In our absolute discretion, we will consider whether we will renew, extend, extend the scope of the FranchiseAgreement or enter into a new Franchise Agreement with the Franchisee, and in so doing will take intoaccount the following, including but not limited to:customer service standards;compliance with the Franchise Agreement and all legislative and regulatory obligations;maintenance of our Retail Image and Outlet presentation standards;financial performance including Average Weekly Sales.(b) whether the prospective franchisee will be entitled to an exit payment at the end of the franchiseagreement and, if so, how the exit payment will be determined or earned; andNo(c) details of the arrangements that will apply to unsold stock, marketing material, equipment and otherassets purchased when the franchise agreement was entered into, including:(i)(ii)hether the franchisor will purchase the stock, marketing material, equipment and other assets;andNot applicable as we do not require the Franchisee to purchase stock, marketing material, equipmentand other assets from us.f the franchisor is to purchase the stock, marketing material, equipment and other assets – howprices will be determined; andNot applicable.(d) whether the prospective franchisee will have the right to sell the business at the end of the franchiseagreement; andNo, at the end of the Franchise Agreement the ability to conduct the Lottery Franchise will cease andtherefore the Lottery Franchise cannot be sold. Prior to the end of the term of the Franchise Agreement, theFranchisee may assign or novate the remainder of the term of the Franchise Agreement in accordance withclause 16 of the Franchise Agreement.(e) if the prospective franchisee will have the right to sell the business at the end of the franchiseagreement – whether the franchisor will have first right of refusal, and how market value will bedetermined.Not applicable(f) whether the franchisor will consider any significant capital expenditure undertaken by the franchiseeduring the franchise agreement, in determining the arrangements to apply at the end of the franchiseagreement.We will consider any significant capital expenditure that is required by us to be undertaken by the franchiseewithin the 2 years prior to the expiry of the term of the Franchise Agreement17C.2 If a franchise agreement is entered into in a financial year commencing on 1 July 2011, 1 July 2012 or 1July 2013 – details of whether the franchisor has, since 1 July 2010, considered any significant capitalexpenditure undertaken by franchisees, in determining the arrangements to apply at the end of franchiseagreements between the franchisor and those franchisees.Consideration has been given to a number of franchisees who have undertaken a shopfit of their Outlet to thelatest Retail Image within the 2 years prior to the expiry of the Franchise Agreement.17C.3 If a franchise agreement is entered into in a financial year commencing after 1 July 2013 – details ofwhether the franchisor has, in the last 3 financial years, considered any significant capital expenditureundertaken by franchisees, in determining the arrangements to apply at the end of the franchiseagreements between the franchisor and those franchisees.Not applicablewi17DAMENDMENT OF FRANCHISE AGREEMENT ON TRANSFER OR NOVATION OF FRANCHISE17D.1 Whether the franchisor will amend (or require the amendment of) the franchise agreement on or before thetransfer or novation of the franchise.As a condition of the transfer or novation of the Franchise Agreement, we may require the incoming franchisee toenter into the then-current franchise agreement which may contain terms and conditions that differ from the originalFranchise Agreement. – See clause 16.3 (f) (iv) and 16.3(h) of the Franchise Agreement.18. OBLIGATION TO SIGN RELATED AGREEMENTS18.1 Summary of any requirements under the franchise agreement for the franchisee or directors, shareholders,beneficiaries, owners or partners of the franchisee to enter into any of the following agreements:(a)a lease, sublease, licence or other agreement under which the franchisee can occupy the premisesof the franchised business;Disclosure Document GC - 26 Nov 2012 (25 July 2013 Update).docPage 24
(b)(ba)(c)(d)(e)The Franchisee must conduct the business from retail premises and therefore must either own or leasesuch premises.a chattel lease or hire purchase agreement;Not applicable.an agreement under which the franchisee gains ownership of, or is authorised to use, anyintellectual property;Not applicable except to the extent that the Franchise Agreement contains various clauses dealing with theuse of intellectual property. See clauses 4.7(a), 11 and 15.6(e)(i) and (iii).a security agreement, including a guarantee, mortgage, security deposit, indemnity, loan agreementor obligation to provide a bank guarantee to a third party;See clauses 18 and 20.3 of the Franchise Agreement.a confidentiality agreement;The Franchisee may be required to enter into a Confidentiality Agreement prior to being provided with acopy of this Disclosure Document and the Franchise Agreement.an agreement not to carry on business within an area or for a time after the franchise agreement isterminated.Not applicable.18.2 All documents mentioned in item 18.1 must be provided to the franchisee:(a)(b)at least 14 days before the day on which the franchise agreement is signed, if they are available atthe time; orConfidentiality Agreement, if required, referred at Item 18.1(d) above is made available 14 days prior to theFranchise Agreement being signed.if they are not available at that time – when they become availableWe may request a franchisee to provide a bank guarantee during the term of the Franchise Agreement. AsFinancial Institutions have different forms of bank guarantees, we are not in a position to provide onestandard bank guarantee.19. EARNINGS INFORMATION19.1 Earnings information for the franchise, if it is given, must be based on reasonable grounds.19.2 Earnings information may be given in a separate document attached to the disclosure document.19.3 Earnings information includes information from which historical or future financial details of a franchisecan be assessed.19.4 If earnings information is not given — the following statement:The franchisor does not give earnings information about the franchise.Earnings may vary between franchises.The franchisor cannot estimate earnings for a particular franchise.19.5 Earnings information that is a projection or forecast must include the following details:(a)(b)(c)(d)(e)(f)the facts and assumptions on which the projection or forecast is based;the extent of enquiries and research undertaken by the franchisor and any other compiler of theprojection or forecast;the period to which the projection or forecast relates;an explanation of the choice of the period covered by the projection or forecast;whether the projection or forecast includes depreciation, salary for the franchisee and the cost ofservicing loans;assumptions about interest and tax.Not applicableDisclosure Document GC - 26 Nov 2012 (25 July 2013 Update).docPage 25