not Applicable Not Applicable
e. Opening Not Applicable Not Applicable
f. Fees Not Applicable Not Applicable
g- Compliance with standards and Sections 10, 11 and 12 Not Applicable
policies/Operating Manual
h. Trademarks and proprietary Sections 8 and 10 Not Applicable
information
i. Restrictions on products/services Section 10 Not Applicable
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Not Applicable Not Applicable
sales quotas
1. Ongoing product/service Not Applicable Not Applicable
purchases
m. Maintenance, appearance and Section 4 Not Applicable
remodeling requirements
n. Insurance Not Applicable Not Applicable
0. Advertising Not Applicable Not Applicable
P- Indemnification Section 17 Not Applicable
q- Owner’s participation/ Not Applicable Not Applicable
management/ staffing
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Not Applicable Not Applicable
u. Renewal Not Applicable Not Applicable
V. Post-termination obligations Section 14 Not Applicable
w. Non-competition covenants Not Applicable Not Applicable
X. Dispute resolution Not Applicable Not Applicable
y- Other: Compliance with Section 11 Not Applicable
statutoiy obligations

37
 This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Copyright Assignment & Agreement

Article(s)/Section(s) in
Obligation Copyright & Assignment Disclosure Document Item
Agreement
a. Site selection and acquisi­ Not Applicable Not Applicable
tion/lease
b. Pre-opening purchases/leases Not Applicable Not Applicable
c. Site development and other pre­ Not Applicable Not Applicable
opening requirements
d. Initial and on-going training Not Applicable Not Applicable
e. Opening Not Applicable Not Applicable
f. Fees Not Applicable Not Applicable
g- Compliance with standards and Not Applicable Not Applicable
policies/Operating Manual
h. Trademarks and proprietary Entire Agreement Not Applicable
information
i. Restrictions on products/services Not Applicable Not Applicable
offered
j- Warranty and customer service Section 3 Not Applicable
requirements
k. Territorial development and Not Applicable Not Applicable
sales quotas
1. Ongoing producFservice Not Applicable Not Applicable
purchases
m. Maintenance, appearance and Not Applicable Not Applicable
remodeling requirements
n. Insurance Not Applicable Not Applicable
0. Advertising Section 1 Not Applicable
P- Indemnification Section 4 Not Applicable
q- Owner’s participation/ Not Applicable Not Applicable
management/ staffing
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Not Applicable Not Applicable
u. Renewal Not Applicable Not Applicable
V. Post-termination obligations Not Applicable Not Applicable
w. Non-competition covenants Not Applicable Not Applicable
X. Dispute resolution Not Applicable Not Applicable
y- Other: Compliance with Not Applicable Not Applicable
statutory obligations
 This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Mortgage

Article(s)/Section(s) in
Obligation Disclosure Document Item
Mortgage
a. Site selection and Not Applicable Not Applicable
acquisition/lease
b. Pre-opening purchases/leases Not Applicable Not Applicable
c. Site development and other pre­ Not Applicable Items 5 and 10
opening requirements
d. Initial and on-going training Not Applicable Not Applicable
e. Opening Not Applicable Not Applicable
f. Fees Paragraph C Items 5 and 10
g- Compliance with standards and Not Applicable Not Applicable
policies/Operating Manual
h. Trademarks and proprietary Not Applicable Not Applicable
information
i. Restrictions on products/services Not Applicable Not Applicable
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Not Applicable Not Applicable
sales quotas
1. Ongoing product/service Not Applicable Not Applicable
purchases
m. Maintenance, appearance and Not Applicable Not Applicable
remodeling requirements
n. Insurance Not Applicable Not Applicable
0. Advertising Not Applicable Not Applicable
P- Indemnification Not Applicable Not Applicable
q- Owner’s participation/ Not Applicable Not Applicable
management/ staffing
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Not Applicable Not Applicable
u. Renewal Not Applicable Not Applicable
V. Post-tennination obligations Not Applicable Not Applicable
w. Non-competition covenants Not Applicable Not Applicable
X. Dispute resolution Not Applicable Not Applicable
y- Payment of principal and Paragraph C of the Mortgage. Item 10
interest
 This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Security Agreement

ArticletsVSectionfsI in
Obligation Disclosure Document Item
Security Agreement
a. Site selection and acquisition/ Not Applicable Items 7, 11 and 12
lease
b. Pre-opening purchases/leases Not Applicable Items 5, 6, 7, 8 and 11
c. Site development and other pre­ Not Applicable Items 7, 11 and 12
opening requirements
d. Initial and on-going training Not Applicable Items 6, 7, 11 and 15
e. Opening Not Applicable Item 11
f. Fees Paragraphs 15 and 16 Items 5, 6, 7, 10 and 11
g- Compliance with standards and Not Applicable Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual
h. Trademarks and proprietary Not Applicable Items 13 and 14
information
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Not Applicable Item 12
sales quotas
1. Ongoing product/service Not Applicable Items 6, 8 and 16
purchases
m. Maintenance, appearance and Not Applicable Item 17
remodeling requirements
n. Insurance Paragraph 9 Items 6, 7 and 8
0. Advertising Not Applicable Items 7, 8 and 11
P- Indemnification Not Applicable Item 6
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffing
r. Records and reports Paragraph 6 Not Applicable
s. Inspections and audits Paragraph 8 Not Applicable
t. Transfer Not Applicable Items 6 and 17
u. Renewal Not Applicable Items 6 and 17
V. Post-termination obligations Not Applicable Item 17
w. Non-competition covenants Not Applicable Item 17
X. Dispute resolution Paragraphs 12, 17 and 18 Item 17
y- Grant of security interest in Paragraph 2 Not Applicable
after-acquired property and
assets, including proceeds
z. Actions necessary for Paragraph 4 Not Applicable
attachment, perfection and first
priority
 ArticletsVSectiontsl in
Obligation Disclosure Document Item
Security Agreement
aa. Change to name, address, Paragraph 6 Not Applicable
officers or type of business
organization
bb. Obligations concerning the Paragraph 8 Not Applicable
collateral

This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Market Reservation Agreement

Article(s)/Section(s) in
Obligation Market Reservation Disclosure Document Item
Agreement
a. Site selection and See Recital and Exhibit A Items 7, 11 and 12
acquisition/lease
b. Pre-opening purchases/leases Not Applicable Items 5, 6, 7 and 11
c. Site development and other pre­ Not Applicable Items 7, 11 and 12
opening requirements
d. Initial and on-going training Not Applicable Items 6, 7, 11 and 15
e. Opening Not Applicable Item 11
f Fees Section 2 Items 5, 6, 7, 10 and 11
g. Compliance with standards and Not Applicable Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual
h. Trademarks and proprietary Not Applicable Items 13 and 14
information
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Sections 4 and 5 Item 12
sales quotas
1. Ongoing product/service Not Applicable Items 6, 8 and 16
purchases
m. Maintenance, appearance and Not Applicable Item 17
remodeling requirements
n. Insurance Not Applicable Items 6, 7 and 8
0. Advertising Not Applicable Items 7, 8 and 11
P- Indemnification Not Applicable Item 6
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffing
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Section 7 Items 6 and 17
u. Renewal Not Applicable Items 6 and 17
V. Post-termination obligations Not Applicable Item 17
 Article(s)/Section(s) in
Obligation Market Reservation Disclosure Document Item
Agreement
w. Non-competition covenants Not Applicable Item 17
X. Dispute resolution Not Applicable Item 17

This table lists your principal obligations under the franchise and other agreements. It will
help you find more detailed information about your obligations in these agreements and in other
items of this disclosure document.

Market Hold Agreement

Article(s)/Section(s) in
Obligation Disclosure Document Item
Market Hold Agreement
a. Site selection and Section 2 Items 7, 11 and 12
acquisition/lease
b. Pre-opening purchases/leases Not Applicable Items 5, 6, 7 and 11
c. Site development and other pre­ Not Applicable Items 7, 11 and 12
opening requirements
d. Initial and on-going training Not Applicable Items 6, 7, 11 and 15
e. Opening Not Applicable Item 11
f. Fees Section 1 Items 5, 6, 7, 10 and 11
g- Compliance with standards and Not Applicable Items 6, 7, 8, 11, 15 and 16
policies/Operating Manual
h. Trademarks and proprietary Section 5 Items 13 and 14
information
i. Restrictions on products/services Not Applicable Items 8 and 16
offered
j- Warranty and customer service Not Applicable Not Applicable
requirements
k. Territorial development and Section 3 Item 12
sales quotas
1. Ongoing product/service Not Applicable Items 6, 8 and 16
purchases
m. Maintenance, appearance and Not Applicable Item 17
remodeling requirements
n. Insurance Not Applicable Items 6, 7 and 8
0. Advertising Not Applicable Items 7, 8 and 11
P- Indemnification Not Applicable Item 6
q- Owner’s participation/ Not Applicable Items 11 and 15
management/ staffmg
r. Records and reports Not Applicable Not Applicable
s. Inspections and audits Not Applicable Not Applicable
t. Transfer Section 5 Items 6 and 17
u. Renewal Section 4 Items 6 and 17
V. Post-termination obligations Not Applicable Item 17 .
w. Non-competition covenants Not Applicable Item 17
X. Dispute resolution Not Applicable Item 17
ITEM 10. FINANCING

We pemiit you to pay the Project Royalty Fee in installments. This is described in detail in
Item 6 of this disclosure document.

We require you to provide us with a mortgage in a minimum amount of $150,000 against the real
property upon which your project will be constructed to secure payment of the Project Royalty Fee all
other fees you may owe to us (see the basic form of Mortgage attached as Exhibit L to this disclosure
document). We also require you to sign a security agreement granting to us a security interest in all of
your personal property at your project to secure payment of the Project Royalty Fee and all other fees you
may owe to us (see the form of Security Agreement attached as Exhibit M to this disclosure document).

You are required to reimburse us for all costs, expenses and fees (ineluding legal fees, and filing
and recording fees) incurred in obtaining, filing and recording the mortgage, security agreement or other
security.

The Mortgage and Security Agreement

The mortgage must be signed by you and delivered to us in order that it can be recorded no later
than 15 days after your closing on the purchase of your property, or if you already own your property, no
later than 30 days after you sign the Franchise Agreement. The mortgage can only be subject to, and
junior only to, the mortgage lien(s) and/or personal property lien(s) granted by you to the lenders
providing land acquisition and construction financing for your project. If you increase the number of
Units in your project, we may require a re-evaluation of the projected as completed value of your project
and an increase in the amount of the mortgage or other security interest and/or require other additional
security. You must reimburse us for all costs, expenses and fees incurred in subordinating your mortgage
or other security interest at the same time you close on any financing with your lender or within fifteen
days of our delivering an invoice to you.

The security agreement can only be subject to, and junior only to, the mortgage lien(s) and/or
personal property lien(s) granted by you to the lenders providing land acquisition and construction
financing for your project. You must reimburse us for all costs, expenses and fees incurred in
subordinating the security agreement at the same time you close on any financing with your lender or
within fifteen days of our delivering an invoice to you.

We may, in our sole discretion, accept a deed of trust, letter of credit, or other security instrument
in substitution of a mortgage or security agreement.

As described in Item 12 of this disclosure document, we acknowledge that real estate developers
often form a separate business entity for each project. If we permit you to sublicense to another business
entity, we may require that business entity to sign new or amended mortgages and security agreements.

Although we have never done so, we have the right to assign our interests in the mortgage and
security agreement to a third party without your consent. If we do so, the third party may be immune
under the law to any defenses to payment you may have against us. If the mortgage and security
agreement are assigned to a third party by us, as long as the Franchise Agreement is effective, we will
remain primarily obligated to provide the assistance to the franchisee for which we are obligated under
the Franchise Agreement.
 Miscellaneous

In the event that you form a business entity to own and operate your franchised business, we will
require that the principal owners of the business entity personally guarantee the obligations of the
business entity under the Franchise Agreement.

Other than as described above in this Item 10, we do not offer direct or indirect financing to you.
We do not receive direct or indirect payments for placing financing. We do not guarantee any loan or
lease which you may obtain or any obligation which you may incur.

ITEM 11. FRANCHISOR’S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND

TRAINING

Except as listed below, we are not required to provide you with any assistance.

Obligations Before Opening

Before you begin development of your initial Epcon Communities project, we will provide the
following assistance:

Plans and Specifications:

1. Unstamped architectural plans and specifications for residential dwellings, based upon
ECFI’s most recently updated project plans, including foundation plan, floor plan, roof plan
with truss drawings, wall sections, exterior elevations, drawings or schedules for windows,
doors, cabinets, shelving and floor coverings. (Franchise Agreement, Section 4.1.1).

2. Unstamped architectural plans and specifications for clubhouses and pavilions, based upon
ECFFs most recently updated project plans, including foundation plan, floor plan, roof plan
with truss drawings, wall sections, exterior elevations, drawings or schedules for windows,
doors, cahinets, shelving and floor coverings, plumbing plan, electrical plan and HVAC
plan. (Franchise Agreement, Section 4.1.2).

3. Sample site and landscape plans from one recent project (Franchise Agreement,
Section 4.1.3).

Training and Support:

4. Operations Manual. (Franchise Agreement, Section 4.1.6).

5. Initial training sessions for you, the owners of the franchise business and your
representatives (up to a total of three persons). (Franchise Agreement, Section 5.12).

6. A reasonable amount of consulting services on the areas of planning, financing,

construction and marketing, for your first project. (Franchise Agreement, Section
4.1.16.1).

7. Accounting Manual. (Franchise Agreement, Section 4.1.14)

 Condominium:

9. Condominium Manual. (Franchise Agreement, Section 4.1.9).

Construction:

10. Pre-Construction Community Manual. (Franchise Agreement, Section 4.1.12).

11. National Account Suppliers Directory. (Franchise Agreement, Section 4.1.10).

12. Sample Construction Scopes of Work. (Franchise Agreement, Section 4.1.4).

13. Construction Manual. (Franchise Agreement, Section 4.1.5).

14. Presentations: QualityMark, Punchout, and Turnover Processes. (Franchise Agreement,

Section 4.1.8).

15. Sample Homeowners Manual. (Franchise Agreement, Section 4.1.11).

Marketing:

16. Epcon Style Guide and Graphics Standards Manual. (Franchise Agreement, Section
4.1.13).

17. Marketing Manual and Materials, including color renderings and floor plans and sample
brochure. (Franchise Agreement, Section 4.1.7).

For manuals and other written materials, we may, in our discretion, provide those items to you in
hard copy or electronic form.

We generally do not provide equipment, signs, fixtures, opening inventory or supplies directly,
but we are in the practice of providing you with written specifications and the names of Approved
Suppliers offering some of these items.

We do not have an obligation to locate a site or negotiate the purchase of a site for you. We do
not own sites that we lease or sell to you.

When you sign your Franchise Agreement, you must also sign a Market Area Agreement that
identifies the Market Area in which your project will be located. If you know the location of the site at
the time you sign the Market Area Agreement, that location will be included in the Market Area
Agreement. If you do not know the location of your project at the time you sign the Market Area
Agreement, you will have one year from the date you sign the Market Area Agreement to locate your
project site and commence construction. If you do not do so within the required time period, we may
terminate your Franchise Agreement.

Obligations After Opening

During the development of your initial Epcon Communities project and all additional Epcon
Communities projects, we will provide the following assistance:

1. Continuation of the assistance referred to in paragraph 6 set out above in this Item 11.
 2. Copies of modifications and improvements to plans and other parts of the Epcon
Communities Development System, upon your request. (Franchise Agreement, Section
9.3).

In order for you to meet your obligations under the Franchise Agreement, you must conduct your
operations as provided for in the Operations Manual or as otherwise designated by us. (Franchise
Agreement, Section 4.3).

We do not have an obligation, either before or after opening, to hire your employees for you.

Although we do not have an obligation to do so, we are significantly involved in improving and
developing the franchised business due in part to Epcon’s and Epcon Carolinas’ operation of Epcon
Communities projects.

We do not have an obligation to establish prices but may suggest prices to you from time to time.

Although we do not have an obligation under the Franchise Agreement to do so, we are in the
practice of establishing and using administrative, bookkeeping, accounting and inventoiy control
procedures which we may share with you from time to time.

Although we do not have an obligation to resolve operating problems you encounter, we do

provide you with advice and consultation in connection with the operation of your Epcon Communities
business and periodic continuing individual advice, consultation and assistance. (Franchise Agreement,
Section 4.1.16.4).

Advertising Programs

We or a business entity selected by us will maintain a web site to promote your condominium
development projects as well as the condominium development projects of our affiliates, Epcon and
Epcon Carolinas. As of the date of this disclosure document, this web site is maintained by our affiliate,
Epcon Marketing. You will be provided web pages on this web site for each of your Epcon communities.
Before you start marketing and/or selling activities for any of your projects, you must provide the
information specified by us so that web pages can be created for your project. We may, at our sole
discretion and for our convenience, terminate the web site and the related web page or pages. You will be
granted access to the administrative portion of www.epconcommunities.com, so that you may make
periodic updates to your web content on that web site. You must designate a person in your company with
the role of web site administrator for providing content updates to your web site community pages.

Although Epcon and Epcon Carolinas advertise the projects that they develop, except as
discussed above, we do not conduct advertising for the Epcon Communities projects to be developed by
you, and we are not required to spend any amount for advertising in the areas where your Epcon
Communities project is located. As noted above in this Item 11, as part of the materials provided to you
at the time you sign the Franchise Agreement, you are provided the Epcon Style Guide and Graphics
Standards Manual (outlining logos, colors and imagery to support and enhance the Epcon brand),
marketing campaign ideas and materials, templates for brochures, direct mail and signage, virtual
renderings and tours for Epcon models, product and lifestyle-based photography from various Epcon
Communities around the country all for your use in your own individual marketing efforts for your Epcon
Communities project. These materials are based on Epcon’s experience in using the development system
licensed to you by us and have been partly developed in-house and partly by outsourced design and
advertising agencies. In your advertising, you are likely to use media that are local in scope.
 We may periodically arrange for printing of sales brochures on a group basis to lower the per
item cost. Each participant in a group order contributes an amount based pro rata on the number of
brochures that he or she orders. We made no profits on these purchases in 2018.

You are permitted to prepare your own advertising materials. They must be approved in writing
in advance by us. Approval will be based upon your compliance with the provisions of the Franchise
Agreement and Graphics Standard Manual regarding the use of service marks and copyrighted and
patented materials relating to or identified with Epcon Communities. You must submit samples of all
advertising plans and materials to us for approval at least 30 days before the intended use. We will not
unreasonably withhold our approval. If written disapproval is not received by you from us within 30 days
of the date that we receive your materials, we will be deemed to have given the required approval. Upon
30 days prior written notice, we can revoke our approval of any advertising and promotion previously
approved.

Along with the general requirement that all advertising materials must be approved in advance by
us, we may apply certain additional advertising restrictions to your use of the Internet, web pages or
email. The web site located at www.epconcommunities.com is the only authorized Epcon Communities
franchising web site. You must disclose to us all web sites owned, registered to or operated by you that
are related to residential construction or real estate sales. You must comply with all laws and regulations
related to the web site, respond to inquiries received through the web site within a certain stated period of
time, and honor all prices advertised on your web pages on the web site.

You must pay to Epcon Marketing a Marketing Program Fee (“Marketing Program Fee”) of $500
per month for each of your projects. Additional details on the Marketing Program Fee may be found in
Item 5.

Epcon Marketing will administer the separate fund of the Marketing Program Fees. It may spend
the Marketing Program Fees to promote the projects of our affiliates, Epcon and Epcon Carolinas, and of
ECFI franchisees at any geographic level, including local, regional and/or national advertising and in any
medium that it believes will promote Epcon Communities projects, in its sole discretion. Epcon
Marketing’s trustees approve the expenditure of the Marketing Program Fees. The finances for this
program will be administered by us. This fund is audited. If any Marketing Program Fees are not spent
in the calendar year in which they are paid, the remaining amounts will be carried over to the next year.
You may request in writing a report of how the Marketing Program Fees are spent from our Chief
Financial Officer. The funds from the Marketing Program Fees in 2018 were spent on production (78%)
and salary and administrative expenses (22%). No Marketing Program Fees will be used to solicit the
sale of franchises.

In April 2000, we established a “Leaders Council” that meets periodically to discuss issues of
importance to you, other franchisees and us. The Leaders Council is composed of a select number of
franchisee members in addition to Edward A. Bacome and Philip G. Fankhauser (whose biographies are
included in Item 2 of this disclosure document). New members of the Leaders Council are selected by us
annually. The Leaders Council held one meeting in 2018.

Other than as described above, you are not required to participate in any other advertising fund or
cooperative. We have not established an advertising council composed of franchisees and have no plans
to do so in the future.
 Computer System

You must purchase and use in your Epcon Communities franchised business a computer system
meeting our specifications and your architect must have a computer design system similar to that now
typically used in the profession to read plans in CAD format. The computer system will be used to store
word processing data, spreadsheets, financial information, PDFs and CAD drawings. Your computer
must be able to recognize and open CAD drawings using AutoCAD LT 2013, or a later version as
determined by us.

We estimate that it will cost you up to $1,500 (per computer) to purchase the computer system
(including hardware and software). You must utilize a broadband Internet connection with your computer
system at a cost of approximately $80 per month. Your computer(s) must allow you to view and listen to
standard multimedia type files such as photos, videos and music files, both locally on your computer and
over the Internet. You must have Microsoft Publisher (version 2013 or later) or similarly capable
software (such as Adobe Photoshop or Illustrator) for making updates to and accessing marketing
materials. You are required to have a working email address. Periodically, we send you important
information by email, and some email messages that we send to you require a response to us. Your
computer and email system will be required to have updated antivirus and anti-spam software installed.

Your computer system will permit you to take advantage of services to be offered to you both by
us and third parties, as described below.

We make our Operations Manual and other information related to the Epcon Communities
Development System, as well as online training modules, available to you and certain of your employees
through a password-protected web site (the “on-line support system”) on the Internet. This has become
the preferred method of making updates to the Operations Manual available to Epcon Communities
franchisees for downloading and printing for their use. Prior to gaining access to our password protected
web site, you and your employees must sign an Epcon Communities Franchising, Inc. Non-Disclosure
and On-Line Information Access Agreement (see attached Exhibit J to this disclosure document), and you
must provide us with a copy of each signed agreement. (See also Items 9 and 17 for disclosures regarding
this Agreement).

To access our on-line support system web site and to meet your obligations under the Franchise
Agreement, you must have a computer system including computer hardware and software with the
specifications as provided by us. You can obtain each individual software and hardware component for
this system from any supplier.

We do not provide technical assistance for any of the designated computer hardware or software
components. Under the terms of the Franchise Agreement, you must periodically upgrade and/or update
the hardware components and/or software programs that make up your personal computer system to meet
our then-current minimum specifications and list of required capabilities. There are no contractual
limitations on the frequency or cost of this obligation, but we will not require these upgrades more often
than annually. We estimate that the annual cost of options or required upgrades will be $250. We are not
obligated to provide any ongoing maintenance, repairs, upgrades or updates.

We are not obligated to provide to you, or to assist you in obtaining, the above listed hardware
and software. We will not have independent access to the information generated or stored on your
computer system. We do not have any liability to you as a result of any malfunctions of any computer
system or website.

48
 We recommend that you use in your business BuildTopia software, which is a web-based
software program that is an all inclusive residential construction management system, providing real time
reporting. BuildTopia is made up of three programs that work together. BT Sales helps you capture leads
from the internet, track customers, provide campaigns for your sales representatives, and electronically
store purchase agreements and documents that can be viewed by buyers. BT Service retains buyer
information and uses the information for customer service, tracking particular buyer issues, and providing
information on repeated repair issues. BT Builder takes you through the construction process from
vendor bidding, budgeting, scheduling, and Unit option selections. As of the date of this disclosure
document, the BuildTopia cost includes an annual fee of $9,563 (paid on a quarterly basis of $2,866.58
per quarter), and for each Unit after the twentieth (20*) Unit released for construction each year, a one
time $75 per Unit fee due at the time you release each Unit for construction. BuildTopia, Inc.’s current
agreement for franchisees includes no fee for the first 20 Units in each calendar year. These fees are
subject to change, including an increase in the amount of the fees, by BuildTopia, Inc. You are not
currently required to use this service, although it is highly recommended.

We also recommend that you use in your business Lasso CRM software, which is a web-based
software program for new home sales and marketing. Lasso software allows your sales consultants to
manage their prospects through the home selling process. Franchisees pay Lasso Soft, Inc. a $500 fee for
the set-up of the Lasso system, as well as a minimum payment of $70 per month for up to two individual
logins for use by you of the Lasso system and an additional $35 per month for each user login after two.
Epcon Marketing will pay the costs incurred for the Lasso integration of your web site on
www.epconcommunities.com so that web leads are auto-generated into Lasso. These fees are subject to
change, including an increase in the amount of the fees charged by Lasso. You are not currently required
to use this software, although it is highly recommended. The costs for BuildTopia and Lasso are included
in your estimated initial investment described in Item 7 of this disclosure document.

Operations Manual

As described above, we provide to franchisees an Epcon Communities Franchising, Inc.

Operations Manual, as well as other manuals containing information related to the Epcon Communities
Development System. We provide these manuals in a format selected by us, which may include hard
copy, electronic files, or web-based format or access.

The Operations Manual contains mandatory and suggested specifications, standards, operating
procedures and rules prescribed by us periodically for use in the development, construction and marketing
of an Epcon Communities project. We have the right to modify this Manual periodically and to
supplement it with periodic bulletins. This Manual is confidential and our proprietary property and is
simply loaned to you. You must return it to us upon the expiration or termination of your Franchise
Agreement for any reason and must treat it confidentially. The following is the Table of Contents of our
Manual, as of the date of this disclosure document, and the number of pages (out of a total of 164 pages)
devoted to each subject;

EPCON COMMUNITIES FRANCfflSING, INC. OPERATIONS MANUAL

TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Getting to Know Us........ 13
Starting Up the Business. 46
 Number of Pages
Subject Devoted to
Subject
Staffing Your Operation..................................................................................... 52
Drawing and Planning Your Community........................................................... 11
Access on Your Site........................................................................................... 2
Writing Your Proforma...................................................................................... 8
Searching and Analyzing Your Land................................................................. 29
Understanding Financing................................................................................... 16
Zoning, from Start to Finish............................................................................... 10

Other Manuals

We also provide you with a Condominium Manual (total of 319 pages), a Sales and Marketing
Manual (total of 348 pages), a Construction Manual (total of 177 pages), a National Account Suppliers
Directory (total of 1,341 pages), a Sample Homeowners Manual (total of 44 pages), an Accounting
Manual (total of 105 pages), a Pre-Construction Community Manual (total of 101 pages). On-line
presentations regarding QualityMark, Punchout, and Turnover, Branded Signage Templates and Signage
Specifications, and a Graphics Standards Manual (total of 25 pages). Following are the tables of contents
of these manuals, as of the date of this disclosure document, and the number of pages devoted to each
subject:

EPCON COMMUNITIES FRANCfflSING, INC. CONDOMINIUM MANUAL

TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Sample Association Articles of Incorporation . 12
Sample Unit Purchase Agreement.................. 12
Sample Development Statement.................... 29
Sample Community Policies and Guidelines... 10
Sample Condominium Declaration................ 254
Sample Property Management Agreement..... 10
Establishing the Condominium Association... 1
Turning Over the Condominium Association. 1

EPCON COMMUNITIES FRANCHISING, INC. ARCHITECTURAL PLANS

EPCON COMMUNITIES FRANCHISING, INC. CONSTRUCTION SPECIFICATIONS
MANUAL (330 PAGES)

This manual includes specifications for the construction of the Epcon Communities Development System.
 EPCON COMMUNITIES FRANCfflSING, INC. SALES AND MARKETING MANUAL
TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Setting Up........................... 59
Operating............................ 69
Selling A Lifestyle.............. 58
Bringing in the Customer.... 23
Selling On Your Site........... 56
Your Community Openings. 12
Your Purchase Agreement..., 60
Your Closing Procedures.... 14

EPCON COMMUNITIES FRANCfflSING, INC. CONSTRUCTION MANUAL

TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Setting Up Your Chart of Accounts and Job Costs. 23
Working with Your Subcontractors....................... 39
National Accounts................................................. 1
Pre-Construction.................................................... 5
On-Site.................................................................. 27
Landscaping.......................................................... 12
Your Sales Staff.................................................... 2
Punch-Out.............................................................. 13
Walk Through and Warranty................................. 55

EPCON COMMUNITIES FRANCfflSING, INC. NATIONAL ACCOUNT SUPPLIERS

DIRECTORY (1,341 PAGES)

This directory includes contact, product and pricing information for 61 national account suppliers and
preferred vendors that can be used in constructing, marketing and operating within the Epcon
Communities Development System.

SAMPLE HOMEOWNERS MANUAL (44 PAGES)

This manual is prepared by Epcon, an Epcon Communities licensee, to provide an informational guide for
service and warranties and should not be relied upon or viewed to either expand or reduce any warranty
provided in the franchisee’s Condominium Unit Purchase Agreement, Condominium Development
Statement, Declaration of Condominium, or other condominium organizational documents.

51
 Number of Pages
Subject Devoted to
Subject
Move-In Reminders................................................ 1
Condominium Rules: Frequently Asked Questions. 6
Homeowner Care and Maintenance........................ 12
Limited Warranty................................................... 19
Warranty Service Procedure................................... 6

ACCOUNTING MANUAL (105 PAGES)

TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Financial Reports.................... 24
Annual Budget......................... 11
Development Cost Summaries. 15
Project Construction Draw..... 9
Miscellaneous Forms............... 30
Employee Expense Reporting.. 11
Purchase Order System........... 5

PRE-CONSTRUCTION MANUAL (101 PAGES)

TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Project Overview............................... 9
Persormel........................................... 6
Preliminary and Contract Documents, 14
Design Change Documents............... 12
Construction Documents................... 8
Construction..................................... 16
Payment............................................. 10
Miscellaneous.................................... 5
Contract Example.............................. 21

52
 GRAPHICS STANDARDS MANUAL (25 PAGES)
TABLE OF CONTENTS

Number of Pages
Subject Devoted to
Subject
Introduction.................................................. 1
A Single Unified Image................................ 1
Brand Attributes and Essence....................... 1
Brand Logo................................................... 5
Theme Line.................................................. 1
Color Palette................................................. 1
Fonts and Font Usage................................... 1
Imagery / Lifestyle and Product Gallery...... 1
Epcon Marketing Materials.......................... 1
Brand Letterhead.......................................... 1
Correspondence and Email Signatures......... 1
Phone Etiquette............................................ 1
Endorser Line and Community Logo Usage. 1
Community Letterhead Package Guidelines. 1
Franchise Company Name Usage................ 1
Corporate Website........................................ 1
Community Presentation Gallery................. 1
Collateral Materials and Print Advertising.... 1
Signage Standards........................................ 1
Apparel and Logo Merchandise................... 1
Questions...................................................... 1

Business Location Selection

You must identify a proposed site at which to locate your Epcon Communities project. The
below listed items, which are updated periodically, have been determined by ECFI as important criteria.
Currently, our site preference criteria are as follows:

1) Exposure The site should be adjacent to or near a major road for visibility
and accessibility.
2) Topography The site should include enough flat ground to achieve the
maximum suitable density at 2.5 to 6 Units per acre.

3) Neighborhood The site should be located in a neighborhood in keeping with a

quality residential lifestyle. Areas including higher priced
single family houses are generally preferred. Areas including
well constructed and maintained multi-family houses are
acceptable.
 4) Zoning Zoning regulations must permit attached or detached multi­
family construction of 1, 2, 3 or 4 Units per structure developed
to a maximum density of 6 Units per acre.

5) Utilities All necessary public utilities (storm sewer, sanitary sewer,

water, gas, electricity, telephone and cable television) must be
extended or extendable to the site and have sufficient capacity
for your community.

6) Natural Sites that offer the appeal of special natural attributes, such as
Amenities trees, lakes and/or ravines, are preferable.

7) Shopping Shopping should be convenient to the site.

8) Medical Support Hospitals, emergency medical facilities and doctors’ offices

Services should be located within a reasonable distance from the site.

9) Recreation Sites having public and private recreational facilities, such as

Facilities golf courses, tennis courts, parks and recreation centers, nearby
are preferred.

10) Acreage Size of the sites may vaiy from 10 lots (for smaller projects) to
50 acres (up to 300 Units).

We also recommend that you obtain both a market study and a density study for your proposed
site. We recommend that you use a qualified market research consultant to prepare your market study.
The density study should show the Epcon Communities Development System buildings arranged on the
site using all required building and parking setbacks and with appropriate clearances between buildings.
Using this drawing you will be able to calculate the number of dwelling Units per acre, which is an
important indicator of the financial viability of the site. An experienced land planner should prepare your
density study.

If a proposed site has been identified, you must submit your proposed site to us for review before
the signing by you and us of a Market Area Agreement, the form of which is attached to this disclosure
document as Exhibit C. Generally, both we and you would be in a position to sign the Market Area
Agreement and to allow you to proceed with development of your site within two weeks after you notify
us of the site. We may, in our discretion, in circumstances where you have not identified a specific
property for development at the time you sign a Franchise Agreement with us, agree to modify, in an
Addendum to the Franchise Agreement and an Initial Market Area Agreement, your obligation to pay
certain fees beginning as late as month thirty-seven (37) and to increase your initial market area to permit
you additional time to locate suitable property for your project. When you identify a property for your
project, and we agree to that location, you will be required to sign the Market Area Agreement with us.

We do not select a site for you for your Epcon Communities project. If invited by you, we will
offer our opinion on your proposed location recognizing that we do not have the benefit of knowledge of
your local market. We do not assist you in confonning the business location to local ordinances and
building codes and/or obtaining any required permits. We are not responsible for constructing,
remodeling or decorating the business location.
Time Before Opening

The typical length of time between the signing of the Franchise Agreement and the beginning of
construction of your Epcon Communities project and/or beginning of Unit sales is generally 10 to 24
months. Factors affecting the length of time include whether you are purchasing developed lots or raw
land. Other factors usually include, site identification and entitlement, obtaining the necessaiy financing
arrangements, obtaining any necessary zoning approvals and governmental permits, soil and
environmental testing, and weather conditions in the locale of your site.

Training Sessions

Initial Training

We provide an initial training program for you. This program typically ranges from two to four
days. In our discretion, this program will be held at our offices located at 500 Stonehenge Parkway,
Dublin, Ohio or elsewhere in the Columbus, Ohio area, or may be provided to you as webinars, online
modules or web-based training seminars or classes. At least one owner of the franchise business must
attend each of the portions of the first scheduled training session after the Franchise Agreement has been
signed and successfully complete this program to our satisfaction before commencing construction of
your project. It is recommended that anyone employed by you in a management capacity in your Epcon
Communities franchise development business (up to two people in addition to you) also attend the
training. This training program is offered periodically by us on an as-needed basis as we determine. You
are entitled to attend the initial training program one time at no fee. If training is held at our offices or
elsewhere in the Columbus, Ohio area, you must pay for transportation and room and board for each
person who attends the initial training program. If web-based training is offered, you must have a personal
computer with Internet service. You may also be required to download a software plug-in such as Java or
Adobe Flash Player to use the web-based training.

TRAINING PROGRAM

As of the date of this disclosure document, the initial franchisee training sessions consists of the
following modules:

Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2) /
Staff Introductions. 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
another location selected by us,
or web-based training
(Note 1)
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Operations Overview: 2 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Mission Statement; Site another location selected by us,
Visits; and Customer Profile. or web-based training
Intellectual Property; (Note 1)
Confidentiality and Non-
Compete Agreements;
Copyrights; Project
Sublicense; and Operations
Manual.
Finding an Architect; Sales
Price Strategies.
Boundaries Matrix; Change
Request Process; Guild
Quality and Brand Standards.
Finding Land and Zoning: 1.5 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Demographic Report and another location selected by us,
Market Study or web-based training
Due Diligence and (Note 1)
Entitlement.
Condominium Association 1.25 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Articles of Incorporation; another location selected by us,
Purchase Agreement; or web-based training
Development Statement; (Note 1)
Community Policies and
Guidelines; Declaration of
Condominium; Property
Management; Establishment
and Turnover of the
Association; Association
Budget; Fair Housing Act
and Americans with
Disabilities Act; and Public
Accommodations.
Product Orientation; 2 hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Construction Overview; another location selected by us,
Construction Requirements; or web-based training
Understanding Codes, (Note 1)
Permits and Inspections; and
Working with Architects and
Engineers.
Tour of Models at an Epcon 1.5 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Community. another location selected by us,
or web-based training
__________ (Note 1)
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Construction Specifications; 3 hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Preliminary Site Design; another location selected by us,
Construction Plans; or web-based training
Preliminary, Bidding, (Note 1)
Buyout and Final Set; and
Schedules.
Landscaping; Signage;
Common Facilities; Options
Chart of Accounts;
Construction Costs:
Estimating and Purchasing;
Working with Sub
Contractors; Scopes of
Work; Production
Management; Bidding and
Negotiating; Quality Mark,
Warranty and Turnover;
Staffing; National Account
Partner/Rebate Program and
Customer Orientation.
National Accounts and 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Rebate Program. another location selected by us,
or web-based training
__________ (Note 1)_________
Training Overview. 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
another location selected by us,
or web-based training
__________ (Note 1)_________
Financing and Accounting; 2 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Project Budget and another location selected by us,
Proforma; Chart of or web-based training
Accounts; Cost Codes; (Note 1)
Accounting Expenses;
Financing Options; Loan
Application.
Intranet Training and Sales 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Reporting. another location selected by us,
or web-based training
__________(Note 1)________
Sales Consultant Attributes 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
and Job Description; and another location selected by us,
Training and Management of or web-based training
TOur Sales Staff. ____ _____(Note 1) ___

57
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Selecting Your Sales Team - 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Coaching and Sample another location selected by us,
Purchase Agreements. or web-based training
__________ (Note 1)
Marketing Materials and 2 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Campaigns; Graphic another location selected by us,
Standards and Support; or web-based training
Marketing Co-Op; (Note I)
Community Web Pages;
Driving Traffic; and Social
Media and Managing Leads.
Setting up Your Clubhouse IHour (Note 3) Dublin, Ohio, Columbus, Ohio,
and Models; Sales Office and another location selected by us,
Trailer; Preselling or web-based training
Campaigns; Event Planning; (Note 1)
Marketing Planning; and
Launching Your
Community.
Human Resources: 2 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Hiring; Organizational another location selected by us,
Management; Training; HR or web-based training
Resources; Benefits and (Note 1)
Compensation; Technology
Assistance; and Software
(Lasso, BuildTopia).
Insurance: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Understanding your another location selected by us,
Insurance Requirements. or web-based training
(Note 1)

Sales and Marketing Training Sessions

We anticipate that we will provide sales and marketing training sessions and materials for your
Sales Consultants and Sales Managers during your first year as a fi-anchisee. These sessions and training
materials may be presented and provided to you in a variety of formats, such as classroom training,
webinars, online modules and/or written materials, depending on adequate franchisee demand for a full
training class and our discretion. Classroom training materials, if any, for Sales and Marketing Training
Sessions will be provided at no cost to you; however, you must pay for transportation and room and board
for yourself and any of your employees who attend the training program. If web-based training is offered,
you must have a personal computer with Internet service. You may also be required to download a
software plug-in such as Java or Adobe Flash Player to use the web-based training.

As of the date of this disclosure document, the training consists of the following modules:
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Welcome to Epcon: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Company History and another location selected by us,
Overview; Mission or web-based training
Statement; Core Values; (Note 1)
Branding, Leadership Team
Introductions.
The Epcon Advantage: 45 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Market Research; another location selected by us,
Competitive Advantages; or web-based training
Customer Preferences; (Note 1)
Lifestyle Features and
Amenities; and
Understanding
Condominiums.
Evolution of Epcon’s 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Products: another location selected by us,
Product and Model or web-based training
Knowledge; and Standard (Note 1)
Features.
Construction Knowledge: 3 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Overview of Homebuilding another location selected by us,
Construction Process and or web-based training
Key construction Practices. (Note 1)
Introduction to the Sales 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Process: another location selected by us,
Overview of Selling Process or web-based training
for New Home Sales (Note 1)
Consultants.
The Role of Sales and 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Marketing: another location selected by us,
Specific Responsibilities; or web-based training
Generating Traffic; (Note 1)
Maintaining Community;
Shopping Competitors;
Managing Leads and
Results; and Working with
Buyers._______________
Marketing Tools and 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Resources: another location selected by us,
Virtual Tour Resources; or web-based training
Company Intranet; and (Note 1)
Ordering Online Marketing
Materials.
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Understanding QualityMark: 45 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Understanding the Process; another location selected by us,
Interior Inspection and or web-based training
Timing; Exterior Inspection (Note 1)
and Timing; Scoring
Procedure; and Explaining
Benefits during the Sales
Process.
Building Your Book of 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Knowledge: another location selected by us,
Organizing Key Information or web-based training
which Can Include Realtor (Note 1)
Referral Forms; Sample
Purchase Agreement;
Product Features; Site and
Availability Map; Tax
Information; and
Homeowners Association.
Setting and Maintaining 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Sales Goals: Goal setting. another location selected by us,
or web-based training
__________ (Note 1)_________
Selling from Your Stage: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Selling on Your Site; Selling another location selected by us,
from Model; Clubhouse or or web-based training
Temporary Sales Center; and (Note 1)
Preselling.
Sales Process Etiquette: 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Opening and Closing another location selected by us,
Procedures; Dress; Office or web-based training
Set Up; and Purchase (Note 1)
Agreements.
Ranking Prospects and 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Effective Follow-up: another location selected by us,
Following up Effectively to or web-based training
Close the Sale. __________ (Note 1)_________
Resources for Creating a 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Virtual Experience: another location selected by us,
Virtual Tour Resources and or web-based training
Intranet Tools. (Note 1)
Managing Your Calendar: 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Time Management. another location selected by us,
or web-based training
__________ (Note 1) ________
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Following Fair Flousing: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Fair Housing Act; another location selected by us,
Definitions; Fair Housing in or web-based training
Selling and Advertising; (Note 1)
Enforcement; and Universal
Design.
Shopping the Competition; 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Different Types of Shops for another location selected by us,
Competition. or web-based training
(Note 1)
Caring for Your Model and 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Clubhouse: another location selected by us,
Maintaining Your or web-based training
Community So It Is Always (Note 1)
In “Show Condition”.
Importance of Referrals and 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Building Relationships with another location selected by us,
Realtors: or web-based training
Creating Referrals and (Note 1)
Working Successfully with
Realtors.
From Online to Onsite: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Best Practices for Web Lead another location selected by us,
Follow-up. or web-based training
(Note 1)
Epcon’s Warranty Program: 45 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Overview of Warranty another location selected by us,
Program and What It or web-based training
Covers; Common Requests (Note 1)
and the Turnover Process.
Customer Orientation 45 Minutes (Note 3) . Dublin, Ohio, Columbus, Ohio,
Program; another location selected by us,
Steps of the Process; or web-based training
Customer Satisfaction; and (Note 1)
the Role of Sales Consultant
in the Process.
Community Signage: 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Ordering signage. another location selected by us,
or web-based training
(Note 1)
Presentation Gallery: 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Utilizing the Presentation another location selected by us,
Gallery in the Sales Process. or web-based training
(Note 1)
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Sales and Marketing 30 Minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
Reports: another location selected by us,
Reports to Help Track or web-based training
Traffic and Prospects. __________ (Note 1)______
Community Events: 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Conducting Special Events another location selected by us,
and Direct Mail Pieces for or web-based training
Events. __________(Note 1)_________
Financing Options 1 hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Available. another location selected by us,
or web-based training
(Note 1)_______
Intranet and Learning Center 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
Training: another location selected by us,
How to Navigate and Use or web-based training
the Various Features. __________ (Note 1)_________

National Conference

In addition, continued development is implemented through our national conference which is

typically held on an annual basis. At least one owner of the franchise business or a representative of your
franchised business who is approved by us must attend this conference, and it is recommended that your
sales and construction managers and sales and construction staff also attend this conference. It is two to
three days of sharing best practices and latest initiatives to improve sales, lower operating costs, build
efficient, high-quality homes and improve profitability. There is a registration fee associated with this of
approximately $625 per person. In addition, you must pay for transportation and room and board for any
of the attendees at the national conference.

Construction Training Sessions

We may provide Construction Training sessions for you, which typically last one or two business
days. In our discretion, this program will be held at our offices in Dublin, Ohio or elsewhere in the
Columbus, Ohio area, or may be provided to you as webinars, online modules or web-based training
seminars or classes. It is recommended that you and anyone employed by you in a construction capacity
at a management level in your Epcon Communities franchise development business attend the
construction training sessions. Construction Training is typically held approximately one time per
calendar year, but may be offered up to two times a year as long as we determine there is adequate
demand for a full class. You and your construction employees are entitled to attend the construction
training program one time at no fee. If training is held at our offices or elsewhere in the Columbus, Ohio
area, you must pay for transportation and room and board for each attendee of the program.

As of the date of this disclosure document, the initial Construction Training sessions are as
follows:
 Hours Of
Classroom Hours Of On-
Subject Location
Training The-Job Training
(Note 2)
Product Orientation: 4 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Plans; Construction another location selected by us,
Specifications; Horizontal or web-based training
Construction Transitioning (Note 1)
into Vertical; Major
Structural Options;
Common Facilities;
Scheduling; Managing
Your Contractors; National
Accounts; Forms and
Inspections.
Intranet Training: 30 minutes (Note 3) Dublin, Ohio, Columbus, Ohio,
How to Use the Forums and another location selected by us,
Library to Access or web-based training
Information. __________(Note 1)_________
Tour of Construction Site, 3.5 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Models, and Clubhouse; another location selected by us,
Unique Construction or web-based training
Practices; Interior Finish (Note 1)
Options; Courtyard
Construction Options;
Construction Faults and
Fixes.
Customer Orientation 2 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Process; QualityMark; another location selected by us,
Warranty; Quality or web-based training
Assurance and Building (Note 1)
Turnover.
Fair Housing; Site IHour (Note 3) Dublin, Ohio, Columbus, Ohio,
Requirements; Public another location selected by us,
Amenities; and Lawsuits. or web-based training
(Note 1)
Safety/OSHA. 1 Hour (Note 3) Dublin, Ohio, Columbus, Ohio,
another location selected by us,
or web-based training
__________ (Note 1)_________
Standard Options/NSO’s; 2 Hours (Note 3) Dublin, Ohio, Columbus, Ohio,
Scopes of Work; another location selected by us,
Construction Budgets; or web-based training
Bidding and Negotiating; (Note 1)
National Accounts; and
Rebates.

Note 1: Franchisee training is scheduled approximately four times per calendar year, and construction
training is held approximately two times per calendar year.
Note 2: Hours of classroom, webinar or online training are approximate. Some topics may take longer
than the indicated time, and some may take less time. The order of the material is subject to change based
on facilitator and resource availability. Length of classes can vary due to attendee participation, questions
asked or additions to or subtractions from the material. There may be pre-class work required prior to
attending or participating in training.

Note 3: ECFI does not provide as a standard part of its training any on-the-job training. However, you
may periodically, at your own expense, request time visiting projects built by Epcon in Columbus.
Additionally, ECFI employees may periodically visit your projects and provide some advice to you. If
you request a visit for the purpose, including site and operation analysis, process improvement feedback,
or personnel training, you must reimburse ECFI for transportation, housing, meals, and car rental or
mileage expenses if applicable.

ECFI will supply you with one copy of its Operations Manual and other manuals. Some of these
copies may be provided to you online or in a computer readable format. These are also available to you
via the Intranet. All training materials required by you during the training sessions are supplied by ECFI.

Instructors for the training programs will vary from course to course and session to session.
David Blackmore, Treasurer and Chief Financial Officer, Joel Rhoades, Vice President and General
Counsel, Nanette Overly, Vice President of Sales and Marketing Services, Paul Hanson, President of
Franchising and Timothy Rini, Vice President of Product Development will most likely be the individuals
assisting with the training of franchisees. In addition, other Epcon Communities associates may conduct
classes based on their expertise in a particular subject matter.

The training instructors have the following number of years of experience in the subject for which
they will provide instruction and the following years of experience with us and/or Epcon; David
Blackmore (45 years of relevant experience/14 years of experience with us and/or Epcon), Nanette Overly
(37 years of relevant experience/19 years of experience with us and/or Epcon), Paul Hanson (16 years of
relevant experience/ 1 year of experience with us and/or Epcon), Timothy Rini (44 years of relevant
experience/11 years of experience with us and/or Epcon), and Joel Rhoades (26 years of relevant
experience/26 years of experience with us and/or Epcon).

You pay no tuition fee for attendance by up to three persons at the initial training program. If
training is held at our offices or elsewhere in the Columbus, Ohio area, you must pay for transportation
and room and board for yourself and any of your employees who attend the program.

Additional Training

In addition to the training sessions described above, we may offer additional training programs to
address system-wide development needs. These programs may be classroom, online or webinar based. A
fee may be applied to these additional training programs to cover expenses associated with materials and
outside instructor costs. Any transportation and room and board for you and any of your employees who
attend these programs, would also be incurred by you.
 Additional training programs and refresher courses are not required, however, you are required to
attend an annual meeting or conference we may hold for franchisees. You must pay a registration fee and
for transportation and room and board associated with any annual meeting or conference.

ITEM 12. TERRITORY

Market Area Reservation Agreement

If you have not signed a Franchise Agreement with us, and you desire to reserve a market area for
the development of an Epcon Communities project by you, if we agree to your request to reserve a
Market Area, you may sign a Market Area Reservation Agreement with us. This agreement allows you to
hold a Market Area for up to 6 months, upon the payment of a $10,000 deposit the (the “Market
Reservation Deposit”). The Market Reservation Deposit is refundable in limited circumstances (described
below). If you sign a Franchise Agreement within six months after you signed the Market Area
Reservation Agreement, the entire Market Reservation Deposit will be applied to the Initial Franchise Fee
due under the Franchise Agreement. You may at any time during the term of the Market Reservation
Agreement request in writing a refund of the Market Reservation Deposit and termination of the Market
Reservation Agreement. If so, we will return the Market Reservation Deposit to you within 15 business
days of receipt of your notice and the signing of a Mutual Release of Market Reservation Agreement by
you and us. We may, at any time during the term of the Market Reservation Agreement notify you that
you have 21 calendar days to enter into a Franchise Agreement and Market Area Agreement with us for
the Market Area described in the Market Reservation Agreement, and pay us the applicable fee set out in
the Franchise Agreement. After this notice from us, if you fail to enter a Franchise Agreement and Market
Area Agreement with us, we will return the Market Reservation Deposit to you within 15 business days
after the expiration of the notice period and the signing of the Mutual Release of Market Reservation
Agreement, and the Market Reservation Agreement will terminate.

Market Area Agreement

At the time that you sign the Franchise Agreement with us, you will also sign a Market Area
Agreement. Each Market Area Agreement (see Exhibit C to this disclosure document) provides for an
Epcon Communities project to be developed at a specific site, selected by you and reviewed by us, and
provides for a “Market Area.”

The Market Area is a concept which is conceived as the smallest specific geographic area
surrounding the project development site that will generate the most purchaser support (typically 60% to
70%) for the development. Generally, a Market Area will roughly encompass the area within a radius of
between 3 to 12 miles, from the development site but will take into consideration existing natural and
man-made boundaries and socioeconomic conditions in the area. The Market Area for your site will be
determined by us and will be depicted on a map attached as an exhibit to the Market Area Agreement.

Under the Market Area Agreement as long as you are in compliance with its terms and those of
the Franchise Agreement, the Market Area is exclusive to you and we agree not to grant to another
franchisee or licensee the right to develop an Epcon Communities project within your Market Area, and
agree that we and Epcon and Epcon Carolinas will not develop an Epcon Communities project within
your Market Area. The exclusivity rights granted to a franchisee to a particular market area under the
Market Area Agreement will terminate on the earlier of the date that a franchisee is in default under the
Franchise Agreement or Market Area Agreement, the date that the Franchise Agreement or Market Area
Agreement terminates, and one year after completion of all of the buildings in a project, or the date set in
the Market Area Agreement.
 You are prohibited from using the Epcon Communities Development System at locations not
specified in your currently-effective Market Area Agreement.

Except as described above, we will not approve the development of additional Epcon
Communities projects within your Market Area or elsewhere.

The exclusivity rights granted to a franchisee to a particular market area under the Market Area
Agreement will terminate on the earlier of the date that a franchisee is in default under the Franchise
Agreement or Market Area Agreement, the date that the Franchise Agreement or Market Area Agreement
terminates, and one year after completion of all of the buildings in a project, or the date set out in the
Market Area Agreement.

Our affiliates, Epcon and Epcon Carolinas, use the Epcon Communities Development System to
develop Epcon projects substantially similar to the projects that ECFI franchisees develop. Neither Epcon
nor Epcon Carolinas will develop projects within your Market Area during the tenn of exclusivity under
your Market Area Agreement with us.

You are not restricted from soliciting any customers to purchase housing Units developed by you,
regardless of who they are or where they reside, whether directly or through other channels such as the
Internet, telemarketing or other direct marketing. There are no restrictions on us or other franchisees (or
our existing licensees) from soliciting customers, regardless of the customers’ locations, whether directly
or through other channels such as the Internet, telemarketing or other direct marketing. You will not
receive any compensation from any sales made by us, Epcon, Epcon Carolinas or other Epcon
Communities franchisees (or licensees) to customers located within your Market Area.

We intend to sell franchises to other franchisees to use the Epcon Communities Development
System.

We have the right under the Franchise Agreement to establish other franchise systems utilizing
the service marks which are a part of the Epcon Communities Development System or other marks. We
have not established any other franchise systems and have no current plans to do so. In August 1996, we
ceased offering new non-franchised licenses for use of the Epcon Communities Development System and
focused on offering franchises.

As of the date of this disclosure document, although we have the right imder the Franchise
Agreement to do so, we have not established any franchised or company-owned projects or another
channel of distribution selling similar products or offering similar services under trademarks or service
marks other than the Epcon Communities service marks.

Except as described in the first paragraph of this Item 12 and except for a default by you under
the Franchise Agreement, continuation of your Market Area exclusivity does not depend upon your
achievement of a certain sales volume, market penetration or other contingency, and your Market Area
may not be altered without your written agreement.

If you decide that you would like to develop additional Epcon Communities projects either within
your existing Market Area(s) or at a site within another Market Area, and we agree, you must sign a new
Franchise Agreement and Market Area Agreement and pay the applicable fees to us, as provided in the
Franchise Agreement. The form of Franchise Agreement you sign at that time may have materially
different terms than the Franchise Agreement you previously signed with us.
 If you become a franchisee and desire to obtain a reservation or “hold” on an additional Market
Area or Areas, and we approve that request, you must sign a Market Hold Agreement (see Exhibit F to
this disclosure document) and pay us a Market Hold Fee for each Market Area that you reserve. The
Market Hold Fee is $5,000 for a six month hold period. If you and we agree, the Market Hold Agreement
may be renewed for additional six month periods for a renewal fee of $5,000 each. These fees are
nonrefundable. However, if you enter into a Franchise Agreement and Market Area Agreement with us
for the reserved Market Area prior to expiration of any market hold term, the Market Hold Fee for that
term will be applied toward payment of the applicable fees for the project.

We may, in our discretion, in circumstances where you have not identified a specific property for
development, agree to extend, in an Addendum to the Franchise Agreement and an Initial Market Area
Agreement, the time period in which you are required to locate suitable property for your project. When
you identify a property for your project, and we agree to that location, you will be required to sign the
Market Area Agreement with us.

Sublicense Agreement

We acknowledge that real estate developers often form a separate business entity for each of then-
projects to isolate each of their business endeavors. On the condition that the individual ownership of the
entities remains the same, and as an accommodation to you to simplify the paperwork involved with
forming a separate business entity for each project, we use the Sublicense Agreement (see Exhibit G to
this disclosure document) as a legal mechanism to evidence the contractual relationship between your
initial business entity, your new business entity, and us. Also, when the Sublicense Agreement is signed,
your new business entity does not pay an initial franchise fee to us (or any other consideration) for the
grant of the rights to your new entity to develop your Epcon Communities project. We do not grant to
you the right to sell or negotiate the sale of franchises in our name or receive any consideration from your
new entity with respect to the grant of these rights. The nature of the sublicense arrangement is described
in Section 12.5 of the Franchise Agreement.

ITEM 13. TRADEMARKS

IP86, LLC (“rP86”), an Ohio limited liability company, was formed on July 15, 2013 and is an
affiliate of ECFI. EP86 maintains its principal place of business at 500 Stonehenge Parkway, Dublin,
Ohio 43017. On April, 15, 2016, IP86 acquired all of the right, title and interest of Home Page, ECFFs
parent company (disclosed in Item 1 of this disclosure document), in ECFFs intellectual property,
including trade names, trademarks, service marks, logos, designs, trade dress, registered or unregistered,
copyrights, registered or unregistered, and derivatives of the intellectual property and domain names.

Through a license agreement with IP86, ECFI has the right to use the Marks and to license to you
the use of the Marks for use in the development of your Epcon Communities project(s) in accordance
with the terms of your Franchise Agreement. Our license agreement with IP86 is in effect until December
31, 2025, and renews automatically for successive one (1) year periods, unless prior to the expiration of
the term, we or ff 86 gives the other party at least three (3) months prior written notice of termination.
Additionally, the agreement may be terminated if: (1) we fail to pay royalty payments under the license
agreement when they are due; (2) any of the following relating to bankruptcy occur: (i) we make an
assignment for the benefit of creditors or enter into an arrangement with our creditors, (ii) a receiver,
custodian, trustee or liquidator is appointed for us or for a material part of our properties, or proceedings
are commeneed seeking appointment of a receiver, custodian, trustee or liquidator and is not dismissed
within 60 days, (iii) a voluntary bankruptcy petition is filed by us or on our behalf, (iv) we suffer an order
for relief under federal bankruptcy law or apply for, consent to or authorize an application of any
bankruptcy, reorganization, arrangement, readjustment of debt, insolvency, dissolution, liquidation or
other similar law, or proceedings are commenced seeking such application and is not dismissed within
sixty (60) days, (v) a material part of our properties are attached or subjected to a lien, which is not
removed within sixty (60) days, (vi) we do not pay our debts as they become due, (vii) we conceal or
remove a material part of our assets, with an intent to hinder or delay our creditors, or (viii) we transfer a
material part of our property for the benefit of a creditor at a time when other similar creditors have not
been paid, or (3) we fail to cure a default under the license agreement. Termination of the license
agreement with ff 86 will not materially alter your rights to use the trademarks.

The Marks listed below are subject to this license agreement and are registered on the Principal
Register of United States Patent and Trademark Office (“PTO”), and as of the date of this disclosure
document, all Affidavits of Use required to be filed under the Lanham Trademark Act have been filed.

Service Mark: “EPCON COMMUNITIES”

Services: Residential building construction services.
Registration Date: April 11, 2006
Registration No.: 3,079,215
Renewed on: March 16, 2016

Service Mark: “EPCON COMMUNITIES”

Services: Franchising, namely offering technical assistance in the
establishment and/or operation of residential building
construction services.
Registration Date: March 6, 2007
Registration No.: 3,216,379
Renewed on: April 17,2017

Service Mark: Design of Four Inter-locking Houses

Services: Franchising, namely offering technical assistance in the
establishment and/or operation of residential building
construction services; and residential building construction
services.
Registration Date: October 17, 2006
Registration No.: 3,160,667
Renewed on: March 17, 2016

Service Mark: “WHERE LIFE COMES TOGETHER”

Services: Franchising, namely offering technical assistance in the
establishment and/or operation of residential building
construction services; and residential building construction
services.
Registration Date: October 24, 2006
Registration No.: 3,163,933
Renewed on: March 17,2016

68
Service Mark: “ONE REMARKABLE EXPERIENCE”
Services: Franchising, namely, offering technical assistance in the
establishment and/or operation of residential building
construction services.
Registration Date: February 19, 2008
Registration No.: 3,383,857
Renewed on: March 15, 2019

Service Mark: “EPCON”

Services: Franchising, namely, offering technical assistance in the
establishment and/or operation of residential building
construction services; and residential building construction
services.
Registration Date: January 20, 2009
Registration No.: 3,564,430
Renewed on: February 16,2019

Service Mark: “QUALITYMARK”

Services: Building inspection.
Registration Date: July 8, 2014
Registration No.: 4,564,174

Service Mark: “BUILDJNG YOUR SUCCESS”

Services: Franchise services, namely, offering business management in the
establishment and operation of construction businesses;
Arranging and conducting of training courses, workshops, non-
downloadable webinars, seminars and conferences in the field of
the operation and marketing of construction businesses.
Registration Date: September 27, 2016
Registration No.: 5,051,052

JP86 believes that it owns common law rights in each of the Marks in those areas where the
Marks have been used by ECFJ, Epcon, Epcon Carolinas or any of the ECFJ franchisees.

There are no currently effective material determinations of the PTO, the United States Patent and
Trademark Office Trademark Trial and Appeal Board, or the trademark administrator of any state or any
court, nor any pending infringement, opposition or cancellation proceedings, nor any pending material
federal or state court litigation involving these Marks. In addition, there are no agreements currently in
effect which significantly limit the rights of ECFJ to use or license the use of the Marks.

You must use each Mark in full compliance with the Franchise Agreement, the Operations
Manual and with reasonable rules prescribed periodically by us. You are prohibited under the Franchise
Agreement from using any Mark as part of any corporate, partnership, trade or other legal name without
our prior consent. You must, except as prohibited by applicable law, develop your projects under the
Marks designated by us for that purpose without any prefix, suffix or other modifying words, terms,
designs or symbols without our prior written consent. In addition, you may not use any Mark in
connection with the sale of any unauthorized product or service or in any manner not authorized in
writing by us. Under the Franchise Agreement, you agree not to contest, directly or indirectly, our
ownership, title, right or interest in the Marks which are a part of the Epcon Communities Development
System.

The Franchise Agreement does not obligate us to protect your use of the Marks or protect you
against claims of infringement or unfair competition arising out of your use of the Marks. You must
promptly notify us of any use of the Marks or any use resembling or suggesting the Marks and any
litigation instituted by any third party against us or you involving the Marks. The Franchise Agreement
does not require us to take affirmative action when notified of these uses or claims. We have the right to
control any administrative proceedings or litigation involving the Marks. We may, in our sole discretion,
undertake the defense, prosecution or settlement of any litigation relating to the Marks. If we do so, you
must, under the Franchise Agreement, sign documents and render other assistance as is in our opinion
reasonably necessary to cany out the defense, prosecution or settlement. The Franchise Agreement does
not require us to participate in your defense and/or to indemnify you for expenses or damages if you are a
party to an administrative or judicial proceeding involving a Mark, or if a proceeding involving a Mark is
resolved unfavorably to you.

If we discontinue use of or modify any of the Marks, we may require you to discontinue or
similarly modify your use of that Mark. Your rights under the Franchise Agreement will continue as long
as you implement the modification or discontinuance of the Marks as required by us. If you fail to
comply with this requirement, we have the right to terminate the Franchise Agreement.

We do not know of any superior prior rights or infringing uses that could materially affect your
use of the Marks in any state.

ITEM 14. PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION

As an ECFI franchisee, you will be granted in the Franchise Agreement a limited, non-exclusive
license to use the information that is the subject of certain copyright registrations, as designated by us for
use in your development and construction of Epcon Communities project(s) in accordance with the terms
of the Franchise Agreement. The copyright registrations are owned by BP86 and are licensed to ECFI. A
list of these copyright registrations is attached to this disclosure document as Exhibit Q. A disclosure
regarding the terms of the sublicense agreement between ff 86, EEC and ECFI appears in Item 13.

All of the copyright registrations have a duration of 70 years after the death of the last surviving
author. All of the copyright registrations listed on Exhibit Q relate to architectural designs, drawings and
blueprints that ECFI will license to you to use in development and construction of your Epcon
Communities project(s). No other copyrights are material to the Epcon Communities franchise.

We do not currently have any patents or any pending patent applications that are material to the
Epcon Communities franchise.

There are no currently effective determinations of the PTO, the U.S. Copyright Office or any
court regarding these copyrights. In addition, there are no agreements currently in effect which
significantly limit the rights of ECFI to license to you the rights to use these copyrights in your
development and construction of Epcon Communities project(s).

You must use the information that is the subject of each copyright registration in full compliance
with the Franchise Agreement, the Operations Manual, the other manuals disclosed in Item 11 of this
disclosure document and with reasonable rules prescribed periodically by us. You must promptly notify
us of any use of information that is the subject of the copyright registrations or any use resembling or
suggesting the information that is the subject of the copyright registrations or the subject matter of any
copyright registration application and any litigation instituted by any third party against us or you
involving the copyright registrations (“Copyrights”). The Franchise Agreement does not require us to
take affirmative action when notified of these uses or claims. We may, in our sole discretion, undertake
the defense, prosecution or settlement of any litigation relating to the Copyrights. If we do so, you are
required under the Franchise Agreement to sign documents and to render other assistance as is in our
opinion reasonably necessary to carry out the defense, prosecution or settlement. The Franchise
Agreement does not require us to participate in your defense and/or to indemnify you for expenses or
damages if you are a party to an administrative or judicial proceeding involving Copyrights, or if a
proceeding involving a copyright registration is resolved unfavorably to you.

If we discontinue or modify use of the information that is the subject of any of the copyright
registrations, we may require you to discontinue or modify your use of that information. We do not know
of any infringements that could materially affect your use of the information that is the subject of the
copyright registrations. Copyrights created on or after January 1, 1978 are not subject to renewal
registration.

In the Franchise Agreement, you acknowledge that your knowledge of the Epcon Communities
Development System and all processes, services and products, formulae, technology and know-how in the
development, construction and marketing of an Epcon Communities project is derived from proprietary
and confidential information of ECFI and that this information is a trade secret. You must maintain as
confidential all information, knowledge or know-how concerning the Epcon Communities Development
System and the methods of operations under the Epcon Communities Development System and any other
matters which could properly be considered to be a part of the Epcon Communities Development System.
You may neither divulge this information to any person, other than your employees to the extent
necessary to develop the project(s), nor permit persons not authorized under the Franchise Agreement to
inspect the Operations Manual, other manuals disclosed in Item 11 of this disclosure document, blueprints
or other materials provided to you by us. Further, you must ensure that your employees comply with the
confidentiality obligations in the Franchise Agreement. You are only permitted to use the Epcon
Communities Development System to develop projects as approved by us under the Franchise Agreement
and Market Area Agreement(s).

ITEM 15. OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE

FRANCfflSE BUSINESS

You are not obligated to participate personally in the development and construction of the Epcon
Communities project(s); however, we recommend that you or at least one of the owners of the franchise
business entity directly participate in these development and construction activities.

If you are a business entity, your principals, officers, owners, directors, investors and/or partners
must, under Section 5.5 of the Franchise Agreement, each sign the Personal Covenants and Agreement
document attached as Exhibit D to this disclosure document. If your spouse is a principal, officer, ovmer,
director, investor or partner in your business entity, your spouse must also sign the Personal Covenants
and Agreement document. Signing this document obligates the party signing to be personally bound by
the payment and other obligations of Article 5 of the Franchise Agreement, the confidentiality and non­
disclosure obligations of Article 10 of the Franchise Agreement, the obligations regarding completion of
project(s) of Article 11 of the Franchise Agreement, and the obligations of Article 13 regarding non­
competition covenants after the franchise is terminated or expires.

71
 There are no limitations on whom you can hire as an on-premises supervisor of your project(s).
Your on-premises supervisor is not required to successfully complete, but may, at your discretion, attend,
our initial franchisee training program. Your on-premises supervisor is not required to ovra an equity
interest in the franchisee, if the franchisee is a business entity.

Pursuant to Section 5.6 of the Franchise Agreement, you must require your managers and
employees who are provided detailed knowledge of the Epcon Communities Development System to sign
the Personal Covenants and Agreement document attached as Exhibit E to this disclosure document.
Signing this document imposes personal obligations on the party signing that are similar to those
described above regarding Exhibit D to this disclosure document.

ITEM 16. RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL

We do not restrict the types of goods or services that you may offer, except that, pursuant to
Articles 8 and 9 of the Franchise Agreement, you are prohibited from modifying the Epcon Communities
Development System (except as necessary to eomply with building codes and permits, and local, state and
federal laws) and, in your development of Epcon Communities projects, you must comply with the
specifications of the Epcon Communities Development System. Under Section 10.6 of the Franchise
Agreement, except in limited circumstances, you may not during the term of the Franchise Agreement,
own, develop, construct or have any interest in any real estate development project that includes
residential homes substantially similar to our architectural plans and specifications for residential
dwellings, or substantially similar to our methods, patterns, documents, materials, know-how, knowledge,
processes and procedures used for development, construction and marketing of detached and attached
homes using unique architectural design, proprietary and confidential information, eopyrighted and
patented materials and material for which copyright registration or patent is pending. You are not required
to sell all goods or services authorized by us. We have the right to add to, discontinue or modify
authorized goods, services, specifications and procedures at our discretion. There are no limits on this
right to make changes to the Epcon Communities Development System.

You are not restricted regarding customers. See Items 8 and 12 of this disclosure document for
additional information.

ITEM 17. RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION

THE FRANCHISE RELATIONSHIP

This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Franchise Agreement

Article(s)/Section(s) in
Provision Summary
Franchise Agreement
a. Length of the franchise Sections 3.1, 13.3 and The Franchise Agreement automatically
term 13.4 terminates on the later of the date that is (i) one
year after the date of completion of your last
Project or (ii) one year after the expiration of
your last Market Hold Agreement with us.
You may terminate the Franchise Agreement if

72
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
you have not commenced construction within
thirty-six (36) months from the date of the
Franchise Agreement, provided you pay us a
$25,000 fee.
We may terminate the Franchise Agreement if
you have not commenced construction within
thirty-six (36) months from the date of the
Franchise Agreement.
b. Renewal or extension of Section 11.4 While not a renewal or extension of the
the term Franchise Agreement, under limited
circumstances, you may be permitted to
complete construction of Units at your project
following termination of your right to use the
Epcon Communities Development System.
c. Requirements for Section 11.4 Although the term “renewal” does not apply to
franchisee to renew or the Epcon franchise, the term renewal generally
extend means that the franchise relationship is extended
for an additional term of years.
Under limited circumstances, you may be
permitted to complete construction of Units at
your project following termination of your right
to use the Epcon Communities Development
System. In no event will you be permitted to
complete construction of the Units for a period
extending beyond two years from the date that
your right to use the Epcon Communities
Development System is terminated.
d. Termination by Section 3.1 You may terminate the Franchise Agreement if
franchisee you have not commenced construction within
thirty-six (36) months from the date of the
Franchise Agreement, provided you pay us a
$25,000 fee.
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f. Termination by Article 13 We may terminate the Franchise Agreement
franchisor with cause upon your default, and we may terminate the
Franchise Agreement if you have not
commenced construction within thirty-six (36)
months from the date of the Franchise
Agreement.
g. “Cause” defined - Sections 12.8, 13.2 and We may terminate the Franchise Agreement if
curable 13.3 within 30 days after you have received written
notice from us, you have failed to cure the
following defaults: (i) your failure, refusal or
neglect to pay to us when due any amounts
owed to us under the Franchise Agreement;
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
(ii) your failure to furnish us with required
reports or information; (iii) your failure to
develop your projects in compliance with the
Epcon Communities Development System;
(iv) your failure, for a 10 day period after your
receipt of notice, to comply with laws
applicable to your franchised development
business; (v) your attempted transfer in
violation of Article 12 of the Franchise
Agreement; (vi) your failure to comply with any
of your obligations under the Franchise
Agreement; (vii) your divulging of any
information or knowledge concerning our
Development System; (viii) your failure to
complete a Project that is required under the
Franchise Agreement; (ix) your failure to
deliver an estimate of your project’s as-built
value, the mortgage, security agreement, or
other security instrument securing your
obligations to us; (x) breach of another
agreement with us; or (xi) you fail to pay the
Minimum Monthly Royalty when due and
without our consent abandon your project for
more than sixty (60) consecutive days.________
h. “Cause” defined - non- Sections 13.1 and 13.3 The Franchise Agreement will automatically
curable terminate immediately upon the occurrence of
the following events of default: (i) your
insolvency; (ii) an assignment by you for the
benefit of creditors; (iii) the filing of a
bankruptcy petition by you; (iv) the filing
against you of a bankruptcy petition which is
either consented to by you or not dismissed
within 30 days; (v) the filing of a proceeding for
the appointment of a receiver for your assets
including a bill in equity where the proceeding
is either consented to by you or not dismissed
within 30 days; (vi) the appointment by a court
of a receiver or other custodian of your
property; (vii) the institution by or against you
of proceedings for composition with creditors
under any state or federal law; (viii) the sale
after levy of your real or personal property;
(ix) your failure to complete the initial training
program to our satisfaction; (x) your material
misrepresentation to us or your conduct that
reflects unfavorably upon your fi-anchised
development business or upon us; (xi) your
conviction or that of your principals or officers
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
of a felony or crime involving moral turpitude;
(xii) our determination that your continued
operation of your franchised development
business will result in immediate danger to
public health or safety and you do not cure the
default within 3 days after notice; (xiii) we give
you a notice of default after 2 previous defaults
have been cured after notice of default with the
preceding 12 months; and (xiv) your death, if
you are an individual, or the death of a majority
owner of your entity.
If you do not commence construction within
thirty six months after you sign the Franchise
Agreement, we may terminate the Franchise
Agreement.
i. Franchisee’s obligations Sections 6.3,10.3, 11.4, Under the Franchise Agreement, after the
on termination/ non­ 13.5, 13.6 and 13.7 Franchise Agreement has terminated for any
renewal reason whatsoever, you may not use, and must
return to us, our Marks, the Epcon Communities
Works (as defined in the Franchise Agreement),
our Development System or any of its parts, or
any other system or its parts that resemble in
any way our Development System. (See also r.
below.)
j. Assignment of contract Not Applicable We have the right to assign our rights and
by franchisor obligations under the Franchise Agreement to
anyone assuming our obligations under the
Franchise Agreement.
k. “Transfer” by franchisee Section 12.1 A transfer includes any transfer sale,
-defined assignment, pledge or encumbrance of the
Franchise Agreement, the rights licensed to you
under the Franchise Agreement, the franchise,
or any ownership interest in the franchise, or
any ownership interest in any entity owning an
interest in you.
1. Franchisor’s approval of Section 12.1 We will not unreasonably withhold our consent
a transfer by franchisee to a transfer by you, but we have the right to
approve the transferee.
m. Conditions for Sections 12.1, 12.2,12.3 If you wish to transfer your interests under the
franchisor’s approval of and 12.4 Franchise Agreement solely for the convenience
a transfer of ownership, we may require that (i) the
transferee be newly organized; (ii) the articles of
incorporation and bylaws of the transferee
confine its activities exclusively to the operation
of the franchised business; (iii) you identify for
us all of the transferee’s stockholders, directors,
officers, partners and/or members; (iv) you enter
into an agreement with us unconditionally

75
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
guaranteeing the transferee’s obligations under
the Franchise Agreement; (v) the stock
certificate bear a legend as set forth in Section
12.4 (d) of the Franchise Agreement; (vi) you
provide us with copies of the transferee’s
governing documents; and (vii) the transferee’s
name not consist of or contain any of our Marks
or any variation of our Marks. If you wish to
transfer your interests for any other reason, we
may require before the transfer the following;
(i) the satisfaction, of all outstanding
obligations, including monetary obligations,
under the Franchise Agreement; (ii) the
subordination of your right to receive
compensation in connection with the transfer to
our right to receive any outstanding obligation
of yours under the Franchise Agreement;
(iii) your signing of a release of any and all
claims against us, and our officers, directors,
shareholders and employees (see Exhibit T to
this disclosure document); (iv) the signing by
the transferee of a written assumption
agreement pursuant to which the transferee
assumes and agrees to discharge all of your
obligations under the Franchise Agreement;
(v) the demonstration to our satisfaction by the
transferee that its meets our educational and
managerial standards; possesses good moral
character, reputation and credit rating; has the
ability to conduct the franchised business; and
has financial resources adequate for operating
the franchised business; (vi) signing by the
transferee of our then-current Franchise
Agreement; and (vii) the completion to our
satisfaction by the transferee of our training
course at transferee’s own expense.
n. Franchisor’s right of Section 12.7 Thirty days prior to the proposed sale or transfer
first refusal to acquire of the franchise, or any ownership interest in
franchisee’s business your entity, or any ownership interest in any
entity owning an interest in you, or the real
property upon which all or a part of your project
is located or is intended to be located, you must
provide us written notice that includes
information reasonably detailed to enable us to
evaluate the terms and conditions of the
proposed sale or transfer. We have thirty days
to notify you that we would like to purchase the
rights, interest, property or assets on the same
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
terms and conditions as are contained in the
written notice. The right of first refusal will be
effective for each proposed transfer, and any
material change in the terms or conditions of the
proposed transfer will be considered a separate
offer and we will have a new thirty day right of
first refusal; the thirty day right of first refusal
period will run concurrently with the period in
which we have to approve or disapprove the
proposed transferee; we may purchase the
interest proposed to be sold for the reasonable
cash equivalent of the consideration offered by
the purchaser. If we choose not to exercise or
right of first refusal, you are free to complete
the transfer subject to your compliance with any
requirements set forth in the Franchise
Agreement._____________________________
Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
Death or disability of Section 13.2.11 The Franchise Agreement will automatically
franchisee terminate immediately upon the occurrence of
the franchisee’s death if franchisee is an
individual.
Non-competition Section 10.6 You (whether as a principal, agent, employee,
covenants during the officer, director or member of any corporation
term of the franchise or other business entity, as a partner or sole
proprietor) may not own, develop, construct or
have any interest in any real estate development
project that includes residential homes
substantially similar to our architectural plans
and specifications for residential dwellings, or
substantially similar to our methods, patterns,
documents, materials, know-how, knowledge,
processes and procedures used for development,
construction and marketing of detached and
attached homes using unique architectural
design, proprietary and confidential
information, copyrighted and patented materials
and material for which copyright registration or
patent is pending. This restriction does not
apply to the involvement by you in the
development of other Epcon Communities
projeets by other franchisee business entities, or
ownership by you of less than three percent
(3%) of the outstanding stock of any publicly
held corporation.

77
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
Non-competition Section 13.7 For a period of three (3) years following the
covenants after the effective date of termination or expiration of the
franchise is terminated Franchise Agreement you (whether as a
or expires principal, agent, employee, officer, director or
member of any corporation or other business
entity, as a partner or sole proprietor) may not
within (a) 10 miles of the geographic border of
any “Market Area” granted to any franchisee
under any Market Area Agreement or other
agreement that is effective between that
franchisee and us, (b) 10 miles of the
geographic border of any “Reserved Market
Area” reserved for any franchisee or prospective
franchisee under any Market Hold Agreement
or other agreement that is in effect between that
party and us, (c) 10 miles of any real estate
development project of Epcon or of any
business entity affiliated with Epcon, or (d) 10
miles of any “Reserved Market Area” reserved
for any prospective franchisee under any Market
Reservation Agreement or other agreement that
is in effect between that party and us, directly or
indirectly, engage in the ownership,
development or construetion of any real estate
development project that includes residential
homes substantially similar to our architectural
plans and specifications for residential
dwellings, or substantially similar to our
methods, patterns, documents, materials, know­
how, knowledge, processes and procedures used
for development, construction and marketing of
detached and attached homes using unique
architectural design, proprietary and
confidential information, copyrighted and
patented materials and material for which
copyright registration or patent is pending.
s. Modification of the Section 4.3 and Articles There may be no modifications generally unless
Agreement Sand 19 they are in writing and signed by both parties,
but the Epcon Communities Development
System and Operations Manual are subject to
change by us in our sole discretion.__________
 Article(s)/Section(s) in
Provision Summary
Franchise Agreement
t. Integration/merger Section 19.1 Subject to applicable state law, only the terms of
clause the Franchise Agreement and other related
written agreements are binding. Any
representations or promises outside of the
disclosure document and franchise agreement
may not be enforceable. However, nothing in
the Franchise Agreement, or in any related
agreement, is intended to disclaim the
representations we made in the franchise
disclosure document that we furnished to you.
u. Dispute resolution by Sections 10.6 and 13.7 Subject to applicable state law, any
arbitration or mediation determination as to whether you have breached
a non-competition covenant or the misuse of our
intellectual property or trade secrets, as well as
any damages that you owe to us as a result of
the breach, must be submitted to final binding
arbitration in Columbus, Ohio (or another
location agreed to by you and us). We may
bring suit in court in our discretion in the
following situations: those necessary to
preserve the status quo, to protect proprietary
information or confidential trade secrets, to
prevent irreparable harm, to enforce defaults
that arise solely out of your failure to pay
amounts due to us, or to compel enforcement of
the non-competition provision. Costs of
arbitration, including arbitrator’s fee, are to be
paid equally by you and us, unless the arbitrator
orders otherwise.
V. Choice of forum Section 20.3 Subject to applicable state law, litigation must
be filed in federal district court for the Southern
District of Ohio in Columbus, Ohio or in
Common Pleas Court of Franklin County, Ohio.
See State Addenda to Franchise Agreement___
w. Choice of law Section 20.2 Subject to applicable state law, Ohio law
applies. See State Addenda to Franchise
Agreement._______________________
 This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Market Area Agreement, Market Area Agreement Extension and Initial Market Area Agreement

Article(s)/Section(s) in
Market Area
Agreement, Market
Provision Area Agreement Summary
Extension and Initial
Market Area
_____ Agreement_____
a. Length of the franchise Not Applicable Not Applicable
term
Renewal or extension of Section 9 of the Market You may request, and we may grant, in our sole
the term Area Agreement; Market and absolute discretion, a six (6) month
Area Agreement extension of the time period during which you
Extension; Not are permitted to use the Epcon Communities
Applicable for Initial Development System at your project provided
Market Area Agreement that for each extension, you pay us a $5,000
extension fee and sign a Market Area
Agreement Extension (see Exhibit C to this
disclosure document).
Requirements for Sections 8 and 9 of the Although the term “renewal” does not apply to
franchisee to renew or Market Area Agreement; the Epcon franchise, the term renewal generally
extend Market Area Agreement means that the franchise relationship is extended
Extension; Not for an additional term of years.
Applicable for Initial You may request, and we may grant, in our sole
Market Area Agreement
and absolute discretion, a six (6) month
extension of the time period during which you
are permitted to use the Epcon Communities
Development System at your project provided
that for each extension, you pay us a $5,000
extension fee and sign a Market Area
Agreement Extension (see Exhibit C to this
disclosure document).
In addition, under limited circumstances,
provided that you are current in all payments
owed to ECFI, and in compliance with the terms
of your Franchise Agreement, you may be
permitted to complete construction of Units at
your project following termination of your right
to use the Epcon Communities Development
System. In no event will you be permitted to
complete construction of the Units for a period
extending beyond two years from the date that
your right to use the Epcon Communities
Development System is terminated.__________

80
 Article(s)/Section(s) in
Market Area
Agreement, Market
Provision Area Agreement Summary
Extension and Initial
Market Area
Agreement
Termination by Section 10 of the Market If you terminate the Franchise Agreement
franchisee Area Agreement; because you have not commenced construction
Section 8 of the Initial within thirty-six (36) months from the date of
Market Area Agreement the Franchise Agreement, this Agreement also
terminates.
Termination by Not Applicable Not Applicable
franchisor without
cause
Termination by Sections 8 and 9 of the Your exclusivity rights in your Market Area will
franchisor with cause Market Area Agreement; immediately terminate in certain circumstances
Sections 7 and 8 of as set forth in subsection (h) of this Item 17.
Initial Market Area
If we terminate the Franchise Agreement
Agreement
because you have not commenced construction
within thirty-six (36) months from the date of
the Franchise Agreement, this Agreement also
terminates.
g. “Cause” defined ■ Not Applicable Not Applicable
curable
h. “Cause” defined - non- Section 8 of the Market Under the Market Area Agreement, your
curable Area Agreement; exclusivity rights in your Market Area will
Section 7 of Initial immediately terminate on the earlier of; (i) your
Market Area Agreement failure to comply fully with your agreements
with us; (ii) the date that is one year after
completion of all buildings in your project; (iii)
the date that all of your rights to use the Epcon
Communities Development System are
terminated; or (iv) an assertion by you, or any
other person claiming to be an assignee of your
rights under the Market Area Agreement, that
your limited exclusivity rights in your Market
Area affected the transfer of any of our
copyrights in any copyrighted works. The
Market Area Agreement automatically
terminates on the termination or expiration of
the Franchise Agreement. Under the Initial
Market Area Agreement, your exclusivity rights
in your Initial Market Area will immediately
terminate on the earlier of; (i) your failure to
comply fully with your agreements with us; (ii)
the earlier of the date you sign a Market Area
Agreement with us and two years from the
effective date of the Initial Market Area
 Article(s)/Section(s) in
Market Area
Agreement, Market
Provision Area Agreement Summary
Extension and Initial
Market Area
Agreement
Agreement; or (iii) an assertion by you, or any
other person claiming to be an assignee of your
rights under the Market Area Agreement, that
your limited exclusivity rights in your Market
Area affected the transfer of any of our
copyrights in any copyrighted works.
If we terminate the Franchise Agreement
because you have not commenced construction
within thirty-six (36) months from the date of
the Franchise Agreement, tliis Agreement also
terminates.
i. Franchisee’s obligations Not Applicable Not Applicable
on termination/
nonrenewal
j. Assignment of contract Not Applicable Not Applicable
by franchisor
k. “Transfer” by franchisee Not Applicable Not Applicable
-defined
1. Franchisor approval of a Not Applicable Not Applicable
transfer by franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s approval of
a transfer
n. Franchisor’s right of Not Applicable Not Applicable
first refusal to acquire
franchisee’s business
0. Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
p. Death or disability of Not Applicable Not Applicable
franchisee
q. Non-competition Not Applicable Not Applicable
covenants during the
term of the franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is terminated
or expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
 Article(s)/Section(s) in
Market Area
Agreement, Market
Provision Area Agreement Summary
Extension and Initial
Market Area
Agreement
u. Dispute resolution by Not Applicable Not Applicable
arbitration or mediation
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Not Applicable Not Applicable

This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Sublicense Agreement

Article(s)/Section(s) In
Sublicense
Provision Summary
Agreement/Franchise
Agreement*
a. Length of the franchise Section 3 The term continues until termination. The
term Sublicense Agreement automatically terminates
on the later of the date that is (i) the date of the
sale of the last Unit of Sublicensee’s Epcon
Communities project or (ii) the date that is one
year after the completion of construction of the
last Unit of Sublicensee’s Epcon Communities
project.
b. Renewal or extension of Not Applicable Not Applicable
the term
c. Requirements for Not Applicable Although the term “renewal” does not apply to
franchisee to renew or the Epcon franchise, the term renewal generally
extend means that the franchise relationship is extended
for an additional term of years.
d. Termination by Section 3 of the If you terminate the Franchise Agreement
franchisee Sublicense Agreement; because you have not commenced construction
Section 3.1 of the within thirty-six (36) months from the date of
Franchise Agreement the Franchise Agreement, this Agreement also
terminates.
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f. Termination by Section 5 of the We may terminate the Sublicense Agreement
franchisor with cause Sublicense Agreement; upon your default. If we terminate the Franchise
Article 13 of the Agreement because you have not commenced
Franchise Agreement construction within thirty-six (36) months from
the date of the Franchise Agreement, this
Agreement also terminates.
 Article(s)/Section(s) In
Sublicense
Provision Summary
Agreement/Franchise
Agreement*
g. “Cause” defined - Section 5 of the We may terminate the Sublicense Agreement if,
curable Sublicense Agreement; within 30 days after you have received written
Sections 13.3 and 13.4 notice from us, you have failed to cure the
of the Franchise following defaults: (i) your failure, refusal or
Agreement neglect to pay to us when due any amounts
owed to us under the Franchise Agreement or
the Sublicense Agreement; (ii) your failure to
furnish us with required reports or information;
(iii) your failure to develop your projects in
compliance with the Epcon Communities
Development System; (iv) your failure, for a 10
day period after your receipt of notice, to
comply with laws applicable to your franchised
development business; (v) your attempted
transfer in violation of Article 12 of the
Franchise Agreement; (vi) your failure to
comply with any of your obligations under the
Franchise Agreement or the Sublicense
Agreement; (vii) your divulging of any
information or knowledge concerning our
Development System; or (viii) your failure to
complete a Project that is required under the
Franchise Agreement or the Sublicense
Agreement. _________ ___________
“Cause” defined ■ ■ non- Section 5 of the The Sublicense Agreement will automatically
curable Sublicense Agreement; terminate immediately upon the occurrence of
Sections 13.1 and 13.3 the following events of default: (i) your
of the Franchise insolvency; (ii) an assignment by you for the
Agreement benefit of creditors; (iii) the filing of a
bankruptcy petition by you: (iv) the filing
against you of a bankruptcy petition which is
either consented to by you or not dismissed
within 30 days; (v) the filing of a proceeding for
the appointment of a receiver for your assets
including a bill in equity where the proceeding
is either consented to by you or not dismissed
within 30 days; (vi) the appointment by a court
of a receiver or other custodian of your
property; (vii) the institution by or against you
of proceedings for composition with creditors
under any state or federal law; (viii) the sale
after levy of your real or personal property; (ix)
your failure to complete the initial training
program to our satisfaction; (x) your material
misrepresentation to us or your conduct that
reflects unfavorably upon your franchised_____

84
 ArticIe(s)/Section(s) In
Sublicense
Provision Summary
Agreement/Franchise
Agreement*
development business or upon us; (xi) your
conviction or that of your principals or officers
of a felony or crime involving moral turpitude;
(xiiy our determination that your continued
operation of your franchised development
business will result in immediate danger to
public health or safety and you do not cure the
default within 3 days after notice; (xiii) we give
you a notice of default after 2 previous defaults
have been cured after notice of default with the
preceding 12 months; and (xiv) your death, if
you are an individual.
If we terminate the Franchise Agreement
because you have not commenced construction
within thirty-six (36) months from the date of
the Franchise Agreement, this Agreement also
terminates.
i. Franchisee’s obligations Section 5 of the After the Sublicense Agreement has terminated
on termmation/non- Sublicense Agreement; for any reason whatsoever, you may not use,
renewal Sections 6.3, 10.3, 13.5, and must return to us, our Marks, the Epcon
13.6 and 13.7 of the Communities Works (as defined in the
Franchise Agreement Franchise Agreement), our Development
System or any of its parts, or any other system
or its parts that resemble in any way our
Development System; you must cooperate in
applying to the appropriate governmental
authorities to cancel recording of the Sublicense
Agreement from all governmental records.
j. Assignment of contract Not Applicable We have the right to assign our rights and
by franchisor obligations under the Sublicense Agreement to
anyone assuming our obligations under the
Sublicense Agreement.
k. “Transfer” by franchisee Section 2 of the A transfer includes any transfer sale,
-defined Sublicense Agreement; assignment, pledge or encumbrance of the
Section 12.1 of the Sublicense Agreement, the rights licensed to
Franchise Agreement you under the Sublicense Agreement, the
sublicense, or any ownership interest in the
sublicense.
1. Franchisor approval of a Section 2 of the We will not unreasonably withhold our consent
transfer by franchisee Sublicense Agreement; to a transfer by you, but we have the right to
Section 12.1 of the approve the transferee.
Franchise Agreement
m. Conditions for Section 2 of the If you wish to transfer your interests under the
franchisor’s approval of Sublicense Agreement; Sublicense Agreement solely for the
a transfer Sections 12.1, 12.2,12.3 convenience of ownership, we may require that
 ArticIe(s)/Section(s) In
Snblicense
Provision Summary
Agreement/F ranchise
Agreement*
and 12.4 of the (i) the transferee be newly organized; (ii) the
Franchise Agreement articles of incorporation and bylaws of the
transferee confme its activities exclusively to
the operation of the sublicensed business;
(iii) you identify for us all of the transferee’s
stockholders, directors, officers, partners and/or
members; (iv) you enter into an agreement with
us unconditionally guaranteeing the transferee’s
obligations under the Sublicense Agreement;
(v) the stock certificate bear a legend as set forth
in Section 12.4 (d) of the Franchise Agreement;
(vi) you provide us with copies of the
transferee’s governing documents; and (vii) the
transferee’s name not consist of or contain any
of our Marks or any variation of our Marks. If
you wish to transfer your interests for any other
reason, we may require before the transfer the
following: (i) your satisfaction of all
outstanding obligations, including monetary
obligations, under the Sublicense Agreement:
(ii) the subordination of your right to receive
compensation with the transfer to our right to
receive any outstanding obligation of yours
under the Sublicense Agreement; (iii) your
signing of a release of any and all claims against
us, and our officers, directors, shareholders and
employees; (iv) the signing by the transferee of
a written assumption agreement pursuant to
which the transferee assumes and agrees to
discharge all of your obligations under the
Sublicense Agreement; (v) the demonstration to
our satisfaction by the transferee that its meets
our educational and managerial standards;
possesses good moral character, reputation and
credit rating; has the ability to conduct the
franchised business; and has financial resources
adequate for operating the franchised business;
(vi) signing by the transferee of our then-current
Sublicense Agreement; and (vii) the completion
to our satisfaction by the transferee of our
training course at transferee’s own expense.
n. Franchisor’s right of Not Applicable Not Applicable
first refusal to acquire
franchisee’s business

86
 Article(s)/Section(s) In
Sublicense
Provision Summary
Agreement/Franchise
Agreement*
Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
Death or disability of Not Applicable Not Applicable
franchisee
Non-competition See Section 10.6 of the You (whether as a principal, agent, employee,
covenants during the Franchise Agreement officer, director or member of any corporation
term of the franchise or other business entity , as a partner or sole
proprietor) may not own, develop, construct or
have any interest in any real estate development
project that includes residential homes
substantially similar to our architectural plans
and specifications for residential dwellings, or
substantially similar to our methods, patterns,
documents, materials, know-how, knowledge,
processes and procedures used for development,
construction and marketing of detached and
attached homes using unique architectural
design, proprietary and confidential
information, copyrighted and patented materials
and material for which copyright registration or
patent is pending. This restriction does not
apply to the involvement by you in the
development of other Epcon Communities
projects by other franchisee business entities, or
ownership by you of less than three percent
(3%) of the outstanding stock of any publicly
held corporation._______
Non-competition Section 13.7 of the For a period of three (3) years following the
covenants after the Franchise Agreement effective date of termination or expiration of the
franchise is tenninated Franchise Agreement you (whether as a
or expires principal, agent, employee, officer, director or
member of any corporation or other business
entity, as a partner or sole proprietor) may not
within (a) 10 miles of the geographic border of
any “Market Area” granted to any franchisee
under any Market Area Agreement or other
agreement that is effective between that
franchisee and us, (b) 10 miles of the
geographic border of any “Reserved Market
Area” reserved for any franchisee or prospective
franchisee under any Market Hold Agreement
or other agreement that is in effect between that
party and us, (c) 10 miles of any real estate
development project of Epcon or of any_______
 Article(s)/Section(s) In
Sublicense
Provision Summary
Agreement/F ranchise
Agreement*
business entity affiliated with Epcon, or (d) 10
miles of any “Reserved Market Area” reserved
for any prospective franchisee under any Market
Reservation Agreement or other agreement that
is in effect between that party and us, directly or
indirectly, engage in the ownership,
development or construction of any real estate
development project that includes residential
homes substantially similar to our architectural
plans and specifications for residential
dwellings, or substantially similar to our
methods, patterns, documents, materials, know­
how, knowledge, processes and procedures used
for development, construction and marketing of
detached and attached homes using unique
architectural design, proprietary and
confidential information, copyrighted and
patented materials and material for which
copyright registration or patent is pending._____
s. Modification of the Section lO.E. of the There may be no modifications generally unless
Agreement Sublicense Agreement; they are in writing and signed by both parties,
Section 19.1 of the but the Epcon Communities Development
Franchise Agreement System and Operations Manual are subject to
change by us in our sole discretion.__________
Integration/merger Section lO.E. of the Subject to applicable state law only the terms of
clause Sublicense Agreement the Sublicense Agreement and other related
written agreements are binding. Any
representations or promises outside of the
disclosure document and franchise agreement
may not be enforceable. However, nothing in
any agreement is intended to disclaim the
express representations made in the Franchise
Disclosure Document, its exhibits and
amendments.
Dispute resolution by Sections 10.2 and 13.7 Subject to applicable state law, any
arbitration or mediation of the Franchise determination as to whether you have breached
Agreement a confidentiality covenant or the misuse of our
intellectual property or trade secrets, as well as
any damages that you owe to us as a result of
the breach, must be submitted to final binding
arbitration in Columbus, Ohio (or another
location agreed to by you and us). We may
bring suit in court in our discretion in the
following situations: those necessary to
preserve the status quo, to protect proprietary

88
 Article(s)/Section(s) In
Sublicense
Provision Summary
Agreement/Franchise
Agreement*
information or confidential trade secrets, to
prevent irreparable harm, to enforce defaults
that arise solely out of your failure to pay
amounts due to us, or to compel enforcement of
the non-competition provision. Costs of
arbitration, including arbitrator’s fee, are to be
paid equally by you and us, unless the arbitrator
orders otherwise.
V. Choice of forum Section lO.G. of the Subject to applicable state law, litigation must
Sublicense Agreement; be filed in federal district court for the Southern
Section 20.3 of the District of Ohio in Columbus, Ohio or in
Franchise Agreement Common Pleas Court of Franklin County, Ohio.
w. Choice of law Section lO.G. of the Subject to applicable state law, Ohio law
Sublicense Agreement; applies.
Section 20.2 of the
Franchise Agreement

*Real estate developers often form a separate business entity for each of their projects to insulate each of
their business endeavors. On the condition that the individual ownership of the entities remains
substantially the same, and as an accommodation to you to simplify the paperwork involved with forming
a separate business entity for each project, ECFI uses the Sublicense Agreement as a legal mechanism to
evidence the contractual relationship between your initial business entity, your new business entity, and
ECFL Pursuant to Section 1 of the Sublicense Agreement, the sublicense does not include certain
obligations imposed upon you pursuant to the Franchise Agreement; pursuant to Section 2 of the
Sublicense Agreement, the sublicensee agrees to be bound by all of your other obligations under the
Franchise Agreement, as these obligations relate to the Epcon Communities project developed by the
sublicensee.

This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Non-Disclosure and On-Line Information Access Agreement

Article(s)/Section(s) in
Non-Disclosure and On-
Provision Summary
Line Information Access
Agreement
a. Length of the Section 14 The term continues until termination.
franchise term
b. Renewal or Not Applicable Not Applicable.
extension of the
term

89
 Article(s)/Section(s) in
Non-Disclosure and On-
Provision Summary
Line Information Access
Agreement
c. Requirements for Not Applicable Not Applicable
franchisee to renew
Although the term “renewal” does not apply to
or extend
the Epcon franchise, the term renewal
generally means that the franchise relationship
is extended for an additional term of years.
d. Termination by Not Applicable Not Applicable
franchisee
e. Termination by Section 14 We can terminate at any time, with or without
franchisor without notice for any reason or no reason, regardless
cause of the status of your Franchise Agreement.
f. Termination by Section 14 We can terminate upon your failure to maintain
franchisor with authorized franchisee status.
cause
g. “Cause” defined - Not Applicable Not Applicable
curable
h. “Cause” defined - Not Applicable Not Applicable
non-curable
i. Franchisee’s Section 14 Upon termination of the Non-Disclosure and
obligations on On-Line Information Access Agreement, you
termination/ will immediately cease accessing the Epcon
nonrenewal Communities Intranet, including the web site
and the databases.
j. Assignment of Not Applicable Not Applicable
contract by
franchisor
k. “Transfer” by Not Applicable Not Applicable
franchisee -defined
1. Franchisor approval Not Applicable Not Applicable
of a transfer by
franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s
approval of a
transfer
n. Franchisor’s right Not Applicable Not Applicable
of first refusal to
acquire
franchisee’s
business
0. Franchisor’s option Not Applicable Not Applicable
to purchase
franchisee’s
business
 ArticIe(s)/Section(s) in
Non-Disclosure and On-
Provision Summary
Line Information Access
Agreement
p. Death or disability Not Applicable Not Applicable
of franchisee
q. Non-competition Section 10 Although you may create your own web site
covenants during and ECFI may authorize you to use
the term of the information presented to you through the
franchise Epcon Communities Internet in the creation of
your web site, you may not create a web site
nsing Epcon, epcon.com,
epconhomesandcommunities.com,
epconcommunities. com,
epconfranchising.com, EpconOpportunity.com
and/or epconcommunitiesfranchising.com, or
register or use other domain names related or
similar to any of these trademarks.
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is
terminated or
expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Section 18 Subject to applicable state law, only the terms
clause of the Non-Disclosure and On-Line
Information Access Agreement and other
related written agreements are binding. Any
representations or promises outside of the
disclosure docmnent and Non-Disclosure and
On-Line Information Access Agreement may
not be enforceable. However, nothing in Non-
Disclosure and On-Line Information Access
Agreement, or in any related agreement, is
intended to disclaim the representations we
made in the franchise disclosure document that
we furnished to you.
u. Dispute resolution Not Applicable Not Applicable
by arbitration or
mediation
V. Choice of forum Section 18 Subject to applicable state law, litigation must
be filed in Franklin County, Ohio or the
Southern District of Ohio.
w. Choice of law Section 18 Subject to applicable state law, Ohio law
applies.
 This table lists certain important provisions of the franchise and related agreements. Yon
should read these provisions in the agreements attached to this disclosure document.

Copvright Assignment & Agreement

Article(s)/Section(s) in
Provision Copyright & Assignment Summary
Agreement
a. Length of the Not Applicable Not Applicable
franchise term
b. Renewal or Not Applicable Not Applicable
extension of the
term
c. Requirements for Not Applicable Not Applicable
franchisee to renew Although the term “renewal” does not apply to
or extend
the Epcon franchise, the term renewal
generally means that the franchise relationship
is extended for an additional term of years.
d. Termination by Not Applicable Not Applicable
franchisee
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f. Termination by Not Applicable Not Applicable
franchisor with
cause
g- “Cause” defined ~ Not Applicable Not Applicable
curable
h. “Cause” defined - Not Applicable Not Applicable
non-curable
i. Franchisee’s Not Applicable Not Applicable
obligations on
termination/ non­
renewal
j- Assignment of Not Applicable Not Applicable
contract by
franchisor
k. “Transfer” by Not Applicable Not Applicable
franchisee -defined
1. Franchisor approval Not Applicable Not Applicable
of a transfer by
franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s
approval of a
transfer
 Article(s)/Section(s) in
Provision Copyright & Assignment Summary
Agreement
n. Franchisor’s right Not Applicable Not Applicable
of first refusal to
acquire
franchisee’s
business
0. Franchisor’s option Not Applicable Not Applicable
to purchase
franchisee’s
business
p. Death or disability Not Applicable Not Applicable
of franchisee
q. Non-competition Not Applicable Not Applicable
covenants during
the term of the
franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is
terminated or
expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
u. Dispute resolution Not Applicable Not Applicable
by arbitration or
mediation
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Not Applicable Not Applicable

This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Mortgage

Article(s)/Section(s) in the
Provision Summary
Mortgage
a. Length of the Paragraph E The Mortgage remains in effect until
franchise term termination by us.
b. Renewal or Not Applicable Not Applicable
extension of the
term
c. Requirements for Not Applicable Not Applicable
franchisee to renew
or extend
 Article(s)/Section(s) in the
Provision Summary
Mortgage
d. Termination by Paragraph Upon payment of all sums secured by the
franchisee Mortgage and the performance of all of the
obligations under the Mortgage by you, we will
release the Mortgage. Upon payment of the
applicable percent of the sales price of each
Unit’s purchase price, as set out in the
Franchise Agreement, we will provide a partial
release of the Mortgage.
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f. Termination by Not Applicable Not Applicable
franchisor with
cause
g. “Cause” defined ~ Not Applicable Not Applicable
curable
h. “Cause” defined - Not Applicable Not Applicable
non-curable
i. Franchisee’s Not Applicable Not Applicable
obligations on
termination/ non­
renewal
j. Assignment of Not Applicable Not Applicable
contract by
franchisor
k. “Transfer” by Not Applicable Not Applicable
franchisee -defined
1. Franchisor approval Not Applicable Not Applicable
of a transfer by
franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s
approval of a
transfer
n. Franchisor’s right Not Applicable Not Applicable
of first refusal to
acquire
franchisee’s
business
0. Franchisor’s option Not Applicable Not Applicable
to purchase
franchisee’s
business
p. Death or disability Not Applicable Not Applicable
of franchisee

94
 Article(s)/Section(s) in the
Provision Summary
Mortgage
q. Non-competition Not Applicable Not Applicable
covenants during
the term of the
franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is
terminated or
expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
u. Dispute resolution Not Applicable Not Applicable
by arbitration or
mediation
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Paragraph F Subject to applicable state law, the laws of the
State where the property is located applies.

This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Securitv Agreement

Article(s)/Section(s) in
Provision Snmmary
Security Agreement
a. Length of the franchise Paragraph 19 Security Agreement tenninates upon full
term performance, payment and satisfaction of your
obligations under the Security Agreement.
b. Renewal or extension of Paragraphs 3 and 4 You authorize us to file financing statement
the term amendments and agree to sign, deliver, and,
if applicable, file financing statements and
amendments relating to the collateral.
c. Requirements for Not Applicable Not Applicable
franchisee to renew or
extend
d. Termination by Not Applicable Not Applicable
franchisee
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f Termination by Not Applicable , Not Applicable
franchisor with cause
g- “Cause” defined - Not Applicable Not Applicable
curable
 ArticIe(s)/Section(s) in
Provision Summary
Security Agreement
h. “Cause” defined - non- Not Applicable Not Applicable
curable
i. Franchisee’s obligations Not Applicable Not Applicable
on termination/ non­
renewal
j- Assignment of contract Not Applicable Not Applicable
by franchisor
k. “Transfer” by franchisee Not Applicable Not Applicable
- defined
1. Franchisor approval of Not Applicable Not Applicable
transfer by franchisee
m. Conditions for Not Applicable Not Applicable
franchisor approval of
transfer
n. Franchisor’s right of Not Applicable Not Applicable
first refusal to acquire
franchisee’s business
0. Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
P- Death or disability of Not Applicable Not Applicable
franchisee
q- Non-competition Not Applicable Not Applicable
covenants during the
term of the franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is terminated
or expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
u. Dispute resolution by Not Applicable Not Applicable
arbitration or mediation
V. Choice of forum Paragraph 17 Subject to applicable state law, you consent to
jurisdiction and venue in any state or federal
court located in Franklin County, Ohio.
w. Choice of law Paragraphs 17 and 18 Subject to applicable state law, Ohio law applies
and you waive your right to a jury trial.
 This table lists certain important provisions of the franchise and related agreements. You
should read these provisions in the agreements attached to this disclosure document.

Market Reservation Agreement

Article(s)/Section(s) in
Provision Market Reservation Summary
Agreement
a. Length of the franchise Section 3 The Reserved Market Area will be held for a
term period of 6 months.
b. Renewal or extension of Not Applicable Not Applicable
the term
c. Requirements for Not Applicable Although the term “renewal” does not apply to
franchisee to renew or the Epcon franchise, the term renewal generally
extend means that the franchise relationship is extended
for an additional term of years.
d. Termination by Not Applicable You may terminate at any time. We will return
franchisee the Market Reservation Deposit at any time
during the term of the Market Reservation
Agreement 15 business days after receipt of a
written request from you to return the Market
Reservation Deposit and to terminate the
Market Reservation Agreement and the signing
of a Mutual Release of Market Reservation
Agreement by you and us.
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f Termination by Sections 4 and 5 If, during the term of the Market Reservation
franchisor with cause Agreement, you sign a Franchise Agreement
and Market Area Agreement and pay the
applicable fees under the Franchise Agreement,
the Market Reservation Agreement will expire.
The Market Reservation Deposit will be applied
toward the applicable fees for your Project as
described in the Franchise Agreement.
Within 21 days of our written request, you must
enter a Franchise Agreement and Market Area
Agreement with us for the Market Area set out
in the Market Reservation Agreement or we
may terminate the Market Reservation
Agreement and return the Market Reservation
Deposit to you. Upon termination of the Market
Reservation Agreement, you and we will sign a
Mutual Release of Market Reservation
Agreement.
g. “Cause” defined - Not Applicable Not Applicable
curable

97
 Article(s)/Section(s) in
Provision Market Reservation Summary
Agreement
h. “Cause” defined - non- Not Applicable Not Applicable
curable
i. Franchisee’s obligations Not Applicable Not Applicable
on termination/
nom-enewal
j- Assignment of contract Not Applicable Not Applicable
by franchisor
k. “Transfer” by ifanchisee Section 6 You may not assign the Market Reservation
- defined Agreement without our consent.
1. Franchisor approval of a Not Applicable Not Applicable
transfer by franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s approval of
a transfer
n. Franchisor’s right of Not Applicable Not Applicable
first refusal to acquire
franchisee’s business
o. Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
P- Death or disability of Not Applicable Not Applicable
franchisee
q- Non-competition Not Applicable Not Applicable
covenants during the
term of the franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is terminated
or expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
u. Dispute resolution by Not Applicable Not Applicable
arbitration or mediation
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Section 9 Subject to applicable state law, Ohio law
applies. See Illinois Addendum to Market
Reservation Agreement.

98
 This table lists certain important provisions of the franchise and related agreements. Yon
shonld read these provisions in the agreements attached to this disclosnre docnment.

Market Hold Agreement

Article(s)/Section(s) in
Provision Market Hold Summary
Agreement
a. Length of the franchise Section 2 The Reserved Market Area will be held for a
term period of 6 months.
b. Renewal or extension of Section 4 The hold period may be extended for additional
the term 6 month periods.
c. Requirements for Not Applicable Although the term “renewal” does not apply to
franchisee to renew or the Epcon franchise, the term renewal generally
extend means that the franchise relationship is extended
for an additional term of years.
d. Termination by Not Applicable Not Applicable
franchisee
e. Termination by Not Applicable Not Applicable
franchisor without
cause
f. Termination by Not Applicable Not Applicable
franchisor with cause
g- “Cause” defined - Not Applicable Not Applicable
curable
h. “Cause” defined - non- Not Applicable Not Applicable
curable
i. Franchisee’s obligations Not Applicable Not Applicable
on termination/
nonrenewal
j- Assignment of contract Not Applicable Not Applicable
by franchisor
k. “Transfer” by franchisee Section 5 The Market Hold Agreement is not assignable
-defined to any other party without the consent of ECFI.
1. Franchisor approval of a Not Applicable Not Applicable
transfer by franchisee
m. Conditions for Not Applicable Not Applicable
franchisor’s approval of
a transfer
n. Franchisor’s right of Not Applicable Not Applicable
first refusal to acquire
franchisee’s business
0. Franchisor’s option to Not Applicable Not Applicable
purchase franchisee’s
business
P- Death or disability of Not Applicable Not Applicable
franchisee
 Article(s)/Section(s) in
Provision Market Hold Summary
Agreement
q- Non-competition Not Applicable Not Applicable
covenants during the
term of the franchise
r. Non-competition Not Applicable Not Applicable
covenants after the
franchise is terminated
or expires
s. Modification of the Not Applicable Not Applicable
Agreement
t. Integration/merger Not Applicable Not Applicable
clause
u. Dispute resolution by Not Applicable Not Applicable
arbitration or mediation
V. Choice of forum Not Applicable Not Applicable

w. Choice of law Section 6 Subject to applicable state law, Ohio law

applies. See Illinois State Addendum to Market
Hold Agreement.

ITEM 18. PUBLIC FIGURES

ECFI does not use any public figure to promote its franchise.

ITEM 19. FINANCIAL PERFORMANCE REPRESENTATIONS

The Federal Trade Commission’s Franchise Rule permits a franchisor to provide information
about the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if
there is a reasonable basis for the information, and if the information is included in the disclosure
document. Financial performance information that differs from that included in Item 19 may be given
only if; (1) a franchisor provides the actual records of an existing outlet you are considering buying; or
(2) a franchisor supplements the information provided in this Item 19, for example, by providing
information about possible performance at a particular location or under particular circumstances.

We do not estimate the revenues or income that you might realize in the development and
marketing of your Epcon Communities project, but, to enable you to have some understanding of the
income that you might expect. Item 19 includes historical sales information regarding Epcon
Communities projects that sold Units in projects in 2018. Because of the nature of construction and the
variables involved, which are discussed in the notes to this Item 19, and also in the notes to Item 7, the
gross sales amounts and absorption rates for a particular project can vary considerably. The information
below is historical information from projects developed by our franchisees and our affiliates, Epcon and
Epcon Carolinas. Projects developed by our affiliates, Epcon and Epcon Carolinas, are sometimes
referred to in this Item 19 as Epcon corporate projects. During 2018, there were 41 franchisees in
operation and two affiliate-owned outlets in operation.

100
 A. Franchisee Projects

The data used to calculate the information presented below is from sales data for Units being sold
in 69 projects that were built by ECFI franchisees in 2018. This data is collected each month in the form
of a monthly closing report, either directly from the franchisee, or obtained by searching county property
records where the project is located. Thirty-Two (32) franchisees^ reported closing data in 2018; two (2)
current franchisees did not have any closing data to report in 2018 due to their projects being sold out;
and seven (7) current franchisees did not have any closings in 2018 due either to their projects being too
new to have Unit closings, or they were in the process of identifying their next project. No data from
franchisees was excluded from Item 19 as a result of their termination or as a result of the closure of their
franchised businesses during their first year of operation.

The calculations are made with all of the available data from franchisees and identify the average,
median, minimum and maximum settlement price'* of Units in each franchisee project. This data for each
project was then used to calculate the information presented in the tables below for all franchisee projects.
For example, the median Unit settlement price is the median of the average settlement prices of each
franchised project.

The absorption rate is the pace of closings per month on the sales of Units in a project. The
absorption rate is calculated by dividing the total number of closings in a project by the number of months
a project was actively selling Units during 2018. The total number of months that a project was actively
selling is defined by the number of months starting from the month of first home closing(s) through to the
month of the project’s final home closing(s). Projects that did not have a selling period lasting the full 12
months of the year either sold all of its available Units within the past year, or the project commenced
selling and closing Units at some point during the year. This data for each project’s absorption rate per
month was then used to calculate the information presented in the tables below for all franchisee projects.
For example, the median absorption rate is the median of the absorption rate of the franchised projects.

The following chart provides the per Unit settlement price for all projects built by franchisees in
2018.

Unit Settlement Price for All 2018 Franchisee Projects Combined

(69 Projects Reported from 32 Franchisees with 741 Total Unit Closings)

Per Unit Settlement Price for All Franchisee Projects

Average $353,222
Median $330,793
Minimum $193,296
Maximum $1,138,207

The number of projects that achieved results above the average Unit settlement price was 25
(36%) and the number of projects that achieved results below the average Unit settlement price was 44
(64%).

A franchisee may have multiple projects in operation during the year, each under a separate Market Area
Agreement and subject to same Franchise Agreement. For purposes of presenting information in Item 19, the
data is calculated on a per project basis rather than by franchisee or Franchise Agreement.
The “settlement price” is defined as the Gross Sales Price as provided in the applicable HUD-1 Settlement
Statement or Closing Disclosure or the total of the “Sale Price of the Property” and the “Sale Price of any
Personal Property included in Sale” in a Settlement Disclosure Form or the amount reported to the appropriate
County office where the project is located.

101
 The following charts provide the absorption rate per month for Units for all franchisee projects.
The rate of absorption indicates how fast the project is selling Units. A project that sells Units more
quickly tends to have lower carrying costs, and a project that sells all of its Units at a quicker pace frees
up capital faster for investment in the project or other projects.

Absorption Rate for All 2018 Franchisee Projects Combined

(69 Projects Reported from 32 Franchisees with 741 Total Unit Closings)

Absorption Rate for All Franchisee Projects

Absorption Rate (rate of Unit
closings per month)
Average 1.06
Median .78
Minimum .08
Maximum 4.17

The number of projects that achieved results at or above the average absorption rate was 16
(23%); and the number of projects that achieved results below the average absorption rate was 53 (77%).

The following charts provide the absorption rate for all projects separated by the top, middle and
bottom third of projects as determined by the absorption rate per month, and include the Per Unit
Settlement Price for projects in those subsets. We define projects having the highest absorption rate per
month as being in the top third of projects and the projects with the lowest absorption rates per month as
being in the bottom third of projects.

Top Third of 2018 Franchise Projects Based on Absorption Rate with Per Unit Settlement Price
(23 Projects reported from 16 Franchisees with 453 Total Unit Closings)

Top Third of Franchise Projects Based on Absorption

Rate w ith Per Unit Settlement Price
Absorption Rate Unit Settlement
(rate of Unit Price
closings per
month)
Average 2.85 $366,049
Median 2.00 $340,550
Minimum 1.17 $193,296
Maximum 4.17 $1,138,207

The number of projects in this subset that achieved results above the average absorption rate was
4 (17%) and the number of projects that achieved results below the average absorption rate was 19 (83%).
The period of closings in this subset ranged from 2-12 months.

The number of projects in this subset that achieved results above the average per Unit settlement
price was 9 (39%) and the number of projects that achieved results below the average per Unit settlement
price was 14 (61%).

102
Middle Third of 2018 Franchise Projects Based on Absorption Rate with Per Unit Settlement Price
(23 Projects reported from 17 Franchisees with 198 Total Unit Closings)

Middle Third of Franchise Projects Based on Absorption

Rate with Per Unit Settlement Price
Absorption Rate Unit Settlement
(rate of Unit Price
closings per
month)
Average .85 $339,366
Median .83 $325,450
Minimum .58 $214,095
Maximum 1.25 $679,650

The number of projects in this subset that achieved results above the average absorption rate was
9 (39%) and the number of projects that achieved results below the average absorption rate was 14 (61%).
The period of closings in this subset ranged from 3-12 months.

The number of projects in this subset that achieved results above the average per Unit settlement
price was 8 (35%) and the number of projects that achieved results below the average per Unit settlement
price was 15 (65%).

Bottom Third of 2018 Franchise Projects Based on Absorption Rate with Per Unit Settlement Price
(23 Projects reported from 14 Franchisees with 90 Total Unit Closings)

Bottom Third of Franchise Projects Based on Absorption

Rate with Per Unit Settlement Price
Absorption Rate Unit Settlement
(rate of Unit Price
closings per
month)
Average .42 $319,141
Median .42 $304,500
Minimum .08 $194,900
Maximum .58 $560,917

The number of projects in this subset that achieved results above the average absorption rate was
5 (22%) and the number of projects that achieved results below the average absorption rate was 18 (78%).
The period of closings in this subset ranged from 5-12 months.

The number of projects in this subset that achieved results above the average per Unit settlement
price was 9 (39%) and the number of projects that achieved results below the average per Unit settlement
price was 14 (61%).

103
 The following chart provides the per Unit settlement price for all projects built by franchisees in
2018 broken-out by those projects that sold only detached Units, sold only attached Units, and sold both
detached and attached Units combined in the same project.

Unit Settlement Price for All 2018 Franchisee Projects Combined

(69 Projects Reported from 32 Franchisees with 741 Total Unit Closings)

Per Unit Settlement Price By Detached, Attached and Combined Projects

Detached Units Projects
Attached Units Projects Combined Projects
(total of 37 projects)
(total of 18 projects) (total of 14 projects)
Average $379,631 $304,116 $341,029
Median $352,764 $298,278 $318,685
Minimum $202,559 $193,296 $194,900
Maximum $1,138,207 $430,257 $560,917

The number of projects that achieved results above the average Unit settlement price for detached
only Unit projects was 12 (3%) and the number of projects that achieved results below the average Unit
settlement price was 25 (68%).

The number of projects that achieved results above the average Unit settlement price for attached
only Unit projects was 7 (39%) and the number of projects that achieved results below the average Unit
settlement price was 11 (61%).

The number of projects that achieved results above the average Unit settlement price for both
attached and detached Unit projects was 6 (43%) and the number of projects that achieved results below
the average Unit settlement price was 8 (57%).

The following chart provides the Absorption rate for all projects built by franchisees in 2018
broken-out by those projects that sold only detached Units, sold only attached Units, and sold both
detached and attached Units combined in the same project.

Absorption Rate for All 2018 Franchisee Projects Combined

(69 Projects Reported from 32 Franchisees with 741 Total Unit Closings)

Absorption Rate for Detached, Attached and Combined Projects

(rate of Unit closings per month)

Detached Units Projects Attached Units Projects Combined Projects

(total of 37 projects) (total of 18 projects) (total of 14 projects)
Average 1.73 1.82 1.97
Median 1.33 1.33 2.58
Minimum 0.17 0.17 0.08
Maximum 3.92 4.17 3.58

The number of projects that achieved results above the average absorption rate for detached only
Unit projects was 6 (16%) and the number of projects that achieved results below the average was 31
(84%).

104
 The number of projects that achieved results above the average absorption rate for attached only
Unit projects was 4 (22%) and the number of projects that achieved results below the average was 14
(78%).

The number of projects that achieved results above the average absorption rate for both attached
and detached Unit projects was 2 (14%) and the number of projects that achieved results below the
average was 12 (86%).

B. Epcon Corporate Projects

The data used to calculate the information presented below is from sales data for Units sold in 18
projects that were built and sold by our corporate affiliates, Epcon and Epcon Carolinas, in 2018. This
data is collected from Epcon and Epcon Carolinas each month. All of the projects represented in this data
were located in either central Ohio, South Carolina or North Carolina.

The calculations are made with all of the available data from Epcon and Epcon Carolinas and
identify the average, median, minimum and maximum settlement price of Units in each Epcon corporate
project. This data for each project was then used to calculate the information presented in the tables
below for all Epcon corporate projects. For example, the median Unit settlement price is the median of
the average settlement prices of all Epcon corporate projects.

The absorption rate is the pace of closings per month on the sales of Units in a project. The
absorption rate is calculated by dividing the total number of closings in a project by the number of months
a project was actively selling and closing Units during 2018 to obtain an average number of closings for
that project. The total number of months that a project was actively selling is defined as the number of
months starting from the month of first home closing(s) through to the month of the project’s final home
closing(s). Projects that did not have a selling period lasting the full 12 months of the year either closed
on the sale of all of its available Units within the past year, or the project commenced selling and closing
Units at some point during the year. This data for each project’s absorption rate per month was then used
to calculate the information presented in the tables below for all Epcon projects. For example, the median
absorption rate is the median of the absorption rate of all Epcon projects.

The following chart provides the per Unit settlement price for all projects built by Epcon and
Epcon Carolinas in 2018.

Unit Settlement Price for All 2018 Epcon Corporate Projects Combined
(18 Projects Reported with 497 Total Unit Closings)

Per Unit Settlement Price for All Epcon Corporate Projects

Average $440,146
Median $443,970
Minimum $225,345
Maximum $638,400

The number of projects that achieved results above the average Unit settlement price was 10
(56%) and the number of projects that achieved results below the average Unit settlement price was 8
(44%).

The following charts provide the absorption rate per month for Units for all Epcon projects. The
rate of absorption indicates how fast a project is selling Units. A project that sells Units more quickly

105
tends to have lower carrying costs, and a project that sells all of its Units at a quicker pace frees up capital
faster for investment in the project or other projects.

Absorption Rate for All 2018 Epcon Corporate Projects Combined

(18 Projects Reported with 497 Total Unit Closings)

Absorption Rate for All Epcon Corporate Projects

Absorption (rate of Unit
closings per month)
Average 3.62
Median 3.92
Minimum 0.25
Maximum 6.71

The number of Epcon projects that achieved results above the average absorption rate was 6
(33%) and the number of projects that achieved results below the average absorption rate was 12 (67%).
The period of closings ranged from 1 to 12 months.

NOTES TO ITEM 19 CHARTS:

Note 1: FACTORS IMPACTING SELLING PRICE AND ABSORPTION RATE: A variety of

factors will impact the selling price for a Unit and the absorption rate for a project, such as: the demand
for new housing in the project area, the location of the project including its proximity to an urban area,
community amenities, perceived value by the buyer, the model of Units built including whether the Units
are attached or detached condominiums, options such as basements and porches, total square footage,
variables in finish levels, among other factors. As a result of the many variables, no particular correlation
between the Unit settlement prices for a project and the absorption rate for a project should be assumed
from the data presented in this Item 19. Some projects with higher per Unit settlement prices may have
lower absorption rates, and projects with lower settlement prices may have higher absorption rates.

Note 2: EPCON PROJECTS. Epcon, or Epcon Carolinas, periodically sells some of its Units to an
affiliated company at cost. These Units are not resold until after the last retail sale is made by Epcon.
This practice allows Epcon to begin a project with more equity in the project than you may have which
may permit Epcon to construct a project more quickly. During 2018, there were eight (8) Units sold to an
affiliated company by Epcon or Epcon Carolinas.

Epcon corporate projects may benefit from increased name recognition in the markets where those
projects are located due to the long history of selling Epcon corporate projects in those areas. Epcon
corporate projects are often located in highly desirable neighborhoods due to Epcon’s thudy (30) years of
industry experience in evaluating and acquiring raw land and Epcon’s increased access to financing and
capital permitting acquisition of prime locations. Epcon also has experienced sales staff, including those
with a long tenure of selling Units in Epcon corporate projects.

Note 3: UNIT TYPES CONSTRUCTED. Different Unit types and home styles may be constructed in
a project, including Unit types which are derived from the standard models listed below. In the projects
used in this Item 19 for Epcon projects, several home types and styles were constructed, some of which
had basements. Homes with basements and detached homes may receive a higher sales price. Epcon
offers a number of home models that are grouped into Series/Collections. Those homes include:

• Villa, Chateau, Windsor of the Classic Series (four-family attached)

106
 • Abbey, Canterbury of the Cathedral Series (four-family attached)
• Aboreta, Bramante, Colonnade, Ducal of the Attached Courtyard Collection (four-family
attached)
• Piazza, Palazzo, Portico, Promenade of the “P-Series” of the Detached Courtyard Collection
(single-family detached)
• Capri, Salerno, Torino, Verona of the “R-Series” of the Detached Courtyard Collection (single­
family detached)
• Alston, Berton of the Duplex Series (attached duplex)
• Ellsworth, Cala, Haven of the Triplex Series (attached duplex or triplex)

This Item 19 information for Epcon reflects Epcon’s experience with the following home series:

• Palazzo, Portico, Promenade of the “P-Series” of the Detached Courtyard Collection (single­
family detached)
• Alston, Berton of the Duplex Series (attached duplex)
• Salerno, Torino, Verona of the “R-Series” of the Detached Courtyard Collection (single-family
detached)
• Ellsworth, Cala, Haven of the Triplex Series (attached duplex or triplex)
• Ducal of the Attached Courtyard Collection (four-family attached)

For the projects used in this Item 19 for franchisees’ results, a variety of homes were constructed. Some
had basements while others did not. Homes with basements and detached home styles may have a higher
sales price although this is largely driven by the location of the project and what is common in the project
area. Those home models built by our franchisees in the data above include:

• Abbey, Canterbury of the Cathedral Series (four-family attached)

• Aboreta, Bramante, Colonnade, Ducal of the Attached Courtyard Collection (four-family
attached)
• Piazza, Palazzo, Portico, Promenade of the “P-Series” of the Detached Courtyard Collection
(single-family detached)
• Capri, Salerno, Torino, Verona of the “R-Series” of the Detached Courtyard Collection (single­
family detached)
• Other home models derived from the standard Epcon models.

Note 4: COMMUNITY AMENITY TYPE. ECFI offers prototype plans for numerous options for
community amenities, and guidelines for which amenity is appropriate to offer, based on the number of
Units in a community. Currently, there are three (3) clubhouse plans and two (2) pavilion plans. The size
of the pavilion in each community is distinguished by the finished floor area of the amenity. Clubhouses
range from 1,500 to 3,706 square feet. An outdoor swimming pool or lap pool is to be constructed with a
clubhouse but not with a pavilion. A project with more amenities tends to increase the sales price for a
Unit in that project.

Some outlets have sold these amounts. Your individual results may differ. There is no assurance
that you will sell as much.

Written substantiation of the data used in preparing the tables set forth above will be made available to
you upon reasonable request to us.

Other than the preceding financial performance representations, ECFI does not make any financial
performance representations. We also do not authorize our employees or representatives to make any

107
representations either orally or in writing. If you are purchasing an existing outlet, however, we may
provide you with the actual records of that outlet. If you receive any other financial performance
information or projections of your future income, you should report it to the franchisor's management by
contacting Joel D. Rhoades, Vice President and General Counsel, Epcon Communities Franchising, Inc.,
500 Stonehenge Parkway, Dublin, Ohio 43017, (614) 761-1010, the Federal Trade Commission, and the
appropriate state regulatory agencies.

ITEM 20. OUTLETS AND FRANCfflSEE INFORMATION

We began offering franchises as of August 13, 1996, and sold our first franchise on October 28,
1996. A list of Epcon Communities’ franchisees and the addresses and telephone numbers of their
business offices is attached as Exhibit N to this disclosure document.

As is discussed in Item 1 of this disclosure document, before August 1996 we entered into
licenses with a number of licensees to use the Epcon Communities Development System to develop and
construct developments similar to those to be developed by you. However, these licensees, with one
exception, were not granted the right to use the Epcon Communities Marks. We no longer enter into
license agreements and focus our efforts on offering and selling franchises.

We have not developed residential community projects using the Epcon Communities
Development System and do not anticipate developing any projects during the fiscal year ending on
December 31, 2019. As is discussed in Item I of this disclosure document and in this Item 20, our
affiliates, Epcon and Epcon Carolinas, have developed, and continue under license agreements with us, to
develop, multi-family residential communities similar to those to be developed by you.

Following is information on our franchises as of the end of our 2016, 2017 and 2018 fiscal years:

ITEM 20 TABLE NO. 1

SYSTEMWIDE OUTLET SUMMARY
FOR FISCAL YEARS 2016/2017/2018

Column 1 Column 2 Column 3 Column 4

Column 5
Outlets at the Outlets at the
Net Change
Outlet Type Year Start of the Year End of the Year
2016 68 61 -7
Franchised 2017 61 60 -1
2018 60 59 -1
2016 15 18 +3
Company-
2017 18 15 -3
Owned*
2018 15 14 -1
2016 83 79 -4
Total Outlets** 2017 79 75 -4
2018 75 73 -2

*We do not operate any company-owned development projeets. Our affiliates, Epcon and Epcon
Carolinas, separately develop similar development projects which are disclosed in this Table as
Company-owned Outlets. The number of Company-owned Outlets at the end of a fiscal year takes into
account that some development projeets have been completed by Epcon or Epcon Carolinas during a
fiscal year and Units are no longer being sold. A development project ceases operation when the sale of
the last Unit in the project has closed or when a certificate of occupancy is issued for the last remaining

108
building in a development; however, some marketing, sales and construction punch-out items may remain
to be completed.

**In this Table, each franchised outlet represents a signed Franchise Agreement and each company-
owned outlet represents a project currently being developed by our affiliates, Epcon and Epcon Carolinas.
Thus, the section of the table labeled “Total Outlets” represents totals of signed Franchise Agreements
(rather than the total number of projects developed) and company-owned development projects.

Following is information on transfers of franchises to new owners (other than to us) as of the end
of our 2016, 2017 and 2018 fiscal years:

ITEM 20 TABLE NO. 2

TRANSFERS OF OUTLETS FROM FRANCfflSEES TO NEW OWNERS
(OTHER THAN THE FRANCHISOR)
FOR FISCAL YEARS 2016/2017/2018

Column 1 Column 2 Column 3

State^ Year Number of Transfers
2016 0
Alabama 2017 0
2018 0
2016 0
California 2017 0
2018 0
2016 0
Colorado 2017 0
2018 0
2016 0
Georgia 2017 0
2018 0
2016 0
Illinois 2017 0
2018 0
2016 0
Indiana 2017 0
2018 0
2016 0
Iowa 2017 0
2018 0
2016 0
Kansas 2017 0
2018 0
2016 0
Kentucky 2017 0
2018 0

^ This Table includes transfer information for only those states in which we register our franchise offering and
those states in which a franchisee was located during the fiscal years included in the Table above.

109
 Column 1 Column 2 Column 3
State® Year Number of Transfers
2016 0
Louisiana 2017 0
2018 0
2016 0
Michigan 2017 0
2018 0
2016 0
Minnesota 2017 0
2018 0
2016 0
Missouri 2017 0
2018 0
2016 0
Nevada 2017 0
2018 0
2016 0
New York 2017 0
2018 0
2016 0
North Carolina 2017 0
2018 0
2016 0
Ohio 2017 0
2018 0
2016 0
Pennsylvania 2017 0
2018 0
2016 0
South Carolina 2017 0
2018 0
2016 0
Tennessee 2017 0
2018 0
2016 0
Texas 2017 0
2018 0
2016 0
Virginia 2017 0
2018 0
2016 0
Washington 2017 0
2018 0
2016 0
West Virginia 2017 0
2018 0

no
 Column 1 Column 2 Column 3
State® Year Number of Transfers
2016 0
Wisconsin 2017 0
2018 0
2016 0
Total 2017 0
2018 0

Following is information on our franchises as of the end of our 2016, 2017 and 2018 fiscal years;

ITEM 20 TABLE NO. 3

STATUS OF FRANCfflSED OUTLETS
FOR FISCAL YEARS 2016/2017/2018

Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6® Col. 7 Col. 8 Col. 9

Re­ Ceased
Outlets at acquired Operations Outlets
Start of Outlets Term­ Non- by Other at end of
State* Year Year Opened inations Renewals Franchisor Reasons the Year
2016 2 0 0 0 0 0 2
Alabama 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2
2016 0 0 0 0 0 0 0
California 2017 0 0 0 0 0 0 0
2018 0 0 0 0 0 0 0
2016 0 0 0 0 0 0 0
Colorado 2017 0 0 0 0 0 0 0
2018 0 1 0 0 0 0 1
2016 3 0 0 1 0 0 2
Georgia 2017 2 2 0 0 0 0 4
2018 4 0 0 1 0 0 3
2016 3 0 0 0 0 0 3
Illinois 2017 3 0 0 0 0 0 3
2018 3 0 0 0 0 0 3
2016 10 0 0 1 0 0 9
Indiana 2017 9 0 0 2 0 0 7
2018 7 0 0 1 0 0 6
2016 3 0 0 1 0 0 2
Iowa 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2

Franchisees are granted the right to use the Epcon Communities Development System to construct and market
an Epcon project at a specified location with a specified market area. A franchisee’s Market Area Agreement
sets out the geographic area within which its project may be located. A franchisee must sign a new Franchise
Agreement and Market Area Agreement for each project it chooses to develop.

Ill
 Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6® Col. 7 Col. 8 Col. 9
Re­ Ceased
Outlets at acquired Operations Outlets
Start of Outlets Term- Non- by Other at end of
State* Year Year Opened inations Renewals Franchisor Reasons the Year
2016 1 0 0 0 0 0 1
Kansas 2017 1 0 0 0 0 0 1
2018 1 0 0 0 0 0 1
2016 2 0 0 0 0 0 2
Kentucky 2017 2 0 0 1 0 0 1
2018 1 0 0 0 0 0 1
2016 1 0 0 0 0 0 1
Louisiana 2017 1 0 0 0 0 0 1
2018 1 0 0 0 0 0 1
2016 2 0 0 1 0 0 1
Michigan 2017 1 0 0 0 0 0 1
2018 1 1 0 0 0 0 2
2016 0 0 0 0 0 0 0
Minnesota 2017 0 0 0 0 0 0 0
2018 0 0 0 0 0 0 0
2016 1 1 0 0 0 0 2
Missouri 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2
2016 0 0 0 0 0 0 0
Nevada 2017 0 1 0 0 0 0 1
2018 1 0 0 0 0 0 1
2016 4 0 0 0 0 0 4
New York 2017 4 0 0 0 0 0 4
2018 4 0 0 0 0 0 4
2016 10 0 0 0 0 0 10
North
2017 10 1 1 0 0 0 10
Carolina
2018 10 0 2 0 0 0 8
2016 14 1 0 3 0 0 12
Ohio 2017 12 1 1 1 0 0 11
2018 11 1 0 0 0 0 12
2016 2 0 0 0 0 0 2
Penn. 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2
2016 1 0 0 0 0 0 1
South
2017 1 0 0 0 0 0 1
Carolina
2018 1 0 0 0 0 0 1
2016 2 0 0 0 0 0 2
Term. 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2
2016 1 1 0 0 0 0 2
Texas 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2

112
 Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6^ Col. 7 Col. 8 Col. 9
Re­ Ceased
Outlets at acquired Operations Outlets
Start of Outlets Term- Non- by Other at end of
State* Year Year Opened inations Renewals Franchisor Reasons the Year
2016 3 0 0 2 0 0 1
Virginia 2017 1 0 0 0 0 0 1
2018 1 0 0 0 0 0 1
2016 0 0 0 0 0 0 0
Wash. 2017 0 0 0 0 0 0 0
2018 0 0 0 0 0 0 0
2016 1 0 0 1 0 0 0
West
2017 0 0 0 0 0 0 0
Virginia
2018 0 0 0 0 0 0 0
2016 2 0 0 0 0 0 2
Wis. 2017 2 0 0 0 0 0 2
2018 2 0 0 0 0 0 2
2016 68 0 10 0 0 61
Total 2017 61 5 2 4 0 0 60
2018 60 3 2 2 0 0 59

*For purposes of Item 20 and Exhibit N, franchisees are assigned to a state in accordance with the
locations of their project(s), not in accordance with the states in which the principal business offices of the
franchisees themselves are located.

We do not operate any company-owned outlets and do not develop projects. Our affiliates, Epcon and
Epcon Carolinas, develop projects similar to those to be developed by you. Following is information on
Epcon’s and Epcon Carolina’s developments as of the end of their 2016, 2017 and 2018 fiscal years:

ITEM 20 TABLE NO. 4

STATUS OF COMPANY-OWNED OUTLETS
FOR FISCAL YEARS 2016/2017/2018

Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6 Col. 7 Col. 8

Outlets at Outlets Re­ Outlets Sold Outlets
Start of the Outlets acquired from Outlets to at end of
State Year Year Opened Franchisees Closed* Franchisees the Year
2016 4 3 0 1 0 6
Ohio 2017 6 1 0 4 0 3
2018 3 1 0 2 0 2
2016 10 3 0 2 0 11
North
2017 11 1 0 1 0 11
Carolina
2018 11 2 0 2 0 11
2016 1 0 0 0 0 1
South
2017 1 0 0 0 0 1
Carolina
2018 1 0 0 0 0 1
2016 15 6 0 3 0 18
Total 2017 18 2 0 5 0 15
2018 15 3 0 4 0 14

113
* Outlets “closed” includes those development projects that have been completed during the fiscal year
and are no longer “open.” A development project ceases operation when the sale of the last Unit in the
project has closed or when a certificate of occupancy is issued for the last remaining building in a
development; however, some marketing, sales and construction punch-out items may remain to be
completed.

Following is information on our projections for the sale of franchises during our 2019 fiscal year
(January 1, 2019 through December 31, 2019):

ITEM 20 TABLE NO. 5

PROJECTED OPENINGS AS OF DECEMBER 31,2018

Column 1 Column 2 Column 3 Column 4

Projected New
Franchise Agreements Projected New Company-Owned
Signed but Outlet Not Franchised Outlets in Outlets in the Next
State Opened the Next Fiscal Year Fiscal Year*
Alabama 0 1 0
Colorado 1 0 0
Georgia 0 0 0
Indiana 0 1 0
Kentucky 0 0 0
Massachusetts 0 0 0
Michigan 1 0 0
Missouri 0 0 0
Nevada 0 0 0
New Jersey 0 0 0
North Carolina 0 0 3
Ohio 1 2 3
Tennessee 0 2 0
Texas 0 0 0
Total 3 6 6

* We do not operate any company-owned locations. The information disclosed in this column relates to
Epcon’s and Epcon Carolina’s projected new development projects.

Following is a list of the names, cities, states and current business telephone numbers (or, if
unknown, the last known home telephone numbers of all franchisees who had a Epcon Communities
franchise terminated, canceled or not renewed, who otherwise voluntarily or involuntarily ceased to do
business under the Franchise Agreement during our most recently completed fiscal year or who have not
communicated with us within 10 weeks before the issuance date of this disclosure document:

Reason for Leaving the

Franchisee Project Location ECFI System
Graystone Group, LEG Indiana Non-Renewal
Sean Edwards Completed Last Project
12562 N. Broadmoor Court
Fishers, IN 46037
317-570-2729

114
 Reason for Leaving the
Franchisee Project Location ECFI System
GTFC Development, LLC Georgia Non-Renewal
101 Kingfisher Circle Completed Last Project
Pooler, GA 31322
Gary Turnbull
912-748-2514

Three Eagles, LLC North Carolina Voluntary Termination

647 Park Meadow Road, Ste. E
Westerville, OH 43081
Duane Cathell
Lyle Wiley
614-939-1700

Olde Towne Villages, LLC North Carolina Voluntaiy Termination

647 Park Meadow Road, Ste. E
Westerville, OH 43081
Lyle E. Wiley
Duane L. Cathell
614-939-1700

Following is a list of the names, cities and states and current business telephone numbers (or, if
unknown, the last known home telephone numbers of every franchisee who had an outlet terminated,
cancelled, not renewed, or otherwise voluntarily or involuntarily ceased to do business under the
Franchise Agreement from the date of our most recently completed fiscal year end until the date of this
disclosure document:

None.

If you buy this franchise, your contact information may be disclosed in the future to other buyers
when you leave the franchise system.

Following is a list of the names, cities and states and current business telephone numbers of
franchisees that signed a Franchise Agreement during our most recently completed fiscal year but, as of
the date of this disclosure document, have not yet opened a franchised outlet:

Franchisee Project Location

Charis Homes, LLC North Canton, Ohio

6231 Frank Avenue NW
North Canton, OH 44720
Glenna Wilson and Todd Scott
(330) 833-4527

Eastman Properties, LLC Fort Lupton, Colorado

745 Heather Glen Lane
Fort Collins, CO 80525
David Krafsur
(970) 690-2007

115
Stanford Development Group, LLC Lowell, Michigan
8106 Fulton East
Ada, MI 49301
Steven D. Hanson
(616) 682-9225

We have sold franchises to business entities owned by members of the immediate families of the
principals of ECFI and Epcon. A member of the immediate family of a principal has signed a Franchise
Agreement (dated December 31, 2001), under which a community in the Florence, Kentucky area was
completed in 2017. A member of the immediate family of a principal has two Franchise Agreements: a
Franchise Agreement (dated March 27, 2013) for projects in the Rock Hill, Columbia and Greenville,
South Carolina areas, and a Franchise Agreement (dated July 15, 2013) for projects in the Charlotte,
North Carolina area. In 2015, a member of the immediate family of a principal completed a community in
Alpharetta, Georgia under a Franchise Agreement dated June 30, 2005.

During the last three fiscal years, no current or former franchisees have signed confidentiality
clauses that restrict them from discussing with you their experiences as a franchisee in our franchise
system.

As of the date of this disclosure document, we are not aware of any trademark-specific franchisee
organization associated with the ECFI franchise system.

ITEM 21. FINANCIAL STATEMENTS

Epcon Communities Franchising, Inc.’s audited financial statements as of December 31, 2016,
December 31, 2017 and December 31, 2018 and for the years then ended are attached to this disclosure
document as Exhibit A.

ITEM 22. CONTRACTS

Attached to this disclosure document are copies of the following agreements relating to the
offering of the Epcon Communities franchise:

Exhibit B. Franchise Agreement

Exhibit C. Market Area Agreement and Market Area Agreement Extension
Exhibit D Personal Covenants and Agreement of Principal, Officer, Director, Owner,
Investor or Partner of Franchisee
Exhibit E Personal Covenants and Agreement of One Provided Detailed Knowledge of the
Development System
Exhibit F Market Hold Agreement and Market Hold Agreement Extension
Exhibit G Sublicense Agreement
Exhibit H Market Reservation Agreement and Mutual Release of Market Reservation
Agreement
Exhibit I Lender Assignment Agreement
Exhibit J Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information
Access Agreements
Exhibit K Copyright Assignment & Agreement
Exhibit L Mortgage

116
 Exhibit M Security Agreement
Exhibit R Termination and Release Agreement
Exhibit S Addendum to Franchise Agreement and Initial Market Area Agreement
Exhibit T State Addenda to the FDD and Agreements

ITEM 23. RECEIPTS

The last pages of this disclosure document are a detachable document acknowledging your
receipt of the disclosure document. If these pages or any other pages or exhibits are missing from your
copy, please contact Epcon Communities Franchising, Inc. at this address or phone number:

Epcon Communities Franchising, Inc.

500 Stonehenge Parkway
Dublin, Ohio 43017
Attention: Franchise Administration Manager
(614) 761-1010
www.epconfranchising.com
www.EpconOpportunity.com

117
 Exhibit B

EPCON COMMUNITIES FRANCHISING, INC.

Franchise Agreement

FRANCHISOR: EPCON COMMUNITIES FRANCHISING, INC.

FRANCHISEE:

EFFECTIVE DATE:

F/A4/19
 EPCON COMMUNITIES FRANCHISING, INC.
Franchise Agreement

TABLE OF CONTENTS

Article Page

Article 1 The Development System and Franchisee'sAcknowledgments............. ....................................... 1

Article 2 Definitions of Certain Terms........................................................................................................... 1

Article 3 Grant of Franchise..................................................................................... 2

Article 4 Franchisor's Obligations.................................................................................................................3

Article 5 Franchisee's Obligations................................................................................................................4

Article 6 Proprietary Marks......................................................................................................................... 10

Article 7 Advertising and Promotion........................................................................................................... 11

Article 8 Uniformity of, and Modifications to, theDevelopment System......................................................12

Article 9 Development System Compliance............................................................................................... 13

Article 10 Confidentiality; Non-Disclosure; Proprietary Information........................................................... 14

Article 11 Completion of Project(s)............................................................................................................. 14

Article 12 Transfer by Franchisee.............................................................................................................. 15

Article 13 Default; Termination................................................................................ 18

Article 14 Remedies...................................................................................................................................20

Article 15 Independent Contractor..............................................................................................................21

Article 16 Indemnification and Insurance................................................................................................... 22

Article 17 Waiver....................................................................................................................................... 23

Article 18 Notices....................................................................................................................................... 23

Article 19 Complete Agreement.................................................................................................................23

Article 20 Miscellaneous Provisions...........................................................................................................24

Article 21 Further Acknowledgments by Franchisee.................................................................................. 25

F/A4/19
 FRANCHISE AGREEMENT

This Franchise Agreement (this "Agreement") is made by and between Epcon Communities Franchising, Inc., an
Ohio corporation having its principal business offices at 500 Stonehenge Parkway, Dublin, Ohio 43017 (hereinafter
referred to as "Franchisor"), and , a(n)
having its principal business offices at
(hereinafter referred to as
"Franchisee"), to be effective as of the date executed by Franchisor.

For and in consideration of the covenants and promises herein contained. Franchisor and Franchisee make the
following agreement, intending to be legally bound thereby;

Article 1
The Development System and Franchisee's Acknowledgments

1.1 Franchisor, as a result of the expenditure of substantial time, effort, and money, has created a unique
Development System (as hereinafter defined) for the purpose of providing guidance for development of detached and
attached homes. The essence of the Development System that Franchisor licenses to its franchisees to use is its
architectural plans and designs. As a part of the franchise and license granted in Article 3 hereof. Franchisor shall
provide the materials and services described in Article 4 hereof to enable Franchisee to implement the Development
System at the location and within the area as set forth in the Market Area Agreement (the "Market Area Agreement")
substantially in the form attached hereto as Exhibit "1".

1.2 Franchisee, being cognizant of the distinctive significance and value thereof, desires to make use of and to
enjoy the benefits of Franchisor's Development System. Franchisee acknowledges that the success of its use of the
Development System depends upon its strict adherence to Franchisor's uniform standards, procedures, and plans, as
well as Franchisee's business abilities and other variables. Franchisee agrees to preserve in every way possible the
integrity of Franchisor's materials, reputation, and goodwill. Franchisee acknowledges that execution of a Market
Area Agreement is required at the same time as the execution of this Agreement.

Article 2
Definitions of Certain Terms

2.1 Each term set forth in this Section 2.1 shall have the meaning specified herein;

2.1.1 "Commencement of Construction Activity" shall mean Franchisee's commencement of any activity on
the Project site that is a precursor to or involves grubbing or clearing land, land development or building construction.

2.1.2 "Development System" shall mean Franchisor's method, pattern, documents, materials, know-how,
knowledge, process, and procedure used for development, construction, and marketing of detached and attached
homes using original architectural designs, as well as other proprietary and confidential information, including
copyrighted and patented material, and material for which the patent is pending, including, without limitation, all
architectural plans and specifications for detached and attached homes, architectural plans and specifications for the
clubhouse or other similar community amenities, site plan samples, production management guidelines, financial
planning guidelines, marketing materials and guidelines, and sample condominium association materials provided by
Franchisor and other specifications developed by Franchisor from time to time for use with the Development System.
The Development System also includes the “Epcon Communities Works” as defined in Section 2.1.12 below. The
Development System shall be deemed to include any method, pattern, process, specification, or procedure used by
Franchisee during the term of this Agreement, along with any modifications or changes thereto.

2.1.3 "Franchisor" shall mean Epcon Communities Franchising, Inc., an Ohio corporation, and any assignee
of, or successor in interest to, Epcon Communities Franchising, Inc.

2.1.4 "Franchisee" shall mean the party so defined in the preamble hereto and any successor in interest to,
or permitted assignee or sublicensee of. Franchisee.
 2.1.5 "Gross Sales Price" shall mean the gross purchase price (including, without limitation, all upgrades
and additions to the base purchase price less any discounts and/or rebates given by Franchisee) for a Unit as stated
in the applicable HUD-1 Settlement Statement or the total of the "Sale Price of the Property” and the “Sale Price of
any personal property included in sale" in the Settlement Disclosure Form (or their equivalent) for such Unit.

2.1.6 "Marks" shall mean all distinguishing characteristics of the Development System, including, without
limitation, the name and mark "Epcon Communities", together with such other trade names, service marks,
trademarks, and trade symbols, emblems, signs, slogans, insignia and copyrights as Franchisor has adopted and
designated for use in connection with its Development System and as Franchisor may hereafter acquire or develop
and designate for use in connection with the Development System.

2.1.7 "Multi Unit" shall mean a residential dwelling located within a building containing two or more
dwellings sharing one or more common walls.

2.1.8 "Project" shall mean all of the development of buildings or appurtenant structures and improvements
on common contiguous grounds by Franchisee, or any successor in interest to, or permitted assignee or sublicensee
of. Franchisee, using the Development System. Such development shall be defined as a Project without
consideration of the elapsed time required for development of the Project or of the development, marketing, or legal
"phase" thereof.

2.1.9 "SFD Unit" shall mean a residential dwelling that constitutes the sole dwelling located within a single
dwelling building. Combining two or more SFD Units into one building shall not change the designation of such Units
from SFD Units to Multi Units.

2.1.10 "Unit" shall mean either a Multi Unit or a SFD Unit. Combining two or more SFD Units into one
building shall not change the designation of such Units from SFD Units to Multi Units.

2.1.11 "Units" shall mean a group of two or more Units which may include only Multi Units, only SFD Units,
or a group including at least one representative of each type of Unit.

2.1.12 “Epcon Communities Works" shall mean Franchisor’s designs for any building as embodied in any
tangible medium of expression, including illustrations, renderings, plans, blueprints, sketches, drawings, models, or
constructed buildings. It also includes all other materials in which Franchisor owns or licenses a copyright that are
associated with the Development System.

Article 3
Grant of Franchise

3.1 Franchisor hereby grants to Franchisee, and Franchisee hereby accepts, a franchise and license to utilize
the Development System subject to the terms, restrictions, and conditions of this Agreement and to the terms,
restrictions, and conditions of the Market Area Agreement(s). Compliance with all the terms and conditions of this
Agreement, including but not limited to the timely payment of all sums due Franchisor hereunder, is a strict condition
precedent to this license. The grant of such franchise to Franchisee shall be on a non-exclusive basis, except to the
extent that certain rights may be granted to Franchisee under certain conditions within a particular area pursuant to
the terms of the Market Area Agreement. The term of this Agreement and the franchise it grants shall commence as
of the date of execution (the "Effective Date") of this Agreement by Franchisor and shall continue until termination of
this Agreement and the franchise as specified in Article 13 hereof.

3.2 Franchisor further grants to Franchisee, subject to the terms and conditions herein contained, a
nonexclusive license to use the Marks as provided in Section 5.9 and Article 6 hereof in connection with Franchisee's
use of the Development System and to use the Epcon Communities Works under the conditions provided in Section
10.5 hereof.

3.3 As provided in Section 1.1 hereof. Franchisee and Franchisor shall execute a Market Area Agreement at the
time this Agreement is executed. Such Market Area Agreement shall specify a Market Area (as defined in the Market
Area Agreement) and a location for Franchisee's Project. Franchisee’s rights to use the Development System at a
Project may be restricted or even terminated as provided in the Market Area Agreement.

3.4 [Intentionally left blank]

 3.5 [Intentionally left blank]

3.6 In the event that Franchisee desires to obtain a reservation or "hold" on a new Market Area or Areas,
Franchisee shall provide to Franchisor a written request with respect thereto. Franchisor shall, within thirty (30) days,
provide notice to Franchisee of its decision respecting Franchisee's request, such decision to be within the sole
discretion of Franchisor. If Franchisor grants approval to Franchisee for such reservations or "holds" on certain
Market Areas, such approval shall be effective as of the execution by Franchisee of a Market Hold Agreement or
Agreements (the "Market Hold Agreement(s)") using Franchisor’s then current form of such agreement, the current
form of which is attached hereto as Exhibit "4", and the payment by Franchisee of the applicable fee(s) as provided in
the Market Hold Agreement(s).

3.7 Notwithstanding any other provisions of this Agreement to the contrary. Franchisor retains the right, in its
sole discretion, itself or through subsidiaries or affiliated or related business entities, to use the Development System
to construct Project(s) outside of Franchisee's Market Area and to franchise or license others to do so.

Article 4
Franchisor's Obligations

4.1 Franchisor agrees to provide, based upon Franchisor's most recently updated project plans, the following, in
a format determined by Franchisor in its sole and absolute discretion, which may include electronic files, web-based
format or access, CD-Rom, DVD and computer-assisted design (“CAD”) format:

4.1.1 Unstamped architectural plans and specifications for buildings containing each of SFD Units and
Multi Units
4.1.1.1 foundation plan
4.1.1.2 floor plan
4.1.1.3 roof plan with non-engineered truss drawings
4.1.1.4 wall sections
4.1.1.5 exterior elevations
4.1.1.6 drawings or schedules for windows, doors, cabinets, shelving, and floor coverings

4.1.2 Unstamped architectural plans and specifications for clubhouses and pavilions
4.1.2.1 foundation plan
4.1.2.2 floor plan
4.1.2.3 roof plan with non-engineered truss drawings
4.1.2.4 wall sections
4.1.2.5 exterior elevations
4.1.2.6 drawings or schedules for windows, doors, cabinets, shelving, and floor coverings
4.1.2.7 plumbing plan
4.1.2.8 electrical plan
4.1.2.9 HVACpIan

4.1.3 Sample site and landscape plans from one recent project

4.1.4 Sample Construction Scopes of Work

4.1.5 Construction Manual

4.1.6 Operations Manual

4.1.7 Marketing Manual and Materials

4.1.7.1 color renderings and floor plans in a computer readable format
4.1.7.2 sample brochure

4.1.8 Presentations: QualityMark, Punchout, and Turnover Processes

4.1.9 Condominium Manual National

4.1.10 Account Suppliers Directory

 4.1.11 Sample Homeowners Manual

4.1.12 Pre-Construction Community Manual

4.1.13 Epcon Style Guide and Graphic Standards Manual

4.1.14 Accounting Manual

4.1.15 Intentionally deleted.

4.1.16 Consulting services

4.1.16.1 In addition to the initial training sessions referenced in Section 5.12, Franchisor will
provide a reasonable amount of consulting services to Franchisee if Franchisee so
requests for Franchisee's first Project. Consulting may include, but is not limited to, advice
on the areas of planning, financing, construction, and marketing.
4.1.16.2 In addition to the initial training sessions referenced in Section 5.12, Franchisor will
provide a reasonable amount of consulting services if Franchisee so requests for each
subsequent Project. Consulting may include, but is not limited to, advice on the areas of
planning, financing, construction, and marketing.
4.1.16.3 Consulting services will be provided to Franchisee either, at Franchisor's discretion, at the
corporate offices of Franchisor, by telephone, or at Franchisee's place(s) of business.
4.1.16.4 Consulting services requested by Franchisee in excess of those considered reasonable by
Franchisor for a particular Project may be billed to Franchisee by Franchisor at $200.00
per hour.

4.2 Franchisor represents that the architectural plans and other materials referenced above in Sections 4.1.1,
4.1.2, 4.1.3, and 4.1.4 and provided to Franchisee are substantially similar to those used by Franchisor's affiliate,
Epcon Communities, LLC. in its developments. Notwithstanding this. Franchisor does not warrant or represent
herein, and hereby disclaims any such warranty and/or representation, express or implied, that the architectural plans
and other materials referenced above in Sections 4.1.1,4.1.2, 4.1.3 and 4.1.4 will comply with any applicable building
code requirements or any other applicable federal, state or local laws, or will be adequate for Franchisee's use in any
way including, but not limited to, assisting Franchisee in obtaining permits and approval for Franchisee's Project(s).
Franchisee (a) recognizes that the provisions of this limitation are a material factor in Franchisor's grant of the
franchise and license for the amounts of the fee(s) provided hereunder, and (b) agrees that any accommodation to
Franchisee by Franchisor shall not be taken to establish any liability of Franchisor or any contract term inconsistent
herewith. (Franchisee should refer to Article 8 hereof regarding its obligations concerning modifications to the
Development System.)

4.3 In order to protect the reputation and goodwill of the Marks, the integrity of the Epcon Communities Works
and to maintain uniform standards of development under the Marks, Franchisee shall conduct its operations
hereunder in accordance with each of the above listed Manuals, one copy of each of which Franchisee acknowledges
that it will receive subsequent to execution hereof on loan from Franchisor for the term of this Agreement. These
Manuals shall at all times remain solely the property of Franchisor. Franchisee shall treat the Manuals, any other
materials created for or approved for its use by Franchisor, and the information contained therein as confidential, and
shall use all reasonable efforts to maintain such information as secret and confidential. Franchisee shall not at any
time, without Franchisor's prior written consent, copy, duplicate, record, or otherwise reproduce the Manuals, in whole
or in part, nor otherwise make the same avaiiable to any unauthorized person. Franchisor shall have the right to add
to or otherwise modify the Manuals from time to time to reflect changes in authorized products and services,
specifications, standards or product quality, and operations of Franchisor Projects. In the event of a dispute as to the
contents of the Manuals, the master copy of each Manual maintained by Franchisor at its principal place of business
shall be controlling.

Article 5
Franchisee's Obligations

5.1 Franchisee shall pay to Franchisor an initial franchise fee (the “Initial Franchise Fee”) in the amount of Fifty
Thousand Dollars ($50,000). The Initial Franchise Fee shall be fully earned, due and payable upon execution of this
Agreement by Franchisor and is not refundable.
 Provided that the Franchisee has a Project Under Development, in the event the undersigned Franchisee, if an
individual, or 50% or more of the ownership of the undersigned Franchisee, if a corporation, partnership, limited
liability company, or similar entity, in Franchisor’s sole and absolute discretion, enters into another franchise
agreement for the development of an additional Project, the Initial Franchise Fee shall be in the amount of Two
Thousand Five Hundred Dollars ($2,500).

5.2 In addition to the Initial Franchise Fee, Franchisee agrees to pay to Franchisor each of the following non-
refundable fees:

(a) Minimum Monthly Royalty: For each month during the term of this Agreement for which a Project is
Under Development (as defined below), and for which Franchisee did not close on the sale of a Unit in the preceding
month. Franchisee shall pay Franchisor a minimum monthly royalty (the “Minimum Monthly Royalty”) on or before the
fifteenth (15*^) day of the month in the amount of Two Thousand Dollars ($2,000.00). Franchisee’s obligation to pay
the Minimum Monthly Royalty shall begin on the earlier of (i) the fifteenth day of the month for the month that is the
thirty-seventh (37th) from the Effective Date of this Agreement, or (ii) the fifteenth (15th) day of the month
immediately following the month in which there is the first closing of a sale of a Unit in a Project.

For purposes of this Agreement, a Project is deemed to be “Under Development” during the period
commencing when the Minimum Monthly Royalty is required to be paid by Franchisee, and continuing until the first to
occur of (i) the Project is completed as provided in Section 11.1 of this Agreement, or (ii) the Market Area Agreement
for the Project is terminated by Franchisor.

Franchisor shall have the right to withdraw the Minimum Monthly Royalty (and other fees due to Franchisor)
from Franchisee's designated bank account each month by electronic funds transfer ("EFT"). Upon execution of this
Agreement and at any time thereafter at Franchisor's request, Franchisee shall execute and deliver such documents
and forms as Franchisor deems necessary to pre-authorize and process EFTs from Franchisee's designated bank
account for payment of the Minimum Monthly Royalty. Franchisee shall at all times maintain in the designated bank
account funds sufficient to pay all Minimum Monthly Royalty payments when due. Should Franchisee's bank for any
reason not honor any EFT, Franchisee shall be responsible for the payment of the Minimum Monthly Royalty, plus
any service charges applied by Franchisor and/or the bank, if any. Franchisor shall have the right, in Franchisor's
sole discretion, to require Franchisee to pay the Minimum Monthly Royalty directly to Franchisor in a manner other
than by EFT.

(b) Project Royalty Fee: Franchisee shall pay Franchisor a royalty fee (the "Project Royalty Fee") as a
percentage of the value of the Units in each Project. At the time of execution of this Agreement the total Project
Royalty Fee will be calculated to be equal to 1.50% multiplied by the total aggregated anticipated "as-built"
completion value. Franchisee shall provide Franchisor with the estimated “as-built” completion value no later than
twenty (20) days after the finalization of the site plan for the Project. Franchisor may, in its sole discretion, permit
Franchisee to provide, in addition to, or in lieu of. Franchisee's estimate, an independent appraisal prepared to obtain
financing for the land acquisition and/or construction of the Project. If, in Franchisor’s sole opinion, the estimate or
appraisal for financing provided by Franchisee is inaccurate. Franchisor has the right to establish the anticipated "as-
built" completion value of those certain Units.

(c) Mortgage: A mortgage against the real property upon which the Project is to be located securing
the obligations of Franchisee to Franchisor under the Franchise Agreement in a minimum amount of $150,000 shall
be executed, delivered and recorded within 15 calendar days after the real property is purchased by Franchisee.
Such mortgage will be in substantially the form attached hereto as Exhibit "7". In the event the real property upon
which the Project is to be located is owned by Franchisee at the time the Agreement is signed, the mortgage shall be
executed, delivered and recorded within 30 calendar days after Franchisor executes the Agreement. Franchisee
shall sign with Franchisor a security agreement granting Franchisor a security interest in all of the personal property
of Franchisee, if any, located within the Project. The mortgage and/or the security agreement shall be subject to and
junior only to the mortgage and personal property lien(s), if any, granted to the lender or lenders providing land
acquisition and construction financing. Upon any such lender's request. Franchisor will enter into a subordination
and/or intercreditor agreement, in form and content acceptable to Franchisor. Franchisor may, in its sole discretion,
accept a deed of trust, letter of credit, or other security instrument in lieu of a mortgage on the real property upon
which the Project is located. Franchisee also agrees to notify the escrow agent, attorney, or any other person
conducting closings for Units in the Project of Franchisee’s obligation to pay Project Royalty Fees to Franchisor. In
the event Franchisee increases the number of Units in its Project after Franchisee's delivery of an estimated value or
appraisal. Franchisor may require an increase in the amount of the mortgage or other security and/or require other
additional security. Upon the closing of its financing with its lender or within fifteen (15) days of Franchisor's submittal
of an invoice to Franchisee, Franchisee shall reimburse Franchisor for all costs, expenses and fees (including.
without limitation, legal fees and filing and recording fees) incurred in obtaining Franchisor's mortgage, security
agreement or other security.

(d) Payments of Project Royalty Fee: Franchisee shall pay to Franchisor the following payments,
under this Franchise Agreement which shall be credited against the total amount of the Project Royalty Fee owed by
Franchisee to Franchisor until such time as the Project Royalty Fee is paid in full or is otherwise no longer due and
owing to Franchisor;

(i) Point of Closing Royalty Payments: Contemporaneously with the closing of the sale of each Unit in
the Project, Franchisee shall remit (or haye the escrow agent, attorney, or any other person conducting
closings remit) a payment to Franchisor in an amount equal to the percentage determined from
consulting the Point of Closing Royalty Percentage Table below (the “Applicable Percentage") multiplied
by the Gross Sales Price of such Unit as proyided in the applicable FIUD-1 Settlement Statement or the
total of the “Sale Price of the Property” and the “Sale Price of any personal property included in sale” in
the Settlement Disclosure Form, or such lower amount, if applicable as proyided in Section 5.2(d)(ii)
(the "Point of Closing Royalty Payment"). No later than two days prior to a Unit's closing, a HUD-1
Settlement Statement or Settlement Disclosure Form, reflecting the applicable Point of Closing Royalty
Payment for such Unit, shall be proyided to Franchisor. Upon Franchisor's receipt of each Point of
Closing Royalty Payment, Franchisor will, at Franchisee's request and expense, promptly deliyer a
partial mortgage release and/or partial security interest release releasing Franchisor's lien as against
the applicable Unit. Franchisee shall continue making Point of Closing Royalty Payments to Franchisor
(eyen after said remaining balance of the estimated Project Royalty Fee has been paid to Franchisor)
until the last Unit in the Project is sold. For the ayoidance of doubt. Franchisor shall be due, and shall
retain, any Point of Closing Royalty Payments to the extent such payments exceed the estimated
Project Royalty Fee, it being the intent of the parties that Franchisor shall be paid a total Project Royalty
Fee equal, at a minimum, to the Applicable Percentage of the Gross Sales Price of each Unit in the
Project.

Point of Closina Royalty Percentaae Table

Unit Closings in any of Franchisee's Projects in a Percentage Applicable to
Calendar Year Unit Closings for that Calendar Year
1-6 2.00
7-12 1.75
13-24 1.50
25-50 1.25
51 and more 1.00

(ii) Volume-Based Reduction to Point of Closing Royalty Payments: At the beginning of each calendar
year. Franchisor may in its sole discretion rank all franchisees on the basis of the total amount of Point
of Closing Royalty Payments paid Franchisor over the course of the previous three calendar years. The
top Fifteen percent (15%) of franchisees in that ranking may receive for that calendar year a reduction
in the Point of Closing Royalty Percentage, provided that in the three (3) previous calendar years,
collectively, (i) they have closed at least 100 Units and (ii) they have paid more than $500,000 in total
Point of Closing Royalty Payments to Franchisor from all of the franchisee's Projects (“Qualifying
Franchisees”).

(a) Qualifying Franchisees that closed from 50 Units through 99 Units in the previous calendar year
will pay Franchisor Point of Closing Royalty Payments on the first 12 Units closed in the current
calendar year using 1.50 as the Applicable Percentage;

(b) Qualifying Franchisees that closed 100 or more Units in the previous calendar year will pay
Franchisor Point of Closing Royalty Payments on the first 24 Units closed in the current calendar
year using 1.25 as the Applicable Percentage.

(iii) Cap on Calculation of Point of Closing Royalty Payments: Franchisor may, in its sole discretion,
from time-to-time, for a calendar year or a portion thereof, for the purpose of calculating Point of Closing
 Royalty Payments, limit the Gross Sales Price of any Unit as provided in the applicable HUD-1
Settlement Statement or the “Sale Price of the Property” and the “Sale Price of any personal property
included in sale” in the Settlement Disclosure Form (the “Cap”).

(iv) Limit on Annual Total Point of Closing Royalty Payments: Franchisor may, in its sole discretion,
from time-to-time, limit the total amount of Point of Closing Royalty Payments made by a Franchisee in
a calendar year.

Notv/ithstanding anything in Section 5.2(d)(i) to the contrary, the foregoing calculations of the number of
Units closing to determine the applicable Point of Closing Royalty Percentages shall apply only if: (1) a
Project in which a Unit is closed is governed by a Franchise Agreement with a Point of Closing Royalty
Payment, and (2) the undersigned Franchisee, if an individual, is the franchisee under the applicable
Franchise Agreement for the Project in which the Unit is closed, or the ownership of the undersigned
Franchisee, if a corporation, partnership, limited liability company, or similar entity, is, in Franchisor’s sole
and absolute discretion, identical to or substantially similar to the ownership of the franchisee under the
applicable Franchise Agreement for the Project in which the Unit is closed.

In the event that all of the Project Royalty Fee has not been paid by Franchisee to Franchisor by the
expiration of the Market Area Agreement, at the election and sole discretion of Franchisor, the remaining
balance of the Project Royalty Fee calculated under Section 5.(b) shall become immediately due and
payable to Franchisor by the end of such time period, it being the intent of the parties that Franchisor shall
be paid a total Project Royalty Fee equal, at a minimum, to the estimated Project Royalty Fee (as may be
reduced under Section 5.2(d)(ii), if applicable) for each Project regardless of the actual sales prices of Units
or status of the construction of a Project.

(e) Annual Reconciliation. At the end of each calendar year during the term of this Agreement, Franchisor
shall review the Minimum Monthly Royalty payments and Point of Closing Royalty Payments made by
Franchisee in that calendar year. Provided that Franchisee is not in default of this Agreement, in the event
that Franchisee has paid Franchisor more than Twenty-Four Thousand Dollars ($24,000) in Point of Closing
Royalty Payments in the calendar year. Franchisor shall refund to Franchisee, within Ninety (90) days, any
Minimum Monthly Royalty payments paid by Franchisee in that calendar year.

5.2.1. In the event that (i) Franchisee desires to relocate its Project to a new Market Area prior to the
commencement of construction, (ii) Franchisor consents to such relocation, and (iii) Franchisee is not in default under
the terms of this Agreement or the Market Area Agreement for such Project, Franchisee may apply the fees it has
paid to Franchisor respecting such Project under this Agreement and the Market Area Agreement towards
Franchisee's payment obligations to Franchisor under the new Market Area Agreement for such Project.

5.3 At any reasonable time during the term of this Agreement Franchisor's representative(s) may without prior
notice enter upon the premises of any Project of Franchisee to observe the Project and the progress towards
completion thereof and to assure the nature and quality of all Projects associated with the Marks and the Epcon
Communities Works (as defined in Section 2.12 hereof). Upon such entry by Franchisor's representative(s).
Franchisee shall cooperate in every way with such review and observation. Upon ten (10) days' written notice.
Franchisor's representatives may enter upon the premises of any office of Franchisee wherever located (Including
after termination of this Agreement) and review Franchisee's records relevant to the Projects. Franchisee shall
cooperate with the audit process by providing a work area where the records are maintained, permit the copying of
such records and shall make a knowledgeable representative of Franchisee available to explain the books and
records and answer questions from Franchisor's representative(s).

5.4 If Franchisee fails to remit to Franchisor when due any payment required under the terms of this Agreement,
Franchisee agrees to pay to Franchisor all of Franchisor's costs of collection of the amount(s) of such outstanding
payments, including reasonable attorney's fees and disbursements, and interest on the unpaid amounts at the lesser
of eighteen percent (18%) per annum or the highest rate statutorily permissible, for the period commencing on the
date such amount(s) were due to be paid to Franchisor and ending on the date such amount(s) are received by
Franchisor in finally collectible funds.

5.5 Franchisee shall provide to Franchisor at the time of execution of this Agreement copies of Exhibit ”2''
attached to this Agreement (the "Personal Covenants Document") executed by each of the principals, officers,
owners and directors of Franchisee or any sublicensee and any other individuals or entities with any ownership or
control interest whatsoever (including any investors) in Franchisee or any sublicensee, and, during the term of this
Agreement, if a change occurs in the principals, officers, owners, investor and/or directors of Franchisee or any
sublicensee or in the other individuals or entities with an ownership or control interest in Franchisee or any
sublicensee, Franchisee agrees that it will promptly deliver to Franchisor copies of the Personal Covenants
Document executed by each of the new principals, officers, owners, or directors of Franchisee or other individuals or
entities with an ownership or control interest (including any investors) in Franchisee or any sublicensee.

5.6 Additionally, Franchisee shall provide to Franchisor copies of the document included as Exhibit "2A"
attached to this Agreement executed by each person who may be provided, either by Franchisee, Franchisor, or any
sublicensee with more detailed information about the Development System than has been or will be disclosed to the
general public, but whom is not otherwise subject to the requirements respecting the Personal Covenants Document
set forth in Section 5.5 or to the provisions of the Personal Covenants Document. A copy of the document included as
Exhibit "2A" shall be individually executed before any such person is provided access to all or any portion of the
Development System. Franchisee's obligation to provide such executed copies of the document included as Exhibit
"2A" to Franchisor shall be ongoing throughout the term of this Agreement.

5.7 If Franchisee is a corporation or other business entity, it shall have the following legend conspicuously
printed on the face of each of its stock certificates or other certificates evidencing ownership:

The transfer of this [stock] certificate is subject to the terms and conditions of a certain Franchise
Agreement with Epcon Communities Franchising, Inc. Reference is made to the provisions of such
Agreement and to the governing documents of this [corporation].

5.8 Franchisee shall not employ or seek to employ any person who is employed by Franchisor, its agents or
representatives, or by any other Epcon Communities franchisee, or otherwise directly or indirectly induce any such
person to leave his or her employment without the specific written consent of Franchisor. Additionally, Franchisee
shall not employ or seek to employ former employees of any of Franchisor, Franchisor's agents or representatives, or
any other Epcon Communities franchisees during the period of one year commencing upon the date that such
employee's employment ended.

5.9 In order to further protect the Development System, the Epcon Communities Works, the Marks and the
goodwill associated therewith, Franchisee shall:

(a) Except where prohibited by state law to the contrary, identify its Project(s) in its advertising as prescribed in
Franchisor's Manuals, advertise under the Marks designated by Franchisor for use for that purpose and use
such Marks without prefix or suffix, except where such use may conflict with a prior registration or use or
may be required by applicable state law or regulation, in which event Franchisee shall operate and advertise
under such other names as Franchisor has previously approved in writing. Franchisor shall have the right to
restrict the use by Franchisee of Franchisee's business entity name or trade name in its advertising and
promotional materials.

(b) Feature and use the Marks solely in the manner prescribed by Franchisor.

(c) Observe such reasonable requirements with respect to service mark, trade name, trademark and fictitious
name registrations and copyright and patent ownership notices as Franchisor may, from time to time, direct
in writing.

(d) Comply with the provisions of Article 6, Section 7.3, and Section 10.5 hereof.

5.10 Franchisee shall, during the term of this Agreement, purchase, install, maintain and use in its operations
under this Agreement a personal computer system having at least the minimum specifications and capabilities, and
including at least the software, as specified by Franchisor in writing from time to time to its Epcon Communities
franchisees. Franchisee understands that compliance with its obligations in this Section 5.10 may require it to
purchase new hardware and software or upgrades to existing hardware and software, as specified by Franchisor in
writing from time to time to its Epcon Communities franchisees. As to any malfunctioning of the any computer system
or any website as further described in this Agreement, neither Franchisor nor any affiliate will be liable to Franchisee
for any consequential, incidental, indirect, economic, special, exemplary or punitive damages, such as, but not limited
to, loss of revenue or anticipated profits or lost business.

Franchisee shall obtain and maintain any and all equipment and services necessary to connect to the website
referenced in Section 7.5 and to receive electronic communications from Franchisor. Franchisee is responsible for
notifying Franchisor of its desired e-mail address for delivery of communications and online sales leads and must
advise Franchisor of any subsequent changes immediately.

5.11 Franchisee's covenants and obligations contained in this Agreement shall be construed as severable
and independent and shall be interpreted and applied consistently with the requirements of reasonableness and
equity. If all or any portion of any covenant is held unreasonable or unenforceable by a court or agency having valid
jurisdiction, Franchisee expressly agrees to be bound by any lesser covenant included within the terms of such
greater covenant that imposes the maximum duty permitted by law, as if the lesser included covenant were
separately stated in and made a part of this Agreement.

5.12 On a schedule, at a location and in a medium to be determined within its sole discretion. Franchisor will
hold a series of initial franchisee training sessions for the benefit of Franchisee at a location and/or medium selected
by Franchisor in its sole discretion. Franchisee or at least one owner of the franchise business is required to attend
and/or participate each of the portions of the first such training session held by Franchisor after execution of this
Agreement. Including the required attendee described above, up to three (3) total individuals may attend the initial
training and the initial training shall be provided free of charge; provided that the Franchisee shall be responsible for
all travel, lodging, meal and other incidental costs and expenses. Franchisor reserves the right to charge a tuition fee
for each attendee/participant attending/or participating in voluntary and required follow-up training sessions for
Franchisee or certain of Franchisee’s employees.

5.13 In the event that Franchisor holds an annual meeting or conference of the Epcon Communities
franchisees. Franchisee or a representative of Franchisee's management satisfactory to Franchisor in its sole
discretion shall attend all sessions of such meeting or conference, unless such attendance is excused by Franchisor
in writing. Attendance at such meeting or conference shall be at Franchisee's sole cost and expense.

5.14 Franchisee may be required, in Franchisor’s discretion, to participate in a rebate tracking service
designated by Franchisor. Franchisor may charge a percentage of the rebates received from the rebate tracking
service as an administrative fee for Franchisor's administration of the rebate tracking service. If required by
Franchisor, Franchisee shall pay any fees or charges due and payable from time to time for participation in such
service. Franchisor may remit the amount of the rebate tracking service fee to the service provider on Franchisee’s
behalf. Any rebates received as a result of Franchisee’s participation in such rebate tracking service will be paid to
Franchisee (after deduction of any administrative fees to Franchisor and any applicable program fees paid to the
service provider).

5.15 Franchisee may be required, in Franchisor's discretion, to participate in a home survey service
designated by Franchisor to track buyer satisfaction. If required. Franchisee shall pay such fees due and payable
from time to time for participation in such service. Franchisee shall also purchase from suppliers designated by
Franchisor certain presentation galleries, site maps for presentation galleries, and web site and marketing materials,
as required by Franchisor from time to time.

5.16 On or before the fifth (5*^) day of each month. Franchisee shall report to Franchisor for the previous
month the number of Units closed and the sale price of each Unit.

5.17 Franchisee shall fully participate in the QualityMark inspection program, or any successor program
instituted by Franchisor (the "QualityMark Program"), and Franchisee shall employ or contract for an inspector to
provide such inspections as required by the QualityMark Program, as the same may be prescribed in writing by
Franchisor from time to time.

5.18 Franchisee shall provide to Franchisor true and accurate copies of all executed loan or other documents
evidencing the arrangement by which Franchisee is financing acquisition, development, and construction of each
Project. Franchisee’s obligation to provide such documents to Franchisor shall continue throughout the term of this
Agreement.

5.19 Franchisee must at all times conduct the business it operates under this Agreement and any and all
Market Area Agreements in full compliance with all applicable federal, state and local laws, regulations, codes and
ordinances. Franchisee also must secure and maintain in force all required licenses, permits and certificates relating
to its business. Any liability or expense that Franchisor or its affiliates incur due to Franchisee’s failure to comply
with the requirements of this Section 5.19 shall be subject to Franchisee’s indemnification obligations under Section
16.1.
 5.20 Franchisee represents that it has or will prior to the commencement of construction, consult with its own
legal counsel regarding compliance with all applicable laws, including applicable zoning and building codes, permit
requirements, or any other federal, state or local laws, including, without limitation, licensing requirements for
contractors, property managers and real estate salespersons, the formation and management of condominium
associations, occupational health and safety on the construction site, housing finance, equal housing laws, the Fair
Flousing Act, the Americans with Disabilities Act, as well as the Accessibility Guidelines promulgated under each of
those acts and employment and labor laws.

Article 6
Proprietary Marks

6.1 Franchisee's rights to use the Marks as granted in Section 3.2 hereof is limited to their use in connection
with the development of the Project(s) as described herein, as set forth in the Operations Manuals and as is
prescribed in writing by Franchisor from time to time.

6.2 Franchisee acknowledges Franchisor's exclusive right and interest to use and license others to use the
Marks (and all registrations granted therefor), along with the identification schemes, standards, specifications,
operating procedures, and other concepts embodied in the Development System. Except as expressly provided by
this Agreement, Franchisee shall acquire no right, title or interest therein or thereto (or to any confusingly similar
variation thereof), and any and all goodwill associated with Development System and the Marks shall inure
exclusively to Franchisor's benefit. Upon the expiration or termination of this Agreement, no monetary amount shall
be assigned as attributable to any goodwill associated with Franchisee's use of the Development System or the
Marks.

6.3 Franchisee acknowledges that the use of the Marks outside of the scope of this Agreement without
Franchisor's prior written consent is an infringement of Franchisor's rights and interest in and to the Marks.
Franchisee expressly covenants that, during the term of this Agreement and after the expiration or termination hereof,
Franchisee shall not, directly or indirectly, commit any act of infringement or contest, or aid in contesting, the validity
or ownership of the Marks, or of confusingly similar trademarks or trade names, or take any other action in derogation
thereof.

6.4 Franchisee shall promptly notify Franchisor of any use of the Marks or any colorable variation thereof by any
person, persons, partnership, association, corporation, or other entity ("Person") other than Franchisor or any of its
representatives and agents or other franchisees, or any other mark in which Franchisor has or claims a proprietary
interest. Franchisee further agrees to notify Franchisor promptly of any litigation instituted by any Person against
Franchisor or Franchisee involving the Marks. In the event that Franchisor, in its sole discretion, undertakes the
defense, prosecution, or settlement of any litigation relating to the Marks, Franchisee agrees to execute any and all
documents (including any registered user agreements and any documents required by governmental authorities to
show the relationship between Franchisee and Franchisor) and to render such assistance as may, in the opinion of
Franchisor, be reasonably necessary to preserve and extend the service mark rights relating to the Marks and to
carry out such defense, prosecution, or settlement.

6.5 Franchisee shall not, without Franchisor's prior written consent, use the Marks as part of Franchisee's
corporate or other legal name, or hold out or otherwise employ the Marks to perform any activity or to incur any
obligation or indebtedness in such a manner as could reasonably result in making Franchisor liable therefor.
Franchisee agrees not to seek registration or to claim ownership of any Marks, or of confusingly similar service marks
or trade names.

6.6 Franchisee expressly acknowledges and agrees that this license to use the Marks is nonexclusive and that
Franchisor has and retains the rights, among others:

(a) To grant other franchises and licenses for the use of the Marks, in addition to those already granted to
existing Epcon Communities franchisees and to Franchisee;

(b) To develop and establish other systems and programs utilizing the same or similar Marks, or any other
proprietary Marks, and to grant franchises and/or licenses therein without providing Franchisee any rights
therein.
 6.7 Franchisee shall not permit any third party to imprint the Marks on any products, materials, documents and
supplies utilized by Franchisee in connection with the operation of its Project(s) without first obtaining the consent of
Franchisor and causing such third party to execute a license agreement with Franchisor. Subject to the foregoing
requirement. Franchisee shall affix the Marks in the manner prescribed by Franchisor to all advertising and
promotional materials used in connection with each of Franchisee's Projects developed hereunder.

6.8 Franchisor or its licensor is responsible for maintaining all registrations covering the Marks and renewing the
registrations as required.

6.9 Franchisor retains the sole right to create a website using the Marks, "EpconCommunities.com" and
EpconHomesAndCommunities.com, and variations thereof and to register or use other domain names related or
similar to any of the Marks. Franchisee shall not own or operate a separate website for the promotion of the Project or
Franchisee’s Epcon Communities business. Franchisee shall disclose the existence to Franchisor of all websites
which are owned, registered to or operated by Franchisee and related in any way to residential construction or real
estate sales.

Article 7
Advertising and Promotion

7.1 Franchisor reserves the right, exercisable at any time, to require Franchisee to purchase and use prescribed
sales brochures and other documents designed for prospective buyers.

7.2 Franchisee shall cooperate with Franchisor in any and all advertising, promotional and marketing plans and
campaigns established by Franchisor in its sole discretion.

7.3 All advertising, promotions and marketing carried out by Franchisee in any media shall be conducted in a
dignified manner and shall conform to the standards and requirements prescribed by Franchisor and to the highest
ethical standards of advertising. At least thirty (30) days prior to publication. Franchisee shall submit to Franchisor,
for its prior written approval (except with regard to prices to be charged), samples of all advertising and promotional
plans and materials that Franchisee desires to use and that have not been prepared or previously approved by
Franchisor. Such approval shall not be unreasonably withheld. Any materials submitted to Franchisor and not
disapproved within thirty (30) days shall be deemed approved. Franchisor may upon thirty (30) days’ notice revoke
its approval of any advertising and promotion previously approved.

7.4 Franchisee shall pay to Franchisor, or to an entity designated by Franchisor that has been formed for the
purpose of operating a franchise system level marketing program, a marketing program fee ("Marketing Program
Fee") in the amount of $500 per month for each of Franchisee’s Projects. The first Marketing Program Fee payment
shall be due on the earlier of (i) the fifteenth day of the month for the month that is the thirty-seventh (37*) month
from the Effective Date of this Agreement, or (ii) the fifteenth day of the month immediately following the month in
which Franchisee requests to include its Epcon community on the Epcon Communities website (i.e,,
www.epconcommunities.com), and shall continue on the same day of each month thereafter until the last Unit in the
Project is sold and Franchisee has completed and submitted the report referred to in Section 11.2.3 herein.

Franchisor or Epcon Communities Marketing Program, Inc. shall have the right, in its sole discretion, during each
subsequent calendar year, to increase the monthly Marketing Program Fee to an amount that is less than or equal to
one hundred twenty percent (120%) of the amount of the monthly Marketing Program Fee applicable during the
immediately preceding calendar year. The provisions of Section 5.4 of this Agreement are applicable to Marketing
Program Fee payments. Franchisor shall have the right to spend Marketing Program Fee paid by Franchisee to the
franchise system level marketing program, including advertising, to promote the projects of its affiliates, including
Epcon Communities and its affiliates, LLC, , and of Epcon Communities franchisees at any geographic level,
including without limitation, local, regional and/or national, and in any communication medium (including, without
limitation, the Internet), that Franchisor deems, in its sole discretion, to be advantageous to the condominium projects
of Epcon Communities franchisees, or Epcon Communities, LLC, and its affiliates, in any combination thereof. Such
Marketing Program Fee shall not be used to market the Epcon Communities franchise concept in a manner intended
to solicit prospective franchisees. Franchisor shall have the right to withdraw the Marketing Program Fee, and all
other fees owed to Franchisor, from Franchisee’s designated bank account each month by EFT.

7.5 (i) Franchisor intends to maintain or cause to be maintained a website to promote the development Projects
of its franchisees and Epcon Communities and its affiliates. Once Franchisee has identified a Project and requests
inclusion of the Project on the website. Franchisor shall provide a web page on its website for each of Franchisee’s
Projects. The content, including but not limited to, text, size (including number of pages or the size of pages),
address and appearance of Franchisee's web page(s) is within the sole discretion of Franchisor. Prior to the
commencement of marketing and/or selling activities for any of Franchisee's Projects, Franchisee shall provide the
information specified by Franchisor so that web page(s) can be created for Franchisee's Project. Franchisor may, in
its sole discretion and for the convenience of Franchisor, elect to update, modify, change or terminate all or any part
of the website or the functionality available through the website at any time in the future,

(ii) All of the contents, marks, trade names, and logos of the website owned by Franchisor are understood to be
the exclusive property of the Franchisor. All of the contents of the website including but not limited to text, software,
music, sound, photographs, video, graphics or other material or other information presented through the website are
protected from copying under.U.S. and international copyright laws and treaties. Franchisee may not use the Content
except as expressly authorized by Franchisor in writing. Any unauthorized copying, use, alteration, distribution,
transmission, performance, display, or other use this material is prohibited.

(iii) Neither Franchisee nor Franchisee's employees may do any of the following; (a) modify the website; (b)
attempt to “hack” the website;(c) access any restricted areas of the website; (d) interfere with the general use or
enjoyment of the website; (e) prepare derivative works of the website; (f) impersonate a Franchisor officer or
misrepresent the existing relationship between Franchisee and Franchisor; (g) upload damaging files or viruses; (h)
post offensive, unlawful, harassing, libelous, abusive, threatening, harmful, vulgar, obscene, hateful, racially,
ethnically or otherwise objectionable material of any kind or nature; or (i) post material in violation of license
agreement, copyright law or other applicable local, state, national or international law or regulation. Franchisor
reserves the right to remove Franchisee from website if, in its sole discretion, it feels Franchisee is not using the
website in a legitimate way that serves the purposes of this Agreement.

Article 8
Uniformity of, and Modifications to, the Development System

8.1 Franchisee understands and acknowledges that the Development System is a complete and unified system
for the construction, marketing and management of the Project(s) and that every detail of the Development System is
important to the use thereof by Franchisee in order to maintain high and uniform standards, as well as to maximize
the opportunity for the success of the Project(s). By accepting the franchise and license granted hereby,
Franchisee is agreeing to utilize the entire Development System without modification thereto, except as set-
forth in Section 8.2.

8.2 Any changes or modifications to the Development System require prior written approval of Franchisor in
each instance. All Franchisee requests for modifications must be accompanied by complete drawings that show a
copyright identifying Franchisor as the owner of the work, describe and identify the modifications that have been
made, and a statement that summarizes the need and rationale behind them. Franchisor agrees to respond to such
requests within thirty days. All modifications, or any parts thereof may be used by Franchisor for its benefit or for the
benefit of any of its other franchisees, licensees or agents, and such changes or modifications shall become the
property of Franchisor. Flowever, nothing contained herein shall be construed to impose upon Franchisor an
obligation to so adopt or use any such changes or modifications nor shall Franchisor be responsible for any payment
to Franchisee therefor.

8.3 Franchisee acknowledges that deviation from and/or modification to the Development System does not
abrogate its responsibility to comply with all terms of this Agreement, including but not limited to payment of amounts
due to Franchisor as specified in Article 5 hereof Franchisee's deviation from and/or modification to the
Development System without the prior written approval of Franchisor, shall, however, terminate Franchisor's
obligation to comply with Market Area Agreement(s), pursuant to which Franchisor, under certain conditions, agrees
to refrain from itself constructing, and from granting to other licensees the right to construct. Projects within
Franchisee's Market Area (as defined in the Market Area Agreement).

8.4 Franchisee shall use a civil engineer or land planner for the conceptual site plan layout for the Project. The
conceptual site plan layout shall include building setbacks and local storm water retention requirements and will be
based upon a site-utilization analysis and density study. The conceptual site plan layout is not required to include
utility plans, grading plans, or preliminary or final engineering. Franchisee may use a different civil engineer or land
planner for additional work following completion of the conceptual site plan.
 Article 9
Development System Compliance

9.1 Franchisor's affiliate, Epcon Communities, LLC., has used the Development System to assist it in obtaining
permits and other governmental approvals under varying circumstances. Notwithstanding this. Franchisor does not
warrant or represent herein, and hereby disclaims any such warranty and/or representation, express or implied, that
the Development System will comply with any applicable building code requirements or any other applicable federal,
state or local laws, or will be adequate for Franchisee's use in any way including, but not limited to, assisting
Franchisee in obtaining permits and approval for Franchisee's Project(s). Franchisee (a) recognizes that the
provisions of this limitation are a material factor in Franchisor's grant of the franchise and license for the amounts of
the fee(s) provided hereunder, and (b) agrees that any accommodation to Franchisee by Franchisor shall not be
taken to establish any liability of Franchisor or any contract term inconsistent herewith.

9.2 Franchisee understands and acknowledges that, due to the continual evolution of the plans, and the other
materials referenced above, and the volume of detailed information and data contained therein, there are likely to be
some inaccuracies and/or items subject to specific local or other requirements which will require correction, at
Franchisee's expense, by Franchisee's architects, engineers, contractors, counsel and/or other professionals as work
progresses. Franchisee acknowledges that it possesses sole responsibility hereunder to, and agrees that it
shall, at its sole cost and expense, make any changes or modifications including, but not limited to, the seal
or stamp of a registered architect, to the plans, specifications or any other part of the Development System
used or proposed for use for or at its Project(s) which changes or modifications are necessitated by any
applicable zoning and building codes, permit requirements, or any other federal, state or local laws,
including, without limitation, licensing requirements for contractors, property managers and real estate
salespersons, the formation and management of condominium associations, occupational health and safety
on the construction site, housing finance, equal housing laws, the Fair Housing Act and the Americans with
Disabilities Act, as well as the Accessibility Guidelines promulgated under each of these acts. Franchisee
further acknowledges that it possesses sole responsibility hereunder to comply with all applicable laws in
the marketing of condominium units in its projects, including, without limitation, the Fair Housing Act.
Franchisee acknowledges that it possesses sole responsibility hereunder to, and agrees that it shall, at its sole cost
and expense, have the seal or stamp of a registered architect affixed to said plans. No changes, however extensive,
shall operate to relieve Franchisee of its obligations to make payments due to Franchisor pursuant to the terms of this
Agreement. Franchisee will require any architect or architects that make modifications to the plans, specifications or
any other part of the Development System to enter into with Franchisee a Copyright Assignment in a form and
content satisfactory to Franchisor.

9.3 Throughout the term hereof. Franchisor agrees to provide to Franchisee, upon Franchisee's request,
modifications or improvements made by Franchisor to the architectural plans and specifications. Modifications and
improvements to other areas of the Development System shall be provided to Franchisee at Franchisor's sole and
absolute discretion. Ali such modifications and improvements to be provided to Franchisee shali be provided by
Franchisor at no additional cost to Franchisee and shall be distributed not more often than once annually.
Modifications and improvements so provided to Franchisee shall be for the standard Development System and will
not be subject to further modification by Franchisee for any changes made by Franchisee pursuant to Section 8.2
above. Notwithstanding any provision hereof to the contrary. Franchisor reserves the right, within its sole discretion,
to discontinue providing updated information to Franchisee respecting modifications and improvements to the
Development System if Franchisee has substantially completed construction of all Projects hereunder and is not
actively pursuing development of another Project.

9.4 The Development System contains both required standards and recommended standards. Any required
standards exist to protect Franchisor's interests in the Development System and the Marks and not for the purpose of
establishing any control or duty to take control over those matters that are reserved to the Franchisee. The
Development System may also include guidelines or recommendations in addition to required standards. In some
instances, the required standards will include recommendations or guidelines to meet the required standards.
Franchisee may follow the recommendations or guidelines or some other suitable alternative, provided Franchisee
meets and complies with the required standards. In order to protect Franchisor’s interests in the Development
System and the Marks, Franchisor reserves the right to determine if Franchisee is meeting a required standard and
whether an alternative is suitable to any recommendations or guidelines.
 Article 10
Confidentiality; Non-Disclosure; Proprietary Information; Architecturai Works

10.1 Franchisor and Franchisee acknowledge and agree that the Development System constitutes a "trade
secret" as defined in Ohio Revised Code Section 1333.61, and, as such, is entitled to all rights and protection as are
afforded to trade secrets under Ohio, and any other applicable, law.

10.2 Neither Franchisee nor any of Franchisee's affiliates, owners, agents, or employees shall communicate
or otherwise divulge to, or use for the benefit of, any other person or entity, any information or knowledge, no matter
how derived, concerning the Development System. Franchisee is granted the specific and limited right to divulge
information respecting the Development System to those individuals who must have access thereto in order to
develop any Projects which are the subject hereof. All information and knowledge provided by Franchisor to
Franchisee, including by way of illustration but not of limitation, drawings, specifications, techniques, and written
material, shall be deemed confidential for the purposes of this Agreement.

10.3 Franchisee acknowledges that the Development System, including any modifications or derivations of
the Development System or any of its parts, remains the exclusive property of Franchisor, even after its use by
Franchisee. Franchisee agrees that it shall not use the Development System, or any portion thereof, at any time,
except in strict accordance with the terms of this Agreement and, after the termination of this Agreement it shall not
use in any manner the Development System or any of its parts, or any system, plans, materials, or designs
resembling in any way the Development System.

10.4 Franchisee shall include in all advertising, sales and other published literature relating to the buildings
depicted in the Epcon Communities Works (the "Buildings") such notices of ownership of patent, copyright and
trademark rights as Franchisor, in its sole discretion, directs and requires.

10.5 Franchisee acknowledges that the Epcon Communities Works and the design of the Buildings are
protected under the Architectural Works Copyright Act of 1990. Franchisee shall not build, license, transfer,
reproduce or duplicate in any way the Epcon Communities Works or any derivative thereof except as expressly
provided for in this Agreement. In the event that any documentation provided to Franchisee by Franchisor bears a
copyright notice or other copyright management information. Franchisee shall not remove such notice from said
documentation, and such notice shall be retained or reproduced in its exact form on all authorized copies and
versions of such documentation, both in machine and human readable language. Franchisee shall not distribute
Franchisor's copyrighted documentation or the Epcon Communities Works to a third party, except as provided for in
the Agreement or otherwise with specific written authorization from Franchisor. Franchisee acknowledges and
agrees that its strict compliance with these provisions are conditions precedent to its license to utilize the
Epcon Communities Works, and as such any use of such works in violation of any of these provisions is
unauthorized and will be acts of copyright infringement.

10.6 Franchisee shall not, during the term of this Agreement, without the prior written consent of Franchisor,
directly or indirectly, either as a principal, agent, employee, officer, director or member of any corporation or other
business entity, as a partner or sole proprietor, or in any other way, own, develop, construct or have any interest in
any real estate development project that includes detached and/or attached homes that are substantially similar to
homes depicted in Franchisor's architectural plans and specifications for Units and/or in homes depicted in the
Development System; provided however, this provision shall not apply to the involvement by Franchisee in the
development of other Epcon Communities Projects by other franchisee business entities, or to any ownership by
Franchisee of less than three percent (3%) of the outstanding stock of any publicly held corporation. For purposes of
this Section 10.6, the term “Franchisee" shall include any officer, director, shareholder, member or holder of an
ownership interest in Franchisee, if Franchisee is a corporation, limited liability company or other business entity, and
any partner of Franchisee, if Franchisee is a partnership.

10.7 Notwithstanding anything to the contrary herein. Franchisor shall have the right to communicate with
any lender(s) of Franchisee regarding the status and details of Franchisor's relationship with Franchisee.

Article 11
Completion of Project(s)

11.1 A Project shall be determined to be completed when the sale of the last Unit in the Project has closed or
when either a temporary or permanent occupancy permit has been issued for all buildings within the Project.
 11.2 Upon completion of the Project, Franchisee shall do the following:

11.2.1 Promptly notify Franchisor in writing that the Project is complete as defined in Section 11.1 above.
11.2.2 Promptly pay to Franchisor all sums owing or accrued. The sums shall include interest, any
damages, costs, and expenses, including reasonable attorneys' fees and disbursements, incurred
by Franchisor by reason of a default by Franchisee under the terms of this Agreement or any other
agreement by and between Franchisor and Franchisee.
11.2.3 Within thirty (30) days of the sale of the last unit in a Project, Franchisee shall provide to Franchisor
a complete report respecting the revenues and expenses of the Project in the form prescribed by
Franchisor. Franchisee hereby grants to Franchisor its consent to disclose the information
contained in such reports in Franchisor's Franchise Disclosure Document and as required in the
franchise sales disclosure process.
11.2.4 Notwithstanding anything contained herein. Franchisee's lender shall have the right to complete
any Project which is the subject hereof, so long as (a) all fees and other amounts due Franchisor
under this Agreement are timely paid in full; (b) such lender complies with the terms of this
Agreement as such terms apply to and obligate Franchisee; and (c) such lender executes a Lender
Assignment Agreement included as Exhibit "6", attached to this Agreement. Franchisee shall
provide an executed Lender Assignment Agreement to Franchisor within 30 days after closing on
Franchisee’s construction loan.

11.3 Franchisee agrees to use its best efforts to complete within a reasonable time each building begun in
connection with any Project so that no building remains incomplete for more than one hundred fifty (150) days after
commencement of construction of that building.

11.4 In the event Franchisee's license to use the Development System at a Project is terminated prior to
completion of construction of all Units in the Project, such that Franchisee is prohibited from using the Development
System or any part thereof for any reason. Franchisee may, at Franchisee’s sole discretion, be granted a limited
license by Franchisor to complete construction of any Units then under construction if and only if (i) construction of
such Unit(s) has commenced prior to the effective date of termination or alternatively such Unit(s) are the subject of a
non-contingent sale-purchase contract between Franchisee and a third-party, and (ii) Franchisee pays Franchisor a
Point of Closing Royalty Payment for such Unit(s) pursuant to the terms and conditions herein. In all events
Franchisee’s right to complete construction of such Unit(s) shall expire six (6) months after the effective date of
termination.

Article 12
Transfer by Franchisee

12.1 Franchisee understands and acknowledges that the rights and duties set forth in this Agreement are
personal to Franchisee and that Franchisor has granted this Epcon Communities franchise in reliance on
Franchisee's business skills, professional reputation and financial capability. Accordingly, neither Franchisee nor any
shareholder, partner, member, (including shareholders, partners or members of entities that have an ownership
interest in Franchisee), or any immediate or remote successor to any part of Franchisee's interest in this Epcon
Communities franchise shall, directly or indirectly, sell, assign, transfer, pledge or encumber, by operation of law or
otherwise, this Agreement or the franchise or licensed rights granted hereunder or any ownership interest in
Franchisee or any ownership interest in any entity owning an interest in Franchisee' without the prior written consent
of Franchisor. Such transfer, sale, assignment, pledge or encumbrance not having the written consent of Franchisor
shall be null and void and shall constitute a material breach of this Agreement, for which Franchisor may then
terminate this Agreement. Franchisor’s consent shall not be required for any Unit sold to third parties in the ordinary
course of Franchisee's business. Franchisor shall not unreasonably withhold its consent to a transfer of any interest
in Franchisee or in this Epcon Communities franchise, provided, however, that prior to the time of transfer. Franchisor
may, in its sole discretion, require that;

All of Franchisee's accrued monetary obligations to Franchisor and all other outstanding obligations related
to the business franchised hereunder shall have been satisfied, or will be satisfied through the transfer;

(b) The transferor's right to receive compensation, pursuant to any agreement or agreements for the purchase
of any interest in Franchisee or in the business franchised hereunder, shall be subordinate and secondary to
Franchisor's rights to receive any outstanding monetary obligation or other outstanding obligations due from
transferor or Franchisee pursuant to this Agreement, and whether arising before or after the transfer;
 (c) Franchisee shall have executed a general release in a form satisfactory to Franchisor, effective as of the
date of transfer, of any and all claims against Franchisor and its officers, directors, shareholders, and
employees in their corporate and individual capacities, including, without limitation, claims arising under
federal, state and local laws, rules and ordinances.

(d) The transferee franchisee shall enter into a written assumption, in a form satisfactory to Franchisor,
assuming and agreeing to discharge all of Franchisee's obligations under this Agreement prior to and after
the date of the assumption;

(e) The transferee franchisee shall demonstrate to Franchisor's satisfaction that he or she, if an individual, its
general partners, if it is a partnership, its members, if it is a limited liability company, and its officers,
directors and principal shareholders, if it is a corporation, meet(s) educational and managerial standards;
possess(es) good moral character, reputation, and credit rating; has the aptitude and ability to conduct the
business franchised hereunder (as may be evidenced by prior related business experience or otherwise);
and has adequate financial resources and capital to operate the business franchised hereunder;

(f) The transferee franchisee shall execute the then-current standard form of Epcon Communities Franchise
Agreement and other ancillary agreements as Franchisor may require for the business franchised hereunder
for a term ending as provided in Section 3.1 of this Agreement; and

(g) At transferee franchisee's expense, and upon such other terms and conditions as Franchisor may
reasonably require, the transferee franchisee shall complete each of the initial training sessions then in
effect for new franchisees.

12.2 If Franchisee is a corporation, partnership, limited liability company, or similar entity, the terms of
Section 12.1 shall apply to any sale, resale, pledge, assignment, transfer or encumbrance of any voting stock of, or
other ownership interest in, Franchisee.

12.3 In connection with any transfer for which Franchisor grants its consent as described in Section 12.1
hereof, Franchisee shall pay to Franchisor a transfer fee to cover Franchisor's actual costs, and due diligence,
administrative, legal and other expenses respecting the transfer.

12.4 In the event that Franchisee proposes to transfer all of its interest in the Epcon Communities franchise
granted pursuant hereto to a corporation, partnership, or limited liability company solely for the convenience of
ownership, the provisions of Sections 12.1, 12.2, and 12.3 hereof shall not apply; provided that Franchisor's consent
to such transfer may, in its sole discretion, be conditioned upon the following requirements:

(a) The transferee entity shall be newly organized and its Articles of Incorporation and Bylaws (or comparable
governing documents for entities other than corporations) shall provide that its activities are confined
exclusively to operate the business franchised hereunder and activities related thereto;

(b) Franchisee shall identify to Franchisor all of the stockholders, directors, officers, partners and/or members of
the transferee entity;

(c) Franchisee shall enter into an agreement, in a form satisfactory to Franchisor, unconditionally guaranteeing
the full payment and performance of the transferee entity's obligations to Franchisor;

(d) Each stock (or other ownership interest) certificate of the transferee entity shall have conspicuously
endorsed upon its face the following legend:

"The transfer of this Ftvpe of certificate) certificate is subject to the terms and
conditions of a certain Franchise Agreement executed with Epcon Communities
Franchising, Inc. Reference is made to the provisions of such Agreement and to
the governing documents of this Ftvpe of transferee entitvi."

(e) Copies of the transferee entity's governing documents, including any resolutions authorizing entry into this
Agreement, shall be furnished to Franchisor for its approval prior to the transfer; and
 (f) The name of the transferee business entity shall not, without Franchisor's prior written approval, consist of or
contain any of Franchisor's Marks or any colorable variation thereof or any other mark in which Franchisor
has or claims a proprietary interest.

12.5 In the event that Franchisee desires to form a business entity having identical or substantively identical
common ownership with Franchisee and to sublicense its rights and obligations hereunder to the new entity (the
"Sublicensee") in order that the Sublicensee might develop a Project and, after receiving Franchisee's request in
writing to do so and such information about the proposed sublicensing arrangement and the entities involved as
Franchisor requests. Franchisor, in its sole discretion, consents to same. Franchisee may execute with the
Sublicensee a Sublicense Agreement in the form attached hereto as Exhibit "5". Any such sublicense arrangement
not having the written consent of Franchisor shall be null and void and shall constitute a material breach of this
Agreement, for which Franchisor may then terminate this Agreement. Franchisor reserves the right hereunder not to
consent to any sublicense arrangement proposed by Franchisee involving an entity not having identical or
substantially identical common ownership with Franchisee. Franchisor may, in its sole discretion, require that, prior to
the effective date of the Sublicense Agreement, (a) all of Franchisee's accrued monetary obligations to Franchisor
shall have been satisfied, and (b) the Sublicensee entity possesses a good credit rating and has adequate financial
resources and capital to develop a Project. The Sublicensee shali be required to execute with Franchisor a Market
Area Agreement substantially in the form attached hereto as Exhibit "1" for the location proposed for Sublicensee's
Project.

12.6 All materials required by federal or state law for any direct or indirect offer or sale of securities of
Franchisee shall be submitted to Franchisor for review and consent, prior to their being filed with any government
agency; and any materials to be used in any exempt offering shall be submitted to Franchisor for review and consent
prior to their use. No such materials shall imply (by use of the Marks or otherwise) that Franchisor is participating as
an underwriter, issuer, or offeror of Franchisee's or Franchisor's securities. Any review by Franchisor of the offering
materials or the information included therein will be conducted solely for the benefit of Franchisor to determine
conformance with Franchisor's internal policies, and not to benefit or protect any other person. No investor should
interpret such review by Franchisor as an approval, endorsement, acceptance, or adoption of any representation,
warranty, covenant, or projection contained in the materials reviewed; and the offering documents shall include such
legends and statements as Franchisor may specify, including, but not limited to, legends and statements which
disclaim Franchisor's liability for, or involvement in, the transaction described in the offering documents. Franchisee
and the other participants in the offering must agree in writing to fully indemnify Franchisor in connection with the
offering in the form prescribed by Franchisor. For each proposed offering, Franchisee shall reimburse Franchisor for
its reasonable costs and expenses associated with reviewing the proposed offering, including, without limitation, legal
and accounting fees and disbursements. Franchisee shall give Franchisor written notice at least sixty (60) days prior
to the date of commencement of any offering covered by this Section 12.6. Any such offering shall comply with
Franchisor's written policies adopted and announced by Franchisor from time to time. Franchisor hereby reserves its
right in its sole discretion not to grant consent to Franchisee for such an offering, and, if such consent is withheld.
Franchisee shall be prohibited hereunder from issuing such an offering. In the event of Franchisor's grant of consent
respecting an offering described under this Section 12.6, the provisions of Section 5.7 of this Agreement shall not
apply.

12.7 At least thirty (30) days prior to the proposed effective date of any sale or transfer involving the
franchise or licensed rights granted hereunder, or any ownership interest in Franchisee or any ownership interest in
any entity owning an interest in Franchisee, or the real property upon which all or a part of Franchisee's Project is
located or is intended to be located. Franchisee shall provide written notice to Franchisor that includes information
reasonably detailed to enable Franchisor to evaluate the terms and conditions of the proposed sale or transfer, which
at a minimum includes a written offer from the proposed transferee. Franchisee grants to Franchisor a thirty (30) day
right of first refusal to purchase such rights, interest, property or assets on the same terms and conditions as are
contained in the written notice set forth herein, provided, however, the following additional terms and conditions
apply: (a) the right of first refusal will be effective for each proposed transfer, and any material change in the terms or
conditions of the proposed transfer shall be deemed a separate offer for which Franchisor shall have a new thirty (30)
day right of first refusal; (b) the thirty (30) day right of first refusal period will run concurrently with the period in which
Franchisor has to approve or disapprove the proposed transferee; (c) if the consideration or manner of payment
offered by a proposed transferee is such that Franchisor cannot reasonably be expected to furnish the same, then
Franchisor may purchase the interest proposed to be sold for the reasonable cash equivalent; if the parties cannot
agree within a reasonable time on the cash consideration, an independent appraiser shall be designated by
Franchisor, whose determination will be binding upon the parties; all expenses of the appraiser shall be paid equally
by Franchisor and Franchisee; and, despite subsection (b) of this Section 12.7, Franchisor will have an additional
fifteen (15) days after determination of the cash consideration to exercise its right of first refusal; and (d) if Franchisor
chooses not to exercise its right of first refusal. Franchisee shall be free to complete the transfer subject to its
compliance with any requirements set forth herein. Franchisor has the unrestricted right to assign this right of first
refusal to a third party, who then will have the rights described herein. The right of first refusal described herein does
not apply to any Unit sold to third parties in the ordinary course of Franchisee's business.

12.8 Franchisee agrees that in the event of a violation of this Article 12, Franchisor may: (a) in addition to,
and not in lieu of, any other right or remedy that may be available to it, immediately terminate this Franchise
Agreement and be entitled to the remedies provided in Article 14 (Remedies); or (b) increase (i) the amount of the
Minimum Monthly Royalty payable in Section 5.2(a) to $5,000.00 per month per Project beginning in the month
following said breach (regardless of when it is discovered) and (ii) the percentage in the Point of Closing Royalty
Percentage Table of the Applicable Percentage used to calculate the Point of Closing Royalty Payments provided for
in Section 5.2 (d) for all closings to 3.5% beginning in the month following said breach (regardless of when it is
discovered). These increases in fees shall continue for the term of the Franchise Agreement. If Franchisee is in
violation of Article 12, Franchisee shall not be eligible for any of the following in this Agreement: the annual
reconciliation of Minimum Monthly Royalty payments or any refunds thereof as set forth in Section 5.2 (e); the volume
based reduction to Point of Closing Royalty Payments as set-forth in Section 5.2 (d)(ii) ; the cap on the calculation of
Point of Closing Royalty Payments as set-forth in Section 5.2 (d)(iii); and, the limit on annual total Point of Closing
Royalty Payments as set-forth in Section 5.2 (d)(iv).

Article 13
Default; Termination

13.1 If Franchisee becomes insolvent or makes an assignment for the benefit of creditors, or if a petition in
bankruptcy is filed by Franchisee, or such a petition is filed against Franchisee and either is consented to by
Franchisee or is not dismissed within thirty (30) days, or if a bill in equity or other proceeding for the appointment of a
receiver of Franchisee or other custodian for Franchisee's business or assets is filed and either is consented to by
Franchisee or is not dismissed within thirty (30) days, or a receiver or other custodian of Franchisee's property or any
part thereof is appointed by a court of competent authority, or if proceedings for composition with creditors under any
state or federal law should be instituted by or against Franchisee or if the real or personal property of Franchisee or a
Sublicensee shall be sold after levy thereupon by any sheriff, marshal, or constable, then upon the occurrence of any
of such events. Franchisee shall be deemed to be in default under this Agreement and all rights granted by
Franchisor hereunder (including but not limited to any licenses to utilize the Development System, the Epcon
Communities Works and the Marks) shall thereupon terminate without any need for notice to Franchisee, and this
Agreement shall thereupon be terminated.

13.2 Franchisee shall also be in default under this Agreement upon the occurrence of any of the following:

13.2.1 Franchisee fails, refuses, or neglects to pay when due to Franchisor any monies owed to
Franchisor, including any amounts due under any promissory notes;

13.2.2 Franchisee fails to satisfactorily complete the initial training program to the satisfaction of
Franchisor as set forth in Section 5.12 and fails to arrange for its representative to attend and
complete such initial training program to the satisfaction of Franchisor;

13.2.3 Franchisee fails to furnish to Franchisor any report or information required under this Agreement;

13.2.4 Franchisee fails to develop its Projects and to operate hereunder in compliance with the terms of
this Agreement, the applicable Market Area Agreement(s), the Operations Manuals, the
Development System and any quality or operations standards and guidelines issued in writing by
Franchisor;

13.2.5 Franchisee fails, for a period often (10) days after receipt of notification of noncompliance, to
comply with any federal, state or local law or regulation applicable to the operation of the
development business franchised hereunder;

13.2.6 Any attempted transfer in violation of Article 12;

13.2.7 Any material misrepresentation by Franchisee relating to the acquisition of the franchise granted
hereunder or any conduct by Franchisee that reflects materially and unfavorably upon the operation
and reputation of Franchisee's development business franchised hereunder or upon Franchisor;
 13.2.8 The conviction of Franchisee or its principals or officers of a felony or any other crime involving
moral turpitude;

13.2.9 Franchisor makes a reasonable determination that the continued operation of the development
business franchised hereunder or any Project developed hereunder by Franchisee will result in
immediate danger to public health or safety and such default is not cured within three (3) days after
notice from Franchisor to Franchisee;

13.2.10 Franchisor gives Franchisee a notice of default under this Section 13.2 after two previous defaults
which have been cured after notice of default within the preceding twelve (12) month period;

13.2.11 The death of Franchisee, if Franchisee is an individual, or the death of Franchisee's sole or majority
member or shareholder if Franchisee is a business entity;

13.2.12 Franchisee fails to comply with any of the obligations imposed upon Franchisee by this Agreement;

13.2.13 Franchisee communicates or divulges any information or knowledge concerning the Development
System in violation of Article 10 hereof;

13.2.14 Franchisee fails to complete a Project as required under the terms of this Agreement;

13.2.15 Franchisee's failure to deliver the estimated "as-built" completion value, mortgage, security
agreement, or other required security, in accordance with Section 5.2 of this Agreement; or

13.2.16 Franchisee breaches any other agreement with Franchisor, including any mortgage, security
agreement or other security instrument securing Franchisee's obligations to Franchisor.

13.2.17 Franchisee fails to make Minimum Monthly Royalty payments and without notice to and
acceptance of such notice by Franchisor, abandons the Project for a period of greater than sixty
(60) consecutive days as evidenced by lack of either construction, marketing, or sales activity by
Franchisee at the Project.

13.3 Upon the occurrence of any of the events set forth in Section 13.2, Franchisor may, without prejudice to
any other rights or remedies contained in this Agreement or provided by law or equity, terminate this Agreement.
Such termination shall be effective thirty (30) days after written notice (or such longer period of notice as may be
required by applicable state law) is given by Franchisor to Franchisee of any of the events set forth in Subsections
13.2.1, 13.2.3, 13.2.4, 13.2.5, 13.2.6, 13.2.12, 13.2.14, 13.2.15 or 13.2.16 of Section 13.2 if such defaults are not
cured within the period. Such termination shall be effective immediately upon written notice upon the occurrence of
the events set forth in Subsections 13.2.2, 13.2.7, 13.2.9, 13.2.10, 13.2.13 or 13.2.17 of Section 13.2. Such
termination shall be effective immediately without notice upon the occurrence of the events set forth in Subsections
13.2.8 or 13.2.11 of Section 13.2. Notwithstanding anything in this Agreement to the contrary, upon Franchisee's
default under this Agreement, Franchisee shall no longer have any rights to use the Marks and the Development
System. To the extent Franchisee’s default is an event of default for which Franchisee has a right to cure under
Subsections 13.2.1, 13.2.3, 13.2.4, 13.2.5, 13.2.6, 13.2.12, 13.2,14, 13.2.15 or 13.2.16, and Franchisee cures said
default within the applicable cure period. Franchisee’s right and license to use the Marks and the Development
System shall be automatically restored and reinstated.

13.4 This Agreement shall continue and automatically terminate on the later of (1) the date that is one year
after the date of completion of Franchisee's last Project executed under this Agreement; or (2) the date that is one
year after the expiration of Franchisee's last Market Hold Agreement or Market Hold Extension with Franchisor
executed under this Agreement.

13.4.1 Franchisor and Franchisee agree that if there has not been the Commencement of Construction
Activity on a Project within Thirty-Six (36) months of the Effective Date of this Agreement, Franchisee may terminate
this Agreement at the end of the Thirty-Sixth (36'^^) month following the Effective Date of this Agreement by giving
Franchisor thirty (30) days prior written notice of its intent to terminate this Agreement and pay to Franchisor the sum
of $25,000 with said notice. In the event of the termination of this Agreement Franchisor and Franchisee shall
release each other of any future obligations under this Agreement and any Market Area Agreement, whether
monetary or otherwise, except for those obligations that specifically survive termination.
 13.4.2 Franchisor and Franchisee agree that beginning with the thirty-seventh (37th) month after the
Effective Date of this Agreement and continuing thereafter, in the event there has not been the Commencement of
Construction Activity on a Project, Franchisor may terminate this Agreement by giving Franchisee thirty (30) days
prior written notice of its intent to terminate this Agreement. In the event of the termination of this Agreement
Franchisor and Franchisee shall release each other of any future obligations under the Franchise Agreement and any
Market Area Agreement, whether monetary or otherwise, except for those provisions that specifically survive
termination.

13.5 Termination hereof shall not affect the obligations of Franchisee to pay all amounts due hereunder to
Franchisor. Upon the termination or expiration of this Agreement, in the event that Franchisee has not yet paid to
Franchisor any or all payments as described under Article 5 of this Agreement applicable to all then-effective Market
Area Agreement, in the case of the Market Area Agreement the amount of the "as-built" estimated value of the
Project described in Section 5.2(b) of this Agreement multiplied by 1.50% (or the Applicable Percentage, if less), then
all such amounts shall become immediately due and payable upon the effective date of such termination or expiration
of this Agreement. Further, the obligations of Franchisee provided in Article 10 hereof, the remedies provided to
Franchisor in Article 14 hereof, and the provisions of Sections 6.3, 20.2 and 20.3 hereof shall survive the termination
of this Agreement.

13.6 Upon termination or expiration of this Agreement, Franchisee shall immediately terminate its use of the
Marks, the Epcon Communities Works and the Development System and promptly return to Franchisor all materials
provided to it by Franchisor. Franchisor may, without prior notice, enter upon the premises of any Project of
Franchisee and remove or obliterate any Marks at Franchisee's expense. Franchisee shall indemnify and hold
Franchisor harmless from and against any claims that Franchisor damaged property in the process of removing or
obliterating such Marks.

13.7 For a period of three (3) years following the effective date of termination or expiration of this Agreement,
whether by lapse of time, sale and/or assignment of the Epcon Communities franchise granted hereunder, or other
cause. Franchisee shall not, directly or indirectly, either as a principal, agent, employee, officer, director or member of
any corporation or other business entity, as a partner or sole proprietor, or in any other way engage in the ownership,
development or construction of any real estate development project that includes detached and/or attached homes
that are substantially similar to the homes depicted in Franchisor’s architectural plans and specifications for Units
and/or depicted in the Development System, within (a) ten (10) miles of the geographic border of any "Market Area"
granted to any franchisee pursuant to any Market Area Agreement or other agreement that is effective between such
franchisee and Franchisor, (b)ten (10) miles of the geographic border of any "Reserved Market Area" reserved for
any franchisee or prospective franchisee under any Market Hold Agreement or other agreement that is in effect
between such party and Franchisor, (c) ten (10) miles of any real estate development project of Epcon Communities,
LLC or of any business entity affiliated with Epcon Communities, LLC, or (d) ten (10) miles of any "Reserved Market
Area" reserved for any prospective franchisee under any Market Reservation Agreement or other agreement that is in
effect between such party and Franchisor. For purposes of this Section 13.7, the term “Franchisee” shall include any
officer, director, shareholder, member or holder of an ownership interest in Franchisee, if Franchisee is a corporation,
limited liability company or other business entity, and any partner of Franchisee, if Franchisee is a partnership. The
determination of whether this Section 13.7, or Sections 10.2, 10.3, 10.4, 10.5, 10.6 or 10.7 have been breached by
Franchisee, and the amount of damages payable to Franchisor as a result of such breach, shall be submitted to
arbitration in Columbus, Ohio or another location agreed to by the parties. The arbitration shall be heard before a
retired judge or attorney mutually acceptable to the parties. In the event the parties fail to agree upon an arbitrator
after reasonable efforts, the arbitration shall be commenced by filing a demand for arbitration with the American
Arbitration Association. The arbitration shall be binding on the parties and their successors with no right of appeal.
The dispute resolution provisions contained in this Section 13.7 shall constitute the sole and exclusive method for
resolving any disputes between the parties arising under this Section 13.7 and/or under Sections 10.2, 10.3, 10.4,
10.5, 10.6 and/or 10.7, except that Franchisor shall have the option to file a civil suit in cases in which it is seeking
temporary, preliminary and/or permanent injunctive relief or other relief set forth in Section 14.4 below, in which case
Franchisee agrees to venue and jurisdiction as set forth in Section 20.3. The costs of the arbitration, including the
arbitrator’s fees, shall be borne equally by the parties to the arbitration, unless the arbitrator orders otherwise.

Article 14
Remedies

14.1 Franchisor shall be entitled to any remedies available at law or in equity for any breach by Franchisee of
any of Franchisee's covenants or obligations provided herein or provided in the Market Area Agreement.
Unauthorized use of the Epcon Communities Works beyond the scope of the licenses granted, or without satisfying
the conditions precedent to such uses, will be acts of copyright infringement.

14.2 Franchisee agrees that the existence of any claims of Franchisee against Franchisor, whether or not
arising from this Agreement, shall not constitute a defense to the enforcement by Franchisor of the provisions of
Article 5 hereof and/or the exercise by Franchisor of its rights under Article 13 hereof respecting Franchisee's
noncompliance with the provisions of Article 5 hereof.

14.3 In the event that Franchisee breaches its covenants and obligations as provided in Section 10.3 hereof
(including without limitation the use by Franchisee of all or any portion of the Development System to develop a
Project (or project) either not in compliance with this Agreement during its term or in any manner after the termination
of this Agreement), Franchisee shall be obligated to pay to Franchisor liquidated damages in the amount of the "as-
built" estimated value of such project multiplied by 3.0%, or, if higher, the actual completion value of such project
multiplied by 3.0%, such fees to be separately applicable to each project developed by Franchisee in breach of
Section 10.3 hereof.

14.4 Franchisor shall be entitled, without bond, to the entry of temporary, preliminary and permanent
injunctions and orders of specific performance (a) enforcing the provisions of this Agreement relating to (i)
Franchisee's use of the Development System, the Epcon Communities Works and/or the Marks; (ii) any obligations of
Franchisee surviving termination of this Agreement; or (iii) an assignment of this Agreement or the franchise and
license granted hereunder or any ownership interest therein; (b) as necessary to prohibit any act or omission by
Franchisee or its employees that would constitute a violation of any applicable law, ordinance or regulation, or which
is dishonest or misleading to Franchisor or the general public; or (c) to prevent the continued or future infringement of
Franchisor’s copyrights, trademarks, or patents.

14.5 In the event a dispute arises under this Agreement, the prevailing party shall be entitled to receive its
expenses, including attorneys' fees and disbursements and accounting fees and disbursements, in addition to any
other relief to which it is found entitled.

Article 15
Independent Contractor

15.1 It is understood and agreed that Franchisee is an independent contractor and nothing in this Agreement
shall create a partnership, employment or agency relationship between Franchisor and Franchisee or authorize
Franchisee to make any contract, agreement, warranty or representation on Franchisor's behalf, or to incur any debt
or other obligation in Franchisor's name, and that Franchisor shall in no event assume liability for, or be deemed
liable hereunder as a result of, any such action, or by reason of any act or omission of Franchisee in any of its
operations hereunder or any claim or judgment arising therefrom against Franchisor. Franchisee further
acknowledges and agrees that Franchisor owes no fiduciary duty whatsoever to Franchisee. Any required standards
in the Development System exist to protect Franchisor’s interests in the Development System and the Epcon
Communities Works and/or the Marks and not for the purpose of establishing any control or duty to take control over
Franchisee’s decisions or day-to-day operations of Franchisee’s business or those matters that are reserved to
Franchisee.

15.2 Neither Franchisor nor its affiliates are the employer or joint employer of Franchisee’s employees.
Franchisee is solely responsible for managing and operating the business franchised under this Agreement and
supervising the Franchisee’s employees. Franchisee agrees to identify itself conspicuously in all dealings with
customers, suppliers, public officials, personnel, and others as the business owner, operator, and manager under a
franchise Franchisor has granted to Franchisee. Any training Franchisor provides to any of Franchisee’s employees
will be limited to training or guidance regarding the Development System. Franchisee is, and will remain, the sole
employer of Franchisee’s employees at all times, including during all training programs, and Franchisee is solely
responsible for all employment decisions and actions related to Franchisee’s employees, and Franchisee has the
sole responsibility for the hiring, wages and other compensation (including benefits), training, supervision and
termination of Franchisee’s employees and all other employment and employee related matters. Franchisee is solely
responsible for ensuring that its workers receive adequate training. If Franchisor or its affiliates incur any cost, loss,
or damage as a result of any actions or omissions of Franchisee or Franchisee’s employees, including any that relate
to any party making a finding of any joint employer status. Franchisee will fully indemnify Franchisor or its affiliates for
any such loss.
 Article 16
Indemnification and Insurance

16.1 Franchisee shall indemnify and hold harmless, to the fullest extent permitted by law, Franchisor, its
directors, officers, employees and agents, entities affiliated with Franchisor through common ownership, and
directors, officers, employees and agents of such affiliated entities, from and against any and all claims, debts,
liabilities, losses, expenses or obligations including without limitation compensatory, exemplary or punitive damages,
fines, charges, costs, expenses, lost profits, attorney's fees, court costs, settlement amounts, and judgments,
incurred in connection with any action, suit, proceeding, claim, demand, investigation or inquiry (formal or informal),
or any settlement thereof, arising directly or indirectly from, as a result of, or in connection with. Franchisee's
ownership or operation of its business hereunder and/or its use or utilization of the Development System, including
without limitation the use of any architectural plans and designs provided by Franchisor. Franchisee shall also
indemnify Franchisor from any action, suit, proceeding, claim, demand, investigation or inquiry (formal or informal), or
any settlement thereof brought against Franchisor by any of Franchisee's principals, officers, directors, owners,
investors or partners. In the event that any action, suit, proceeding, investigation or inquiry is instituted, or any claim
or demand is asserted against or involving Franchisor, Franchisee shall resist and defend such action, suit,
proceeding, investigation, inquiry, claim or demand at Franchisee's sole cost and expense or shall cause it to be
resisted or defended by an insurer. Franchisee shall also make every reasonable effort to seek to have Franchisor
dismissed or released from liability in the event of such action, suit, proceeding, investigation, inquiry, claim or
demand. Franchisor shall have the right to resist and defend itself in and/or against any such action, suit,
proceeding, investigation, inquiry, claim or demand, and, upon receipt of written notice from Franchisor of the amount
expended by Franchisor in such defense. Franchisee shall, within ten business days of such receipt, reimburse
Franchisor in full for the total amount of such expenses.

16.2 Franchisee shall at all times during the term of this Agreement, and at its own expense, keep in force by
advance payment of premium general liability insurance in an amount not less than One Million Dollars
($1,000,000.00) per occurrence and in the amount of not less than Two Million Dollars ($2,000,000.00) per Project
annual aggregate, arising out of a single accident, and with a deductible or self-insured retention on any such policy
of not greater than One Thousand Dollars ($1,000.00), or such other amounts of coverage and self-insurance as
Franchisor may specify from time to time, insuring Franchisee against any liability that may accrue by reason of the
development by Franchisee of Project(s). Such policy shall include coverage for liability arising from premises-
operations, independent contractors and products-completed operations. The policy shall not contain any restrictive
endorsements or policy language which excludes coverage for residential construction, work performed by
subcontractors on your behalf, or liability assumed under construction contracts. The policy shall name Epcon
Communities Franchising, Inc. as an additional insured, using ISO Additional Insured Endorsement CG2029 (11-85)
or its equivalent which provides premises and completed operations coverage. Franchisee shall also carry workers
compensation insurance including an employer's liability limit of $500,000, and commercial auto liability (primary)
providing limits of at least $1,000,000.00 each occurrence, combined single limits.

16.3 All policies of insurance to be maintained by Franchisee shall name the Franchisee and all Project
entities as named insureds and contain a separate endorsement naming Franchisor as an additional insured. All
insurance shall be placed with an insurance carrier or carriers with an A.M. Best's rating of "A-" and an A.M. Best's
Class rating of "xiv" or better, duly licensed in the state in which the Project is located, or be otherwise approved in
writing by Franchisor. All policies of insurance and the certificates evidencing the coverages thereunder shall
expressly provide that they shall not be subject to cancellation, material alteration or non-renewal except upon thirty
(30) days written notice to Franchisor. At least thirty (30) days prior to the expiration of any policy required
hereunder. Franchisee shall deliver to Franchisor, certificates of insurance evidencing the continuation of proper
coverage. All policies of insurance, or certifications for insurance with a copy of the original policy attached, showing
full compliance with the requirements of this covenant, shall at all times be kept on deposit with Franchisor. Prior to
the commencement of construction of Franchisee's Project or the installation of "Epcon Communities" signage, and
on an annual basis. Franchisee shall provide to Franchisor evidence in the form of a certificate of insurance and a
copy of the actual policy that such insurance remains in full force and effect.

16.4 Franchisee’s obligation to obtain and maintain the foregoing policies in the amounts specified shall be
through primary insurance coverage and shall not be limited in any way by reason of any insurance which may be
maintained by Franchisor, nor shall Franchisee’s performance of that obligation relieve it of liability under the
indemnity provisions of this Agreement.

16.5 All public liability policies may be required by Franchisor to contain a provision that Franchisor, although
named as an additional insured, shall nevertheless be entitled to recover under said policies on any loss occasioned
to Franchisor or its servants, agents or employees by reason of the negligence of Franchisee or its servant, agents or
employees.

Article 17
Waiver

17.1 No failure of Franchisor to exercise any power or right reserved to it hereunder, or to insist upon strict
compliance by Franchisee with any obligation, covenant, or condition herein, and no custom or practice of the parties
in variance with the terms hereof, shall constitute a waiver of Franchisor's right to demand strict compliance with the
terms hereof. Waiver by Franchisor of any particular default by Franchisee shall not affect or impair Franchisor's right
with respect to any subsequent default of the same or of a different nature; nor shall any delay, waiver, forbearance,
or omission of Franchisor to exercise any power or right arising out of any breach or default by Franchisee of any of
the terms, provisions, or covenants hereof affect or impair Franchisor's rights, nor shall such constitute a waiver by
Franchisor of any right hereunder or of the right to declare any subsequent breach or default. Subsequent
acceptance by Franchisor of the payments due to it hereunder shall not be deemed a waiver by Franchisor of any
preceding breach by Franchisee of any terms, covenants, conditions, or obligations of this Agreement.

Article 18
Notices

18.1 Except as provided in Section 18.2 of this Agreement, all notices, payments, or other communications
required or permitted to be given or made under this Agreement to Franchisor or to Franchisee shall be given in
writing and shall be deemed to have been given if delivered by hand or by certified mail, postage prepaid, return
receipt requested or transmitted by facsimile machine (with a hard copy to be sent within forty-eight (48) hours
following such electronic transmissions), or by any commercially reasonable overnight courier service providing a
receipt of delivery, effective upon receipt thereof at the addresses set forth below;

if to Franchisor, to; if to Franchisee, to;

Epcon Communities Franchising, Inc.
500 Stonehenge Parkway
Dublin, Ohio 43017-5067
Attn.; Joel D. Rhoades
Facsimile; 614-761-1155

18.2 Either of Franchisor and Franchisee may, by notice given to the other from time to time and at any time,
designate a different entity, individual, or address for making payments required to be made or for the giving of
notices or other communications. Such notices may be sent by Franchisee to Franchisor via e-mail, and such notices
will be effective upon Franohisor's acknowledgment of the receipt of such e-mail.

Article 19
Complete Agreement

19.1 This Agreement, and the documents referred to herein, including the Market Area Agreement and
Market Hold Agreement by and between Franchisor and Franchisee, shall be the entire, full, and complete agreement
between Franchisor and Franchisee concerning the subject matter hereof and thereof. This Agreement supersedes
all prior franchise agreements, no other representation having induced Franchisee to execute this Agreement;
provided however, that nothing herein, or in any related agreement, is intended to disclaim the representations
Franchisor made in the franchise disclosure document that Franchisor furnished to Franchisee. There are no
representations, inducements, promises, or Agreements, oral or otherwise, between the parties not embodied herein
which are of any force or effect with reference to this Agreement and the subject matter hereof. There are no implied
licenses created by this Agreement. No amendment, change or variance from this Agreement shall be binding on
either party hereto unless executed in writing by each. Franchisor and Franchisee agree that if there is any conflict,
ambiguity, or inconsistency, in Franchisor's judgment, between the terms of this Agreement or any of the other
agreements between the parties, including any New Franchise Agreement, then the applicable terms and provisions,
in Franchisor's judgment, providing Franchisor with greater rights, remedies, powers, privileges, or benefits, shall
control.
 Article 20
Miscellaneous Provisions

20.1 Severability. Each article, section, provision, and term of this Agreement shall be considered severable,
and if, for any reason, any article, section, provision, or term herein is determined to be invalid and contrary to or in
conflict with any existing or future law or regulation, such shall not impair the operation thereof nor affect the
remaining portion of this Agreement. This Agreement will continue to be given full force and effect and bind the
parties hereto. Any invalid article, section, provision, or term shall be deemed not to be a part of this Agreement.

20.2 Choice of Law. Except to the extent governed by the federal copyright and trademark law, this
Agreement shall be deemed to have been entered into under, and for all purposes shall be interpreted, construed,
and governed by, the local laws of the State of Ohio, without application of its conflicts of laws principles.

20.3 Venue. Except to the extent prohibited by applicable state law to the contrary, and except to the extent
of the arbitration provision of Section 13.7 hereof. Franchisor and Franchisee agree that any litigation or legal action
to enforce or relating to this Agreement and the relationship of the parties hereunder shall be filed in the United
States District Court for the Southern District in Columbus, Ohio, or the Common Pleas Court of Franklin County,
Ohio, and each of Franchisor and Franchisee hereby consents to the jurisdiction of such courts.

20.4 Benefit. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective and legal representatives, successors and permitted assigns and/or sublicensees.

20.5 Joint and Several Obligations. If Franchisee consists of more than one person, their liability hereunder
shall be deemed to be joint and several.

20.6 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same agreement.

20.7 Pronouns. The number and gender of each pronoun used in this Agreement shall be construed to be
such number and gender as context, circumstances, or its antecedent may require.

20.8Captions. The articles and section headings and other captions contained in this Agreement are contained
only for convenience of reference and do not define, limit, explain, or modify this Agreement or its interpretation,
construction, or meaning, and are not to be construed as part of this Agreement.

20.9 Limitation of Liability. Under no circumstances will Franchisor be liable to the Franchisee, and/or its
affiliates, officers, directors, owners and employees, for any amount claimed against Franchisor which exceeds the
amount actually paid to Franchisor for the Initial Franchise Fee. ALL CLAIMS AGAINST FRANCHISOR AND/OR ITS
AFFILIATES, OFFICERS, SHAREHOLDERS, DIRECTORS AND EMPLOYEES FOR CONSEQUENTIAL,
INCIDENTAL, SPECIAL OR EXEMPLARY DAMAGES, WHETHER BASED UPON THEORIES OF CONTRACT,
TORT, OR OTHERWISE, ARE HEREBY WAIVED BY FRANCHISEE.

20.10 Our Rights. Whenever this Agreement provides that we have a certain right, that right is absolute and
the parties intend that our exercise of that right will not be subject to any limitation or review. Franchisor has the right
to operate, administrate, develop, and change the Development System in any manner that is not specifically
precluded by the provisions of this Agreement, although this right does not modify the requirements of any express
limitations set forth in this Agreement.

20.11 Franchisor’s Reasonable Business Judgment. Whenever Franchisor reserves discretion in a particular
area or where Franchisor agrees to exercise its rights reasonably or in good faith. Franchisor will satisfy its
obligations whenever it exercises “Reasonable Business Judgment” (as defined below) in making its decision or
exercising its rights. Franchisor’s decisions or actions will be deemed to be the result of “Reasonable Business
Judgment,” even if other reasonable or even arguably preferable alternatives are available, if its decision or action is
intended, in whole or significant part, to promote or benefit the Development System generally even if the decision or
action also promotes its financial or other individual interest. Examples of items that will promote or benefit the
Development System include, without limitation, enhancing the value of the Marks or the Epcon Communities Works,
improving customer service and satisfaction, improving product quality, improving uniformity, enhancing or
encouraging modernization and improving the competitive position of the Development System.
 Article 21
Further Acknowledgments by Franchisee

21.1 By its signature set forth below, Franchisee acknowledges that;

(a) It has conducted an independent investigation and financial assessment of the business contemplated by
this Agreement and the Market Area(s) in which the Project(s) is/are to be located and recognizes that it
involves business risks making the success of the venture largely dependent upon the business abilities of
Franchisee as well as other variables. Franchisor expressly disclaims the making of, and Franchisee
acknowledges that if has not received or relied upon, any representations, warranties or guarantees,
express or implied, as to the potential volume, profits or success of the business venture contemplated by
this Agreement.

(b) If has no knowledge of any representations by Franchisor, or its officers, directors, shareholders,
employees, agents or servants, about the business contemplated by this Agreement that are contrary to the
terms of this Agreement or the documents incorporated herein, and further represents to Franchisor, as an
inducement to its entry into this Agreement, that it has made no misrepresentations in obtaining this
Agreement.

(c) It has received, read and understood this Agreement and the attachments hereto, if any. Franchisor has had
fully and adequately explained the provisions of each to its satisfaction; and Franchisor has afforded it ample
time and opportunity to consult with advisors of its own choosing about the potential benefits and risks of
entering into this Agreement.

(d) It has received Franchisor's Franchise Disclosure Document for the state in which the franchise is to be
located at least fourteen (14) calendar days prior to the execution of any agreements or the payment of any
consideration to Franchisor.

(e) It is aware of the fact that some franchisees may operate under different forms of agreements, and
consequently, that Franchisor's obligations and rights in respect to its various franchisees may differ
materially in certain circumstances.

[signature page follows]

 IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Agreement.

Witnesses: Franchisee: [NAME]

By:. Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed: ___________

Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_______________

Witnesses: Franchisor: Epcon Communities Franchising, Inc.

By:
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General Counsel

Name Printed:____________ __________

Signature - Witness as to Paul W. Hanson. Paul W. Hanson, President of Franchising

Name Printed:_______________________ Date:________________________________

32574859.5
 EXHIBIT C

EXHIBIT "1"
(to Franchise Agreement)

MARKET AREA AGREEMENT

This Market Area Agreement (this "Market Area Agreement") is made by and between Epcon Communities
Franchising, Inc., an Ohio corporation having its principal business offices at 500 Stonehenge Parkway, Dublin, Ohio
43017 (hereinafter referred to as "Franchisor"), and , a(n)
having its principal business offices at
(hereinafter referred to as
"Franchisee"), to be effective as of the date executed by Franchisor (the “Effective Date”).

Pursuant to the terms of the Franchise Agreement, dated made by and between the
parties hereto (the "Franchise Agreement"), Franchisor and Franchisee make the following agreement, intending to
be legally bound thereby:
1. Each term set forth herein having initial capital letters shall have the meaning as set forth herein or, if not defined
herein, as specified in the Franchise Agreement.

2. For purposes of this Market Area Agreement, the term "Market Area" is intended to include the smallest specific
geographic area that will generate the most purchaser support (typically between 60% and 70%) for a
development. The area included within the Market Area typically takes into consideration existing natural and
man-made boundaries and socioeconomic conditions. The Market Area for this Market Area Agreement shall be
as depicted on the map attached hereto as Exhibit "A" and incorporated herein for all purposes.

3. Franchisor, having granted to Franchisee a license to use the Development System pursuant to the terms and
conditions of the Franchise Agreement, desires to further protect its materials, reputation, and goodwill and to
geographically limit use by Franchisee of the Development System in an ordered and controlled manner.
Franchisee acknowledges that such restrictions are essential to the success of the Project and the projects of
other franchisees and licensees of Franchisor.

4. Franchisee agrees to fully implement the Development System only within the Market Area depicted on Exhibit
"A" and at the location or address hereinafter specified:

Proposed Name of Project:_

Projected Number of Units in the Project:,

Franchisee hereby acknowledges that Franchisor's review and expressed opinion about Franchisee's proposed
location is only Franchisor's opinion respecting how the site meets Franchisor's criteria for locations for Epcon
Communities Projects and is based upon Franchisor's limited information about Franchisee's Market Area. It
does not constitute a representation, warranty, or an acknowledgment by Franchisor or any employee or agent of
Franchisor that an Epcon Communities Project at the proposed location will be successful. The decision of
Franchisee to proceed with the development of an Epcon Communities Project at the proposed location shall be
at the sole discretion of Franchisee based upon its independent analysis, and Franchisee hereby acknowledges
and agrees that it shall not have any claim of any nature against Franchisor and its employees and agents if the
Epcon Communities Project does not perform in accordance with the expectations of Franchisee.

5. Franchisee shall make all payments specified in the Franchise Agreement to Franchisor.

6. [Intentionally left blank}

7. Franchisee acknowledges that it shall not use or allow to be used the Development System anywhere except at
the location within the Market Area specified in this Market Area Agreement executed by and between
Franchisor and Franchisee. Franchisee further acknowledges that any unauthorized and unacknowledged use
would be in violation of the terms of this Market Area Agreement and of the Franchise Agreement and agrees
 that any such breach shall afford to Franchisor each of the rights and remedies set forth in the Franchise
Agreement.

8. During the term of the Franchise Agreement, Franchisee shall have certain limited exciusivity rights (the "Limited
Rights") to the Market Area depicted on Exhibit "A" pursuant to the terms and conditions set forth beiow in this
Section 8. Whiie such Limited Rights are in effect, Franchisor agrees to grant to no other iicensee or franchisee
the right to commence construction (nor to itself commence construction) of a Project utiiizing the Development
System within the Market Area depicted on Exhibit "A". The parties agree that this grant of certain limited
exclusivity rights is contractual only, and is neither intended nor shali be interpreted to transfer any of
Franchisor’s exciusive rights under United States copyright iaw to anyone, including Franchisee.

The Limited Rights respecting the Market Area depicted on Exhibit "A" shall immediately terminate upon the
earliest to occur of any of the foliowing:

a) Franchisee at any time is not in fuil compiiance with the provisions of the Franchise Agreement and
this Market Area Agreement.

b) The date that is one year after the date of completion (as defined by Section 11.1 of the Franchise
Agreement) of all buildings in the Project described in Section 4 above.

c) That date on which the rights to use the Development System are terminated pursuant to the
Franchise Agreement or, as set forth below in Section 9.

d) Any assertion by Franchisee, or anyone claiming to be an assignee or beneficiary of Franchisee’s

rights, that the Limited Rights affected any transfer of any portion of Franchisor’s copyrights in any
copyrighted work. In the event of any such assertion. Franchisee agrees that it automaticaily
assigns to Franchisor any and ail putative rights (inciuding in any and all causes of action for
infringement) in ail such copyrighted works.

With the written consent of Franchisor (such consent evidenced by Franchisor’s execution of a Market Area
Agreement Extension with Franchisee), which may be withheid in Franchisor’s sole and absolute discretion.
Franchisee may obtain additional six (6) month extensions of the Limited Rights by paying to Franchisor
$5,000.00 and executing a Market Area Agreement Extension for each extension prior to the expiration of the
original term of the Limited Rights or any subsequent extension.

Upon the termination of the Limited Rights, Franchisor shall have the right to grant to any entity the license to
use, or may itseif use (or may permit its business entity affiliate to use), the Deveiopment System to deveiop a
project or projects within the Market Area set forth in Exhibit "A".

9. Franchisee’s license to use the Deveiopment System at the Project shall commence on the Effective Date and
shaii automaticaliy terminate on, 20__________________ , uniess otherwise terminated as permitted herein,^
and Franchisee shaii be prohibited from using the Deveiopment System or any part thereof for any reason
thereafter; provided, however, that if Franchisee is then current on ail payments of Minimum Monthly Royalty
payments and Project Royalty Fees to Franchisor, Franchisor may grant Franchisee a limited license, which shaii
exclude the Limited Rights, to complete construction of any Unit(s) in the Project previousiy identified in this
Market Area Agreement, provided Franchisee pays Franchisor a Point of Ciosing Royalty Payment for such
Unit(s), Minimum Monthiy Royalty payments and the Marketing Program Fees, pursuant to the terms and
conditions set forth in the Franchise Agreement and otherwise remains, during the term of the limited license, in
fuli compliance with the terms and conditions set-forth in the Franchise Agreement. Notwithstanding anything to
the contrary herein. Franchisee’s right to complete construction of such Unit(s) shall expire two (2) years after the
effective date of termination.

10. This Agreement shall automatically terminate on the effective date of any termination or expiration of the
Franchise Agreement.

■' Date to be inserted shall be the date that is the later of (i) the date that is twenty-four (24) calendar months from the
Effective Date, or (ii) the date that is the number of months from the Effective Date, which date shall be the number of
calendar months equal to the sum of (a) six (6); plus (b) the Projected Number of Units in the Project (as set forth in
Paragraph 4 herein) divided by two (2).
 IN WITNESS WHEREOF the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Market Area Agreement.

Witnesses: Franchisee: [NAME]

By:, Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_______________

By:. Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_______________

By:. Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed;_______________

Witnesses: Franchisor: Epcon Communities Franchising, Inc.

By:
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and
General Counsel
Name Printed:______________________

Signature - Witness as to Paul W. Hanson Paul W. Hanson, President of Franchising

Name Printed:______________________ Date:_________________________________

 EXHIBIT "A"
(to Market Area Agreement)

Market Area
 MARKET AREA AGREEMENT EXTENSION

Franchisee:

Geographic Area of Market Area.

Effective Date of Market Area Agreement.

Date of end of prior renewal Term(s), if any.

Date of end of this renewal Term________

Payment of $5,000 Extension Fee received (circle one) YES NO

Attach each of the following:

Initial Market Area Agreement

Prior Market Area Agreement Extensions (if any)

Description of progress achieved during the prior Term

Projected schedule for completion of site development and final closing

The party designated above as Franchisee and Epcon Communities Franchising, Inc. are parties to a Market
Area Agreement (described above) pursuant to which they each agreed that the term of such Market Area Agreement
could be extended upon the occurrence of certain events. This Market Area Agreement Extension shall serve as
documentation of their mutual agreement, as set forth in Section 8 of the Market Area Agreement, to renew and
extend the term of the Market Area Agreement.

All terms herein which are not separately defined shall have the meanings ascribed to such terms in the Market
Area Agreement. This Market Area Agreement Extension shall be construed in accordance with the terms of the
Market Area Agreement. This Market Area Agreement Extension, together with the Market Area Agreement and any
prior Market Area Agreement Extensions, if any, constitute the entire agreement of the parties with respect to the
subject matter hereof and may not be further modified or amended except in a written agreement signed by both
parties.

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Market Area Agreement Extension to be effective as of the date of execution by Epcon Communities
Franchising, Inc.

Franchisee: [NAME] Franchisor: Epcon Communities Franchising, Inc.

By:.
[Name, Title] Joel D. Rhoades, Vice President and
General Counsel
Date:________

By:. By:.
[Name, Title] Paul W. Hanson, President of Franchising

Date:________ Date:________________________________
 EXHIBIT D

EXHIBIT "2"
(to Franchise Agreement and Sublicense Agreement)

PERSONAL COVENANTS AND AGREEMENT OF PRINCIPAL,

OFFICER, DIRECTOR, OWNER, INVESTOR OR PARTNER OF FRANCHISEE

The undersigned agrees as follows:

1. The undersigned acknowledges that he or she is a principal, an officer, a director or the owner of capital
stock or a partnership interest (or another membership or control interest or investor in Franchisee) in one or both of
("Franchisee") and/orfSublicensee). Franchisee has entered
into a Franchise Agreement dated , by and between Franchisee and Epcon
Communities Franchising, Inc. (the "Franchise Agreement"). Sublicensee has entered into a Sublicense Agreement
dated , by and between Franchisee and Sublicensee with the consent of Epcon
Communities Franchising, Inc. (the "Sublicense Agreement"). The undersigned acknowledges the direct personal
benefit accruing to him or her under one or both of the Franchise Agreement and the Sublicense Agreement.

2. As an inducement to Epcon Communities Franchising, Inc. to enter into the Franchise Agreement with
Franchisee, and/or to consent to the Sublicense Agreement, and in consideration of the direct personal benefit to be
derived by the undersigned thereby, the undersigned agrees that he or she shall be personally bound by all of the
recitations, obligations and covenants of Franchisee contained in Article 5 ("Franchisee's Obligations"), Article 10
("Confidentiality; Non-Disclosure; Proprietary Information"), Article 11 ("Completion of Project(s)"), Article 13
("Default; Termination") and Article 16 ("Indemnification and Insurance") of the Franchise Agreement as if such
recitations, obligations and covenants were made and given personally by the undersigned directly to Epcon
Communities Franchising, Inc. as a party to the Franchise Agreement, including without limitation the following:

The undersigned agrees not to communicate or otherwise divulge to, or use for the benefit of any third Party,
any information or knowledge concerning the Epcon Communities Development System (as defined in the
Franchise Agreement).

The undersigned acknowledges that the Development System is the exclusive property of Epcon
Communities Franchising, Inc., and the undersigned agrees that he or she shall not use the Development
System or any of its parts or any system, plans, materials, or designs resembling in any way the
Development System except in strict accordance with the terms of the Franchise Agreement and the
Sublicense Agreement.

The undersigned agrees that it shall not, during the term of Franchise Agreement, without the prior written
consent of Epcon Communities Franchising, Inc., directly or indirectly, either as a principal, agent,
employee, officer, director or member of any corporation or other business entity, as a partner or sole
proprietor, or in any other way, own, develop, construct or have any interest in any real estate development
project that includes detached and/or attached homes that are substantially similar to homes depicted in
Epcon Communities Franchising, Inc.'s architectural plans and specifications for units and/or in homes
depicted in the Epcon Communities Development System; provided however, this provision shall not apply
to the involvement by the undersigned in the development of other Epcon Communities Projects by other
franchisee business entities, or to any ownership by the undersigned of less than three percent (3%) of the
outstanding stock of any publicly held corporation.

For a period of three (3) years following the effective date of termination or expiration of this Agreement,
whether by lapse of time or other cause, sale and/or assignment of the Epcon Communities franchise
granted under the Franchise Agreement, or other cause, the undersigned shall not, directly or indirectly,
either as a principal, agent, employee, officer, director or member of any corporation or other business
entity, as a partner or sole proprietor, or in any other way engage in the ownership, development or
construction of any real estate development project that includes detached and/or attached homes that are
substantially similar to the homes depicted in Epcon Communities Franchising, Inc.'s architectural plans and
specifications for units and/or depicted in the Epcon Communities Development System, within (a) ten (10)
miles of the geographic border of any "Market Area" granted to any franchisee pursuant to any Market Area
Agreement or other agreement that is effective between such franchisee and Epcon Communities
Franchising, Inc., (b) ten (10) miles of the geographic border of any "Reserved Market Area" reserved for
any franchisee or prospective franchisee under any Market Hold Agreement or other agreement that is in
effect between such party and Epcon Communities Franchising, Inc., (c) ten (10) miles of any real estate
 development project of Epcon Communities, LLC or of any business entity affiliated with Epcon
Communities, LLC., or (d) ten (10) miles of any "Reserved Market Area" reserved for any prospective
franchisee under any Market Reservation Agreement or other agreement that is in effect between such party
and Epcon Communities Franchising, Inc. The determination of whether this Section 2.6., or Section 2.c.,
has been breached by the undersigned, and the amount of damages payable to Epcon Communities
Franchising, Inc. as a result of such breach, shall be submitted to arbitration in Columbus, Ohio or another
location agreed to by the parties. The arbitration shall be heard before a retired judge or attorney mutually
acceptable to the parties. In the event the parties fail to agree upon an arbitrator after reasonable efforts,
the arbitration shall be commenced by filing a demand for arbitration with the American Arbitration
Association. The arbitration shall be binding on the parties and their successors with no right of appeal.
The dispute resolution provisions contained in this Section 2.d. shall constitute the sole and exclusive
method for resolving any disputes between the parties arising under this Section 2.d. and/or under Section
2.C., except that Epcon Communities Franchising, Inc. shall have the option to file a civil suit in cases in
which it is seeking temporary, preliminary and/or permanent injunctive relief or other relief as set forth in
Section 14.4 of the Franchise Agreement, in which case the undersigned agrees to venue and jurisdiction in
United States District Court for the Southern District in Columbus, Ohio, or the Common Pleas Court of
Franklin County, Ohio. The costs of the arbitration, including the arbitrator’s fees, shall be borne equally by
the parties to the arbitration, unless the arbitrator orders otherwise.

The undersigned agrees that, in the event he or she breaches any obligation or covenant set forth or
referenced herein, Epcon Communities Franchising, Inc. or Franchisee shall be entitled to use of the
remedies set forth in Article 14 ("Remedies") of the Franchise Agreement against the undersigned. In the
event that the undersigned breaches its covenant set forth in subsection 2.b. above, Epcon Communities
Franchising, Inc. or Franchisee shall have right to seek, and the undersigned agrees to pay, liquidated
damages in the amounts set forth in Section 14.3 of the Franchise Agreement for each project developed by
the undersigned in breach of such covenant.

The undersigned agrees that such recitations, undertakings and covenants are fair and reasonable and will not
deprive the undersigned of his or her respective livelihood. The undersigned has read and understands all of the
provisions of the Sublicense Agreement and said Articles and Sections of the Franchise Agreement.

3. The undersigned agrees that if any sentence, clause, paragraph or combination of the same in Articles 5,
10, 11 and 16 of the Franchise Agreement or any other covenant or obligation set forth or referenced herein is held
by a court of applicable jurisdiction to be unenforceable as applied to the undersigned, then such unenforceable
sentence, clause or paragraph may be modified by such court to the extent necessary to render it enforceable, and it
shall be enforceable as so modified, and if it cannot be so modified, it shall be severed and the remainder of said
Articles shall remain in full force and effect.

4. The undersigned understands and acknowledges that certain information, documents, drawings,
specifications, blueprints and other materials, including, materials and plans, provided to Franchisee by Epcon
Communities Franchising, Inc. pursuant to the Franchise Agreement (and/or Sublicensee pursuant to the Sublicense
Agreement) and often referred to as the "Epcon Communities Development System", include confidential and
proprietary trade secret information developed by Epcon Communities Franchising, Inc., after the expenditure of
considerable time, effort and expense and which derives independent economic value from not being generally
known to other persons or to the general public . The undersigned also understands, acknowledges, and agrees that
Epcon Communities Franchising, Inc. is the sole owner of the copyrights in all architectural works, technical drawings,
and other copyrighted works provided to Franchisee pursuant to the Franchise Agreement (and/or Sublicensee
pursuant to the Sublicense Agreement) as well as all “derivative works” (as that term is used in the Copyright Act)
that may be created as a result of the Franchise Agreement or Sublicense Agreement. The undersigned also
understands, acknowledges, and agrees that neither the Franchise Agreement, the Sublicense Agreement, or this
Personal Covenants and Agreement, create any implied license to use, copy, distribute, or create derivative works
from any copyrighted work owned by Epcon Community Franchising, Inc., and that the only licenses to do so are
those may be expressly set forth in those agreements.

5. This Personal Covenants and Agreement document shall become effective when accepted by Epcon
Communities Franchising, Inc. in the State of Ohio and shall be governed by the local laws of such State, without
applications of its conflicts of laws principles.
 6. Under no circumstances will Epcon Communities Franchising, Inc. be liable to the undersigned for any
amount claimed against Epcon Communities Franchising, Inc. which exceeds an amount equal to (i) the amount of
the Initial Franchise Fee (as defined in the Franchise Agreement) actually paid to Epcon Communities Franchising,
Inc. by Franchisee under the Franchise Agreement, multiplied by (ii) the undersigned's percentage ownership of
Franchisee as of the time of determination of any liability. ALL CLAIMS AGAINST EPCON COMMUNITIES
FRANCHISING, INC. AND/OR ITS AFFILIATES, OFFICERS, DIRECTORS, SHAREHOLDERS, AND EMPLOYEES
FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR EXEMPLARY DAMAGES, WHETHER BASED UPON
THEORIES OF CONTRACT, TORT, OR OTHERWISE, ARE HEREBY WAIVED BY THE UNDERSIGNED.

Accepted by: Epcon Communities Franchising, Inc.

Date: By:
[Name, Title] Joel D. Rhoades, Vice President and General
Counsel

By:
Paul W. Hanson, President of Franchising

Date:
 EXHIBIT E

EXHIBIT "2A"
(to Franchise Agreement and Sublicense Agreement)

PERSONAL COVENANTS AND AGREEMENT OF ONE PROVIDED

DETAILED KNOWLEDGE OF THE DEVELOPMENT SYSTEM

The undersigned agrees as follows:

1. The undersigned acknowledges that, because of his or her employment relationship and/or contractual
relationship with , ("Franchisee") and/or ("Sublicensee")
and/or his or her ownership or other interest in Franchisee and/or Sublicensee or its assigns, he or she has been
or will be provided, pursuant to the Franchise Agreement (the "Franchise Agreement") by and between Epcon
Communities Franchising, Inc. and Franchisee, or the Sublicensee Agreement by and between Franchisee and
Sublicensee and consented to by Epcon Communities Franchising, Inc. (the "Sublicensee Agreement"), with
more detailed information concerning the Epcon Communities Development System (as defined by the Franchise
Agreement) than has been or will be disclosed to the general public.

2. In consideration of the personal benefit to be derived by the undersigned thereby, the undersigned agrees that he
or she shall be personally bound by the following agreements, covenants and acknowledgments;

a. The undersigned agrees not to communicate or otherwise divulge to, or use for the benefit of, himself or
herself or any third party any information or knowledge concerning the Development System.

b. The undersigned acknowledges that the Development System is the exclusive property of Epcon
Communities Franchising, Inc., and the undersigned agrees that he or she shall not use the Development
System or any of its parts or any system, plans, materials, or designs resembling in any way the
Development System except in strict accordance with the terms of the Franchise Agreement or as he or she
may be directed by Franchisee, such direction to be in accordance with the terms of the Franchise
Agreement, as determined by Epcon Communities Franchising, Inc. in its sole discretion.

c. If the undersigned has a limited investment or other ownership interest in the Project (as defined in the
Franchise Agreement), the undersigned agrees that he or she has read and shall be personally bound by all
of the recitations, obligations, and covenants of Franchisee contained in Sections 5.2, 5.6, and 5.7 of Article
5 of the Franchise Agreement, entitled "Franchisee's Obligations", Article 10 of the Franchise Agreement,
entitled "Confidentiality; Non-Disclosure; Proprietary Information", and Section 11.2.2 of the Franchise
Agreement, entitled "Completion of Project(s)".

d. The undersigned agrees that, in the event he or she breaches any obligation or covenant set forth or
referenced herein, Epcon Communities Franchising, Inc. and/or Franchisee and/or Sublicensee shall be
entitled, without bond, to the entry of temporary and permanent injunctions and orders of specific
performance as necessary to prohibit any violation of the terms of this Personal Covenants and Agreement
document or any applicable law, ordinance, or regulation, or which is dishonest or misleading to Epcon
Communities Franchising, Inc. or the general public.

The undersigned agrees that such recitations, undertakings and covenants are fair and reasonable and will not
deprive the undersigned of his or her respective livelihood.

3. The undersigned agrees that, if any covenant or obligation set forth or referenced herein is held by a court of
applicable jurisdiction to be unenforceable as applied to the undersigned, then such unenforceable covenant or
obligation may be modified by such court to the extent necessary to render it enforceable, and it shall be
enforceable as so modified, and if it cannot be so modified, it shall be severed and the remainder shall remain in
full force and effect.

4. The undersigned understands and acknowledges that certain information, documents, drawings, specifications,
blueprints and other materials, including materials and plans, provided to Franchisee by Epcon Communities
Franchising, Inc. pursuant to the Franchise Agreement (and/or Sublicensee pursuant to the Sublicense
Agreement) and often referred to as the "Epcon Communities Development System", include confidential and
proprietary trade secret information developed by Epcon Communities Franchising, Inc., after the expenditure of
considerable time, effort and expense and which derives independent economic value from not being generally
known to other persons or to the general public. The undersigned also understands, acknowledges, and agrees
 that Epcon Communities Franchising, Inc. is the sole owner of the copyrights in all architectural works, technical
drawings, and other copyrighted works provided to Franchisee pursuant to the Franchise Agreement (and/or
Sublicensee pursuant to the Sublicense Agreement) as well as all “derivative works” (as that term is used in the
Copyright Act) that may be created as a result of the Franchise Agreement or Sublicense Agreement. The
undersigned also understands, acknowledges, and agrees that neither the Franchise Agreement, the Sublicense
Agreement, or this Personal Covenants and Agreement, create any implied license to use, copy, distribute, or
create derivative works from any copyrighted work owned by Epcon Community Franchising, Inc., and that the
only licenses to do so are those may be expressly set forth in those agreements..

5. This Personal Covenants and Agreement document shall become effective when accepted and executed by
Epcon Communities Franchising, Inc. in the State of Ohio and shall be governed by the local laws of such State,
without applications of its conflicts of law principles.

6. Under no circumstances will Epcon Communities Franchising, Inc. be liable to the undersigned for any amount
claimed against Epcon Communities Franchising, Inc. which exceeds an amount equal to (i) the amount of the
Project Fee (as defined in the Franchise Agreement) for the Initial Franchise Fee (as defined in the Franchise
Agreement) actually paid to Epcon Communities Franchising, Inc. by Franchisee under the Franchise Agreement,
multiplied by (ii) the undersigned's percentage ownership of Franchisee as of the time of determination of any
liability. ALL CLAIMS AGAINST EPCON COMMUNITIES FRANCHISING, INC. AND/OR ITS AFFILIATES,
OFFICERS, DIRECTORS, SHAREHOLDERS, AND EMPLOYEES FOR CONSEQUENTIAL, INCIDENTAL,
SPECIAL OR EXEMPLARY DAMAGES, WHETHER BASED UPON THEORIES OF CONTRACT, TORT, OR
OTHERWISE, ARE HEREBY WAIVED BY THE UNDERSIGNED.

Accepted By;
Franchisee: [NAME]

By:. Date: By:. Date:

[Name, Title] [Name, Title]

By:. Date:
[Name, Title]

Accepted By;
Sublicensee: [NAME]

By;. Date:
[Name, Title]

Date;
[Name, Title]

Epcon Communities Franchising, Inc.

Joel D. Rhoades, Vice President and General

Counsel

Paul W. Hanson, President of Franchising

Date:________________________________
 EXHIBIT "3"
(to Franchise Agreement)
Intentionally Deleted
 EXHIBIT F

EXHIBIT "4"
. Franchise Agreement)

MARKET HOLD AGREEMENT

This Market Hold Agreement (this "Market Hold Agreement") is made by and between Epcon Communities
Franchising, Inc., an Ohio corporation having its principal business offices in Dublin, Ohio (hereinafter referred to as
"Franchisor"), and, acorporation having its principal business
offices located at(hereinafter referred to as "Franchisee").

RECITALS

A. Franchisor and Franchisee are parties to that certain Franchise Agreement (the "Franchise Agreement"),
pursuant to which Franchisor granted a license to Franchisee to use the Epcon Communities Development System
(as defined in the Franchise Agreement), and are parties to at least one Market Area Agreement (the "Market Area
Agreement"), pursuant to which Franchisor and Franchisee have agreed upon a site-specific location for a Project (as
defined in the Franchise Agreement) to be constructed by Franchisee within a Market Area (as defined in the Market
Area Agreement).

B. Franchisee desires to obtain a reservation or "hold" upon another Market Area, as set forth in Exhibit "A" to
this Market Hold Agreement (the "Reserved Market Area") pending its decision on whether to enter into a Franchise
Agreement and Market Area Agreement with Franchisor to develop a Project at a location within the Reserved Market
Area, and Franchisor has agreed to grant to Franchisee such reservation for such Reserved Market Area.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows;

1. Franchisee shall have paid to Franchisor no later than the time of Franchisee's execution of this Market Hold
Agreement a non-refundable fee in the amount of $5,000 (the "Initial Market Hold Fee").

2. For a period of six (6) months from the Effective Date (as hereinafter defined) of this Market Hold Agreement
(the "Term"), Franchisor will not itself develop, nor will it grant to a third party a license to develop, a Project utilizing
the Development System within the Reserved Market Area, except after first proceeding in compliance with the
provisions of Section 5 hereof

3. At any time within the Term, as long as Franchisee is in full compliance with all of its obligations provided in
the Franchise Agreement and all other agreements between Franchisee and Franchisor, Franchisee may notify
Franchisor that Franchisee desires to execute with Franchisor a Franchise Agreement and Market Area Agreement
having as its Market Area (as defined in the Market Area Agreement) a geographic area identical to the Reserved
Market Area or a geographic area making up a portion of the Reserved Market Area. Franchisee acknowledges and
agrees that the Market Area reflected in the Franchise Agreement and Market Area Agreement will generally be a
smaller geographic area than the Reserved Market Agreement under this Market Hold Agreement. Franchisee shall
be obligated to execute a Franchise Agreement and Market Area Agreement with Franchisor prior to the earlier of the
closing of the land purchase transaction by Franchisee or the obtaining of zoning or plan approval by governmental
authorities by Franchisee respecting a specific site located within the Reserved Market Area. Upon the execution by
Franchisor and Franchisee of such Franchise Agreement and Market Area Agreement and the payment to Franchisor
by Franchisee of the applicable fee(s) for the Project as provided by the Franchise Agreement this Market Hold
Agreement shall expire. Provided, if the parties enter into such Franchise Agreement and Market Area Agreement on
or before the end of the Term of this Market Hold Agreement or the Term of any subsequent Market Hold Extension,
the applicable non-refundable Initial Market Hold Fee or Market Hold Extension Fee, as the case may be, paid to
Franchisor shall be applied to the applicable fee(s) for such Project. No portion of the Fee will be applied to Project
fees when the Franchise Agreement and Market Area Agreement is entered into after the end of the Term of this
Market Hold Agreement or Market Hold Extension, as applicable. No more than one (1) $5,000.00 Fee will be
applied to the applicable Project fee(s).

4. Upon the agreement of both parties hereto, which agreement may be withheld by either party for any reason
or for no reason. Franchisee may obtain additional six (6) month Terms by paying to Franchisor $5,000.00 for each
Term and executing a Market Hold Extension prior to the expiration of the previous Term.
 5. This Market Hold Agreement and the rights provided to Franchisee hereunder may not be assigned by
Franchisee to any other party without the prior written consent of Franchisor. Any attempt to assign either the Market
Hold Agreement or the rights provided to Franchisee hereunder shall cause the Term hereof and the rights provided
hereunder automatically to expire. The parties agree that this grant of certain limited rights is contractual only, and is
neither intended nor shall be interpreted to transfer any of Franchisor’s exclusive rights under United States copyright
law to anyone, including Franchisee.

6. This Market Hold Agreement shall be interpreted, construed, and governed by the local laws of the State of
Ohio, without application of its conflicts of laws principles.

7. The effective date of this Market Hold Agreement (the "Effective Date") shall be the date upon which the
Franchisor receives the Initial Market Hold Fee from Franchisee or which the Franchisor executes this Market Hold
Agreement, whichever is later.

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Market Hold Agreement to be effective as of the Effective Date.

Witnesses: Franchisee;

By:. Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:

Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_____________

Witnesses: Franchisor; Epcon Communities Franchising, Inc.

By;
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, President and General Counsel

Name Printed:_________

Signature - Witness as to Paul W. Hanson Paul W. Hanson, President of Franchising

Name Printed:______________________

Effective Date:
 EXHIBIT "A"
____ Market Hold Agreement)

The Reserved Market Area

That area located in and included within the following described boundary:

As depicted on the attached map as that area enclosed by the heavy dark line.
 EXHIBIT "A" Map
______ Market Hold Agreement
 MARKET HOLD AGREEMENT EXTENSION

Franchisee

Geographic Area of Reserved Market Area_

Effective Date of Market Hold Agreement__

Date of end of prior renewal Term(s), if any.

Date of end of this renewal Term________

Payment of $5,000 Renewal Market Hold Fee received (circle one) YES NO

Attach each of the following: Initial Market Hold Agreement

Prior Market Hold Agreement Extensions (if any)

Description of progress achieved during the prior Term

Projected schedule for acquisition and development of a site

The party designated above as Franchisee and Epcon Communities Franchising, Inc. are parties to a Market
Hold Agreement (described above) pursuant to which they each agreed that the term of such Market Hold Agreement
could be extended upon the occurrence of certain events. This Market Hold Agreement Extension shall serve as
documentation of their mutual agreement, as set forth in Section 4 of the Market Hold Agreement, to renew and
extend the term of the Market Hold Agreement.
All terms herein which are not separately defined shall have the meanings ascribed to such terms in the Market
Hold Agreement. This Market Hold Agreement Extension shall be construed in accordance with the terms of the
Market Hold Agreement. This Market Hold Agreement Extension, together with the Market Hold Agreement and any
prior Market Hold Agreement Extensions, if any, constitute the entire agreement of the parties with respect to the
subject matter hereof and may not be further modified or amended except in a written agreement signed by both
parties.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Market Hold Agreement Extension to be effective as of the date of execution by Epcon Communities
Franchising.
Franchisee: [NAME] Franchisor: Epcon Communities Franchising, Inc.

Date: By:.
[Name, Title] Joel D. Rhoades, Vice President and General Counsel

By:. Date: By:.

[Name, Title] Paul W. Hanson, President of Franchising

Date:________________
 EXHIBIT G

EXHIBIT "5"
(to Franchise Agreement)

SUBLICENSE AGREEMENT

This Sublicense Agreement (this "Sublicense Agreement") is made and entered into this___day of
, 20_______________ by and between a Wisconsin limited liability company
having its principal place of business at ("Franchisee"), and
limited liability company having its principal place of business at
. (Sublicensee").

Recitals

A. Franchisee has entered into that certain Epcon Communities Franchising, Inc. Franchise
Agreement (the "Franchise Agreement"), date, with Epcon Communities Franchising,
Inc. (hereinafter "Franchisor"), a copy of which is attached as Exhibit "A" to this Agreement, respecting the grant by
Franchisor to Franchisee of the franchise and license to use the Epcon Communities Development System (as
defined in the Franchise Agreement) in the development of Epcon Communities projects and a license to use Epcon
Communities' Marks (as defined in the Franchise Agreement) in connection therewith.
B. Pursuant to the Franchise Agreement, Franchisee may, after meeting certain preconditions to
Franchisor's satisfaction and obtaining Franchisor's prior consent, grant a sublicense to a business entity having
identical or substantially Identical common ownership with Franchisee to permit such Sublicensee business entity to
use the Development System and the Marks licensed to Franchisee under the Franchise Agreement to develop and
market its own Epcon Communities project.

C. Franchisee desires to sublicense certain of its rights under the Franchise Agreement to
Sublicensee, and Sublicensee desires to accept the assignment of such rights and to assume certain of Franchisee's
obligations under the Franchise Agreement.

D. Franchisee and Sublicensee each desire to acknowledge that Franchisor is intended to be a third
party beneficiary of this Sublicense Agreement.

Agreement

NOW, THEREFORE, in consideration of the foregoing, of the agreements, terms and conditions
herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Franchisee and Sublicensee hereby agree as follows, each intending to be legally bound hereby:

1. Grant of Sublicense. Franchisee hereby expressly grants to Sublicensee a limited, nontransferable

and royalty free sublicense to use the Development System, Epcon Communities Works and the Marks solely in
connection with the development and marketing of an Epcon Communities project pursuant to a Market Area
Agreement to be executed by and between Sublicensee and Franchisor and subject to the terms and conditions set
forth in the Franchise Agreement and this Sublicense Agreement. Compliance with all terms and conditions of this
Sublicense Agreement, is a strict condition precedent to this sublicense. This sublicense shall not Include the grant of
rights to, or the imposition of obligations upon. Franchisee provided under Sections 3.4, 3.5, 3.6, or 4.1 (except for
Subsection 4.1.9) of the Franchise Agreement. Article 21 of the Franchise Agreement shall not be included in the
subiicense hereunder. The Franchise Agreement shall remain In full force and effect subsequent to execution of this
Sublicense Agreement. Notwithstanding the foregoing, this Section 1 shall not prevent the Sublicensee from using
those materials provided by Franchisor to Franchisee pursuant to Section 4.1 of the Franchise Agreement.

2. Acceptance of Sublicense and Assumption of the Obligations. Sublicensee hereby accepts the
sublicense described in Section 1 hereof and, as of the date hereof, assumes, and agrees to be bound by, all of
Franchisee's obligations under the Franchise Agreement and any related agreements as such obligations relate to
the Epcon Communities project developed by Sublicensee.

3. Term. Except as provided in Section 5 of this Sublicense Agreement, the sublicense granted
pursuant to Section 1 of this Sublicense Agreement shall remain in full force and effect until the earlier of (a) the date
of the sale of the last unit of Sublicensee's Epcon Communities project (b) the date that is one year after the
completion of construction (as defined by Section 11.1 of the Franchise Agreement) of the last unit of Sublicensee's
Epcon Communities project or (c) the date of the termination of the Franchise Agreement (the "Term").

4. Ownership of Development System. Epcon Communities Works and Marks. Sublicensee

acknowledges Franchisor's sole and exclusive rights in and to the Development System, Epcon Communities Works
and the Marks, and Sublicensee agrees that it will do nothing inconsistent with such rights and interests and that all
use of the Development System, Epcon Communities Works and the Marks by Sublicensee shall inure to the benefit
of and be on behalf of Franchisor. If requested by Franchisor or Franchisee, Sublicensee agrees to assist Franchisor
in recording this Sublicense Agreement with the appropriate governmental authorities. Sublicensee agrees that
nothing in this Sublicense Agreement shall give Sublicensee any right, title or interest in any of the Development
System, Epcon Communities Works or the Marks other than the right to use the Development System, Epcon
Communities Works and the Marks in accordance with this Sublicense Agreement, and Sublicensee agrees that it will
not attack the title of Franchisor to the Development System, Epcon Communities Works or the Marks or attack the
validity of the Franchise Agreement or validity of the sublicense granted pursuant to this Subiicense Agreement.
Sublicensee acknowledges and agrees that its strict compliance with the provisions of this Sublicense
Agreement are conditions precedent to its sublicense to utilize the Epcon Communities Works, and as such
any use of such works in violation of any of these provisions is unauthorized and will be acts of copyright
infringement.

5. Termination. This Sublicense Agreement may be terminated in compliance with Article 13 of the
Franchise Agreement. Upon the effective date of any termination of this Sublicense Agreement and, in any event,
upon expiration of the Term, Sublicensee shall, immediately upon the effective date of such termination or the
expiration of the Term, as the case may be, discontinue all use of the Development System, Epcon Communities
Works and the Marks and any terms or logos confusingly similar thereto, shall cooperate with Franchisor and
Franchisee or their appointed agents in applying to the appropriate governmental authorities to cancel recording of
this Sublicense Agreement from all government records and shall destroy all existing inventory of materials and all
advertising, promotional and other printed materials bearing the Marks.

6. Infringement Actions. Sublicensee shall notify Franchisee and Franchisor of any unauthorized use
of the Development System, Epcon Communities Works or the Marks by third parties promptly as it comes to
Sublicensee's attention. Franchisor shall have the sole and exclusive right and discretion to bring infringement or
unfair competition proceedings involving the Development System, Epcon Communities Works or the Marks.

7. ACKNOWLEDGMENT OF EXISTENCE OF THIRD PARTY BENEFICIARY OF THIS

AGREEMENT. EPCON COMMUNITIES FRANCHISING. INC. FRANCHISEE AND SUBLICENSEE
ACKNOWLEDGE AND AGREE THAT EACH CONTEMPLATES AND INTENDS THAT: (A) THIS AGREEMENT
AND ITS SPECIFIC PROVISIONS ARE INTENDED DIRECTLY AND PRIMARILY TO BENEFIT FRANCHISOR,
AND FRANCHISOR IS INTENDED TO BE, AND SHALL BE, A THIRD PARTY BENEFICIARY OF THIS
AGREEMENT; (B) SUBLICENSEE, IN EXECUTING THIS AGREEMENT, SHALL ASSUME A DIRECT
OBLIGATION TO FRANCHISOR, AS SUCH THIRD PARTY BENEFICIARY, TO PERFORM CERTAIN OF
FRANCHISEE'S OBLIGATIONS UNDER THE FRANCHISE AGREEMENT; AND (C) FRANCHISOR, AS SUCH
THIRD PARTY BENEFICIARY, SHALL BE CONFERRED WITH THE RIGHTS, IN ITS SOLE DISCRETION, TO
ITSELF TAKE ANY ACTION OR PURSUE ANY REMEDY THAT IT DEEMS NECESSARY IN ORDER TO
ENFORCE THE PROVISIONS HEREOF OR OF THE FRANCHISE AGREEMENT AND TO WHICH IT WOULD BE
ENTITLED AS A PARTY ENFORCING THIS AGREEMENT. FRANCHISOR SHALL BE ENTITLED TO ANY
REMEDIES AVAILABLE AT LAW, IN EQUITY, OR PROVIDED IN THE FRANCHISE AGREEMENT FOR ANY
BREACH BY SUBLICENSEE OF ANY PROVISION HEREOF OR OF ANY MARKET AREA AGREEMENT.

8. Representations and Warranties: Covenants. Sublicensee represents and warrants that, as of the
date hereof, the information set forth on Exhibit "B" attached hereto is true and accurate. Sublicensee shall join as an
obligor of any obligations of Franchisee in favor of Franchisor by execution of any documents requested by
Franchisor, and Sublicensee shall promptly deliver any mortgages, security agreements or other security instruments
requested by Franchisor.

9. Indemnification. Sublicensee shall at all times (notwithstanding the termination or expiration of this
Sublicense Agreement) indemnify Franchisee and Franchisor and any of their respective officers, agents, employees
or representatives against any and all claims, demands, actions, liabilities, damages, costs or expenses (including
reasonable attorneys' fees) arising out of Sublicensee's development and marketing of an Epcon Communities
project or the sale or advertisement of condominiums under the Marks.
 10. Miscellaneous.

A. Notices. All notices and other communications required or permitted to be given pursuant
to this Sublicense Agreement shall be given in writing and shall be deemed to have been given if delivered by hand
or by certified mail, postage prepaid, or by telecopier or telex (with a hard copy to be sent within forty-eight (48) hours
following such electronic transmissions), or by any commercially reasonable overnight courier service providing a
receipt of delivery, effective upon receipt thereof at the addresses set forth in the first paragraph hereof. Any party to
this Sublicense Agreement may, by notice given in accordance with this Section 10.A., designate a new address for
notices and other communications to such party.

B. Duplicate Originals. This Sublicense Agreement may be executed in one or more

counterparts, each of which shall be deemed to be a duplicate original, but all of which, when taken together, shall be
deemed to constitute a single instrument.

C. Successors and Assigns. The subiicense granted to Sublicensee hereunder shall be

personal to Sublicensee and may not be assigned or sublicensed by Sublicensee to any other party without the prior
written consent of Franchisee and Franchisor. Notwithstanding the foregoing, this Sublicense Agreement shall inure
to the benefit of and be binding upon the respective successors and assigns (including successive, as well as
immediate, successors and assigns) of the parties hereto.

D. Captions. The captions in this Sublicense Agreement are included for convenience of
reference only and do not define, limit, explain or modify this Sublicense Agreement or its interpretation, construction
or meaning and are in no way to be construed as a part of this Sublicense Agreement.

E. Amendments. Changes and Modifications. This Sublicense Agreement may be amended,

changed or modified only in a writing executed by each of the parties hereto.

F. Waiver. The failure of either party to insist in any one or more instances upon strict
performance by the other of its obligations under this Sublicense Agreement shall not constitute a waiver or
relinquishment of any such obligation in the future, and the same shall continue in full force and effect.

G. Choice of Law and Venue. The parties hereto agree that any litigation or legal action to
enforce or relating to this Agreement and the relationship of the parties hereto shall be governed by the choice of law
and venue provisions of the Franchise Agreement.

H. Entire Agreement. This Sublicense Agreement, together with the exhibits attached hereto,
constitutes the entire agreement between the parties hereto in respect of the subject matter of this Sublicense
Agreement, and supersedes and cancels any other agreement, representation or communication, whether oral or in
writing, between the parties hereto relating to the subject matter hereof.

[signature page follows]

 IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed and
delivered this Agreement to be effective on the day and year first written above.

Witnesses: Franchisee:

By:_______ Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_______________

Witnesses: Sublicensee:

By:________ Date:
Signature - Witness as to [Name] [Name, Title]
 FRANCHISOR'S CONSENT TO SUBLICENSE

For valuable consideration, receipt of which is acknowledged, Epcon Communities Franchising, Inc., an
Ohio corporation ("Franchisor"), hereby consents to the sublicense by , as
Franchisee, toas Sublicensee, of certain of the rights granted to Franchisee, and certain
obligations imposed upon Franchisee, by the Epcon Communities Franchising, Inc. Franchise Agreement, dated as
of^by and between Franchisor and Franchisee and attached hereto as Exhibit "A". Franchisor
hereby agrees that such Franchise Agreement shall remain in full force and effect.

Witnesses: Franchisor: Epcon Communities Franchising, Inc.

By:.
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General Counsel

Name Printed: _______________

By:_
Signature - Witness as to Paul W. Hanson Paul W. Hanson, President of Franchising

Name Printed: ____ _____________ Date:________________________________

 Exhibit "A"
(to Sublicense Agreement)

THE FRANCHISE AGREEMENT

 Exhibit "B"
(to Sublicense Agreement)

You have requested that Epcon Communities Franchising, Inc. consent to the sublicense of your rights and
obligations under the Epcon Communities Franchising, Inc. Franchise Agreement to a related entity to the franchisee
entity. In order for us to consider your request, we will need you to provide us with the following information:

A. Licensor:

1. Full legal name of franchisee entity:

2. Type of entity (corporation, partnership, limited partnership, limited liability company):

3. State where franchisee entity is registered:

4. Date of formation: ___________________

5. Ownership of franchisee entity:

Name Percentage of Ownership

6. Location(s) of Epcon Project(s):

B. Related Entity: (If this entity has not yet been established, provide information regarding the plans for the
entity.)

1. Full legal name of related entity:

2. Full business address of related entity:.

3. Type of entity (corporation, partnership, limited partnership, limited liability company:

4. State where related entity is registered:.

5. Date of formation:_________________

6. Ownership of related entity:

Name Percentage of Ownership

7. Location(s) of Epcon Project(s):

C. Purpose of Proposed Sublicense Arrangement:

Activities related to construction, marketing and sales of a unit project containing

;Epcon condominium homes.

D.
Signature of Individual Submitting Response
Title:

Date:
 EXHIBIT H

MARKET RESERVATION AGREEMENT

This Market Reservation Agreement (this "Market Reservation Agreement") is made by and
between Epcon Communities Franchising, Inc., an Ohio corporation having its principal business offices in
Dublin, Ohio (hereinafter referred to as "Franchisor"), anda(n)
having its principal business offices located at (hereinafter referred to as
"Purchaser").

RECITALS

A. Purchaser desires to obtain a reservation or "hold" upon a Market Area, as set forth in Exhibit "A" to
this Market Reservation Agreement (the "Reserved Market Area") pending Its decision on whether to enter
into a Franchise Agreement with Franchisor to develop a Project at a location within the Reserved Market
Area, and Franchisor has agreed to grant to Purchaser such reservation for such Reserved Market Area.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

1. Each of the following capitalized terms shall have the meaning specified as follows:

"Development System" shall mean Franchisor’s method, pattern, documents, materials, know-how,
knowledge, process, and procedure used for development, construction, and marketing of detached and
attached homes using a unique architectural design, as well as other proprietary and confidential
information, including copyrighted and patented material, and material for which the copyright registration or
patent is pending, including, without limitation, all architectural plans and specifications for detached and
attached homes, architectural plans and specifications for the clubhouse, site planning guidelines,
production management guidelines, financial planning guidelines, marketing materials and guidelines, and
sample condominium association materials provided by Franchisor and other specifications developed by
Franchisor from time to time for use with the Development System. The Development System shall be
deemed to include any method, pattern, process, specification, or procedure used by Franchisee during the
term of this Agreement, along with any modifications or changes thereto.

"Effective Date" shall mean the date upon which the Franchisor receives the Market Reservation
Deposit from Purchaser or upon which the Franchisor executes this Market Reservation Agreement,
whichever is later.

"Market Area" shall mean the smallest specific geographic area as determined by Franchisor that
will generate the most purchaser support (between 60% and 70%) for a Project. The area included within
the Market Area typically takes into consideration existing natural and man-made boundaries and
socioeconomic conditions.

"Project" shall mean all of the development of buildings or appurtenant structures and
improvements on common contiguous grounds using the Development System. Such development shall be
defined as a Project without consideration of the elapsed time required for development of the Project or of
the development, marketing, or legal “phase” thereof

“Small Market Area” shall mean Market Area as determined by Franchisor for a Project of 10 to 48
units and will typically encompass an area between 1 to 3 miles from the Project.

2. Purchaser shall have paid to Franchisor no later than the time of Purchaser's execution and
delivery of this Market Reservation Agreement a refundable deposit in the amount of $10,000 (the “Market
Reservation Deposit”).

3. For a period of six (6) months from the Effective Date (as hereinafter defined) of this Market
Reservation Agreement (the "Term"), Franchisor will not itself develop, nor will it grant to a third party a
license to develop, a Project utilizing the Development System within the Reserved Market Area, except
after first proceeding in compliance with the provisions of Section 4 hereof
 4. At any time within the Term of this Market Reservation Agreement, and if Purchaser is in full
compliance with all of its obligations, Purchaser may notify Franchisor that Purchaser would like to execute a
Franchise Agreement and Market Area Agreement. The Market Area Agreement will have as its Market
Area a geographic area identical to the Reserved Market Area or a geographic area making up a portion of
the Reserved Market Area. Purchaser acknowledges and agrees that the Market Area reflected in the
Market Area Agreement will generally be a smaller geographic area than the Reserved Market Agreement
under this Market Reservation Agreement. This Market Reservation Agreement will automatically expire
upon execution of a Franchise Agreement and Market Area Agreement by Franchisor and Purchaser and
payment by Purchaser of the applicable fee(s) for the Project. If the parties enter into a Franchise
Agreement and Market Area Agreement on or before the end of the Term of this Market Reservation
Agreement the refundable Market Reservation Deposit paid to Franchisor will be applied to the applicable
fee(s) for the Project.

Purchaser may at any time during the term of this Market Reservation Agreement request in writing a refund
of the Market Reservation Deposit and termination of this Market Reservation Agreement and Franchisor will
return the Market Reservation Deposit to Purchaser within 15 business days of the execution of a Mutual
Release of Market Reservation Agreement by both Purchaser and Franchisor.

5 Franchisor may, at any time during the Term of this Market Reservation Agreement, notify
Purchaser in writing, that Purchaser has 21 calendar days (the "Notice Period) to enter into a Franchise
Agreement and Market Area Agreement with Franchisor for the Market Area described in the Market
Reservation Agreement, and pay Franchisor the applicable fee provided by the Franchise Agreement. In
the event Purchaser fails to enter into such a Franchise Agreement and Market Area Agreement with
Franchisor, Franchisor shall return the Market Reservation Deposit to Purchaser within 15 business days
after the expiration of the Notice Period and the execution of a Mutual Release of Market Reservation
Agreement by both Purchaser and Franchisor and this Agreement shall terminate.

6. Purchaser shall not be entitled to interest during the time the Market Reservation Deposit is held by
Franchisor.

7. This Market Reservation Agreement and the rights provided to Purchaser hereunder may not be
assigned by Purchaser to any other party without the prior written consent of Franchisor.

8. This Market Reservation Agreement form may also be used to reserve a Small Market Area. In
such cases, the term “Market Area Agreement” in this form shall be deemed to refer to and include any
Small Market Area Agreement to which it refers.

9. This Market Reservation Agreement shall be interpreted, construed, and governed by the local
laws of the State of Ohio, without application of its conflicts of laws principles and venue for the resolution of
any dispute involving the interpretation or enforcement of this Market Reservation Agreement shall lie in the
Common Pleas Court of Franklin County, Ohio.

[signature page follows]

 IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly
executed and delivered this Market Reservation Agreement to be effective as of the Effective Date.

Witnesses: Purchaser:

By:. Date:
Signature - Witness as to Name [Name, Title]

Name Printed:

Date:
Signature - Witness as to Name [Name, Title]

Name Printed:______________

Witnesses: Franchisor; Epcon Communities Franchising, Inc.

By:
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General Counsel

Name Printed; __'

By:.
Signature - Witness as to Paul W. Hanson Paul W. Hanson, President of Franchising

Name Printed: Date:

 EXHIBIT "A"
(to Market Reservation Agreement)

The Reserved Market Area

8166740 V.9
 MUTUAL RELEASE OF
MARKET RESERVATION AGREEMENT

This Mutual Release of Market Reservation Agreement (the "Mutual Release") is entered into by and
among Epcon Communities Franchising, Inc. (“Epcon”) and, a(n)
, having its principal business offices located at
(hereinafter referred to as “Reservation Holder”).

The parties entered into a Market Reservation Agreement on or about,

20__ whereby Epcon reserved a Market Area or a Small Market Area for Reservation Holder’s potential
use of the Development System in and around (the "Agreement”).

The undersigned parties for themselves, their agents, their assigns and their representatives
hereby release and discharge all of the parties to this Mutual Release, along with their agents, their
assigns and their representatives, from any and all claims, causes of action and demands arising out of or
related to the Agreement. The deposit payment made by Reservation Holder shall be returned by Epcon
to Reservation Holder within fifteen (15) days of the date of this Mutual Release.

Except as set forth in any other contract or agreement to which Epcon and Reservation Holder
may be parties, no party to this Mutual Release shall have further obligation to any other party with
respect the Agreement or the use of the Development System. This Mutual Release is specific to the
Agreement and has no relation to any other contract or agreement to which Epcon and Reservation
Holder may be parties.

Reservation Holder: Epcon: Epcon Communities Franchising, Inc

By:_____________ By:_________________________________

Print Name: Print Name:__________________________

Title:_____ Title:_______________________________

Date: Date: ___ ___ ___

116 V:
 EXHIBIT I

Exhibit “6”

(to the Franchise Agreement)

LENDER ASSIGNMENT AGREEMENT

THIS LENDER ASSIGNMENT AGREEMENT (this "Assignment Agreement") is made to be effective as of

the . day of, 20______________, by and betw/een,, a(n)
(hereinafter, "Assignor”), and. a(n). . (hereinafter "Assignee”).

Recitals

A. Assignor has entered into that certain Epcon Communities Franchising, Inc. Franchise Agreement
(the “Franchise Agreement”), including the Market Area Agreement attached thereto (the “Market Area Agreement”),
both dated, 20__________________, with Epcon Communities Franchising, Inc. (hereinafter “Epcon Communities”),
relating to the grant by Epcon Communities to Assignor of the license to use the Epcon Communities Development
System in the market area depicted and described in the Market Area Agreement.

B. Assignee desires to obtain collateral security for the payment and performance of certain
obligations by and from Assignor to and on behalf of Assignee, and to ensure the performance of the Franchise
Agreement and Market Area Agreement, including but not limited to payments therein specified, without altering or
otherwise increasing Epcon Communities’ duties or obligations thereunder.

C. Assignor desires to assign certain rights and obligations under the Franchise Agreement and
Market Area Agreement, to Assignee, and Assignee desires to accept the assignment of and, if upon the default by
Assignor under the loan agreement or other agreement(s) between Assignor and Assignee (the "Loan Agreements”),
Assignee decides to use the Development System to complete any unfinished Project(s) (as defined in the Franchise
Agreement), and promptly communicates such decision to Epcon Communities in writing, the assumption of such
obligations of the franchisee as set forth in the Franchise Agreement and Market Area Agreement.

Agreement

NOW, THEREFORE, in consideration of the foregoing, of the agreements, terms and conditions herein
contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged. Assignor and Assignee do hereby agree as follows:

1. Assignment of Franchise Agreement and Market Area Agreement. Assignor hereby expressly grants,
bargains, sells, conveys, transfers and assigns to Assignee such of Assignor's right, title and interest in and
to the Franchise Agreement and the Market Area Agreement (copies of which are attached hereto, made a
part hereof and marked as Exhibit "A”), and the license granted thereunder, which may be necessary to
permit Assignee to complete any Project which is the subject thereof upon the default or occurrence of an
event of default by Assignor under any of the Loan Agreements (hereinafter, the “Assignment”). The
Assignment shall not include the rights of the franchisee provided under Sections 3.4 and 3.5 of the
Franchise Agreement.

2. Acceptance of Assignment and Assumption of the Obligations. Assignee hereby accepts the Assignment
and, if, upon the default by Assignor under the Loan Agreements, Assignee decides to use the Development
System to complete any unfinished Project(s), assumes, and agrees to be bound by all of Assignor's
obligations under the Franchise Agreement as such obligations relate to the Epcon Communities project
developed by Assignor and such of Assignor's obligations under the Franchise Agreement and the Market
Area Agreement as are corresponding with the right, title, and interest transferred to Assignee in Section 1
hereof (hereinafter, the “Obligations”). Assignee shall promptly communicate in writing to Epcon
Communities its decision respecting assumption of the Obligations as franchisee under the Franchise
Agreement and the Market Area Agreement. If Assignee, in full compliance with the terms of the Franchise
Agreement and the Market Area Agreement uses the Development System to complete a Project or
Projects, Assignee shall have no obligation to Epcon Communities to cause Assignee’s stock certificates or
other certificates evidencing ownership to be inscribed with a legend referencing the Franchise Assignment
Agreement, the Lender Agreement, or the Market Area Agreement.

3. Assignor's Continuing Liability for the Obligations. Notwithstanding the Assignment, Assignor hereby
acknowledges and agrees that it shall remain liable to Epcon Communities for all of the Obligations.
4. Ownership of Development System. Assignee acknewledges Epcon Communities’ sole and exclusive rights
in and to the Development System, and Assignee agrees that it will do nothing inconsistent with such rights
and interests. Assignee agrees that nothing in this Assignment Agreement shall give Assignee any right,
title or interest in any of the Development System other than the right to use the Development System in
accordance with this Assignment Agreement, and each of the Franchise Agreement and the Market Area
Agreement, attached hereto as Exhibit “A”, and Assignee agrees that it will not attack the title of Epcon
Communities or its affiliates to the Development System or attack the validity of the Franchise Agreement or
the validity of the assignment granted pursuant to this Assignment Agreement. Assignee further
acknowledges and agrees that its strict compliance with these provisions are conditions precedent
to any license to utilize the Epcon Communities Works, and as such any use of such works in
violation of any of these provisions is unauthorized and will be acts of copyright infringement.

5. Third-Party Beneficiary. Assignor and Assignee acknowledge and agree that each contemplates and
intends that: (a) this Assignment Agreement and its specific provisions are intended directly to
benefit Epcon Communities, and Epcon Communities is intended to be, and shall be, a third party
beneficiary of this Assignment Agreement; (b) Assignee, if it decides to use the Development
System to complete any unfinished Project(s) pursuant to Section 2 above, shall assume a direct
obligation to Epcon Communities, as such third party beneficiary, to perform certain of Assignor’s
obligations under the Franchise Agreement and the Market Area Agreement; and (c) Epcon
Communities, as such third party beneficiary, shall be conferred with the rights, in its sole
discretion, to itself take any action or pursue any remedy that it deems necessary in order to enforce
the provisions hereof or of the Franchise Agreement and to which it would be entitled as a party
enforcing this Assignment Agreement. Epcon Communities shall be entitled to any remedies
available at law, in equity, or provided in the Franchise Agreement for any breach by Assignee of
any provision hereof or of any Market Area Agreement.

6. Acknowledgment of Conditions of Consent. Each of Assignor and Assignee acknowledges and agrees to
the conditions set forth in Epcon Communities’ Consent to Assignment attached hereto.

7. Termination: Expiration. Effective as of the effective date of any termination or expiration of the Franchise
Agreement, this Assignment Agreement shall automatically terminate. Upon the final payment in full by
Assignor to Assignee of all of Assignor’s obligations to Assignee under the Loan Agreements, Assignee
shall promptly provide notice to Epcon Communities of such payment in full, and this Assignment Agreement
shall automatically terminate.

8. Successors and Assigns. This Assignment Agreement shall inure to the benefit of, and be binding upon, the
parties hereto and their respective successors and permitted assigns.

9. Counterparts. This Assignment Agreement may be executed in one or more counterparts, each of which
shall be deemed to be a duplicate original, but all of which, taken together, shall constitute a single
instrument.

10. Governing Law. This Assignment Agreement shall be deemed to have been made and entered into in the
State of Ohio, and all rights and obligations of the parties hereto shall be governed by and construed in
accordance with the local laws of the State of Ohio, without application of its conflicts of laws provisions.

[signature page follows]

 IN WITNESS WHEREOF, the parties hereto have executed or caused to be executed this Assignment
Agreement to be effective on the day and year first written above.

ASSIGNOR: NAME

Witnesses;

Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed:_______________

Signature - Witness as to [Name]

Name Printed:_______________

ASSIGNEE: NAME

Witnesses:

Date:
Signature - Witness as to [Name] [Name, Title]

Name Printed;_______________

Signature - Witness as to [Name]

Name Printed:_______________
 EPCON COMMUNITIES’ CONSENT TO ASSIGNMENT

For valuable consideration, receipt of which is hereby acknowledged, Epcon Communities

Franchising, Inc. (“Epcon Communities”), hereby consents to the assignment, as evidenced by the Lender
Assignment Agreement, of the Epcon Communities Franchising, Inc. Franchise Agreement and Market Area
Agreement or Small Market Area Agreement, as applicable, attached hereto as Exhibit “A” by
, as Assignor, to , as Assignee, and
agrees that such Franchise Agreement and Market Area Agreement or Small Market Area Agreement, as
applicable, shall remain in full force and effect in accordance with their terms, as amended by the Lender
Assignment Agreement; provided and conditioned, however, upon fulfillment by both Assignor and
Assignee, of the following conditions;

1. Epcon Communities’ duties and obligations pursuant to the terms of the Franchise Agreement and
Market Area Agreement or Small Market Area Agreement, as applicable, are not altered or
otherwise increased.

2. Epcon Communities shall be paid any and all payments specified in the Franchise Agreement no
later than the applicable payment due dates.

3. Assignor fully complies with the terms of the Franchise Agreement, Market Area Agreement or
Small Market Area Agreement, as applicable, and any and all other agreements between Epcon
Communities and Assignor. Notwithstanding the foregoing, if Assignor is not in full compliance with
the terms of each such agreement(s) but either of the following occur Epcon Communities shall
consent to the assignment: (i) if Assignor’s non-compliance is due to nonpayment of amounts due
to Epcon Communities related to the subject Project, Assignee shall pay any fees related to such
Project that are past due and payable to Epcon Communities and shall agree to pay any fees
related to such Project that become due and payable to Epcon Communities in the future, or (ii) if
Assignor’s non-compliance is due to a material default in Assignor’s use of the Development
System in the construction of the Project, Assignee agrees to correct such material defaults and
use the entire Development System without modification or deviation.

Assignee fully compiles with the terms of the Franchise Agreement and Market Area Agreement or
Small Market Area Agreement, as applicable. Including without limitation, upon its decision to use
the Development System to complete a Project or Projects, providing to Epcon Communities
copies of the documents attached as Exhibit “2” and/or Exhibit “2A” to the Franchise Agreement
executed by those individuals who will be acting on behalf of Assignee in completing any Project(s)
and will be provided more detailed information regarding the Development System than has been
provided to the general public.

In the event that Epcon Communities must hold initial training sessions for the benefit of Assignee,
or Assignee’s agents and employees. Assignee agrees to pay to Epcon Communities a reasonable
tuition fee for each attendee attending such training.

Witnesses: Franchisor: Epcon Communities Franchising, Inc.

By:.
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General Counsel

Name Printed;_______________________

By:_
Signature - Witness as to Paul W. Flanson Paul W. Flanson, President of Franchising

Name Printed:_______________________ Date:

32574859 V.5
 EXHIBIT J

EPCON COMMUNITIES FRANCHISING, INC.

NON-DISCLOSURE AND ON-LINE INFORMATION ACCESS AGREEMENTS
Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information Access Agreement
(Franchisee)

Welcome to the Epcon Communities Franchising, Inc. Intranet! Read all terms and conditions of
this Epcon Communities Franchising, Inc. ("Epcon Communities") Non-Disclosure and On-Line
Information Access Agreement (this "Agreement") before signing. Complete the bottom section,
have it signed by an authorized person and either e-mail, fax or mail it to Epcon Communities at
the facsimile number or addresses at the end of this Agreement. Upon receipt and acceptance by
Epcon Communities, Epcon Communities will contact you with your User Name and Password so
you can access the Epcon Communities Intranet and/or the Epcon Learning Center.

The following items will describe the terms of service for the Epcon Communities services collectively known
as the Epcon Communities Intranet. These services include a web site, online training modules, and a
bulletin board service, as well as any services, which may be added from time to time. The purpose of the
Epcon Communities Intranet is to facilitate communication between you and other Epcon Communities
franchisees and their employees, Epcon Communities employees and Epcon Communities departments.
We at Epcon Communities believe that you will find the Epcon Communities Intranet to be both useful as a
means for receiving technical information and assistance from Epcon Communities, and as a forum for
discussion on a wide range of issues of interest to the Epcon Communities community as a whole. Because
you, as an Epcon Communities Intranet User, will have the ability not only to access information on the
Epcon Communities Intranet, but also the ability to contribute information by uploading information, and/or
participating in real-time and other communications, you must agree to the following before you will be
authorized to access the Epcon Communities Intranet:

1) Limited License. The authorization to access and use the Epcon Communities Intranet that is
granted to you in this Agreement is limited to your internal use in your ordinary course of business as a
franchisee of Epcon Communities. This authorization is non-transferable and non-exclusive, is for use
only by you and your employees, and only in accordance with this Agreement and any Epcon
Communities Intranet policies provided to you or available on-line from time to time.

2) Definitions. For purposes of this Agreement, the following definitions shall apply:
a) Epcon Communities means Epcon Communities Franchising, Inc., an Ohio corporation.
b) Web Site. The Web Site means all information, content, concepts, program interfaces,
structures, functionality, computer code, published materials, electronic documents, video, graphics
and other information and technology in Epcon - Communities’ World Wide Web Site located at
www.epconconnect.com and/or at epcon.smarteru.com.
c) Databases. The Databases include all information accessible from Epcon Communities
through the Web Site, which may include, but is not limited to, technical and other specifications, sales,
marketing and training materials, online training modules and related documents, online libraries of
manuals, articles and sample documents, pricing, advice, and other data and information. All data and
information available in the Databases is proprietary, confidential and the sole property of Epcon
Communities (or of third parties licensing such information to Epcon Communities) and contain
copyrighted and patented material.
d) The Epcon Communities Intranet means, collectively, the Web Site and related services
accessed through the Web Site, including its Databases and a bulletin board service, as well as any other
services which may be added from time to time.
3) Access and Security. Each of your authorized users (“Users”) must enter a valid User Name and
Password ("Access Codes") to access some of the Databases or access the Web Site's secure areas.
Do not permit any of your Users to disclose your Access Codes to anyone not authorized to act on your
behalf. It is your responsibility to safeguard and protect your Users’ Access Codes and to monitor all use
of these Access Codes for all purposes. You accept all responsibility for maintaining the security of your
Users’ Access Codes and for ail utilization of the Epcon Communities Intranet via your Users’ Access
Codes, with or without your knowledge or consent. Notify Epcon Communities immediately if you have
 Epcon Communities Franchising, inc. Non-Disclosure and On-Line Access Agreement (Franchisee)

lost any of your Access Codes or wish to terminate a particular User’s User Name and Password or have
these Access Codes changed.
4) Your Hardware and Communications Responsibility. You are responsible for obtaining and
maintaining any communications equipment necessary to connect to the Epcon Communities Intranet,
including modems, computer hardware and software and long distance or local telephone service. You
must be connected to the Internet and must use your own Internet service provider ("ISP") to access the
Epcon Communities Intranet. Any charges incurred for such equipment or access are your sole
responsibility.
5) The Epcon Communities Intranet Purposes. The Epcon Communities Intranet is to be used to conduct
work-related business or to exchange technical or analytical Epcon Communities related information. If
you wish to express personal opinions, you must use a private ISP and a personal access account distinct
from the Epcon Communities Intranet. Epcon Communities Intranet Users are expected to exercise
reasonable judgment and discretion when using the Epcon Communities Intranet, particularly when
uploading text or communicating with others. EPCON COMMUNITIES WILL NOT REVIEW OR EDIT
BEFOREHAND ANY INFORMATION THAT AN EPCON COMMUNITIES INTRANET USER CHOOSES TO
CONTRIBUTE TO THE EPCON COMMUNITIES INTRANET. However, the continued viability of the Epcon
Communities Intranet depends upon the use of the Epcon Communities Intranet only for legitimate purposes.
Epcon Communities Intranet Users are requested to report to Epcon Communities suspected illegal or
improper uses of the Epcon Communities Intranet, such as for distribution of misappropriated software code
or dissemination of other inappropriate information. You acknowledge and agree that Epcon Communities
does not endorse any user content created or transmitted via the Epcon Communities Intranet and Epcon
Communities is not responsible or liable for any unlawful, harassing, libelous, privacy invading, abusive,
threatening, harmful, vulgar, obscene, tortious, or otherwise objectionable content, or content that
infringes or may infringe the intellectual property or other rights of another.
6) Your Information. The Epcon Communities Intranet is designed to facilitate open communication among
the Epcon Communities Intranet Users and from the Epcon Communities Intranet Users to Epcon
Communities. To this end, all information that you upload or contribute to the Epcon Communities Intranet
bulletin board or similar service or communicate to Epcon Communities through the Epcon Communities
Intranet is deemed non-confidential and non-proprietary as to you. The Epcon Communities Intranet Users
who wish to communicate their own confidential information must use a different method of communication.
Epcon Communities is the owner of all data which resides on the Epcon Communities Intranet, including
mail messages or other files that may be tagged with your, or any other Epcon Communities Intranet
user's, identification.
7) Your Privacy. Epcon Communities may monitor, edit or disclose information about you or your private
content in the good faith belief that such action is reasonably necessary to: comply with the law; comply
with legal process; enforce this Agreement; respond to claims that such contents violate the rights of third
parties; or, protect the interests of Epcon Communities or others. You acknowledge and agree that Epcon
Communities may access your content and the Databases as necessary to identify or resolve technical
problems or to respond to service complaints. You acknowledge and agree that certain technical
processing of information is and may be required to: send and receive such data; perform planning and
scheduling functions; conform to the technical requirements of connecting networks; conform to the
technical requirements of the Epcon Communities Intranet; or, conform to other, similar technical
requirements.
8) Epcon Communities Information. All information disclosed through the Epcon Communities Intranet or
which is otherwise disclosed by Epcon Communities to you which relates to or concerns Epcon Communities’
systems, products and services is the exclusive property of Epcon Communities, is confidential and
proprietary to Epcon Communities, developed by Epcon Communities after the expenditure of considerable
time, effort and expense and from which Epcon Communities derives independent economic value from not
being generally known to other persons or to the general public. You agree not to communicate or otherwise
divulge to, or use for the benefit of yourself or any third party any information or knowledge concerning such
systems, products or services. You also acknowledge and agree that content, including but not limited to
text, logos, software, music, sound, photographs, video, graphics or other material or other information
presented to you through the Epcon Communities Intranet ("Content") is protected by copyright, trademark,
patent and other laws. You are only permitted to use this Content as long as you are a current franchisee of
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Franchisee)

Epcon Communities and then only as expressly authorized by Epcon Communities, and may not copy,
reproduce, distribute, or create derivative works from this Content, except in accordance with such
authorization. You may not use trademarks of Epcon Communities unless you hold a valid, written
franchise agreement (or license agreement) with Epcon Communities and then only in accordance with
such agreement.
9) Modification of the Web Site. Databases or Agreement. Epcon Communities may elect to update,
modify, change or terminate all or any part of the functionality available through the Databases or Web
Site, including modification or termination of any services provided, including the Epcon Communities
Intranet itself. In addition, Epcon Communities may modify this Agreement from time to time by
amendments or modifications provided to you through on-line notice on the Web Site, by email to the
email address you have provided to us, or by regular mail or facsimile transmission. You agree that
access to the Databases or Web Site after you have, or should have received, notice of modifications or
amendments to this Agreement will constitute acceptance of all such modifications or amendments.
10) Franchisee Web Sites. Notwithstanding that Epcon Communities may authorize you to use portions
of the Content in the creation of your own web site, Epcon Communities retains the sole right to create a
Web site using:
“EpconCommunities”;
“epconcommunities.com"; “epconhomesandcommunities.com’’;
“epconfranchising.com “; and/or
“EpconOpportunity.com”

(collectively, the “Marks”) and to register or use other domain names related or similar to any of the Marks.
Prior to your creation of any web site related in any manner to your Epcon Communities franchised
business (and pursuant to the approval process provided in the Epcon Communities Franchise
Agreement), you must obtain Epcon Communities’ written approval of (and Epcon Communities shall have
continuing approval rights regarding) the domain name for such web site, the content of such Web site
(including all framing employed) and use of any of the Marks in the content of such Web site. Epcon
Communities retains the right to pre-approve your use of linking between your web pages which are
related in any manner to your Epcon Communities franchised business and any other web site. Within
five (5) days of any written request by Epcon Communities, you shall (a) remove any links between your
web pages related in any manner to your Epcon Communities franchised business and all other web sites;
and/or (b) remove any references on your web pages to the Marks. Further, you shall comply with your
Epcon Communities Franchise Agreement and Epcon Communities’ guidelines, as published from time to
time to the Epcon Communities franchise system, regarding the use by franchisees and certain of their
employees of web sites related to Epcon Communities franchised businesses.

11) User Conduct.

You agree to do all of the following:
a) abide by all applicable local, state, federal, and international laws and regulations in your use of
the Epcon Communities Intranet; and
b) comply with all regulations, policies and procedures of the Epcon Communities Intranet
established by Epcon Communities and posted on the Web Site.
12) Your Obligations and Prohibitions.
You agree that you shall NOT do any of the following:
a) attempt to modify or ’’hack" the Web Site or Databases;
b) access any area on the Web Site or Databases which you are not explicitly authorized to access;
c) interfere with, restrict or inhibit any other user from, the use and enjoyment of the Epcon
Communities Intranet, the Web Site or any Databases;
decompile, disassemble, probe, or otherwise reverse engineer, or modify, translate, merge, or
prepare derivative works of the Databases or the Web Site;
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Franchisee)

e) impersonate any person or entity, including but not limited to, an Epcon Communities officer,
forum leader, guide or host or falsely state or otherwise misrepresent your affiliation with a person
or entity:
f) collect or harvest personal information about other users of the Epcon Communities Intranet;
g) transmit or post any material that encourages conduct that could constitute a criminal offense,
give rise to civil liability, or otherwise violate any applicable local, state, national or international
law or regulation, including, without limitation, the U.S. Export Control laws and regulations;
h) post, promote or transmit through the Epcon Communities Intranet any unlawful, harassing,
libelous, abusive, threatening, harmful, vulgar, obscene, hateful, racially, ethnically or otherwise
objectionable material of any kind or nature, including, without limitation, any transmissions
constituting or encouraging conduct that would constitute a criminal offense, or give rise to civil
liability;
i) knowingly upload, copy, post, publish, transmit, reproduce, distribute or participate in the transfer
or sale or transmit any files that contain viruses, corrupted files, or any other similar software or
programs or any software in violation of copyright law, or the applicable software license
agreement;
j) jeopardize the operation of computer systems owned by Epcon Communities or the reputation of
Epcon Communities;
k) use any of the Web Site or any Databases for service bureau or other purposes not specified in
this Agreement, the Epcon Communities Intranet policies or your franchise agreement;
l) advertise or offer to sell any goods or services, or engage in any surveys or contests; or
m) use the Epcon Communities Intranet to encourage, post or transmit "junk mail," "spam," hoaxes,
chain letters, or advertisements and/or rude, obscene or harassing messages.
13) Epcon Communities’ Rights. Epcon Communities reserves the right, upon learning of actual or possible
illegal or improper uses of the Epcon Communities Intranet, to investigate and take action, as it deems
necessary in its sole discretion, to stop the actual or possible illegal or improper use, including but not limited
to, immediately and without notice, deleting your information or information pertaining to you and revoking
your authorization to use the Epcon Communities Intranet. In addition, Epcon Communities may, in its sole
discretion, immediately terminate your access to the Epoon Communities Intranet should your conduct fail
to fully conform with any terms and conditions of this Agreement. Epcon Communities may, but is not in
any way obligated to, enforce this Agreement against any Epcon Communities Intranet user.
14) Term and Termination. Your access to the Epcon Communities Intranet is a privilege extended by
Epcon Communities and begins with issuance of your access codes (issued only after your execution and
delivery of this Agreement and acceptance of same by Epcon Communities) and ends upon termination by
you or by Epcon Communities. Your Epcon Communities Intranet access rights shall immediately
terminate, without notice, on your failure to maintain authorized franchisee status. In addition, Epcon
Communities may terminate this Agreement and your authorization to access the Web Site and
Databases at any time, with or without notice for any reason or no reason. You agree that on termination
of this Agreement or your right of access granted hereunder, you immediately will cease accessing the
Epcon Communities Intranet, including the Web Site and the Databases. Sections 6, 7, 8, 9, 10, 11, 12,
13. 14, 15, 16, 17 and 18 of this Agreement shall survive the termination of this Agreement.
15) Disclaimer of Warranty; Limitations of Liability and of Remedies. The Epcon Communities Intranet,
the Databases and Web Site are provided to you "AS IS" and "AS AVAILABLE" as a convenience for you
in communicating with Epcon Communities. EPCON COMMUNITIES MAKES NO WARRANTY
REGARDING DATABASE ACCURACY OR THE ABSENCE OF ANY ERRORS AND OMISSIONS, AND
IT IS SOLELY YOUR RESPONSIBILITY TO EVALUATE THE ACCURACY, COMPLETENESS AND
USEFULNESS OF ALL OPINIONS, ADVICE, SERVICES OR OTHER INFORMATION CONTAINED IN
THE DATABASES AND THE WEB SITE. IN NO EVENT WILL EPCON COMMUNITIES BE LIABLE FOR
ANY DAMAGES OF ANY KIND RELATING IN ANY WAY TO THE EPCON COMMUNITIES INTRANET
SERVICE OR FROM INTERRUPTION, SUSPENSION OR TERMINATION OF THE SERVICE.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THIS LIABILITY EXCLUSION APPLIES
 Epcon Communities Franchising, inc. Non-Disciosure and On-Line Access Agreement (Franchisee)

TO ALL DAMAGES, WHETHER DIRECT, INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE,

EXEMPLARY OR CONSEQUENTIAL AND UNDER ANY LEGAL THEORY, WHETHER IN CONTRACT,
TORT, EQUITY OR AT LAW, INCLUDING BUT NOT LIMITED TO, DAMAGES FOR LOSS OF
PROFITS, USE, DATA OR OTHER INTANGIBLES, AND EVEN IF EPCON COMMUNITIES HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIABILITY EXCLUSION INCLUDES,
WITHOUT LIMITATION, ANY AND ALL DAMAGES RESULTING FROM THE USE OR THE INABILITY
TO USE THE EPCON COMMUNITIES INTRANET SERVICE OR FOR COST OF PROCUREMENT OF
SUBSTITUTE GOODS AND SERVICES OR RESULTING FROM ANY GOODS, DATA, INFORMATION
OR SERVICES PURCHASED OR OBTAINED OR DATA RECEIVED OR TRANSACTIONS ENTERED
INTO THROUGH THE EPCON COMMUNITIES INTRANET SERVICE OR RESULTING FROM
UNAUTHORIZED ACCESS TO OR ALTERATION OF YOUR TRANSMISSIONS OR DATA. YOUR
SOLE AND EXCLUSIVE REMEDY FOR ANY BREACH OF THIS AGREEMENT BY EPCON
COMMUNITIES SHALL BE TO TERMINATE THIS AGREEMENT.
16) Additional Disclaimers. Additional disclaimers may be contained on the Web Site and in the
Databases. Epcon Communities does not warrant that the functions of the Epcon Communities Intranet
will meet any specific requirement you may have or that it will be error-free or your use will be
uninterrupted.
17) Indemnity. You agree to defend, indemnify and hold Epcon Communities and its affiliates, and its and
their directors, employees and agents harmless from any and all liabilities, costs and expenses, including
reasonable attorneys' fees related to or arising from a breach by you of any of the terms of Sections 11
and/or 12 of this Agreement.
18) Miscellaneous. This Agreement and your use of the Databases and Web Site are governed by the
laws of the State of Ohio (without reference to conflicts of laws provisions) and applicable federal laws of
the United States. The state courts in the State of Ohio in Franklin County and, if the jurisdictional
prerequisites exist at the time, the United States District Court for the Southern District of Ohio (Northern
Division) shall have the sole and exclusive jurisdiction to hear and determine any dispute or controversy
arising under or concerning this Agreement. Neither party to this Agreement shall be responsible to the
other party for non-performance or delay in performance of the terms and conditions hereunder due to
acts of God, acts of government, wars, riots, strikes, accidents in transportation, materials shortages or
other causes beyond the control of the party. This Agreement supersedes any and all agreements,
whether oral or written, between the parties with respect to the subject matter hereof and contains all the
covenants and agreements between the parties with respect to the subject matter hereof. Each party
acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have
been made by any party, or anyone acting on behalf of any party, that are not embodied herein, and that
no other agreement, statement, or promise not contained in this agreement shall be valid or binding.
Nothing in this Agreement or any related agreement, however, is intended to disclaim the representations
Epcon Communities made in the franchise disclosure document Epcon Communities furnished to the
undersigned Franchisee. Each time you access the Epcon Communities Intranet, you confirm your
agreement to this Agreement, as modified or amended from time to time.

(signature page follows]

 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Franchisee)

I have read the above Agreement and I agree to the terms thereof;

This section to be filled out by Franchisee (or Authorized Representative):

Franchise Company;

Contact Name; Authorized Signature;

Authorized Users; (Please duplicate this form if you would like to request additional users.)
Note; When denoting titles and to determine the appropriate level of access, please use one of the
following; Franchisee, Operations Manager, Sales/Marketing Manager, Sales Consultant, Project
Manager/Construction Manager, Construction Superintendent, Administrative Personnel

User #1; I have read the On-Line Information

User #2; 1 have read the On-Line Information
Access Agreement and I agree to the terms
Access Agreement and 1 agree to the terms thereof;
thereof;

Name Name

Title Title

Community Community

E-mail E-mail

Signature Signature

User #3; I have read the On-Line Information

User #4; 1 have read the On-Line Information
Access Agreement and I agree to the terms
Access Agreement and 1 agree to the terms thereof;
thereof;

Name Name

Title Title

Community Community

E-mail E-mail

Signature Signature

E-mail Completed Form to; [email protected] or Fax to; (614) 761-2672

Your User Name(s) and Password(s) will be Intranet Address; www.epconconnect.com

e-mailed to the listed e-mail address after receipt and/or epcon.smarteru.com
and acceptance by Epcon Communities.

4255540 V.16
Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information Access Agreement
(Employee)

Welcome to Epcon Communities Franchising, Inc. Read all terms and conditions of this Epcon
Communities Franchising, Inc. ("Epcon Communities") Non-Disclosure and On-Line Information
Access Agreement (this "Agreement") before signing. Complete the bottom section, have it
signed by an authorized representative of the Franchisee, sign it and either e-mail, fax or mail it to
Epcon Communities at the facsimile number or addresses at the end of this Agreement. Upon
receipt and acceptance by Epcon Communities, Epcon Communities will contact you with your
User Name and Password so you can access the Epcon Communities Intranet and/or the Epcon
Learning Center.

The following items will describe the terms of service for the Epcon Communities services collectively known
as the Epcon Communities Intranet. These services include a web site, online training modules, and a
bulletin board service, as well as any services, which may be added from time to time. The purpose of the
Epcon Communities Intranet is to facilitate communication between you and employees of other Epcon
Communities franchisees, Epcon Communities employees and Epcon Communities departments. We at
Epcon Communities believe that you will find the Epcon Communities Intranet to be both useful as a means
for receiving technical information and assistance from Epcon Communities, and as a forum for discussion on
a wide range of issues of interest to the Epcon Communities community as a whole. Because you, as an
Epcon Communities Intranet User, will have the ability not only to access information on the Epcon
Communities Intranet, but also the ability to contribute information by uploading information, and/or
participating in real-time and other communications, you must agree to the following before you will be
authorized to access the Epcon Communities Intranet:

1) Limited License. The authorization to access and use the Epcon Communities Intranet that is
granted to you in this Agreement is limited to your internal use in your ordinary course of business as
an employee of a franchisee of Epcon Communities. This authorization is non-transferable and non­
exclusive, is for your use only, and only in accordance with this Agreement and any Epcon
Communities Intranet policies provided to you or available on-line from time to time.

2) Definitions. For purposes of this Agreement, the following definitions shall apply:
a) Epcon Communities means Epcon Communities Franchising, Inc., an Ohio corporation.
b) Web Site. The Web Site means all information, content, concepts, program interfaces,
structures, functionality, computer code, published materials, electronic documents, video, graphics
and other information and technology in Epcon Communities’ World Wide Web Site located at
www.epconconnect.com and/or at epcon.smarteru.com.
c) Databases. The Databases include all information accessible from Epcon Communities
through the Web Site, which may include, but is not limited to, technical and other specifications, sales,
marketing and training materials, online training modules and related documents, online libraries of
manuals, articles and sample documents, pricing, advice, and other data and information. All data and
information available in the Databases is proprietary, confidential and the sole property of Epcon
Communities (or of third parties licensing such information to Epcon Communities) and contain
copyrighted and patented material.
d) The Epcon Communities Intranet means, collectively, the Web Site and related services
accessed through the Web Site, including its Databases and a bulletin board service, as well as any other
services which may be added from time to time.
3) Access and Security. As an authorized user (“User”), you must enter a valid User Name and
Password ("Access Code") to access some of the Databases or access the Web Site's secure areas.
Do not disclose your Access Code to anyone not authorized to act on your behalf. It is your
responsibility to safeguard and protect your User’s Access Code. You accept all responsibility for
maintaining the security of your User’s Access Codes and for all utilization of the Epcon Communities
Intranet via your User’s Access Codes, with or without your knowledge or consent. Notify Epcon
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Employee)

Communities immediately if you have lost your Access Codes or wish to terminate your User’s User
Name and Password or have these Access Code changed.
4) [Reserved].
5) The Epcon Communities Intranet Purposes. The Epcon Communities Intranet is to be used to conduct
work-related business or to exchange technical or analytical Epcon Communities related information.
If you wish to express personal opinions, you must use a private ISP and a personal access account
distinct from the Epcon Communities Intranet. Epcon Communities Intranet Users are expected to
exercise reasonable judgment and discretion when using the Epcon Communities Intranet, particularly
when uploading text or communicating with others. EPCON COMMUNITIES WILL NOT REVIEW OR
EDIT BEFOREHAND ANY INFORMATION THAT AN EPCON COMMUNITIES INTRANET USER
CHOOSES TO CONTRIBUTE TO THE EPCON COMMUNITIES INTRANET. However, the continued
viability of the Epcon Communities Intranet depends upon the use of the Epcon Communities Intranet
only for legitimate purposes. Epcon Communities Intranet Users are requested to report to Epcon
Communities suspected illegal or improper uses of the Epcon Communities Intranet, such as for
distribution of misappropriated software code or dissemination of other inappropriate information. You
acknowledge and agree that Epcon Communities does not endorse any user content created or
transmitted via the Epcon Communities Intranet and Epcon Communities is not responsible or liable
for any unlawful, harassing, libelous, privacy invading, abusive, threatening, harmful, vulgar, obscene,
tortious, or otherwise objectionable content, or content that infringes or may infringe the intellectual
property or other rights of another.
6) Your Information. The Epcon Communities Intranet is designed to facilitate open communication among
the Epcon Communities Intranet Users and from the Epcon Communities Intranet Users to Epcon
Communities. To this end, all information that you upload or contribute to the Epcon Communities
Intranet bulletin board or similar service or communicate to Epcon Communities through the Epcon
Communities Intranet is deemed non-confidential and non-proprietary as to you. The Epcon
Communities Intranet Users who wish to communicate their own confidential information must use a
different method of communication. Epcon Communities is the owner of all data which resides on the
Epcon Communities Intranet, including mail messages or other files that may be tagged with your, or
any other Epcon Communities Intranet user's, identification.
7) Your Privacy. Epcon Communities may monitor, edit or disclose information about you or your private
content in the good faith belief that such action is reasonably necessary to: comply with the law;
comply with legal process; enforce this Agreement; respond to claims that such contents violate the
rights of third parties; or, protect the interests of Epcon Communities or others. You acknowledge
and agree that Epcon Communities may access your content and the Databases as necessary to
identify or resolve technical problems or to respond to service complaints. You acknowledge and
agree that certain technical processing of information is and may be required to: send and receive
such data; perform planning and scheduling functions; conform to the technical requirements of
connecting networks; conform to the technical requirements of the Epcon Communities Intranet; or,
conform to other, similar technical requirements.
8) Epcon Communities Information. All information disclosed through the Epcon Communities Intranet or
which is otherwise disclosed by Epcon Communities to you which relates to or concerns Epcon
Communities’ systems, products and services is the exclusive property of Epcon Communities, is
confidential and proprietary to Epcon Communities, developed by Epcon Communities after the
expenditure of considerable time, effort and expense and from which Epcon Communities derives
independent economic value from not being generally known to other persons or to the general public.
You agree not to communicate or otherwise divulge to, or use for the benefit of yourself or any third party
any information or knowledge concerning such systems, products or services.
You also acknowledge and agree that content, including but not limited to text, logos, software, music,
sound, photographs, video, graphics or other material or other information presented to you through the
Epcon Communities Intranet ("Content") is protected by copyright, trademark, patent and other laws.
You are only permitted to use this Content as long as you are authorized to do so as an employee of a
current franchisee of Epcon Communities and then only as expressly authorized by Epcon Communities,
and may not copy, reproduce, distribute, or create derivative works from this Content, except in
 Epcon Communities Franchising, Inc. Non-Disciosure and On-Line Access Agreement (Employee)

accordance with such authorization. You may not use trademarks of Epcon Communities unless you
are authorized to do so as an employee of an entity that holds a valid, written franchise agreement (or
license agreement) with Epcon Communities and then only in accordance with such agreement.
Because of your employment relationship and/or contractual relationship with the Epcon Communities
franchisee and/or the sublicensee of said franchisee and/or your ownership or other interest in the
Epcon Communities franchisee and/or sublicensee or its assigns, you have been or will be provided
with more detailed information concerning Epcon Communities’ systems, products and services than
has been or will be disclosed to the general public.
You agree not to communicate or otherwise divulge to, or use for the benefit of, yourself or any third
party any information or knowledge concerning said systems, products and services.
You acknowledge that the more detailed information concerning Epcon Communities’ systems,
products and services is the exclusive property of Epcon Communities and you agree that you shall
not use said systems, products and services or any of its parts or any system, plans, materials, or
designs resembling in any way said systems, products and services except in strict accordance with
the terms of the Franchise Agreement between Epcon Communities and its franchisee or as you may
be directed by the Epcon Communities franchisee, such direction to be in accordance with the terms
of the Franchise Agreement, as determined by Epcon Communities in its sole discretion.
You further acknowledge that Epcon Communities is the sole owner of the copyrights in all
architectural works, technical drawings, and other copyrighted works provided to Epcon Communities
franchisee pursuant to the Franchise Agreement with Epcon Communities (and/or Sublicensee
pursuant to the Sublicense Agreement) as well as all “derivative works” (as that term is used in the
Copyright Act). You also understand, acknowledge, and agree that neither the Franchise Agreement,
the Sublicense Agreement, or this Agreement, create any implied license to use, copy, distribute, or
create derivative works from any copyrighted work owned by Epcon Communities and that the only
licenses to do so are those may be expressly set forth in those agreements.
9) Modification of the Web Site, Databases or Agreement. Epcon Communities may elect to update,
modify, change or terminate ail or any part of the functionality available through the Databases or
Web Site, including modification or termination of any services provided, including the Epcon
Communities Intranet itself. In addition, Epcon Communities may modify this Agreement from time to
time by amendments or modifications provided to you through on-line notice on the Web Site, by
email to the email address you have provided to us, or by regular mail or facsimile transmission. You
agree that access to the Databases or Web Site after you have, or should have received, notice of
modifications or amendments to this Agreement will constitute acceptance of all such modifications or
amendments.
10) Franchisee Web Sites. Notwithstanding that Epcon Communities may authorize you to use portions
of the Content in the creation of a web site, Epcon Communities retains the sole right to create a Web
site using:
“EpconCommunities”;
''epconcommunities.com”; “epconhomesandcommunities.com”;
“epconfranchising.com “; and/or
“EpconOpportunity.com”

(collectively, the “Marks”) and to register or use other domain names related or similar to any of the
Marks. Prior to your creation of any web site related in any manner to an Epcon Communities franchised
business (and pursuant to the approval process provided in the Epcon Communities Franchise
Agreement), you must obtain Epcon Communities’ written approval of (and Epcon Communities shall
have continuing approval rights regarding) the domain name for such web site, the content of such Web
site (including all framing employed) and use of any of the Marks in the content of such Web site. Epcon
Communities retains the right to pre-approve your use of linking between your web pages which are
related in any manner to an Epcon Communities franchised business and any other web site. Within five
(5) days of any written request by Epcon Communities, you shall (a) remove any links between your web
pages related in any manner to an Epcon Communities franchised business and all other web sites;
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Employee)

and/or (b) remove any references on web pages to the Marks. Further, you shall comply with the Epcon
Communities Franchise Agreement and Epcon Communities' guidelines, as published from time to time to
the Epcon Communities franchise system, regarding the use by franchisees and certain of their
employees of web sites related to Epcon Communities franchised businesses.

11) User Conduct.

You agree to do all of the following:
a) abide by all applicable local, state, federal, and international laws and regulations in your use of the
Epcon Communities Intranet; and
b) comply with all regulations, policies and procedures of the Epcon Communities Intranet established
by Epcon Communities and posted on the Web Site.
12) Your Obligations and Prohibitions.
You agree that you shall NOT do any of the following:
a) attempt to modify or "hack" the Web Site or Databases;
b) access any area on the Web Site or Databases which you are not explicitly authorized to access;
c) interfere with, restrict or inhibit any other user from, the use and enjoyment of the Epcon
Communities Intranet, the Web Site or any Databases;
d) decompile, disassemble, probe, or otherwise reverse engineer, or modify, translate, merge, or
prepare derivative works of the Databases or the Web Site;
e) impersonate any person or entity, including but not limited to, an Epcon Communities officer,
forum leader, guide or host or falsely state or otherwise misrepresent your affiliation with a person
or entity;
f) collect or harvest personal information about other users of the Epcon Communities Intranet;
g) transmit or post any material that encourages conduct that could constitute a criminal offense,
give rise to civil liability, or otherwise violate any applicable local, state, national or international
law or regulation, including, without limitation, the U.S. Export Control laws and regulations;
h) post, promote or transmit through the Epcon Communities Intranet any unlawful, harassing,
libelous, abusive, threatening, harmful, vulgar, obscene, hateful, racially, ethnically or otherwise
objectionable material of any kind or nature, including, without limitation, any transmissions
constituting or encouraging conduct that would constitute a criminal offense, or give rise to civil
liability;
i) knowingly upload, copy, post, publish, transmit, reproduce, distribute or participate in the transfer
or sale or transmit any files that contain viruses, corrupted files, or any other similar software or
programs or any software in violation of copyright law, or the applicable software license
agreement;
j) jeopardize the operation of computer systems owned by Epcon Communities or the reputation of
Epcon Communities;
k) use any of the Web Site or any Databases for service bureau or other purposes not specified in
this Agreement, the Epcon Communities Intranet policies or your franchise agreement;
l) advertise or offer to sell any goods or services, or engage in any surveys or contests; or
m) use the Epcon Communities Intranet to encourage, post or transmit "junk mail," "spam," hoaxes,
chain letters, or advertisements and/or rude, obscene or harassing messages.
13) Epcon Communities’ Rights. Epcon Communities reserves the right, upon learning of actual or possible
illegal or improper uses of the Epcon Communities Intranet, to investigate and take action, as it deems
necessary in its sole discretion, to stop the actual or possible illegal or improper use, including but not
limited to, immediately and without notice, deleting your information or information pertaining to you and
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Employee)

revoking your authorization to use the Epcon Communities Intranet. In addition, Epcon Communities
may, in its sole discretion, immediately terminate your access to the Epcon Communities Intranet
should your conduct fail to fully conform with any terms and conditions of this Agreement. Epcon
Communities may, but is not in any way obligated to, enforce this Agreement against any Epcon
Communities Intranet user.
14) Term and Termination. Your access to the Epcon Communities Intranet is a privilege extended by
Epcon Communities and begins with issuance of your access code (issued only after your execution
and delivery of this Agreement and acceptance of same by Epcon Communities) and ends upon
termination by you or by Epcon Communities. Your Epcon Communities Intranet access rights shall
immediately terminate, without notice, on the failure to maintain authorized franchisee status. In
addition, Epcon Communities may terminate this Agreement and your authorization to access the
Web Site and Databases at any time, with or without notice for any reason or no reason. You agree
that on termination of this Agreement or your right of access granted hereunder, you immediately will
cease accessing the Epcon Communities Intranet, including the Web Site and the Databases.
Sections 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16. 17 and 18 of this Agreement shall survive the
termination of this Agreement.
15) Disclaimer of Warranty: Limitations of Liability and of Remedies. The Epcon Communities Intranet,
the Databases and Web Site are provided to you "AS IS" and "AS AVAILABLE" as a convenience for
you in communicating with Epcon Communities. EPCON COMMUNITIES MAKES NO WARRANTY
REGARDING DATABASE ACCURACY OR THE ABSENCE OF ANY ERRORS AND OMISSIONS,
AND IT IS SOLELY YOUR RESPONSIBILITY TO EVALUATE THE ACCURACY, COMPLETENESS
AND USEFULNESS OF ALL OPINIONS. ADVICE, SERVICES OR OTHER INFORMATION
CONTAINED IN THE DATABASES AND THE WEB SITE. IN NO EVENT WILL EPCON
COMMUNITIES BE LIABLE FOR ANY DAMAGES OF ANY KIND RELATING IN ANY WAY TO THE
EPCON COMMUNITIES INTRANET SERVICE OR FROM INTERRUPTION, SUSPENSION OR
TERMINATION OF THE SERVICE. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, THIS LIABILITY EXCLUSION APPLIES TO ALL DAMAGES, WHETHER DIRECT,
INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE,
EXEMPLARY OR CONSEQUENTIAL AND UNDER ANY LEGAL THEORY, WHETHER IN
CONTRACT, TORT, EQUITY OR AT LAW, INCLUDING BUT NOT LIMITED TO, DAMAGES FOR
LOSS OF PROFITS, USE. DATA OR OTHER INTANGIBLES, AND EVEN IF EPCON
COMMUNITIES HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS
LIABILITY EXCLUSION INCLUDES. WITHOUT LIMITATION, ANY AND ALL DAMAGES
RESULTING FROM THE USE OR THE INABILITY TO USE THE EPCON COMMUNITIES
INTRANET SERVICE OR FOR COST OF PROCUREMENT OF SUBSTITUTE GOODS AND
SERVICES OR RESULTING FROM ANY GOODS, DATA, INFORMATION OR SERVICES
PURCHASED OR OBTAINED OR DATA RECEIVED OR TRANSACTIONS ENTERED INTO
THROUGH THE EPCON COMMUNITIES INTRANET SERVICE OR RESULTING FROM
UNAUTHORIZED ACCESS TO OR ALTERATION OF YOUR TRANSMISSIONS OR DATA. YOUR
SOLE AND EXCLUSIVE REMEDY FOR ANY BREACH OF THIS AGREEMENT BY EPCON
COMMUNITIES SHALL BE TO TERMINATE THIS AGREEMENT.
16) Additional Disclaimers. Additional disclaimers may be contained on the Web Site and in the
Databases. Epcon Communities does not warrant that the functions of the Epcon Communities
Intranet will meet any specific requirement you may have or that it will be error-free or your use will be
uninterrupted.
17) Indemnity. You agree to defend, indemnify and hold Epcon Communities and its affiliates, and its
and their directors, employees and agents harmless from any and all liabilities, costs and expenses,
including reasonable attorneys' fees related to or arising from a breach by you of any of the terms of
Sections 11 and/or 12 of this Agreement.
18) Miscellaneous. This Agreement and your use of the Databases and Web Site are governed by the
laws of the State of Ohio (without reference to conflicts of laws provisions) and applicable federal
laws of the United States. The state courts in the State of Ohio in Franklin County and, if the
jurisdictional prerequisites exist at the time, the United States District Court for the Southern District of
 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Employee)

Ohio (Northern Division) shall have the sole and exclusive jurisdiction to hear and determine any
dispute or controversy arising under or concerning this Agreement. Neither party to this Agreement
shall be responsible to the other party for non-performance or delay in performance of the terms and
conditions hereunder due to acts of God, acts of government, wars, riots, strikes, accidents in
transportation, materials shortages or other causes beyond the control of the party. This Agreement
supersedes any and all agreements, whether oral or written, between the parties with respect to the
subject matter hereof and contains all the covenants and agreements between the parties with
respect to the subject matter hereof. Each party acknowledges that no representations, inducements,
promises, or agreements, orally or otherwise, have been made by any party, or anyone acting on
behalf of any party, that are not embodied herein, and that no other agreement, statement, or promise
not contained in this agreement shall be valid or binding. Nothing in this Agreement or any related
agreement, however, is intended to disclaim the representations Epcon Communities made in the
franchise disclosure document Epcon Communities furnished to the undersigned Franchisee. Each
time you access the Epcon Communities Intranet, you confirm your agreement to this Agreement, as
modified or amended from time to time.

Isiqnature page follows]

 Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Access Agreement (Employee)

I have read the above Agreement and I agree to the terms thereof:

This section to be filled out by Franchisee (or Authorized Representative):

Franchise Company:

Contact Name: Authorized Signature:

Authorized User:
Note: When denoting titles and to determine the appropriate level of access, please use one of the
following: Franchisee, Operations Manager, Sales/Marketing Manager, Sales Consultant, Project
Manager/Construction Manager, Construction Superintendent, Administrative Personnel

User: I have read the On-Line Information Access Agreement

and I agree to the terms thereof:

Name

Title

Community

E-mail

Signature

E-mail Completed Form to: charmon(gepconcommunities.cornor Fax to: (614) 761-2672

Your User Name(s) and Password(s) will be e-mailed to the Intranet Address:
listed e-mail address after receipt and acceptance by Epcon www.epconconnect.com and/or
Communities. epcon.smarteru.com

21642718 V4
 EXHIBIT K

Copyright Assignment & Agreement

This Copyright Assignment & Agreement ("Agreement”) by and between

_____________________ (hereinafter “Architect”), organized under the laws of the state of _
located at and (hereinafter "Franchisee”) in
connection with the creation of architectural drawings by Architect for Franchisee (“Work(s)”), that are derived from
earlier copyrighted work(s) (“Epcon Works”) owned by Epcon Communities Franchising. Inc. (“Epcon”), and is
effective as of the date signed by Franchisee and Architect.

A. Franchisee is a franchisee of Epcon; and

B. Franchisee and Architect entered into contract(s) for certain architectural services described therein; and

C. Epcon requires Franchisee, pursuant to the terms of the Franchise Agreement between Epcon and
Franchisee, to obtain the representations and assignments contained herein from any architect or contractor who
changes, modifies or revises an Epcon Works; and

D. In consideration of the continuation of the business relationship between Franchisee and Architect,
Franchisee and Architect desire to have this Agreement serve to set forth their mutual understanding regarding the
ownership of all Works created for Franchisee, both prior to and subsequent to this Agreement.

The following terms and conditions shall apply to all Works created by Architect for Franchisee:

1. Architect hereby irrevocably transfers, conveys and assigns all worldwide right, title and interest in the
copyright of each such Work in all formats and media, whether now existing or hereafter devised, including all
electronic and future media, all translations and all primary and subsidiary rights, to Epcon. The rights transferred
include but are not limited to the right to bring suit, collect damages and pursue all remedies for past infringement, all
copyrights registrations of the Work, and the right to secure any copyright registrations, renewals, reissues or
extensions of any such copyrights throughout the world, the right to register the copyright in Epcon’s name, the right
to license, sell, assign or otherwise exploit the Work as it sees fit in its sole discretion, the right to reproduce, alter,
expand, change, modify and adapt the Work, and the sole right to decide whether and in what manner to publish,
advertise, publicize, and exploit the Work. This Agreement is intended to satisfy the requirements of 17 U.S.C.
Section 204. Architect agrees to execute upon demand any additional assignments or other documents that Epcon
may reasonably request in order to assign or confirm the assignment of all such copyrights from Architect to Epcon.

2. If any other party has any right, title or interest in the Works, Architect shall obtain all rights and assign
such rights to Epcon. The intent of this provision is to ensure that Epcon will be the exclusive owner of the copyright
and of all rights comprised in the copyright of the Work, and that Epcon have the sole right to exercise all rights of the
copyright owner with respect thereto, including without limitation all exclusive rights set forth in 17 U.S.C. Sec. 106.

3. Architect represents and warrants to Epcon that:

(a) Architect has identified all persons and entities who have worked on the Work, each Work is or will
be the original work of Architect and/or its agents who have executed valid assignments of rights to Architect, subject
to the rights of Epcon in the Epcon Works.

(b) Each Work does not and will not infringe upon or violate the copyrights, trademarks, or any other
rights whatsoever of any person or entity.

(c) No adverse claim exists with respect to each Work and Architect has not assigned any Work to
another person or entity.

(d) Each Work has not heretofore previously been published or exploited in any form anywhere in the
world.

(e) Architect has the full and exclusive right and authority to enter into this agreement.

(f) Architect has obtained releases and assignments, if needed, from all required parties in each work.
 4. Architect will indemnify and save harmless Franchisee, Epcon, and Epcon's clients, customers, licensees
or other permitted users of any Work, and their successors and assigns from and against any and all loss, damage or
expense, including reasonable attorneys’ fees, resulting from or by reason of the breach or alleged breach of any
representation or warranty herein made by Architect.

Please evidence your acceptance hereof and Agreement hereto by signing the place indicated below.

Franchisee:
Signature

Name Printed Name, Title

Date:________
Architectural Firm Name

Date:
 CONSENT TO ASSIGNMENT

Epcon Communities Franchising, Inc. hereby consents to the assignment of all intellectual property rights in
the Works referred to herein to Epcon Communities Franchising, Inc.

Franchisor: Epcon Communities Franchising, Inc.

By:.
Joel D. Rhoades, Vice President and General Counsel

By: Date;
Paul W. Flanson, President of Franchising

58801S4 V.8
 EXHIBIT L
EXHIBIT “7”
(to Franchise Agreement)

THE SPECIFIC FORM OF MORTGAGE OR SECURITY INSTRUMENT USED IN EACH JURISDICTION

WILL VARY TO COMPLY WITH APPLICABLE STATE AND LOCAL LAWS.]

MORTGAGE

A. This Mortgage is made by and between:

1. ______________ (NAME OF MORTGAGOR), a(n)

(STATE OF MORTGAGOR’S ORGANIZATION)
___________(TYPE OF ENTITY) whose address is
______________________ (“Mortgagor”); and

2. EPCON COMMUNITIES FRANCHISING, INC., an Ohio corporation located at 500 Stonehenge

Parkway, Dublin, Ohio 43017 (“Mortgagee”).

B. For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged.
Mortgagor mortgages, hypothecates, pledges, grants, conveys, bargains, sells, and transfers to
Mortgagee:

1. All of Mortgagor’s fee simple right, title, and interest in the property described in attached Schedule
A, including, without limitation, any and all appurtenances thereto, and any and all buildings,
structures, fixtures, and improvements thereon, whether now or later existing (collectively
“Property”);

2. All rents, revenues, profits, sale proceeds, and other benefits relating to the Property ("Rents");

C. This Mortgage secures payment of any and all present and future franchise fees owed by Mortgagor to
Mortgagee pursuant to that certain Franchise Agreement dated, 20____________, including but not
■ limited to the Project Royalty Fee as defined in the Franchise Agreement in the original principal sum of
$(the “Obligations”).

D. Upon default under the Obligations:

1. To the extent permitted by law. Mortgagee may completely or partially foreclose upon and sell the
Property in accordance with the applicable private, nonjudicial foreclosure procedures prescribed
by state law;

2. If state law prohibits private foreclosure sales. Mortgagee may institute court proceedings for
complete or partial foreclosure upon sale of the Property in accordance with state law.

E. This Mortgage remains in effect until Mortgagee releases it.

1. Upon full and final payment and performance of all of the Obligations, Mortgagee will release this
Mortgage.
2. Upon release, this Mortgage will be void.
3. Mortgagee shall provide a partial release of this Mortgage for any portion of the Property upon
Mortgagee’s receipt of payment of the applicable percentage of each dwelling unit’s purchase price
as set forth in the Franchise Agreement by and between Mortgagor or Mortgagor’s predecessor in
interest and Mortgagee.
4. Any partial release of this Mortgage shall not release Mortgagor of any obligations under this
Mortgage or under the Obligations, nor preclude Mortgagee from exercising any right granted in
this Mortgage.
F. This Mortgage is governed by the laws of the State where the Property is located.
______________________________________(NAME OF MORTGAGOR),
a(n) (STATE OF MORTGAGOR’S ORGANIZATION)
(TYPE OF ENTITY).

Signature:_

By (print)

Title:_____

Date:

STATE OF_________ J SS.

COUNTY OF________

On this ___ day of A.D. 20__, before me, the undersigned, personaliy appeared
(NAME), ____________________ (TiTLE),
(NAME OF MORTGAGOR), a(n) _____(STATE OF
MORTGAGOR’S ORGANIZATION) (TYPE OF ENTITY) who
acknowledged execution of the foregoing instrument for the purposes therein contained on behalf of said
company.

IN WITNESS WHEREOF, I hereunto set my hand and official seal.

Notary Public

Prepared By. _, Mortgagee.

 EXHIBIT A

LEGAL DESCRIPTION

F/A4/19
 EXHIBIT M

SECURITY AGREEMENT

THIS SECURITY AGREEMENT, dated as of, 20_ (this '‘AareemenfV is by and between
, a(n)(the “Debtor”), and Epcon Communities Franchising, Inc., an Ohio
corporation (the “Secured Party").

A. The Debtor has executed and delivered a Promissory Note () dated, 20___________
in the original principal amount of $in favor of Secured Party (as amended and in effect from
time to time, the “Note”) and Debtor and Secured Party have entered into a Franchise Agreement dated
, 20___________ and related documents, pursuant to which Debtor owes Secured Party certain
monetary and performance obligations (as amended and in effect from time to time, collectively, the
“Franchise Agreement,” and collectively with the Note, the “Franchise Documents”).

B. It is a condition to the Secured Party's extension of credit under the Note and the entering into the
Franchise Agreement with Debtor that the Debtor execute and deliver to the Secured Party a security
agreement in substantially the form hereof.

C. The Debtor wishes to grant a security interest in favor of the Secured Party as herein provided.

NOW, THEREFORE, in consideration of the promises contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1. Definitions. All capitalized terms used herein without definitions shall have the respective
meanings provided therefor in the Franchise Documents. The term “State,” as used herein, means the
State of Ohio. All terms defined in the Uniform Commercial Code of the State and used herein shall have
the same definitions herein as specified therein.

2. Grant of Security Interest. The Debtor hereby grants to the Secured Party, to secure the payment
and performance in full of all of the obligations under the Franchise Documents (the “Obligations”), a
security interest in, and so pledges and assigns to the Secured Party, the following properties, assets and
rights of the Debtor, wherever located, whether now owned or hereafter acquired or arising, and all
proceeds and products thereof and any and all accessions thereto (all of the same being hereinafter
called the “Collateral”): whether now owned or existing or hereafter acquired or arising, all of Debtor’s
personal and fixture property of every kind and nature including without limitation all goods (including
inventory, equipment and any accessions thereto), instruments (including promissory notes), documents,
accounts, chattel paper (whether tangible or electronic), deposit accounts, letter-of-credit rights (whether
or not the letter of credit is evidenced by a writing), commercial tort claims, securities and all other
investment property, supporting obligations, any other contract rights or rights to the payment of money,
insurance claims and proceeds, and all general intangibles (including all payment intangibles),

3. Authorization to File Financing Statements. The Debtor hereby irrevocably authorizes the
Secured Party at any time and from time to time to file in any filing office in any Uniform Commercial Code
jurisdiction any initial financing statements and amendments thereto that (a) indicate the Collateral (i) as
all assets of the Debtor or words of similar effect, regardless of whether any particular asset comprised in
the Collateral falls within the scope of Article 9 of the Uniform Commercial Code of the State or such
jurisdiction, or (ii) as being of an equal or lesser scope or with greater detail, and (b) provide any other
information required by part 5 of Article 9 of the Uniform Commercial Code of the State, or such other
jurisdiction, for the sufficiency or filing office acceptance of any financing statement or amendment.

4. Other Actions. The Debtor further agrees, at the request and option of the Secured Party, to take
any and all other actions the Secured Party may determine to be necessary or useful for the attachment,
perfection and first priority of (except as expressly permitted by the Franchise Documents), and the ability
of the Secured Party to enforce, the Secured Party’s security interest in any and all of the Collateral,
 including, without limitation, (a) executing, delivering and, where appropriate, filing financing statements
and amendments relating thereto under the Uniform Commercial Code, to the extent, if any, that the
Debtor’s signature thereon is required therefor, (b) causing the Secured Party’s name to be noted as
secured party on any certificate of title for a titled good if such notation is a condition to attachment,
perfection or priority of, or ability of the Secured Party to enforce, the Secured Party’s security interest in
such Collateral, (c) complying with any provision of any statute, regulation or treaty of the United States
as to any Collateral if compliance with such provision is a condition to attachment, perfection or priority of,
or ability of the Secured Party to enforce, the Secured Party’s security interest in such Collateral,
(d) obtaining governmental and other third party waivers, consents and approvals in form and substance
satisfactory to Secured Party, including, without limitation, any consent of any licensor, lessor or other
person obligated on Collateral, (e) obtaining waivers from bailees, mortgagees and landlords in form and
substance satisfactory to the Secured Party and (f) taking all actions under any earlier versions of the
Uniform Commercial Code or under any other law, as reasonably determined by the Secured Party to be
applicable in any relevant Uniform Commercial Code or other jurisdiction, including any foreign
jurisdiction.

5. Representations and Warranties Concerning Debtor’s Legal Status. The Debtor represents and
warrants to the Secured Party as follows; (a) the Debtor’s exact legal name is that indicated in the first
paragraph hereof, and (b) the Debtor is an organization of the type, and is organized in the jurisdiction set
forth in the first paragraph hereof.

6. Covenants Concerning Debtor’s Legal Status. The Debtor covenants with the Secured Party as
follows: (a) without providing at least 30 days prior written notice to the Secured Party, the Debtor will not
change its name, its place of business or, if more than one, chief executive office, or its mailing address
or organizational identification number if it has one, (b) if the Debtor does not have an organizational
identification number and later obtains one, the Debtor shall forthwith notify the Secured Party of such
organizational identification number, and (c) the Debtor will not change its type of organization,
jurisdiction of organization or other legal structure.

7. Representations and Warranties Concerning Collateral, etc. The Debtor further represents and
warrants to the Secured Party as follows: (a) the Debtor is the owner of the Collateral, free from any
mortgage, pledge, lien or other charge or encumbrance of any kind (including the charge upon property
purchased under conditional sale or other title retention documents), except for the security interest
created by this Agreement, the other liens permitted by the Franchise Documents, and as listed on
Schedule 1. attached hereto, and (b) the Debtor has at all times operated its business in compliance with
all applicable provisions of federal, state and local statutes and ordinances.

8. Covenants Concerning Collateral, etc. The Debtor further covenants with the Secured Party as
follows: (a) the Collateral, to the extent not delivered to the Secured Party, will be kept at its address
listed on the signature page hereof and the Debtor will not remove the Collateral from such location,
without providing at least thirty days prior written notice to the Secured Party, (b) except for the security
interest herein granted and liens permitted by the Franchise Documents, the Debtor shall be the owner of
the Collateral free from any right or claim of any other person, lien, security interest or other
encumbrance, and the Debtor shall defend the same against all claims and demands of all persons at any
time claiming the same or any interests therein adverse to the Secured Party, (c) the Debtor shall not
pledge, mortgage or create, or suffer to exist any right of any person in or claim by any person to the
Collateral, or any security interest, lien or encumbrance in the Collateral in favor of any person, other than
the Secured Party except for liens permitted by the Franchise Documents, (d) the Debtor will keep the
Collateral in good order and repair and will not use the same in violation of law or any policy of insurance
thereon, (e) the Debtor will permit the Secured Party, or its designee, to inspect the Collateral at any
reasonable time, wherever located, and (f) the Debtor will not sell or otherwise dispose, or offer to sell or
otherwise dispose, of the Collateral or any interest therein except for (i) sales of inventory and licenses of
general intangibles in the ordinary course of business and (ii) so long as no Event of Default has occurred
and is continuing, sales or other dispositions permitted by the Franchise Documents.

-2-
9. Insurance. The Debtor will maintain with financially sound and reputable insurers insurance with
respect to its properties and business against such casualties and contingencies as shall be in
accordance with general practices of businesses engaged in similar activities in similar geographic areas.

10. Collateral Protection Expenses: Preservation of Collateral. In the Secured Party’s discretion (but
without obligation), if the Debtor fails to do so, the Secured Party may discharge taxes and other
encumbrances at any time levied or placed on any of the Collateral, maintain any of the Collateral, make
repairs thereto and pay any necessary filing fees or insurance premiums. The Debtor agrees to
reimburse the Secured Party on demand for all expenditures so made. The Secured Party shall have no
obligation to the Debtor to make any such expenditures, nor shall the making thereof be construed as the
waiver or cure of any Event of Default.

11. Power of Attorney. The Debtor hereby irrevocably constitutes and appoints the Secured Party
and any officer or agent thereof, with full power of substitution, as its true and lawful attorneys-in-fact with
full irrevocable power and authority in the place and stead of the Debtor or in the Secured Party’s own
name, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action
and to execute any and all documents and instruments that may be necessary or useful to accomplish the
purposes of this Agreement. To the extent permitted by law, the Debtor hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof. This power of attorney is a power
coupled with an interest and is irrevocable. The powers conferred on the Secured Party hereunder are
solely to protect its interests in the Collateral and shall not impose any duty upon it to exercise any such
powers. The Secured Party shall be accountable only for the amounts that it actually receives as a result
of the exercise of such powers, and neither it nor any of its officers, directors, employees or agents shall
be responsible to the Debtor for any act or failure to act, except for the Secured Party’s own gross
negligence or willful misconduct,

12. Rights and Remedies. If an Event of Default shall have occurred and be continuing, the Secured
Party, without any other notice to or demand upon the Debtor have in any jurisdiction in which
enforcement hereof is sought, in addition to all other rights and remedies, the rights and remedies of a
secured party under the Uniform Commercial Code of the State and any additional rights and remedies
which may be provided to a secured party in any jurisdiction in which Collateral is located, including,
without limitation, the right to take possession of the Collateral, and for that purpose the Secured Party
may, so far as the Debtor can give authority therefor, enter upon any premises on which the Collateral
may be situated and remove the same therefrom. The Secured Party may in its discretion require the
Debtor to assemble all or any part of the Collateral at such location or locations within the jurisdiction(s) of
the Debtor’s principal office(s) or at such other locations as the Secured Party may reasonably designate.
Unless the Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold
on a recognized market, the Secured Party shall give to the Debtor at least ten business days prior
written notice of the time and place of any public sale of Collateral or of the time after which any private
sale or any other intended disposition is to be made. The Debtor hereby acknowledges that ten business
days prior written notice of such sale or sales shall be reasonable notice. In addition, the Debtor waives
any and all rights that it may have to a judicial hearing in advance of the enforcement of any of the
Secured Party’s rights and remedies hereunder, including, without limitation, its right following an Event of
Default to take immediate possession of the Collateral and to exercise its rights and remedies with
respect thereto.

13. No Waiver by Secured Party, etc. The Secured Party shall not be deemed to have waived any of
its rights or remedies in respect of the Obligations or the Collateral unless such waiver shall be in writing
and signed by the Secured Party. No delay or omission on the part of the Secured Party in exercising
any right or remedy shall operate as a waiver of such right or remedy or any other right or remedy. A
waiver on any one occasion shall not be construed as a bar to or waiver of any right or remedy on any
future occasion. All rights and remedies of the Secured Party with respect to the Obligations or the
Collateral, whether evidenced hereby or by any other instrument or papers, shall be cumulative and may
be exercised singularly, alternatively, successively or concurrently at such time or at such times as the
Secured Party deems expedient.

-3-
14. Marshalling. The Secured Party shall not be required to marshal any present or future collateral
security (including but not limited to the Collateral) for, or other assurances of payment of, the Obligations
or any of them or to resort to such collateral security or other assurances of payment in any particular
order, and all of its rights and remedies hereunder and in respect of such collateral security and other
assurances of payment shall be cumulative and in addition to all other rights and remedies, however
existing or arising.

15. Proceeds of Dispositions: Expenses. The Debtor shall pay to the Secured Party on demand any
and all expenses, including reasonable attorneys’ fees and disbursements, incurred or paid by the
Secured Party in protecting, preserving or enforcing the Secured Party’s rights and remedies under or in
respect of any of the Obligations or any of the Collateral. After deducting all of said expenses, the
residue of any proceeds of collection or sale or other disposition of the Collateral shall, to the extent
actually received in cash, be applied to the payment of the Obligations in such order or preference as the
Secured Party may determine, proper allowance and provision being made for any Obligations not then
due. In the absence of final payment and satisfaction in full of all of the Obligations, the Debtor shall
remain liable for any deficiency.

16. Overdue Amounts. Until paid, all amounts due and payable by the Debtor hereunder shall be a
debt secured by the Collateral and shall bear, whether before or after judgment, interest at the rate of
interest for overdue payments set forth in the Franchise Documents.

17. Governing Law: Consent to Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO. Debtor agrees that any
suit for the enforcement of this Agreement may be brought in any state or federal court sitting in Franklin
County, Ohio and consents to the jurisdiction of such court and to service of process in any such suit
being made upon Debtor by mail at the address specified in the first sentence hereof. Debtor hereby
waives any objection that it may now or hereafter have to the venue of any such suit or any such court or
that such suit is brought in an inconvenient court.

18. Waiver of Jury Trial. DEBTOR WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO
ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS
AGREEMENT. ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY
SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law, the Debtor waives any right which it
may have to claim or recover in any litigation referred to in the preceding sentence any special,
exemplary, punitive or consequential damages or any damages other than, or in addition to, actual
damages. The Debtor (i) certifies that neither the Secured Party nor any representative, agent or attorney
of the Secured Party has represented, expressly or otherwise, that the Secured Party would not, in the
event of litigation, seek to enforce the foregoing waivers or other waivers contained in this Agreement,
and (ii) acknowledges that, in entering into the Franchise Documents, the Secured Party is relying upon,
among other things, the waivers and certifications contained in this Section 18.

19. Miscellaneous. The headings of each section of this Agreement are for convenience only and
shall not define or limit the provisions thereof. This Agreement and all rights and obligations hereunder
shall be binding upon the Debtor and its respective successors and assigns, and shall inure to the benefit
of the Secured Party and its successors and assigns. If any term of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity of ail other terms hereof shall in no way be affected thereby,
and this Agreement shall be construed and be enforceable as if such invalid, illegal or unenforceable term
had not been included herein. The Debtor acknowledges receipt of a copy of this Agreement. This
Agreement will terminate upon the full performance, payment and satisfaction of the Obligations
(“Termination”). Upon such Termination, Secured Party will, promptly upon Debtor’s request and at
Debtor’s expense, execute and deliver to Debtor a release of the lien granted to Secured Party hereunder
on the Collateral or similar instrument of re-conveyance prepared by Secured party and deliver UCC
termination statements with respect to the lien granted to Secured Party hereunder on the Collateral.

-4-
 IN WITNESS WHEREOF, Intending to be legally bound, the Debtor has caused this Agreement
to be duly executed as of the date first above written. '

I _]

By:___
Name:
Title:

By;___
Name:
Title:

Notice address:

Attn:____________
Facsimile No.: ()

Accepted:

EPCON COMMUNITIES FRANCHISING, INC.

By:__________________________________
Name: Joel D. Rhoades
Title: Vice President and General Counsel

Notice address:

Epcon Communities Franchising, Inc.

500 Stonehenge Parkway
Dublin, Ohio 43017-5067
Attn.: Paul W. Hanson and
Joel D. Rhoades
Facsimile: 614-761-1155

Signature Page to Security Agreement

1071276.^ V 7
 EXHIBIT N

List of Epcon Communities Franchisees (Listed by State) (As of April 17,2019>

Following is a list of Epcon Communities franchisees who were in operation at any time during our most recent
fiscal year (January 1, 2018 through December 31, 2018) and were still in operation as of April 17, 2019. A list
of Epcon Communities franchisees that began operation of an Epcon Communities franchised business after the
date of ECFFs most recent fiscal year end (December 31, 2018) is included at the end of this Exhibit.

PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Alabama
Wilcox Development Group
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
Birmingham, AL James R. Wilcox 8/8/2014
Burr Ridge, IE 60527
Jonathan Wilcox
815-782-7235
Wilcox Development Group
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
No Current Project James R. Wilcox 12/29/2014
Burr Ridge, IE 60527
Jonathan Wilcox
815-782-7235
Colorado
Eastman Properties, LLC
745 Heather Glen Lane
Fort Lupton, CO David Krafsur 12/03/2018
Fort Collins, CO 80525
970-690-2007

Georgia
Traton Lifestyles, LLC
Christopher J. Poston
720 Kennesaw Avenue
Carrollton, GA William C. Poston, Jr. 12/29/2017
Marietta, GA 30060
William C. Poston
770-427-9064
The Meadows Group, Inc.
3 Gresham Landing
McDonough, GA Darren Hutcheson 10/14/2003
Stockbridge, GA 30281
770-474-1399
Longleaf Communities, LLC
14205 Hwy 92, Ste. 109 Richard Parvey
Roswell, GA 02/09/2017
Woodstock, GA 30188-7138 Roger Thomas
864-293-9566
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Illinois
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
New Lenox, PL James R. Wilcox 12/29/2014
Burr Ridge, IL 60527
Jonathan Wilcox
815-782-7235
Gateway Villages, LLC
c/o Paster, West, Kraner
Joan West
138 N. Meramac Avenue No Current Project 12/6/2004
John Holthaus
Clayton, MO 63105
618-670-0020
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
Woodstock, IL James R. Wilcox 12/31/2001
Burr Ridge, IL 60527
Robert S. Long
815-782-7235
Indiana
Legendary Homes, LLC
2104 Heather Glen Way Ted B. Shuel
Franklin, IN 1/28/2013
Franklin, IN 46131 Jamie Speas Shuel
415-516-0726
Wilcox Development Group
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
Greenwood, IN James R. Wilcox 7/14/2015
Burr Ridge, IL 60527
Jonathan Wilcox
815-782-7235
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306 Indianapolis, IN
James R. Wilcox 2/23/2007
Burr Ridge, IL 60527 Valparaiso, IN
Robert S. Long
815-782-7235
Condominium Communities, LLC
dba Group 90-IN Richard W. Foster
1500 W. Third Avenue, 4* Floor No Current Project Edward Foster 12/6/2006
Columbus, OH 43212 Jeffery Wilkins
614-352-2920
Kalan Homes Management, Inc.
P.O. Box 2662
West Lafayette, IN Kim Kreidler 11/06/2003
West Lafayette, IN 47996
765-420-9272
Neer Development, Inc.
124 Bridgestone Drive
Terry Neer
P.O. Box 399 Zionsville, DSf 11/30/2001
Larry Neer
Mooresville, IN 46158
317-557-9230
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Iowa
E.C, LLC
Justin Bauer
31 NE Mission Street Ankeny, LA
Christopher Cornelius 5/20/2015
Ankeny, lA 50021 Clive-IA
Shawn Edwards
515-710-5085
Bartels Lutheran Home, Inc.
1922 5* Avenue N.W.
Waverly, LA Debra K. Schroeder 1/31/2008
Waverly, LA 50677
319-352-0021
Kansas
Perfection Builders, LLC
11828 W. Central, Suite 124 Scott A. Lehner
Wichita, KS - 5 1/2/2008
Wichita, KS 67212 Jason R. Ronk
316-729-1900
Kentucky
Premier Villages of Kentucky, LLC
(fka) Premier Villages, LLC -
Kentucky C. E. Crouse, Jr.
Lexington, KY 12/30/1998
2700 Brumfield Lane Kevin Crouse
Nicholasville, KY 40356
859-621-8963
Louisiana
Charmant Baton Rouge, LLC
613 Crescent Office Park, Ste. 200
J. Blake Cress
P.O. Box 1260 Baton Rouge, LA 9/25/2013
Gary B. Cress
Ridgeland, MS 39158
601-427-9996
Michigan
Covenant Developments, LLC
6119 28* Street SE, Suite 2A Peter Scott Engles
Grand Rapids, MI 4/1/2004
Grand Rapids, MI 49546-6956 LeAnn M. Engles
616-450-4718
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Stanford Vaughn Development,
LLC
Lowell, MI Steven D. Hanson 12/15/18
8106 E. Fulton
Ada, MI 49301
Missouri
Rubicon Corporation, Inc.
Mathew L. Hartig
2174 Englewood Terrace Chesterfield, MO 06/03/2016
Jerrold F. Meyer
Chesterfield, MO 63017
Wilcox Development Group
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
Nixa, MO James R. Wilcox 08/08/2014
Burr Ridge, IL 60527
Jonathan Wilcox
815-782-7235
Nevada
Ideal Homes, LLC
1200 Mt. Diablo Blvd., Ste.316 Joe Locicero
Reno, NV 7/20/2017
Walnut Creek, CA 94596 Curtiz Heinz
925-708-2051
New York
Greene Building Co., LLC
Susan Greene
9740 Rosecroft Drive Clarence Center,
Jeffrey Greene 8/25/2008
Clarence Center, NY 14031 NY
Dominic Piestrak
716-741-5145
Life Style Communities, LLC
P.O. Box 945
Hamburg, NY David M. Stapleton 6/30/2005
Hamburg, NY 14075
716-691-6900
Easthampton Penfield, LLC
210 Packetts Landing
Penfield, NY Mark Welker 6/29/2012
Fairport, NY 14450
585-223-1500
Wegman Family, LLC IV
550 Latona Road
Edwin J. Wegman
Building A, Suite 100 Rochester, NY 6/10/2003
Philip R. Wegman
Rochester, NY 14626
585-225-7370
North Carolina
Robinson Oaks, LLC William Allen
3735 Beam Road, Ste. B C. Philip Blanton
Belmont, NC 10/28/2013
Charlotte, NC 28217 Robert H. Calder
704-496-7132 James Calder
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
NewStyle Communities, Inc.*
2125 Southend Drive, Ste. 453 Brock L. Fankhauser
Charlotte, NC-2 7/15/2013
Charlotte, NC 28203 Adam R. Fiorenza
980-298-6828
GML Development, Inc.
109 Hay Street, Ste. 301 Fayetteville, NC -
Pat McKee 11/4/2010
Fayetteville, NC 28301 4
910-475-7100
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Parkway, Ste. 306
Greensboro, NC James R. Wilcox 12/29/2014
Burr Ridge, DL 60527
Jonathan Wilcox
815-782-7235
Nova Triad Partners, LLC
206 North Spruce St. #2A Andrew Dreyfuss
Mebane, NC 12/29/2017
Winston-Salem, NC 27101 Nathan Sawyer
336-749-1012
Condominium Communities, LLC
dba Group 90 Richard W. Foster
1500 W. Third Avenue, 4* Floor No Current Project Edward Foster 6/30/2005
Columbus, OH 43212 Jeffery Wilkins
614-352-2920
Cornerstone Homes, LLC-NC
6912 Three Chopt Road, Suite C
No Current Project Roger Glover, III 8/22/2006
Richmond, VA 23226
804-270-7701
Elite Living, LLC
John W. Hodges, Jr.
1484 Hampton Plaza Drive Winston-Salem,
John W. Hodges, Sr. 3/31/2008
Kemersville, NC 27284 NC
Joseph R. Brown
336-382-7775
Ohio
Wilcox Development Group, LLC
250 W. Old Wilson Bridge Rd. James C. Wilcox
Ste. 104 Amelia, OH James R. Wilcox 12/29/2014
Worthington, OH 43085 Jonathan Wilcox
614-273-3100
Villa Communities, LLC
Stephen S. Wittmann
330 West Spring Street, Suite 460
Jeffrey M. Wittmann
P.O. Box 16955 Beavercreek, OH 3/30/2001
Steven T. Ackley
Columbus, OH 43216
Benjamin T. Ackley
614-224-5224
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Wilcox Development Group, LLC
250 W. Old Wilson Bridge Rd. Brunswick, OH James R. Wilcox
Ste. 104 Streetsboro, OH James C. Wilcox 3/17/2003
Worthington, OH 43085 Kent, OH Robert S. Long
614-273-3100
The Courtyards at Deer Run, LLC
Kevin E. Norman
8 Medical Drive
Chillicothe, OH Terry E. Whaley 8/7/2017
Chillicothe, OH 45601
Randy Detillion
740-701-1810
Stone Works Development, LLC
Heath, OH
1050 Harris Avenue
Mt. Vernon, OH Eriech Horvath 5/21/2003
Newark, OH 43055
Zanesville, OH
740-920-4158
Joshua Development Group, LLC
Peter Haring
1452 W. Cook Road
Mansfield, OH Peter Pizarro 10/7/2005
Mansfield, OH 44906-3624
Matthew Mercurio
419-756-8383
Charis Homes Glenna Wilson
6215 Frank Avenue NW North Canton, OH 10/18/18
Todd Scott
North Canton, OH 44720
Amspiger Development
Group, LLC
254 Crossing Creek N Pataskala, OH Curt Amspiger 12/31/2003
Gahanna, OH 43230
614-571-4769
Sunshine Estates Builders, LLC
1871 NE Catawba Road, Ste. A1 Gerald A. Corona
Port Clinton, OH 06/06/2016
Port Clinton, OH 43452 Steven May
419-797-7000
RH Village Communities, Ltd.
8271 Spmce Needle Ct. Robert Harvey
Sandusky, OH 12/12/2005
Columbus, OH 43235 Vickie Harvey
614-436-3003
Crosstowne Properties, Ltd.
1101 North Fountain Avenue
Springfield, OH Craig A. Crossley 10/28/1996
Springfield, OH 45504
937-603-3882
Foundation Development
Group, LLC
David J. Labus
2470 E. Main St., Ste. 2 West Chester, OH 8/9/2004
Carl Fankhauser
Columbus, OH 43209
614-299-4540
 PROJECT
LOCATION/# DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Pennsylvania
Weaver Master Builders, Inc.
P.O.Box 449
William J. Weaver
361 Mars Valencia Road Pittsburgh, PA-7 9/28/2001
Bonnie Weaver
Mars, PA 16046
724-625-7800
Hawthorne Partners, LLC
102 W. Pike Street, Suite 200 Paul Scarmazzi
Pittsburgh, PA-3 3/20/2000
Houston, PA 15342-1429 Lisa J. Scarmazzi
724-745-4250
South Carolina
NewStyle Communities, Inc.*
Columbia, SC
2125 Southend Drive, Ste.453 Brock L. Fankhauser
Greenville, SC 3/27/2013
Charlotte, NC 28203 Adam R. Fiorenza
Rock Hill, SC
980-298-6828
Tennessee
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Pkwy., Ste. 306 Bristol, TN
James R. Wilcox 8/8/2014
Burr Ridge, IL 60527 Farragut, TN
Jonathan Wilcox
815-782-7235
Wilcox Development Group, LLC
James C. Wilcox
101 Burr Ridge Pkwy., Ste. 306
Knoxville, TN James R. Wilcox 12/29/2014
Burr Ridge, IL 60527
Jonathan Wilcox
815-782-7235
Texas
Wood Falls Development
Group, LLC
19059 Champion Forest Drive Adrian Jacob
Conroe, TX 9/9/2016
Ste. 102 Diane Jacob
Spring, TX 77379
832-381-4670
Integrity Retirement Group, LLC
Highland Village,
2565 Strader Road John Delin
TX 2/2/2012
Justin, TX 76247 Steve Delin
Mansfield, TX
817-430-3318
 PROJECT
LOCATION / # DATE OF
COMPANY AND ADDRESS PRINCIPALS
OF AGREEMENT
COMMUNITIES
Virginia
Cornerstone Homes LLC
6912 Three Chopt Road, Suite C
Richmond, VA Roger A. Glover, El 12/17/2001
Richmond, VA 23226
804-270-7701
Wisconsin
Apple Tree, LLC
3410 Indigo Bluff Drive Appleton, WI
Jeffrey Straubel 12/1/2004
Green Bay, WI 54311 Green Bay, WI
920-632-4655
Cornerstone Development
ofS.E. WI,LLC
N63 W23849 Main St. No Current Project John J. Wahlen 1/20/2011
Sussex, WI 53089
262-932-4188

* At least one of the principals of this franchisee entity is a member of the immediate families of principals of
Epcon Communities, LLC. This franchise and project is the subject of a disclosure in Item 20 of this disclosure
document.

As of the date of this disclosure document, there is one franchisee that commenced operations of an Epcon
Communities franchised business after the date of our most recent fiscal year end (December 31, 2018).

Ohio
Alloway Real Estate Holdings, LLC
22812 Pelomar Lane
TBD Robert L. Alloway 02/27/19
Marysville, OH 43040
937-578-3937
 EXHIBIT O

LIST OF STATE ADMINISTRATORS

California Indiana
Commissioner of Business Oversight State of Indiana Securities Division
Department of Business Oversight 302 West Washington Street, Room E-111
320 West 4th Street, Suite 750 Indianapolis, IN 46204
Los Angeles, CA 90013-2344 (317) 232-6681
(213) 576-7500
(866)275-2677 Iowa
Iowa Secretary of State
Connecticut Business Services
Assistant Director First Floor, Lucas Building
Securities and Business Investment Division 321 East 12* Street
Connecticut Department of Banking Des Moines, lA 50319
260 Constitution Plaza (515)281-5204
Hartford, CT 06103-1800
(860) 240-8230 Kentucky
State of Kentucky Attorney General
Florida Office of Consumer Protection
Regulatory Consultant 1024 Capital Center Drive, Suite 200
Department of Agriculture and Consumer Frankfort, KY 40601
Services (502) 696-5389
Division of Consumer Services
P.O. Box 6700 Maryland
Tallahassee, FL 32314-6700 Office of the Attorney General
(850)410-3800 Securities Division
200 St. Paul Place
Hawaii Baltimore, MD 21202
Commissioner of Securities (410)576-6360
Business Registration Division
Department of Commerce and Consumer Affairs Michigan
P.O. Box 40 Michigan Department of Attorney General
Honolulu, HI 96810 Consumer Protection Division
(808) 586-2744 Franchise Section
G. Mermen Williams Building, 1st Floor
Illinois 525 West Ottawa Street
State of Illinois Attorney General P.O. Box 30213
Franchise Bureau Lansing, MI 48909
500 South Second Street (517)373-7117
Springfield, IL 62701-1705
(217)782-1090
 South Dakota
Minnesota Division of Insurance
Minnesota Department of Commerce Securities Regulation
Registration Division 124 South Euclid, Suite 104
85 7th Place East, Suite 280 Pierre, SD 57501
St. Paul, MN 55101 (605) 773-3563
(651)539-1627
Texas
Nebraska Secretary of State
Nebraska Department of Banking and Finance Registrations Unit
Bureau of Securities James E. Rudder Office Building
1526 K Street, Suite 300 1019 Brazos Street
Lincoln, NE 68508-2732 Austin, TX 78701
(402) 471-3445 (512) 475-0775

New York Utah

Office of the New York State Attorney General Director
Investor Protection Bureau State of Utah Department of Commerce
Franchise Section Division of Consumer Protection
New York State Department of Law 160 East 300 South, 2”‘‘ Floor
120 Broadway, 23rd Floor P.O. Box 146704
New York, NY 10271-0332 Salt Lake City, UT 84114-6704
(212)416-8236 (801)530-6601
(212)416-6042 (fax)
Virginia
North Dakota State Corporation Commission
North Dakota Securities Department Division of Securities and Retail Franchising
Franchise Registration Tyler Building
State Capital, Fifth Floor 1300 East Main Street
600 East Boulevard Avenue Richmond, VA 23219
Bismarck, ND 58505-0510 (804)371-9051
(701)328-4712
Washington
Oregon Administrator
Department of Consumer and Business Services Department of Financial Institutions
Division of Finance Regulation Securities Division
350 Winter Street NE, Room 410 P.O. Box 9033
Salem, OR 97301-3883 Olympia, WA 98507-9033
(503)378-4140 (360) 902-8760

Rhode Island Wisconsin

Rhode Island Dept, of Business Regulation Franchise Registration
Securities Division Division of Securities, Suite 300
1511 Pontiac Avenue, Building 68-2 Department of Financial Institutions
Cranston, RI 02920 P.O. Box 1768
(401)462-9500 Madison, WI53701-1768
(608) 266-1064
 EXHIBIT P

LIST OF AGENTS FOR SERVICE OF PROCESS

California New York

Commissioner of Business Oversight New York Secretary of State
California Department of Business Oversight New York Department of State
1515 K Street, Suite 200 One Commerce Plaza
Sacramento, California 95814 99 Washington Avenue, 6* Floor
Albany, New York 12231-0001
Hawaii (518)473-2492
Commissioner of Securities
Business Registration Division North Dakota
Department of Commerce North Dakota Securities Commissioner
and Consumer Affairs State Capitol - 5* Floor
King Kalakaua Building 600 East Boulevard Avenue
335 Merchant Street Bismarck, North Dakota 58505-0510
Honolulu, Hawaii 96813
Oregon
Illinois Director of Oregon Department of Consumer
Illinois Office of the Attorney General and Business Services
500 South Second Street Division of Finance and Corporate Securities
Springfield, Illinois 62701-1705 Labor and Industries Building
350 Winter Street, NE, Room 410
Indiana Salem, Oregon 97301
Indiana Secretary of State
200 W. Washington Street, Room 201 Rhode Island
Indianapolis, Indiana 46204 Director of Rhode Island Department
of Business Regulation
Maryland Department of Business Regulation
Maryland Securities Commissioner Securities Division
200 Saint Paul Place John O. Pastore Complex, Building 68-2
Baltimore, Maryland 21202-2020 1511 Pontiac Avenue
Cranston, Rhode Island 02920-4407
Michigan
Michigan Department of Commerce South Dakota
Corporations and Securities Bureau Division of Insurance
Corporation Division Securities Regulation
P.O. Box 30054 124 South Euclid, Suite 104
Lansing, Michigan 48909 Pierre, SD 57501
(605)773-3563
Minnesota
Minnesota Commissioner of Commerce Virginia
Department of Commerce Clerk of the State Corporation Commission
85 7* Place East, Suite 280 Commonwealth of Virginia
St. Paul, Minnesota 55101 1300 East Main Street, P‘ Floor
Richmond, Virginia 23219
Washington
Director of Dept, of Financial Institutions
Securities Division
150 Israel Rd SW
Tumwater, Washington 98501
(360) 902-8760

Wisconsin
Wisconsin Department of Financial Institutions
Division of Securities
345 West Washington Avenue
Madison, Wisconsin 53703
 EXHIBIT Q
LIST OF COPYRIGHTS

Copyright Registration
Full title
Number Date
Abbey for The Woods at Hayden Run. VA0001628325 12/28/2007
Aboreta (Condominium Building) - for The Courtyards at Seldom
VA0001792284 09/30/2011
Seen.
Aboreta (Condominium Building) - for The Courtyards at Seldom
VA0001792285 09/30/2011
Seen
Aboreta (Condominium Building) - for The Villas at Culp Arbor VA0001792278 10/06/2011
Aboreta (Condominium Building) - for The Villas at Culp Arbor VA0001792277 10/06/2011
Aboreta (Condominium Building) - for The Woods at Hayden Run
VA0001792325 09/27/2011
Condominium
Aboreta (Condominium Building) - For the Woods at Hayden Run
VA0001792328 09/27/2011
Condominium
Bramante (Condominium Building) - for The Courtyards at Seldom
VA0001792279 09/30/2011
Seen
Bramante (Condominium Building) - for The Courtyards at Seldom
VA0001792287 09/30/2011
Seen
Bramante (Condominium Building) - for The Villas at Culp Arbor VA0001792275 10/06/2011
Bramante (Condominium Building) - for The Villas Culp Arbor VA0001792274 10/06/2011
Bramante (Condominium Building) - for the Woods at Hayden Run
VA0001792326 09/27/2011
Condominium
Bramante (Condominium Building) - for the Woods at Hayden Run
VA0001792324 09/27/2011
Condominium
Clubhouse at The Villas at Culp Arbor. VA0001792259 10/06/2011
Clubhouse for The Villas at Culp Arbor VA0001792261 10/06/2011
Colonnade (Condominium Building) - for The Courtyards at Seldom
VA0001792288 09/30/2011
Seen.
Colonnade (Condominium Building) - for The Courtyards at Seldom
VA0001792290 09/30/2011
Seen
Colonnade (Condominium Building) - for The Villas at Culp Arbor VA0001792273 10/06/2011
Colonnade (Condominium Building) - for The Villas at Culp Arbor VA0001792271 10/06/2011
Colonnade (Condominium Building) - for The Woods at Hayden Run
VA0001792322 09/27/2011
Condominium
Colonnade (Condominium Building) - for The Woods at Hayden Run
VA0001792320 09/27/2011
Condominium
Condominium Building - Abbey - The Woods at Sugar Run
VA0001716721 02/18/2009
Condominium
Condominium Building - Arboreta (PDA-1) The Woods at Sugar Run VA0001716719 02/18/2009
 Copyright Registration
Full title
Number Date
Condominium
Condominium Building - Ashford - The Woods at Sugar Run
VAOOO1703646 02/18/2009
Condominium
Condominium Building - Bramante (PDA-2) The Woods at Sugar Run
VA0001703647 02/18/2009
Condominium
Condominium Building - Cambridge -The Woods at Sugar Run
VA0001703635 02/18/2009
Condominium
Condominium Building - Canterbury - The Woods at Sugar Run
VA0001703629 02/18/2009
Condominium
Condominium Building - Chateau - The Woods at Sugar Run
Condominium Building type 100 The Woods at Sugar Run VA0001716716 02/18/2009
Condominium
Condominium Building - Colonnade (PDA-3) The Woods at Sugar Run
VA0001770827 02/18/2009
Condominium
Condominium Building - Ducal (PDA-4) - The Woods at Sugar Run
VA0001703641 02/18/2009
Condominium
Condominium Building - Palazzo (PDD-1) The Woods at Sugar Run
VA0001716715 02/18/2009
Condominium Epcon communities The Woods at Sugar Run ppd-1
Condominium Building - Promenade (PDD-3) - The Woods at Sugar
Run Condominium Epcon Communities The Woods at Sugar Run
VA0001716718 02/18/2009
Condominium
ppd 3
Condominium Building - Villa - The Woods at Sugar Run
VA0001703624 02/18/2009
Condominium
Condominium building (Abbey) VA0001325063 11/10/2005
Condominium Building (Abbey) Polo Club at Weddington VA0001635903 03/13/2008
Condominium Building (Abbey/Canterbury Polo Club at Weddington VA0001635893 03/13/2008
Condominium building (Abbey/Canterbury) Cobblestone at the
VA0001325016 11/04/2005
Preserves, Thompson Road, New Albany, Franklin County, Ohio.
Condominium Building (Abbey/Canterbury) for The Woods at Sugar
VA0001694326 02/27/2008
Run
Condominium building (Abbey/Canterbury) for Villas at Broadmere,
VA0001325015 11/04/2005
Columbus, Ohio
Condominium Building (Cambridge/ Ashford) forThe Woods at
VA0001694309 02/27/2008
Sugar Run
Condominium building (Canterbury) VA0001325062 11/10/2005
Condominium Building (Canterbury) Polo Club at Weddington VA0001635901 03/13/2008
Condominium building (Canterbury/Abbey) for Maple Creek, Africa
VA0001325018 11/04/2005
Rd. And Worthington Rd., Delaware County, Ohio.
Condominium building (Chateau) VA0001335460 11/09/2005
 Copyright Registration
Full title
Number Date
Condominium Building (Chateau) Polo Club at Weddington VA0001635904 03/13/2008
Condominium building (Clubhouse) for Stone Bridge at Golf Village,
VA0001345988 11/04/2005
Powell, Ohio
Condominium building (Clubhouse) for The Villas at Glenealy
VA0001388933 01/10/2007
Building type lOOM, The Villas of Glenealy; project no. 2005-051
Condominium Building (Clubhouse) for The Woods at Sugar Run
Condominium Building Type 100 The Woods at Sugar Run VA0001694300 02/27/2008
Condominium.
Condominium building (Clubhouse) for Windsor Bridge VA0001338009 11/04/2005
Condominium Building (Clubhouse) Polo Club at Weddington
VA0001635682 03/13/2008
Building Type 100 Polo Club at Weddington.
Condominium Building (Clubhouse) Polo Club at Weddington
VA0001635690 03/13/2008
Building Type 100 Polo Club at Weddington
Condominium building (countryside architectural style)
VA0001414853 04/23/2007
Abbey/Canterbury for the Villas at Glenealy
Condominium building (countryside architectural style) Canterbury
VA0001414854 04/23/2007
for the Villas at Glenealy
Condominium building (English country architectural style)
VA0001414851 04/23/2007
Abbey/Canterbury for the Villas at Glenealy
Condominium building (English country architectural style)
VA0001414857 04/23/2007
Canterbury for the Villas at Glenealy
Condominium building (European country architectural style)
VA0001414858 04/23/2007
Abbey/Canterbury for the Villas at Glenealy
Condominium building (European country architectural style) abbey
VA0001420992 04/23/2007
for the Villas at Glenealy
Condominium building (European country architectural style) abbey
VA0001420993 04/23/2007
for the Villas at Glenealy
Condominium building (European country architectural style) abbey
VA0001420994 04/23/2007
for the Villas at Glenealy
Condominium building (European country architectural style)
VA0001414856 04/23/2007
Canterbury for the Villas at Glenealy
Condominium building (European country architectural style)
VA0001420991 04/23/2007
chateau for the Villas at Glenealy
Condominium building (European country architectural style)
VA0001420995 04/23/2007
chateau for the Villas at Glenealy
Condominium building (European country architectural style)
VA0001420989 04/23/2007
villa/chateau for the Villas at Glenealy
Condominium building (European country architectural style) villa
VA0001420990 04/23/2007
for the Villas at Glenealy
Condominium Building (Heritage Stone Architectural Style) VA0001628330 12/28/2007
 Copyright Registration
Full title
Number Date
Canterbury for The Woods at Hayden Run
Condominium Building (Heritage Stone Architectural Style) Chateau
VA0001628335 12/28/2007
for the Woods at Hayden Run
Condominium Building (Heritage Stone Architectural Style)
VA0001628332 12/28/2007
Clubhouse for The Woods at Hayden Run
Condominium Building (Heritage Stone Architectural Style) Villa for
VA0001628333 12/28/2007
the Woods at Hayden Run
Condominium Building (Heritage Stone Architectural Style) Windsor
VA0001628321 12/28/2007
for The Woods at Hayden Run
Condominium Building (PDA-l/PDA-2) for The Woods at Sugar Run
VA0001694333 02/27/2008
Condominium
Condominium Building (PDA-3/PDA-4) for The Woods at Sugar Run
VA0001694332 02/27/2008
Condominium
Condominium Building (PDD-1) for The Woods at Sugar Run
VA0001694277 02/27/2008
Condominium Epcon Communities The Woods at Sugar Run PDD-1
Condominium Building (PDD-2) for The Woods at Sugar Run
VA0001694282 02/27/2008
Condominium Epcon Communities The Woods at Sugar Run PDD-2
Condominium Building (PDD-3) for The Woods at Sugar Run
VA0001694286 02/27/2008
Condominium Epcon Communities The Woods at Sugar Run PDD-3
Condominium building (Tidewater architectural style) Villa for the
VA0001414852 04/23/2007
Villas at Glenealy
Condominium building (Tidewater architectural style) Villa/Chateau
VA0001414855 04/23/2007
for the Villas at Glenealy
Condominium building (Villa) VA0001325061 11/10/2005
Condominium Building (Villa) Polo Club at Weddington Polo Club at
VA0001635905 03/13/2008
Weddington
Condominium building (Villa/Chateau) for Cobblestone at the
VA0001325019 11/04/2005
Preserves, Thompson Road, New Albany, Franklin County, Ohio.
Condominium Building (Villa/Chateau) for The Woods at Sugar Run VA0001694306 02/27/2008
Condominium Building (Villa/Chateau) Polo Club at Weddington VA0001635891 03/13/2008
Condominium building clubhouse for Stone Bridge at Golf Village,
VA0001325017 11/04/2005
Powell, Ohio
Condominium building clubhouse for Stone Bridge at Golf Village,
VA0001334332 11/09/2005
Powell, Ohio : project no. A1060
Ducal (Condominium Building) - for The Courtyards at Seldom Seen VA0001792291 09/30/2011
Ducal (Condominium Building) - for The Courtyards at Seldom Seen VA0001792282 09/30/2011
Ducal (Condominium Building) - for The Villas at Culp Arbor VA0001792265 10/06/2011
Ducal (Condominium Building) - for The Woods at Hayden Run
VA0001792318 09/27/2011
Condominium
Ducal (Condominium Building) - for The Woods at Hayden Run VA0001792317 09/27/2011
 Copyright Registration
Full title
Number Date
Condominium
Ducal (Condominium Building) - for Villas at Culp Arbor VA0001792269 10/06/2011
Epcon communities The Woods at Sugar Run Condominium ppd-2 VA0001716720 02/18/2009
Palazzo (Condominium Building) - for The Courtyards at Seldom
VAU001080381 09/30/2011
Seen.
Palazzo (Condominium Building) - for The Courtyards at Seldom Seen VAU001080380 09/30/2011
Palazzo (Condominium Building) - for the Woods at Hayden Run VA0001792315 09/27/2011
Palazzo (Condominium Building) - for the Woods at Hayden Run
VA0001792316 09/27/2011
Condominium
Palazzo (Condominium Building) for the Polo Club at Weddington VA0001801074 11/18/2011
Palazzo (Condominium Building) for the Polo Club at Weddington VA0001801084 11/18/2011
Portico (Condominium Building) - for The Courtyards at Seldom Seen VAU001080379 09/30/2011
Portico (Condominium Building) - for The Courtyards at Seldom
VAU001080378 09/30/2011
Seen.
Portico (Condominium Building) - for the Woods at Hayden Run
VA0001792312 09/27/2011
Condominium
Portico (Condominium Building) for the Polo Club at Weddington VA0001801086 11/18/2011
Portico (Condominium Building) for the Polo Club at Weddington VA0001801101 11/18/2011
Portico (Condominium Unit) - for The Woods at Hayden Run
VA0001792311 09/27/2011
Condominium
Promenade (Condominium Building) - for The Courtyards at Seldom
VAU001080377 09/30/2011
Seen
Promenade (Condominium Building) - For the Woods at Hayden Run
VA0001792294 09/27/2011
Condominium
Promenade (Condominium Building) - for The Woods at Hayden Run
VA0001792292 09/27/2011
Condominium
Promenade (Condominium Building) - the Courtyards at Seldom
VAU001080382 09/30/2011
Seen
Promenade (Condominium Building) for the Polo Club at
VA0001801102 11/18/2011
Weddington
Promenade (Condominium Building) for the Polo Club at
VA0001801105 11/18/2011
Weddington
Windsor (Condominium Building) for the Polo Club at Weddington VA0001800990 11/22/2011
Windsor (Condominium Building) for the Polo Club at Weddington VA0001800988 11/22/2011
Windsor Bridge, Thompson Road, Columbus, Franklin County, Ohio :
VA0001334328 11/09/2005
project no. A3026
Architectural Alliance VAU000348458 10/27/1995

The Crossings at Windemere project. Crossings at Windemere : a 52 VA0000698779 11/17/1994

 Copyright Registration
Full title
Number Date
unit plus clubhouse residential condominium, Westerville, Ohio
The Crossings at Windemere project. Crossings at Windemere ; a 52
VA0000698780 11/17/1994
unit plus clubhouse residential condominium, Westerville, Ohio
Ranch condominium building/Property Group One, Inc. Fairway
VA0000698784 11/17/1994
Palms at the villages of Cypress Creek
Ranch condominium building/Fairway Palms project/two bedroom
VA0000698785 11/17/1994
unit. Fairway Palms at the villages of Cypress Creek
Community building/Fairway Palms project. Fairway Palms II at the
VA0000698783 11/17/1994
villages of Cypress Creek
Ranch condominium building/Fairway Palms II project. Fairway
VA0000698781 11/17/1994
Palms II at the villages of Cypress Creek
Ranch condominium building/Fairway Palms II project. Fairway
VA0000698782 11/17/1994
Palms II at the villages of Cypress Creek
Timbers Edge project condominium building. Timbers Edge : a 64
VA0000745900 10/19/1995
unit plus clubhouse, residential condominium, Columbus, Ohio

Timbers Edge project condominium building. Timbers Edge : a 64

VA0000745901 10/19/1995
unit plus clubhouse, residential condominium, Columbus, Ohio

Ranch condominium building/Property Group One, Inc. Trotter's

VA0000698786 11/17/1994
Chase, Bethel and Sawmill Roads, Columbus, Ohio : phase 2
Community building-The Village at Windemere project. Village at
VA0000698775 11/17/1994
Windemere
Community building-The Village at Windemere project. Village at
VA0000698776 11/17/1994
Windemere
Ranch condominium building/The Willows at Quail Creek project.
Willows at Quail Creek : a 100 unit residential condominium and club VA0000698777 11/17/1994
house. Grove City, Qhio
Ranch condominium building/The Willows at Quail Creek project.
Willows at Quail Creek : a 100 unit residential condominium and club VA0000698778 11/17/1994
house. Grove City, Ohio
Verona - Rear Courtyard Series VA 1-989-696 10/06/2015
Verona - Rear Courtyard Series VA 1-989-698 10/06/2015
Salerno - Rear Courtyard Series VA 1-989-702 10/06/2015
Salerno - Rear Courtyard Series VA 1-989-699 10/06/2015
Large Pavilion - The Courtyards on Tussic Condominium VA 1-989-704 09/30/2015
Large Pavilion - The Courtyards on Tussic Condominium VA 1-989-703 09/30/2015
Cabana and Pool - The Courtyards at Flayden Run VA 1-989-382 10/21/2015
Cabana and Pool - The Courtyards at Hayden Run VA 1-986-701 10/21/2015
Small Pavilion -The Courtyards at Grandshire Condominium VA 1-989-694 10/05/2015
 Copyright Registration
Full title
Number Date
Small Pavilion -The Courtyards at Grandshire Condominium VA 1-985-674 10/05/2015
Torino - Rear Courtyard Series VA 1-989-691 10/06/2015
Torino - Rear Courtyard Series VA 1-989-689 10/06/2015
Promenade (Condominium Building) with Basement and Bonus Suite VA 1-994-947 03/08/2016
Promenade (Condominium Building) with Basement and Bonus Suite VA 1-994-948 03/08/2016
Portico (Condominium Building) with Basement and Bonus Suite VA 1-994-940 03/08/2016
Portico (Condominium Building) with Basement and Bonus Suite VA 1-994-943 03/08/2016
Palazzo (Condominium Building) with Basement and Bonus Suite VA 1-994-937 03/08/2016

Palazzo (Condominium Building) with Basement and Bonus Suite VA 1-994-939 03/08/2016

Large Clubhouse (Courtyards at Hidden Ravines) VA0002065803 07/07/2017

Large Clubhouse (Courtyards at Hidden Ravines) VA0002065806 07/07/2017

Small Clubhouse (Courtyards of Huntersville) VA0002065805 07/07/2017

Small Clubhouse (Courtyards of Huntersville) VA0002065795 07/07/2017

Medium Clubhouse (Courtyards on Hoover) VA0002065807 07/07/2017

Medium Clubhouse (Courtyards on Hoover) VA0002065804 07/07/2017

Building 41 (The Courtyards on Hoover) VA0002065800 08/02/2017

Building 41 (The Courtyards on Hoover) VA0002065797 08/02/2017

Building 42 (The Courtyards on Hoover) VA0002065796 08/02/2017

Building 42 (The Courtyards on Hoover) VA0002065799 08/02/2017

Building 43 (The Courtyards on Hoover) VA0002065802 08/02/2017

Building 43 (The Courtyards on Hoover) VA0002065798 08/02/2017

29739S28
 EXHIBIT R

TERMINATION AND RELEASE AGREEMENT

This Termination and Release Agreement (this “Termination Agreement") is made as of

, 20______________, by and among Epcon Communities Franchising, Inc,, an Ohio corporation with its principal
place of business at 500 Stonehenge Parkway, Dublin, OH 43017 (“Epcon”) and
a(n)with its principal place of business at
(“Franchisee.”)

Background

A. Epcon and Franchisee entered into that certain Epcon Communities Franchising, Inc. Franchise
Agreement (the “Franchise Agreement”), dated as of, pursuant to which Franchisee was granted
the right to use the Epcon Development System.

B. Epcon and Franchisee each desire to terminate the Franchise Agreement effective upon the
performance by Franchisee of certain preconditions as set forth herein.

C. Epcon desires to release Franchisee and Franchisee desires to release Epcon, with respect to any
and all claims that each may have against the other party as of the Effective Date (as hereinafter defined) of this
Termination Agreement.

Agreement

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this
Termination Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

Section 1. Termination of the Franchise Agreement. Epcon and Franchisee hereby agree to terminate the
Franchise Agreement effective as of the date last set forth below (the “Effective Date”). Notwithstanding the
execution of this Termination Agreement and except as amended hereby. Franchisee acknowledges that it continues
to be fully obligated under the Franchise Agreement through and until the Effective Date. The foregoing sentence
shall not constitute a release of Franchisee’s obligations contained in Article 10, Article 12, and Sections 5.8, 6.3,
13.7, 15.1, 16.1, 20.2 and 20.3 of the Franchise Agreement, effective and the Personal
Covenants and Agreement ofdated.

Section 2. Preconditions to Termination. As preconditions to the effectiveness of this Termination

Agreement, Franchisee shall be obligated to fully perform each of the following:

(a) Franchisee shall promptly tender possession and ownership to Epcon of all items provided to
Franchisee by Franchisor as described in Article 4 of the Franchise Agreement and any copies or
derivations thereof, if any.

(b) Franchisee shall fully perform all other post-termination obligations of a franchisee as provided in
Article 12 of the Franchise Agreement.

Section 3. Release of Epcon by Franchisee. As of the Effective Date, Franchisee, for itself and its
successors and assigns, hereby releases and forever discharges Epcon, any persons acting by, through, under or on
behalf of Epcon, the successors and assigns of Epcon and the officers, directors, stockholders and agents of Epcon
(collectively, the “Epcon Group”), of and from any and all debts, demands, actions or causes of action, damages,
claims, rights and liabilities whatsoever, both at law and in equity, which Franchisee has, as of the Effective Date, or
ever had against the Epcon Group and each member thereof

Section 4. Indemnification of Eocon bv Franchisee. Franchisee agrees to, and hereby does, indemnify,
defend and hold harmless the Epcon Group, and each member thereof from any damages, losses, claims, expenses
or liability (including attorney's fees) which it may incur as a result of or related to the Franchise Agreement,
Franchisee’s development or operation of any project during the period occurring prior to the Effective Date, and/or
this Termination Agreement.
 Section 5. Release of Franchisee by Epcon. As of the Effective Date, Epcon, for itself and its successors
and assigns, hereby releases and forever discharges Franchisee, any persons acting by, through, under or on behalf
of Franchisee and the successors and assigns of Franchisee (collectively, the “Franchisee Group”), of and from any
and all debts, demands, actions or causes of action, damages, claims, rights and liabilities whatsoever, both at law
and in equity, which Epcon has, as of the Effective Date, or ever had against Franchisee Group and each member
thereof.

Section 6. Binding Effect. This Termination Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors, assigns, executors and personal representatives. Nothing in this
Termination Agreement, express or implied, is intended to confer on any person other than the parties hereto, and
their respective successors, assigns, executors and personal representatives, any rights, remedies, obligations or
liabilities under or by reason of this Termination Agreement.

Section 7. Amendment or Modification. This Termination Agreement may not be amended, modified or
supplemented by the parties hereto in any manner, except by an instrument in writing signed on behalf of each of the
parties hereto individually or by its duly authorized officer(s) or representative(s).

Section 8. Severability. If an provision of this Termination Agreement shall be determined by a court of

competent jurisdiction to be invalid or unenforceable in any jurisdiction, such determination shall not affect the validity
or enforceability of the remaining provisions of this Termination Agreement in such jurisdiction or affect the validity or
enforceability of such provision in any other jurisdiction.

Section 9. Governing Law. This Termination Agreement shall be governed by, and be construed in
accordance with, the local laws of the State of Ohio.

Section 10. Counterparts. This Termination Agreement may be executed in any number of counterparts,
each of which shall be deemed an original of this Termination Agreement and all of which together shall constitute
one and the same instrument.

Section 11. Section and Other Fleadinqs. The section and other headings contained in this Termination
Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this
Termination Agreement.

[signature page follows]

 IN WITNESS WHEREOF, the parties hereto have caused this Termination Agreement to be executed on the
date and year first above written and to be effective as of the Effective Date.

Witnesses: Franchisee: NAME

By:. Date:
Signature - Witness as to Name [Name, Title]

Name Printed:

Date;
Signature - Witness as to Name [Name, Title]

Name Printed:

Witnesses: Epcon; Epcon Communities Franchising, Inc.

By:.
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General Counsel

Name Printed:______________________

By;.
Signature - Witness as to Paul W. Hanson Paul W, Hanson, President of Franchising

Name Printed: ____ _______________ Date:

8229849V.8
 EXHIBITS

INITIAL MARKET AREA AGREEMENT AND ADDENDUM TO FRANCHISE AGREEMENT

 EXHIBIT S

Exhibit "1”

INITIAL MARKET AREA AGREEMENT

This Initial Market Area Agreement (hereinafter the "Initial Market Area Agreement") is made by and between Epcon
Communities Franchising, Inc., an Ohio corporation having its principal business offices at 500 Stonehenge Parkway, Dublin,
Ohio 43017 (hereinafter referred to as "Franchisor"), and, a(n)having its principal
business offices at (hereinafter referred to as "Franchisee"), to be effective as of the date
executed by Franchisor (the “Effective Date").

Pursuant to the terms of the Franchise Agreement, of even date herewith, made by and between the parties hereto and
any amendments or addendums thereto (collectively the "Franchise Agreement"), Franchisor and Franchisee make the
following agreement, intending to be legally bound thereby:
1. Each term set forth herein having initial capital letters shall have the meaning as set forth herein or, if not defined herein,
as specified in the Franchise Agreement.

2. For purposes of this Initial Market Area Agreement, the term "Initial Market Area" includes an area generally larger than
the typical Market Area as described below. Within twenty-four (24) months of the Effective Date Franchisee and
Franchisor shall agree on the location for a Project within the Initial Market Area. Upon Franchisee’s and Franchisor’s
agreement upon the location of a Project, Franchisee and Franchisor shall execute a Market Area Agreement in the form
of that attached hereto as Exhibit “B” and execute the Note and Mortgage required by the Franchise Agreement.
Franchisee acknowledges that the "Market Area" in said Market Area Agreement will be a smaller geographic area than
the Initial Market Area. The “Market Area" is intended to include the smallest specific geographic area that will generate
the most purchaser support (typically between 60% and 70%) for a development. The area included within the Market
Area typically takes into consideration existing natural and man-made boundaries and socioeconomic conditions. In the
event the parties hereto cannot mutually agree on a Market Area within twenty-four (24) months of the Effective Date,
then the Limited Rights set-out in Section 7 of this Initial Market Area shall automatically terminate and Franchisor and
Franchisee shall release each other of any future obligations under this Initial Market Area Agreement and the Franchise
Agreement, whether monetary or otherwise, except for those provisions that specifically survive termination..

The Initial Market Area for this Initial Market Area Agreement shall be as depicted on the map attached hereto as Exhibit
"A" and incorporated herein for all purposes.

3. Franchisor, having granted to Franchisee a license to use the Development System pursuant to the terms and conditions
of the Franchise Agreement, desires to further protect its materials, reputation, and goodwill and to geographically limit
use by Franchisee of the Development System in an ordered and controlled manner. Franchisee acknowledges that such
restrictions are essential to the success of the Project and the projects of other franchisees and licensees of Franchisor.

4. Franchisee agrees to fully implement the Development System only within the Initial Market Area depicted on Exhibit "A".
Franchisee hereby acknowledges that Franchisor's review and expressed opinion about any Project location proposed by
Franchisee is only Franchisor's opinion respecting how the site meets Franchisor's criteria for locations for Epcon
Communities Projects and is based upon Franchisor's limited information about Franchisee's Initial Market Area. It does
not constitute a representation, warranty, or an acknowledgment by Franchisor or any employee or agent of Franchisor
that an Epcon Communities Project at the proposed location will be successful. The decision of Franchisee to proceed
with the development of an Epcon Communities Project at the proposed location shall be at the sole discretion of
Franchisee based upon its independent analysis, and Franchisee hereby acknowledges and agrees that it shall not have
any claim of any nature against Franchisor and its employees and agents if the Epcon Communities Project does not
perform in accordance with the expectations of Franchisee.

5. Franchisee shall make all payments specified in the Franchise Agreement to Franchisor.

6. Franchisee acknowledges that it shall not use or allow to be used the Development System anywhere except at the
agreed location within the Initial Market Area specified in this Initial Market Area Agreement executed by and between
Franchisor and Franchisee. Franchisee further acknowledges that any unauthorized and unacknowledged use would be
in violation of the terms of this Initial Market Area Agreement and of the Franchise Agreement and agrees that any such
breach shall afford to Franchisor each of the rights and remedies set forth in the Franchise Agreement.
7, Except as otherwise provided for in this Initial Market Area Agreement, During the term of the Franchise Agreement,
Franchisee shall have certain limited exclusivity rights (the "Limited Rights”) to the Initial Market Area depicted on Exhibit
"A" pursuant to the terms and conditions set forth below in this Section 8. While such Limited Rights are in effect.
Franchisor agrees to grant to no other licensee or franchisee the right to commence construction (nor to itself commence
construction) of a Project utilizing the Development System within the Initial Market Area depicted on Exhibit "A", The
parties agree that this grant of certain limited exclusivity rights is contractual only, and is neither intended nor shall be
interpreted to transfer any of Franchisor’s exclusive rights under United States copyright law to anyone, including
Franchisee.

The Limited Rights respecting the Initial Market Area depicted on Exhibit "A" shall immediately terminate upon the earliest
to occur of any of the following;

a) Franchisee at any time is not in full compliance with the provisions of the Franchise Agreement and this
Initial Market Area Agreement.

b) That date that is the earlier of (i) the date Franchisee and Franchisor execute a Market Area Agreement for
a Market Area or (ii) the date that is two (2) years after the Effective Date of this Initial Market Area
Agreement.

c) Any assertion by Franchisee, or anyone claiming to be an assignee or beneficiary of Franchisee’s rights,

that the Limited Rights affected any transfer of any portion of Franchisor’s copyrights in any copyrighted
work. In the event of any such assertion. Franchisee agrees that it automatically assigns to Franchisor any
and all putative rights (including in any and all causes of action for infringement) in all such copyrighted
works.

Upon the termination of the Limited Rights, Franchisor shall have the right to grant to any entity the license to use, or may
itself use (or may permit its business entity affiliate to use), the Development System to develop a project or projects
within the Initial Market Area set forth in Exhibit "A".

8. This Agreement shall automatically terminate on the execution of a Market Area Agreement or the effective date of any
termination or expiration of the Franchise Agreement.

IN WITNESS WHEREOF the parties hereto, intending to be legally bound hereby, have duly executed and delivered this
Market Area Agreement.
Franchisee:
Witnesses:
By:

By:____ Date:
Signature - Witness as to
Name Printed: ___

By:. Date:
Signature - Witness as to
Name Printed: ___

Witnesses: Franchisor: Epcon Communities Franchising, Inc.

By:
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, VP and General Counsel
Name Printed:______________________

By:.
Paul W. Hanson, President of Franchising
Signature - Witness as to Paul W. Hanson.
Name Printed: Date:_________________________________
 EXHIBIT "A"
(to Initial Market Area Agreement)

Market Area
 EXHIBIT “B”
(to Initial Market Area Agreement - Market Area Agreement form)

3257S195
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING. INC.
FRANCHISE AGREEMENT

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement (hereinafter the “Addendum”) is
agreed to this day of, 20__________________ , by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and (“Franchisee") to amend and revise the Franchise Agreement between the
parties, of even date herewith (the “Franchise Agreement”),

Background
WHEREAS, pursuant to a request by Franchisee to modify certain terms and provisions of the Franchise
Agreement, Franchisee and Franchisor have agreed to amend the Franchise Agreement; and,

WHEREAS, Franchisee and Franchisor shall execute this Addendum to evidence said modifications to the
Franchise Agreement.

Agreement
NOW, THEREFORE, in consideration of the foregoing, of the agreements, terms and conditions herein contained,
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows, each intending to be legally bound hereby,

1. All capitalized terms herein which are not separately defined herein shall have the meanings ascribed to these
terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the terms of this Addendum, the
terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise Agreement are in full force and
effect.

4. The Addendum and the Franchise Agreement are hereinafter collectively referred to as the “Agreement”.

5. The last sentence of Subsection 1.1 shall be deleted and the following substituted in place thereof:

As a part of the franchise and license granted in Article 3 hereof. Franchisor shall provide the materials
and services described in Article 4 hereof to enable Franchisee to implement the Development System at
the location and within the area as set forth in the Initial Market Area Agreements or Market Area
Agreements (singularly or collectively the “Market Area Agreement(s)”) each substantially in the form
attached hereto as Exhibit “1" or as “Exhibit B" to “Exhibit 1".

6. Franchisee represents and agrees that it will keep the terms, provisions, amounts and fact of this Addendum
and the Agreement, any of the negotiations or discussions related thereto, any of the facts or allegations related
thereto and any terms, provisions, and amounts of any related documents completely confidential and not divulge
said terms except as required by law. Franchisee may divulge, so much of the terms of this Addendum and the
Agreement, to its respective accountants, auditors, financial, business and legal advisors as is necessary for
ordinary conduct of its business and financial affairs.

7. This Addendum, together with the Franchise Agreement to which it is attached, constitutes the entire
agreement of the parties with respect to the subject matter hereof and may not be further modified or amended
except in a written agreement signed by both parties.
In Witness Whereof, the parties hereto, intending to be legally bound hereby, have duly executed and delivered
this Agreement.

Franchisee:
Witnesses:
By:

By:______ Date:
Signature - Witness as
Name Printed:

By: Date:
Signature - Witness as
Name Printed:

Franchisor: Epcon Communities Franchising, Inc.

Signature - Witness as to Paul W. Hanson By:

Name Printed: Paul W. Hanson, President of Franchising

Signature - Witness as to Joel D. Rhoades By:

Joel D. Rhoades, Director, VP, General Counsel
Name Printed:

Page 2 of 2
3257S149 V.?
 EXHIBIT T

STATE ADDENDA TO THE FDD AND AGREEMENTS

 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF ALASKA

Item 17 of the disclosure document is hereby modified by adding the following paragraphs to the
end thereof:

"The Franchise Agreement requires application of the laws of Ohio, This

provision may not be enforceable under Alaska law.

Under certain circumstances, the Franchise Agreement requires you to

participate in binding arbitration. This provision may not be enforceable under
Alaska law unless you and Epcon Communities Franchising, Inc. agree to the
submission of a dispute to binding arbitration or to binding alternative dispute
resolution at the time that the dispute arises.

Alaska Stat. § 45.45.750(a)(3) prohibits the requirement that you pay Epcon
Communities Franchising’s attorneys’ fees. If the Franchise Agreement contains
a provision that is inconsistent with the statute, the statute will control.”

16247890V2
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF ALASKA

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement is agreed

to this ____ day of , _________________, by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and (“Franchisee”) to amend and revise the Franchise
Agreement between the parties, dated,, in the following respects:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to these terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the
terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 13.7 of the Franchise Agreement is hereby modified by adding the

following paragraph to the end thereof:

“This Agreement requires that certain disputes between the Franchisee

and Franchisor be submitted to binding arbitration. This provision may
not be enforceable under Alaska law unless Franchisee and Franchisor
agree to the submission of such a dispute to arbitration or binding
alternative dispute resolution at the time that the dispute arises.”

5. Section 20.2 of the Franchise Agreement is hereby deleted in its entirety and
following substituted therefor:

“20.2 Choice of Law. Except to the extent governed by the federal

copyright and trademark law, this Agreement shall be deemed to have
been entered into under, and for all purposes shall be interpreted,
construed, and governed by, the local laws of the State of Alaska, without
application of its conflicts of laws principles.”

6. The Franchise Agreement is hereby modified by adding the following new Article
22 to the Franchise Agreement:

“Article 22
Alaska Specific Provisions

Alaska Stat. § 45.45.750(a)(3) prohibits the requirement that Franchisee

pay Franchisor's attorneys’ fees. If this Agreement contains a provision
that is inconsistent with the statute, the statute will control.”

7. This Addendum, together with the Franchise Agreement to which it is attached,

constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties.
 IN WITNESS WHEREOF, the parties hereto have signed this Addendum to be effective
as of the date first above written.

FRANCHISOR: Epcon Communities Franchising, Inc,

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:
[Name, Title]

-2-
16247559 V 3
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF CALIFORNIA

California Corporations Code, Section 31125, requires Epcon Communities to give you a
disclosure document, approved by the Department of Business Oversight, before solicitation of a
proposed material modification of an existing franchise.

THE CALIFORNIA FRANCHISE INVESTMENT LAW REQUIRES THAT A COPY OF ALL

PROPOSED AGREEMENTS RELATING TO THE SALE OF THE FRANCHISE BE DELIVERED
TOGETHER WITH THE DISCLOSURE DOCUMENT.

Item 1 of the disclosure document, under the heading “Description of the Epcon Communities
Franchise” is hereby modified by adding the following paragraph to the end thereof:

“If your franchise project is located in the State of California, among the other laws with which you
may have to comply in order to develop a project in California are the California Subdivided Lands
Act, California Business & Professions Code, Section 11,000 et seq. and the Title 10 of the
California Code of Regulations, Section 2790 et seq. and you may have to obtain approvals from
the California Bureau of Real Estate, the California Department of Consumer Affairs and local
jurisdictions.”

Item 3 of the disclosure document is hereby modified by adding the following paragraph to the end
thereof:

“Except as may be disclosed in this Item 3, neither Epcon Communities Franchising, Inc. nor any
person listed in Item 2 of this Franchise Disclosure Document is subject to any currently effective
order of any national securities association or national securities exchange, as defined in the
Securities Exchange Act of 1934, 15 U.S.C.A. 78a et seg., suspending or expelling such persons
from membership in such association or exchange.”

The chart in Item 6 of the disclosure document is hereby modified by adding the following
language to the end of the “Amount” column for the “Late Payment Row”:

“The maximum annual interest rate permitted under California law is ten percent (10%).”

The third paragraph of Item 10 is hereby modified by adding the following language to the end of
item (5):

“The maximum annual interest rate permitted under California law is ten percent (10%).”

The first paragraph of Item 12 regarding the Market Area Reservation Agreement and Market
Reservation Deposit is hereby modified by adding the following language to the end of the
paragraph:

“The provision of the Market Area Reservation Agreement to you by ECFI, the signing of the
Market Area Reservation Agreement by you and ECFI, and the payment of the Market
Reservation Deposit by you to ECFI will be done in compliance with California Corporations Code,
Section 31119(a).”
8. Item 17 of the disclosure document is hereby modified by adding the following paragraphs to the
end thereof:

“California Business and Professions Code Sections 20000 through 20043 provide rights to you
concerning termination, transfer or nonrenewal of a franchise. If the franchise agreement
contains a provision that is inconsistent with the law, the law will control.

The Franchise Agreement provides for termination upon bankruptcy. This provision may not be
enforceable under federal bankruptcy law (11 U.S.C.A. Sec. 101, et seq.).

The Franchise Agreement contains a covenant not to compete which extends beyond the
termination of the franchise. This provision may not be enforceable under California law. The
Franchise Agreement contains a liquidated damage clause. Under California Civil Code, Section
1671, certain liquidated damage clauses are unenforceable.

For certain claims, the Franchise Agreement requires you to participate in binding arbitration with
Columbus, Ohio as the forum. This provision may not be enforceable under California law. The
costs of the arbitration will be paid equaily by the parties to the arbitration, unless the arbitrator
orders otherwise.

The Franchise Agreement requires Ohio as the forum. This provision may not be enforceable
under California law.

The Franchise Agreement requires application of the laws of Ohio. This provision may not be
enforceable under California law.

The Franchise Agreement requires you to sign a general release of claims upon renewal or
transfer of the Franchise Agreement. California Corporations Code Section 31512 provides that
any condition, stipulation or provision purporting to bind any person acquiring any franchise to
waive compliance with any provision of that law or any rule or order thereunder is void. Section
31512 voids a waiver of your rights under the Franchise Investment Law (California Corporations
Code Section 31000-31516). Business and Professions Code Section 20010 voids a waiver of
your rights under the Franchise Relations Act (Business and Professions Code Sections 20000 -
20043).

Prospective franchisees are encouraged to consult private legal counsel to determine the
applicability of California and federal laws (such as Business and Professions Code Section
20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions
of a franchise agreement restricting venue to a forum outside the State of California.”

9. Item 19 of the disclosure document is hereby modified by adding the following paragraph to the
end thereof;

“The financial performance figures reflect some of the costs of sales, operating expenses, or
other costs or expenses that must be deducted from the gross revenue or gross sales figures to
obtain your net income or profit. You should conduct an independent investigation of the costs
and expenses you will incur in operating your franchised business. Franchisees or former
franchisees, listed in the disclosure document, may be one source of this information.”

OUR WEBSITE HAS NOT BEEN REVIEWED OR APPROVED BY THE CALIFORNIA

DEPARTMENT OF BUSINESS OVERSIGHT ANY COMPLAINTS CONCERNING THE
CONTENT OF THIS WEBSITE MAY BE DIRECTED TO THE CALIFORNIA DEPARTMENT OF
BUSINESS OVERSIGHT at www.dob.ca.qoy.

-2-
4/18/2019 500.^073 V.21
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF CALIFORNIA

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement is agreed

to this ____ day of, 20_______________, by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and (“Franchisee”) to amend and revise the Franchise
Agreement between the parties, dated,, in the following respects:

1. Ail capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to these terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the
terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 13.7 of the Franchise Agreement is hereby modified by adding the

following paragraph at the end thereof:

“THIS AGREEMENT REQUIRES COLUMBUS, OHIO AS THE FORUM

FOR ARBITRATION. THIS PROVISION MAY NOT BE ENFORCEABLE
UNDER CALIFORNIA LAW.”

5. Section 20.2 of the Franchise Agreement is hereby modified by adding the

following paragraph at the end thereof:

“THIS AGREEMENT REQUIRES APPLICATION OF THE LAW OF THE

STATE OF OHIO. THIS PROVISION MAY NOT BE ENFORCEABLE
UNDER CALIFORNIA LAW.”

6. Section 20.3 of the Franchise Agreement is hereby modified by adding the

following paragraph at the end thereof:

“THIS AGREEMENT REQUIRES OHIO AS THE FORUM. THIS

PROVISION MAY NOT BE ENFORCEABLE UNDER CALIFORNIA
LAW.”

7. (a) California Corporations Code, Section 31125, requires Franchisor to give you
a disclosure document, approved by the Department of Business Oversight, before a solicitation of a
proposed material modification of an existing franchise.

(b) The Franchise Agreement contains a liquidated damage clause, and under
California Civil Code, Section 1671, certain liquidated damage clauses are unenforceable.

(c) Relative to the provision for termination upon bankruptcy, this provision may
not be enforceable under federal bankruptcy law.

(d) California Business and Professions Code Sections 20000 through 20043
provide rights to the franchisee concerning termination, transfer or nonrenewal of a franchise. If the
franchise agreement contains a provision that is inconsistent with the law, the law will control.
 (e) The Franchise Agreement requires you to sign a general release of claims
upon renewal or transfer of the Franchise Agreement. California Corporations Code Section 31512
provides that any condition, stipulation or provision purporting to bind any person acquiring any franchise
to waive compliance with any provision of that law or any rule or order thereunder is void. Section 31512
voids a waiver of your rights under the Franchise Investment Law (California Corporations Code Section
31000-31516). Business and Professions Code Section 20010 voids a waiver of your rights under the
Franchise Relations Act (Business and Professions Code Sections 20000 - 20043).

(f) The Franchise Agreement contains a covenant not to compete which extends
beyond the termination of the franchise. This provision may not be enforceable under California law.

(g) Prospective franchisees are encouraged to consult private legal counsel to

determine the applicability of California and federal laws (such as Business and Professions Code Section
20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions of a
franchise agreement restricting venue to a forum outside the State of California.

8. This Addendum, together with the Franchise Agreement to which it is attached,

constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties.

IN WITNESS WFIEREOF, the parties hereto have signed this Addendum to be effective
as of the date first above written.

FRANCFIISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:
[Name, Title]

-2-
3767733 V.20
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF ILLINOIS

The Risk Factors set forth on the Franchise Disclosure Document cover page of this disclosure
document are hereby modified to comply with Section 4 of the Illinois Franchise Disclosure Act,
which provides that any provision in a franchise agreement that designates jurisdiction or venue in
a forum outside of Illinois is void.

Item 17 of the disclosure document is hereby modified as follows;

(a) by substituting the following in place of the last two items of the chart regarding the Franchise
Agreement;

SECTION IN
PROVISION FRANCHISE SUMMARY
AGREEMENT
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Section 20.2 of Illinois law applies. See State Addenda
the Franchise to Franchise Agreement.
Agreement
and by adding the following paragraph to the end thereof;

"THE CONDITIONS UNDER WHICH YOUR FRANCHISE CAN BE

TERMINATED AND YOUR RIGHTS UPON NON-RENEWAL MAY BE
AFFECTED BY ILLINOIS LAW: 815 ILCS 705/19 AND 20.”

(b) by substituting the following in place of the last two items of the chart regarding the Market
Hold Agreement;

SECTION IN
PROVISION AGREEMENT SUMMARY
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Section 6 of the Market Illinois law applies. See Illinois
Hold Agreement Addendum to Market Hold
Agreement.

and by adding the following paragraph to the end thereof;

"THE CONDITIONS UNDER WHICH YOUR FRANCHISE CAN BE

TERMINATED AND YOUR RIGHTS UPON NON-RENEWAL MAY BE
AFFECTED BY ILLINOIS LAW: 815 ILCS 705/19 AND 20.”
 (c) by substituting the following in place of the last two itenns of the chart regarding the Market
Reservation Agreement:

SECTION IN
PROVISION AGREEMENT SUMMARY
V. Choice of forum Not Applicable Not Applicable
w. Choice of law Section 9 of the Market Illinois law applies. See Illinois
Reservation Agreement Addendum to Market
Reservation Agreement.

and by adding the following paragraph to the end thereof:

"THE CONDITIONS UNDER WHICH YOUR FRANCHISE CAN BE

TERMINATED AND YOUR RIGHTS UPON NON-RENEWAL MAY BE
AFFECTED BY ILLINOIS LAW: 815 ILCS 705/19 AND 20."

3. Illinois law governs the agreements between the parties to the franchise. Any condition,
stipulation, or provision purporting to bind any person acquiring any franchise to waive compliance
with any provisions of the Illinois Franchise Disclosure Act, or any other law of Illinois is void.

4487155 V 13
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF ILLINOIS

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement (this

“Addendum”) is attached to and made a part of the Epcon Communities Franchising, Inc. Franchise
Agreement (the “Franchise Agreement”), by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and _____________________________________ , a
the principal place of business of which is located at
(“Franchisee”), dated as of
for the purpose of modifying and amending the terms of such
Franchise Agreement. For such purpose, Franchisor and Franchisee agree as follows:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the
terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 20.2 of the Franchise Agreement is hereby deleted and the following
substituted therefor:

“20.2 Choice of Law. Except to the extent governed by the federal

copyright and trademark law, this Agreement shall be deemed to have
been entered into under, and for all purposes shall be interpreted and
construed under and governed by the local laws of the State of Illinois,
without application of its conflicts of laws principles.

Illinois law governs the agreements between the parties to the franchise.
Any condition, stipulation, or provision purporting to bind any person
acquiring any franchise to waive compliance with any provisions of the
Illinois Franchise Disclosure Act, or any other law of Illinois is void.”

5. Section 20.3 of the Franchise Agreement is hereby deleted and the following
substituted therefor:

“20.3 Venue. Except to the extent prohibited by applicable state law to

the contrary, and except to the extent of the arbitration provision of
Section 13.7 hereof, Franchisor and Franchisee agree that any litigation
or legal action to enforce or relating to this Agreement and the
relationship of the parties hereunder shall be filed in a United States
District Court in the State of Illinois or Courts of the State of Illinois having
jurisdiction, and each of Franchisor and Franchisee hereby consents to
the jurisdiction of such courts.”

6. The last sentence of Section 21.1(a) of the Franchise Agreement is hereby

deleted.

7. This Addendum, together with the Franchise Agreement to which it is attached,

constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties, provided, however,
nothing in this or in any related agreement is intended to disclaim the representations Franchisor
made in the franchise disclosure document that Franchisor furnished to Franchisee.

IN WITNESS WHEREOF, the parties hereto have executed this Addendum to be

effective as of the effective date of the Franchise Agreement.

FRANCHISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:________________
[Name, Title]

-2-
4513470 V15
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
MARKET RESERVATION AGREEMENT
FOR THE STATE OF ILLINOIS

This Addendum to Epcon Communities Franchising, Inc. Market Reservation Agreement

(this “Addendum”) is attached to and made a part of the Epcon Communities Franchising, Inc. Market
Reservation Agreement (the “Market Reservation Agreement”), by and between Epcon Communities
Franchising, Inc. (“Franchisor”) and , a(n)
the principal place of business of which is located at
(“Franchisee”), dated as of ,for the
purpose of modifying and amending the terms of such Market Reservation Agreement. For such purpose,
Franchisor and Franchisee agree as follows:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Market Reservation Agreement.

2. In the event of a conflict between the terms of the Market Reservation Agreement
and the terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Market

Reservation Agreement are in full force and effect.

4. Section 9 of the Market Reservation Agreement is hereby deleted and the

following substituted therefor:

“This Agreement shall be interpreted, construed, and governed by, the

local laws of the State of Illinois, without application of its conflicts of laws
principles.

Illinois law governs the agreements between the parties to the franchise.
Any condition, stipulation, or provision purporting to bind any person
acquiring any franchise to waive compliance with any provisions of the
Illinois Franchise Disclosure Act, or any other law of Illinois is void.”

5. This Addendum, together with the Market Reservation Agreement to which it is

attached, constitutes the entire agreement of the parties with respect to the subject matter hereof and may
not be further modified or amended except in a written agreement signed by both parties, provided,
however, nothing in this or in any related agreement is intended to disclaim the representations
Franchisor made in the franchise disclosure document that Franchisor furnished to Franchisee.

[remainder of page intentionally left blank]

 IN WITNESS WHEREOF, the parties hereto have executed this Addendum to be
effective as of the effective date of the Market Reservation Agreement.

FRANCHISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:.
[Name, Title]

8234329 V.4
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
MARKET HOLD AGREEMENT
FOR THE STATE OF ILLINOIS

This Addendum to Epcon Communities Franchising, Inc. Market Hold Agreement (this
“Addendum”) is attached to and made a part of the Epcon Communities Franchising, Inc. Market Hold
Agreement (the “Market Hold Agreement”), by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and, athe
principal place of business of which is located at
(“Franchisee”), dated as of
_, for the purpose of modifying and amending the terms of such Market
Hold Agreement. For such purpose. Franchisor and Franchisee agree as follows:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Market Hold Agreement.

2. In the event of a conflict between the terms of the Market Hold Agreement and
the terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Market Hold
Agreement are in full force and effect.

4. Section 6. of the Market Hold Agreement is hereby deleted and the following
substituted therefor:

“This Agreement shall be interpreted, construed, and governed by, the

local laws of the State of Illinois, without application of its conflicts of laws
principles.

Illinois law governs the agreements between the parties to the franchise.
Any condition, stipulation, or provision purporting to bind any person
acquiring any franchise to waive compliance with any provisions of the
Illinois Franchise Disclosure Act, or any other law of Illinois is void.”

5. This Addendum, together with the Market Hold Agreement to which it is attached,
constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties, provided, however,
nothing in this or in any related agreement is intended to disclaim the representations Franchisor
made in the franchise disclosure document that Franchisor furnished to Franchisee.

[remainder of page intentionally left blank]

 IN WITNESS WHEREOF, the parties hereto have executed this Addendum to be
effective as of the effective date of the Market Hold Agreement,

FRANCHISOR; Epcon Communities Franchising, Inc.

By;________________^____________
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE; NAME

By;________________
[Name, Title]

V i;
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF INDIANA

The State Cover Page of this disclosure document is hereby modified to comply with Indiana law
by adding the following disclosure after the stated “Risk Factors”:

“INDIANA LAW IS CONTROLLING FOR INDIANA FRANCHISEES.”

Item 3 of the disclosure document is hereby modified by adding the following paragraph to the end
thereof:

“Except as set out above, neither Epcon Communities nor any person identified in Item 2 of this
disclosure document is involved in any pending arbitration and has, during the 10 year period
immediately preceding the date of this disclosure document, been a party to any arbitration
proceeding.”

Item 6 of the disclosure document is hereby modified by adding the following to the “Remarks”
column of the table opposite the listing for “Liquidated Damages”:

“Liquidated damages are prohibited by Indiana Code Section 23-2-2.7-1(10). Epcon Communities
may seek such damages in a court of proper jurisdiction. See Addendum to Epcon Communities
Franchising, Inc. Franchise Agreement for State of Indiana.”.

Item 17 of the disclosure document is hereby modified by substituting the following in place of the
specified three items of the chart therein:

SECTION IN
PROVISION SUMMARY
FRANCHISE AGREEMENT
V. Choice of forum Section 20.3 Litigation must be filed
in court of competent
jurisdiction in Indiana.
w. Choice of law Section 20.2 Indiana law applies.

and by adding the following paragraphs to the end thereof:

“With respect to item m. of the chart set forth above, you are not required to release any
claims against Epcon Communities arising under Indiana franchise law.”

4/18/2018 4768535 V.10

 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF INDIANA

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement is agreed

to this ___ day of , __________________ , between Epcon Communities Franchising, Inc.
("Franchisor") and ________________________ ("Franchisee") to amend and revise the Franchise
Agreement, dated _ ,, in the following respects:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the
terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 12.1(c) of the Franchise Agreement is hereby modified by adding the

following language to the end thereof:

", provided, however, that Franchisee shall not be required to release any
claim against Franchisor arising under Indiana franchise law.".

5. Section 14.3 of the Franchise Agreement is hereby modified by adding the

following to the end thereof:

“Notwithstanding the foregoing provisions of this Section 14.3 to the

contrary, in the event that liquidated damages are prohibited by
applicable state law. Franchisor may seek such damages in a court of
proper jurisdiction.”.

6. Section 14.4 of the Franchise Agreement is hereby modified by adding the

following to the end thereof:

" Franchisor’s right to injunctive relief shall be subject to Indiana Code

Section 23-2-2.7-1(10). In addition, nothing in this Agreement shall be
construed as a waiver by Franchisee of any applicable bond requirement
with regard to Franchisor’s entitlement to injunctive relief.".

7. Section 20.3 of the Franchise Agreement is hereby deleted in its entirety and the
following substituted therefor:

“Venue. Except to the extent prohibited by applicable state law to the

contrary. Franchisor and Franchisee agree that any litigation or legal
action to enforce or relating to this Agreement and the relationship of the
parties hereunder shall be filed in Indiana courts, and each of Franchisor
and Franchisee hereby consents to the jurisdiction of such courts.”.

8. Section 20.2 of the Franchise Agreement is hereby deleted in its entirety and the
following substituted therefor:

“Choice of Law. Except to the extent governed by the federal copyright

and trademark law, this Agreement shall be deemed to have been
entered into under, and for all purposes shall be governed by, the local
laws of the State of Indiana.”.
 9. Franchisor’s right to enforce Section 13.7 of the Franchise Agreement shall be
subject to Indiana Code Section 23-2-2.7-1(9).

10. This Addendum, together with the Franchise Agreement to which it is attached,
constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties.

IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read

this Addendum, understands and consents to be bound by all of its terms, and agrees it shall become
effective as of the date first above written.

FRANCHISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:
[Name, Title]

5.vS207<) V.I5
 IOWA

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly
executed and delivered this Agreement.

You, the buyer, may cancel this transaction at any time prior to midnight of the third business day
after the date of this transaction. See the attached notice of cancellation form for an explanation of
this right.

Franchisee: NAME

Witnesses:

Date:
Signature - Witness as to Name [Name, Title]

Name Printed:_____________

Date:
Signature - Witness as to Name [Name, Title]

Name Printed:

Franchisor: Epcon Communities Franchising, Inc.

Witnesses:

By:
Signature - Witness as to Joel D. Rhoades Joel D. Rhoades, Vice President and General
Counsel

Name Printed:

By:.
Signature - Witness as to Paul W. Hanson Paul W. Hanson, President of Franchising

Name Printed:
 NOTICE OF CANCELLATION (IOWA)
Copy 1

Epcon Communities Franchising, Inc. Franchise Agreement, signed

You may cancel this transaction, without any penalty or obligation, within three business
days from the above date.

If you cancel, any property traded in, any payments made by you under the contract or sale,
and any negotiable instrument executed by you will be returned within ten business days following
receipt by the seller of your cancellation notice, and any security interest arising out of the
transaction will be canceled.

If you cancel, you must make available to the seller at your residence, in substantially as
good condition as when received, any goods delivered to you under this contract or sale; or you may
if you wish, comply with the instructions of the seller regarding the return shipment of the goods at
the seller’s expense and risk.

If you do not agree to return the goods to the seller or if the seller does not pick them up
within twenty days of the date of your notice of cancellation, you may retain or dispose of the goods
without any further obligation.

To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice
or any other written notice, or send a telegram, to Epcon Communities Franchising, Inc., 500
Stonehenge Parkway, Dublin, Ohio 43017, attn: Joel D. Rhoades, Vice President and General
Counsel, not later than midnight of(Date).

I hereby cancel this transaction.

Buyer’s Signature:___________

Date:
 NOTICE OF CANCELLATION (IOWA)
Copy 2

Epcon Communities Franchising, Inc. Franchise Agreement, signed.

You may cancel this transaction, without any penalty or obligation, within three business
days from the above date.

If you cancel, any property traded in, any payments made by you under the contract or sale,
and any negotiable instrument executed by you will be returned within ten business days following
receipt by the seller of your cancellation notice, and any security interest arising out of the
transaction will be canceled.

If you cancel, you must make available to the seller at your residence, in substantially as
good condition as when received, any goods delivered to you under this contract or sale; or you may
if you wish, comply with the instructions of the seller regarding the return shipment of the goods at
the seller’s expense and risk.

If you do not agree to return the goods to the seller or if the seller does not pick them up
within twenty days of the date of your notice of cancellation, you may retain or dispose of the goods
without any further obligation.

To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice
or any other written notice, or send a telegram, to Epcon Communities Franchising, Inc., 500
Stonehenge Parkway, Dublin, Ohio 43017, attn: Joel D. Rhoades, Vice President and General
Counsel, not later than midnight of(Date).

I hereby cancel this transaction.

Buyer’s Signature:___________

Date:

?o,;5iy8 V i(i
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF MINNESOTA

1. Item 6 of the disclosure document is hereby modified by adding the following to the “Remarks"
column of the table opposite the listing for “Liquidated Damages":

“Minn. Rule 2860.4400J. prohibits requiring a franchisee to consent to liquidated damages.

Epcon Communities may seek such damages in a court of proper jurisdiction. See Addendum to
Epcon Communities Franchising, Inc. Franchise Agreement for State of Minnesota.”.

2. Item 13 of the disclosure document is hereby modified by adding the following paragraph to the
end thereof:

“With respect to the franchises governed by Minnesota law, the franchisor will comply
with Minnesota Statute 80C.12, subdivision 1(g), which requires that the franchisor will
protect the franchisee’s right to use the trademarks, service marks, trade names,
logotypes or other commercial symbols or indemnify the franchisee from any loss, costs
or expenses arising out of any claim, suit or demand regarding the use of the name.".

3. Item 17 of the disclosure document is hereby modified by adding the following paragraphs to the
end thereof:

“With respect to the franchises governed by Minnesota law, the franchisor will comply
with Minnesota Statute §80C.14, subdivisions 3, 4 and 5, which require, except in certain
specific cases, that a franchisee be given 90 days notice of termination (with 60 days to
cure) and 180 days notice for non-renewal of the franchise agreement.

“Minnesota Statutes, Section 80C.21 and Minnesota Rule 2860.4400(J) prohibit the
franchisor from requiring litigation to be conducted outside Minnesota, requiring waiver of
a jury trial, or requiring the franchisee to consent to liquidated damages, termination
penalties or judgment notes. In addition, nothing in the Franchise Disclosure Document
or agreement(s) can abrogate or reduce any of franchisee’s rights as provided for in
Minnesota Statutes, Chapter 80C, or franchisee’s rights to any procedure, forum, or
remedies provided for by the laws of the jurisdiction.”

With respect to the franchisees governed by Minnesota law, Epcon Communities may
seek injunctive relief, but may not require you to waive any rights provided under Minn.
Rule 2860.4400J. Furthermore, the determination as to whether or not a bond will be
required of Epcon Communities in seeking injunctive relief will be left to the determination
of the court hearing the petition for relief

The general release referenced in m. in each of the charts set forth above shall not apply
to any claims under Minnesota Statutes, Sections 80C.01 to 80C.22.”

4522126 V.5
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF MINNESOTA

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement (this "Addendum”)
is attached to and made a part of the Epcon Communities Franchising, Inc, Franchise Agreement (the
“Franchise Agreement”), by and between Epcon Communities Franchising, Inc. (“Franchisor”) and
, awhose principal place of business is located
at (“Franchisee”), dated as of
_, for the purpose of modifying and amending the terms of such Franchise
Agreement. For such purpose, Franchisor and Franchisee agree as follows:

1. All capitalized terms herein which are not separately defined herein shall have the meanings
ascribed to such terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the terms of this
Addendum, the terms of this Addendum shall control,

3. Except as specifically modified by this Addendum, all terms of the Franchise Agreement are in full
force and effect.

4. Section 6.4 of the Franchise Agreement is hereby modified by adding the following to the end
thereof:

“Notwithstanding any other provision of this Agreement to the contrary,

Franchisor will protect Franchisee's right to use the trademarks, service
marks, trade names, logotypes or other commercial symbols or
■indemnify Franchisee from any loss, costs or expenses arising out of any
claim, suit or demand regarding the use of the name.”,

5. Section 12.1(c) of the Franchise Agreement is hereby modified by adding the following to the end
thereof:

“The above-referenced general release shall not apply to any claims

under Minnesota Statutes, Sections 80C.01 to 80C.22 ”.

6. Section 14.3 of the Franchise Agreement is hereby modified by adding the following to the end
thereof:

“Notwithstanding the foregoing provisions of this Section 14.3 to the

contrary, in the event that liquidated damages are prohibited by
applicable state law. Franchisor may seek such damages in a court of
proper jurisdiction.”.

7. Section 14.4 of the Franchise Agreement is hereby modified by adding the following to the end
thereof:

“With respect to franchises governed by Minnesota law, Franchisor may

seek injunctive relief, but Franchisor may not require Franchisee to waive
any rights provided under Minn. Rule 2860.4400J. Furthermore, the
determination as to whether or not a bond will be required of Franchisor
in seeking injunctive relief will be left to the determination of the court
hearing the petition for relief.”.

8. Article 13 of the Franchise Agreement is hereby modified by adding the following new Section
13.8 to the end thereof:
 "13.8. Minnesota law provides franchisees with certain termination and
non-renewal rights. Minn. Stat. §80C14, Subd. 3,4 and -5, require,
except in certain specified cases, that a franchisee be given 90 days
notice of termination (with 60 days to cure) and 180 days notice for non­
renewal of the Franchise Agreement.".

9. Article 20, Section 20.2, of the Franchise Agreement is hereby modified by adding the following
paragraph to the end thereof:

"This Section 20.2 shall not in any way abrogate or reduce any rights of
Franchisee as provided for in Minnesota Statutes 1992, Chapter 80C,
including the right to submit matters to the jurisdiction of the courts of
Minnesota."

10. Article 20, Section 20.3, of the Franchise Agreement is hereby modified by adding the following
paragraph to the end thereof:

“Minnesota Statutes, Section 80C.21 and Minnesota Rule 2860.4400(J)

prohibit the franchisor from requiring litigation to be conducted outside
Minnesota, requiring waiver of a jury trial, or requiring the franchisee to
consent to liquidated damages, termination penalties or judgment notes.
In addition, nothing in the Franchise Disclosure Document or
agreement(s) can abrogate or reduce any of franchisee’s rights as
provided for in Minnesota Statutes, Chapter 80C, or franchisee’s rights to
any procedure, forum, or remedies provided for by the laws of the
jurisdiction.’’

11. This Addendum, together with the Franchise Agreement to which it is attached and any other
addenda thereto, constitutes the entire agreement of the parties with respect to the subject matter hereof
and may not be further modified or amended except in a written agreement signed by both parties.

IN WITNESS WFIEREOF, the parties hereto have executed this Addendum to be effective as of
the effective date of the Franchise Agreement.

FRANCFIISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:________________
[Name, Title]

5355820 V 10
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FOR THE STATE OF NEW YORK

1. The State Cover Page of this disclosure document is hereby modified to comply with New York
law by adding the following disclosures after the stated “Risk Factors”:

“REGISTRATION OF THIS FRANCHISE BY NEW YORK DOES NOT MEAN THAT NEW
YORK STATE RECOMMENDS IT OR HAS VERIFIED THE INFORMATION IN THIS
DISCLOSURE DOCUMENT. IF YOU LEARN THAT ANYTHING IN THE DISCLOSURE
DOCUMENT IS UNTRUE, CONTACT THE FEDERAL TRADE COMMISSION AND NEW
YORK STATE DEPARTMENT OF LAW BUREAU OF INVESTOR PROTECTION AND
SECURITIES, 120 BROADWAY, 23^° FLOOR, NEW YORK, NEW YORK 10271.

THE FRANCHISOR MAY, IF IT CHOOSES, NEGOTIATE WITH YOU ABOUT ITEMS

COVERED IN THE PROSPECTUS. HOWEVER, THE FRANCHISOR CANNOT USE
THE NEGOTIATING PROCESS TO PREVAIL UPON A PROSPECTIVE FRANCHISEE
TO ACCEPT TERMS WHICH ARE LESS FAVORABLE THAN THOSE SET FORTH IN
THIS PROSPECTUS.”

2. Item 3 of the disclosure document is hereby modified by adding the following language to the end
thereof:

“Except as previously disclosed in this Item 3, neither Epcon Communities Franchising,

nor any person identified in Item 2 of this disclosure document, has (i) an administrative,
criminal or civil action pending against that person alleging: a felony; a violation of a
franchise, antitrust or securities law; fraud, embezzlement, fraudulent conversion,
misappropriation of property; unfair or deceptive practices or comparable civil or
misdemeanor allegations; or (ii) any other action pending against that person, other than
routine litigation incidental to our business, which are significant in the context of the
number of franchisees and the size, nature or financial condition of the Epcon
Communities Franchising franchise system or its business operations.

Except as previously disclosed in this Item 3, neither Epcon Communities Franchising,

nor any person identified in Item 2 of this Franchise Disclosure Document, has been
convicted of a felony or pleaded nolo contendere to a felony charge or, within the ten-year
period immediately preceding the application for registration in the State of New York, has
been convicted of or pleaded nolo contendere to a misdemeanor charge or has been the
subject of a civil action alleging: violation of a franchise, antifraud or securities law; fraud,
embezzlement, fraudulent conversion or misappropriation of property, or unfair or
deceptive practices or comparable allegations; or

Except as previously disclosed in this Item 3, neither Epcon Communities Franchising,

nor any person identified in Item 2 of this disclosure document, is (i) subject to a currently
effective injunctive or restrictive order or decree relating to the franchise, or under a
Federal, State or Canadian franchise, securities, antitrust, trade regulation or trade
practice law, resulting from a concluded or pending action or proceeding brought by a
public agency; or subject to any currently effective order of any national securities
association or national securities exchange, as defined in the Securities and Exchange
Act of 1934, suspending or expelling such person from membership in such association
or exchange; or (ii) subject to a currently effective injunctive or restrictive order relating to
any other business activity as a result of an action brought by a public agency or
department, including, without limitation, actions affecting a license as a real estate broker
or sales agent.”
3. Item 4 of the disclosure document is hereby modified by adding the following language to the end
thereof:

“Neither Epcon Communities Franchising, nor any of its officers or general partners of
Epcon Communities Franchising, has during the 10-year period immediately before the
date of this disclosure document (i) filed as debtor (or had filed against it) a petition to
start an action under the U.S. Bankruptcy Code; (ii) obtained a discharge of its debt under
the U.S. Bankruptcy Code; or (iii) was a principal officer of a company or a general
partner in a partnership that either filed as a debtor (or had filed against it) a petition to
start an action under the U.S. Bankruptcy Code or that obtained a discharge of its debts
under the U.S. Bankruptcy Code during or within 1 year after the officer or general partner
of Epcon Communities Franchising, Inc. held this position in the company or partnership.”

4. Item 5 of the disclosure document is hereby modified by adding the following language to the end
thereof;

"Proceeds from the Initial Franchise Fee, Monthly Franchise Fee, and Project Royalty Fee
are, in part, compensation to us for your use of the service marks and the Epcon
Communities Franchising, Inc. system and are, in part, used to defray our expenses and
costs incurred in connection with registering and offering franchises, identifying and
evaluating prospective franchisees, registering and protecting our service marks and
commercial symbols, further development of the Epcon Communities Franchising, Inc.
system, providing the initial package of plans and other materials provided to franchisees,
and furnishing services to franchisees.”.

5. Section “d” of the first chart in Item 17 of the disclosure document is hereby modified by adding
the following language to the “Summary” thereof;

“You are permitted to terminate the Franchise Agreement upon any ground permitted by
law.”.

6. Section “m” of the first chart in Item 17 of the disclosure document is hereby modified by adding
the following language to the end of the “Summary” thereof:

“Notwithstanding the above, all rights enjoyed by the franchisee and any causes of action
arising in its favor from the provisions of the General Business Law of the State of New
York, Article 33, and the regulations thereunder remain in force.”.

7. Section “w” of the first chart in Item 17 of the disclosure document is hereby modified by adding
the following language to the end of the “Summary” thereof:

“The foregoing choice of law should not be considered a waiver of any right conferred
upon the franchisor, or upon you, the franchisee, by Article 33 of the General Business
Law of the State of New York.”.

4979919 V.12
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF NEW YORK

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement is agreed

to this ____ day of , ___________________ , between Epcon Communities Franchising, Inc.
("Franchisor") and, ("Franchisee") to amend
and revise the Franchise Agreement dated _, in the following respects:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the
terms of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 12.1(c) of the Franchise Agreement is hereby modified by adding the

following to the end thereof:

"Provided, however, that all rights arising in Franchisee’s favor from the
provisions of Article 33 of the General Business Law of the State of New
York and the regulations issued thereunder shall remain in force; it being
the intent of this proviso that the non-waiver provisions of General
Business Law, Sections 687.4 and 687.5, be satisfied.".

5. A new Section 13.8 is hereby added to the Franchise Agreement as follows:

“Franchisee shall be permitted to terminate this Agreement upon

any grounds available by law.”.

6. Section 20.2 of the Franchise Agreement is hereby modified by adding the

following to the end thereof:

“The foregoing choice of law should not be considered a waiver of any

right conferred upon Franchisee by the General Business Law of the
State of New York, Article 33.”.

7. This Addendum, together with the Franchise Agreement to which it is attached,

constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties.

IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read

this Addendum, understands and consents to be bound by ail of its terms, and agrees it shall become
effective as of the date first above written.

FRANCHISOR: Epcon Communities Franchising, Inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:.
[Name, Title]
4280921 V.11
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
DISCLOSURE DOCUMENT
FORTH E STATE OF WASHINGTON

1. Item 17 of the disclosure document is hereby modified by adding the following language to the
end thereof:

"The State of Washington has a statute, RCW 19.100.180 which may supersede the franchise
agreement in your relationship with the franchisor including the areas of termination and renewal
of your franchise. There may also be court decisions which may supersede the franchise
agreement in your relationship with the franchisor including the areas of termination and renewal
of your franchise.

In any arbitration involving a franchise purchased in Washington, the arbitration site shall be either
in the State of Washington, or in a place mutually agreed upon at the time of the arbitration, or as
determined by the arbitrator.

In the event of a conflict of laws, the provisions of the Washington Franchise Investment
Protection Act, Chapter 19.100 RCW shall prevail.

A release or waiver of rights executed by a franchisee shall not include rights under the
Washington Franchise Investment Protection Act except when executed pursuant to a negotiated
settlement after the agreement is in effect and where the parties are represented by independent
counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations
period for claims under the Act, rights or remedies under the Act such as a right to a jury may not
be enforceable.

Transfer fees are collectable to the extent that they reflect the franchisor's reasonable estimated
or actual costs in effecting a transfer.

The undersigned does hereby acknowledge receipt of this addendum."

3843355 V.7
 ADDENDUM TO EPCON COMMUNITIES FRANCHISING, INC.
FRANCHISE AGREEMENT
FOR THE STATE OF WASHINGTON

This Addendum to Epcon Communities Franchising, Inc. Franchise Agreement (this

“Addendum”) is attached to and made a part of the Epcon Communities Franchising, Inc. Franchise
Agreement (the “Franchise Agreement”), by and between Epcon Communities Franchising, Inc.
(“Franchisor”) and , a the
principal place of business of which is located at
(“Franchisee”), dated as of
for the purpose of modifying and amending the terms of such
Franchise Agreement. For such purpose. Franchisor and Franchisee agree as follows:

1. All capitalized terms herein which are not separately defined herein shall have the
meanings ascribed to such terms in the Franchise Agreement.

2. In the event of a conflict between the terms of the Franchise Agreement and the terms
of this Addendum, the terms of this Addendum shall control.

3. Except as specifically modified by this Addendum, all terms of the Franchise

Agreement are in full force and effect.

4. Section 5.8 of the Franchise Agreement is hereby deleted in its entirety and nothing
shall be substituted therefor.

5. Section 20.2 of the Franchise Agreement is hereby modified by adding the following
paragraphs to the end thereof:

"The State of Washington has a statute, RCW 19.100.180, which may supersede
the franchise agreement in your relationship with the franchisor including the
areas of termination and renewal of your franchise. There may also be court
decisions which may supersede the franchise agreement in your relationship with
the franchisor including the areas of termination and renewal of your franchise.

In any arbitration involving a franchise purchased in Washington, the arbitration

site shall be either in the State of Washington, or in a place mutually agreed upon
at the time of the arbitration, or as determined by the arbitrator.

In the event of a conflict of laws, the provisions of the Washington Franchise

Investment Protection Act, Chapter 19.100 RCW shall prevail.

A release or waiver of rights executed by a franchisee shall not include rights

under the Washington Franchise Investment Protection Act except when
executed pursuant to a negotiated settlement after the agreement is in effect and
where the parties are represented by independent counsel. Provisions such as
those which unreasonably restrict or limit the statute of limitations period for
claims under the Act, rights or remedies under the Act such as a right to a jury
may not be enforceable.

Transfer fees are collectable to the extent that they reflect the franchisor's
reasonable estimated or actual costs in effecting a transfer.

The undersigned does hereby acknowledge receipt of this addendum.".

 6. This Addendum, together with the Franchise Agreement to which it is attached,
constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be
further modified or amended except in a written agreement signed by both parties.

IN WITNESS WHEREOF, the parties hereto have executed this Addendum to be

effective as of the effective date of the Franchise Agreement.

FRANCHISOR: Epcon Communities Franchising, inc.

By:
Joel D. Rhoades, Vice President and General Counsel

FRANCHISEE: NAME

By:
[Name, Title]

4/19/2018 4928747 V.11

 Copy 1
RECEIPT

This disclosure document summarizes certain provisions of the franchise agreement and other information
in plain language. Read this disclosure document and all agreements carefully.
If Epcon Communities Franchising, Inc. offers you a franchise, Epcon Communities Franchising, Inc.
must provide this disclosure document to you 14 calendar-days before you sign a binding agreement with,
or make a payment to, the franchisor or an affiliate in connection with the proposed franchise sale.
New York requires that Epcon Communities Franchising, Inc. give you this disclosure document at the
earlier of the first personal meeting or 10 business days before the execution of the franchise or other
agreement or the payment of any consideration that relates to the franchise relationship.
Michigan requires that Epcon Communities Franchising, Inc. give you this disclosure document at least
10 business days before the execution of any binding franchise or other agreement or the payment of any
consideration, whichever occurs first.
If Epcon Communities Franchising, Inc. does not deliver this disclosure document on time or if it
contains a false or misleading statement, or a material omission, a violation of federal law and state law
may have occurred and should be reported to the Federal Trade Commission, Washington, D.C. 20580
and your state agency, if one is listed in Exhibit O of this disclosure document.
The franchisor is Epcon Communities Franchising, Inc., located at 500 Stonehenge Parkway, Dublin,
Ohio 43017. Its telephone number is (614) 761-1010.
Issuance Date: April 17, 2019
The franchise sellers for this offering are; Epcon Communities Franchising, Inc. and Ed Bacome,
Phil Fankhauser, Nanette Overly, Jennifer Dimel, Paul Hanson, Robert Krohn, Gregory Leath and
Adam Smith, each having principal business offices at 500 Stonehenge Parkway, Dublin, Ohio 43017
and a telephone number of (614) 761-1010. The name(s), principal business address(es) and telephone
number(s) of additional franchise sellers, if any, are:

I received a disclosure document dated April 17, 2019, that included the following Exhibits:

A. Financial Statements for Epcon Communities Franchising, Inc.

B. Franchise Agreement
C. Market Area Agreement and Market Area Agreement Extension
D. Personal Covenants and Agreement of Principal, Officer, Director, Owner, Investor or
Partner of Franchisee
E. Personal Covenants and Agreement of One Provided Detailed Knowledge of the
Development System
F. Market Hold Agreement and Market Hold Agreement Extension
G. Sublicense Agreement
H. Market Reservation Agreement and Mutual Release of Market Reservation Agreement
I. Lender Assignment Agreement
J. Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information Access
Agreements
K. Copyright Assignment & Agreement
L. Mortgage
M. Security Agreement
 N. List of Epcon Communities Franchisees
O. List of State Administrators
P. List of Agents for Service of Process
Q. List of Copyrights
R. Termination and Release Agreement
S. Addendum to Franchise Agreement and Initial Market Area Agreement
T. State Addenda to the FDD and Agreements

Date:
Signature of Prospective Franchisee,
Individually or as an Officer or Partner of:

Name Printed:

Please sign and date this Receipt as of the date you received the disclosure document. Please return the
signed, dated Receipt to Epcon Communities Franchising, Inc., 500 Stonehenge Parkway, Dublin, Ohio
43017.

Epcon Communities Franchising, Inc. Franchise Disclosure Document No.:

 Copy 2
RECEIPT

This disclosure document summarizes certain provisions of the franchise agreement and other information
in plain language. Read this disclosure document and all agreements carefully.
If Epcon Communities Franchising, Inc. offers you a franchise, Epcon Communities Franchising, Inc.
must provide this disclosure document to you 14 calendar-days before you sign a binding agreement with,
or make a payment to, the franchisor or an affiliate in connection with the proposed franchise sale.
New York requires that Epcon Communities Franchising, Inc. give you this disclosure document at the
earlier of the first personal meeting or 10 business days before the execution of the franchise or other
agreement or the payment of any consideration that relates to the franchise relationship.
Michigan requires that Epcon Communities Franchising, Inc. give you this disclosure document at least
10 business days before the execution of any binding franchise or other agreement or the payment of any
consideration, whichever occurs first.
If Epcon Communities Franchising, Inc. does not deliver this disclosure document on time or if it
contains a false or misleading statement, or a material omission, a violation of federal law and state law
may have occurred and should be reported to the Federal Trade Commission, Washington, D.C. 20580
and your state agency, if one is listed in Exhibit O of this disclosure document.
The franchisor is Epcon Communities Franchising, Inc., located at 500 Stonehenge Parkway, Dublin,
Ohio 43017. Its telephone number is (614) 761-1010.
Issuance Date: April 17, 2019
The franchise sellers for this offering are: Epcon Communities Franchising, Inc. and Ed Bacome,
Phil Fankhauser, Nanette Overly, Jennifer Dimel, Paul Hanson, Robert Krohn, Gregory Leath and
Adam Smith, each having principal business offices at 500 Stonehenge Parkway, Dublin, Ohio 43017
and a telephone number of (614) 761-1010. The name(s), principal business address(es) and telephone
number(s) of additional franchise sellers, if any, are:

I received a disclosure document dated April 17, 2019, that included the following Exhibits:

A. Financial Statements for Epcon Communities Franchising, Inc.

B. Franchise Agreement
C. Market Area Agreement and Market Area Agreement Extension
D. Personal Covenants and Agreement of Principal, Officer, Director, Owner, Investor or
Partner of Franchisee
E. Personal Covenants and Agreement of One Provided Detailed Knowledge of the
Development System
F. Market Hold Agreement and Market Hold Agreement Extension
G. Sublicense Agreement
H. Market Reservation Agreement and Mutual Release of Market Reservation Agreement
I. Lender Assignment Agreement
J. Epcon Communities Franchising, Inc. Non-Disclosure and On-Line Information Access
Agreements
K. Copyright Assignment & Agreement
L. Mortgage
M. Security Agreement
 N. List of Epcon Communities Franchisees
O. List of State Administrators
P. List of Agents for Service of Process
Q. List of Copyrights
R. Termination and Release Agreement
S. Addendum to Franchise Agreement and Initial Market Area Agreement
T. State Addenda to the FDD and Agreements

Date:
Signature of Prospective Franchisee,
Individually or as an Officer or Partner of:

Name Printed:
Please sign and date this Receipt as of the date you received the disclosure document. Please return the
signed, dated Receipt to Epcon Communities Franchising, Inc., 500 Stonehenge Parkway, Dublin, Ohio
43017.
Epcon Communities Franchising, Inc. Franchise Disclosure Document No,:

32645978 V.3