Document:

Unassociated Document

 

EXHIBIT 4.8

 

ABOVENET, INC.

RESTRICTED STOCK UNIT AGREEMENT

 

AboveNet, Inc. (“Company”) hereby grants to the Participant named below a Restricted Stock Unit award (“Award”), each Restricted Stock Unit (“Restricted Stock Unit” or “RSU”) representing the right to receive one share of common stock of the Company, par value $0.01 per share (“Stock”), in accordance with and subject to the terms and restrictions of this Agreement (“Agreement”) and the AboveNet, Inc. 2011 Equity Incentive Plan (“Plan”), which is incorporated by reference and made a part of this Award. This is the first page of the Agreement, which describes in detail your rights with respect to the Restricted Stock Units granted to you hereby and which constitutes a legal agreement between you and the Company.  Capitalized terms not defined in this Agreement shall have the meanings given in the Plan.

 

1.          Participant Name and Address:_________________________________________

 

__________________________________________________________________

 

2.          Award Date: _______________

 

3.          Number of Restricted Stock Units: _______________

 

4.          Vesting Date(s):                              _________________________________

 

_________________________________

 

_________________________________

 

By electronically acknowledging and accepting this Award within 30 days after the date of the electronic mail notification to the Participant of the grant of this Award (“Email Notification Date”) or by accepting in paper form and delivering the executed Award agreement to the Company within the same timeframe, the Participant agrees to be bound by the terms and conditions herein, the Plan, and any and all conditions established by the Company in connection with Awards issued under the Plan, and further acknowledges and agrees that this Award does not confer any legal or equitable right (other than those rights constituting the Award itself) against the Company.  If the Participant fails to accept this Award within 30 days of the Email Notification Date, the Award will be cancelled and forfeited.  The Participant acknowledges receipt of a copy of the Plan.

 

IN WITNESS WHEREOF, AboveNet, Inc. and the Participant agree to be bound by the terms and provisions of this Agreement, as of the date noted below.

ABOVENET, INC.

By:_________________________

     Name/Title:

     Date:_________________

(Please sign, date and return this page)

PARTICIPANT:   _____________________.

 

Date:_______________

*Note: This Agreement is not valid unless signed by you and an Executive Officer of the Company.

 

  

1

  

ARTICLE I

RESTRICTED STOCK UNITS

 

Section 1.1. Vesting. Subject to the terms and conditions of this Award, your Restricted Stock Units will vest on the conclusion of each vesting period ending on the vesting date(s) indicated on page one of this Agreement and the Company will deliver to you the number of shares of Stock underlying your vested Restricted Stock Units on such vesting date(s), provided that you remain in the continuous service of the Company until each respective vesting date.

 

Section 1.2. Termination of Service. If your service with the Company terminates due to:

 

(a)(i) your death, any portion of the Award that remains unvested on such termination date will be fully vested as of your termination date; or

 

(ii) your Disability (as defined in the Plan and as conclusively determined by the Committee), any portion of the Award that remains unvested on such termination date will be fully vested as of your termination date;

(b) your being terminated by the Company other than for Cause, or your termination for Good Reason prior to the expiration of the vesting period, any portion of the Award that remains unvested on such termination date will be fully vested as of your termination date; or

(c) any reason other than those identified in paragraph (a) or (b) above, any Restricted Stock Units that have not vested in accordance with Section 1.1 as of your termination date shall be forfeited and you shall have no rights thereunder or hereunder.

 

Section 1.3. Change in Control. Subject to Section 9(c) of the Plan, in the event of a Change in Control (as defined in the Plan), your Restricted Stock Units under this Agreement will automatically vest to the extent not then vested.  The shares of Stock underlying the Restricted Stock Units shall be distributed within 30 days following the Change in Control.

 

ARTICLE II

RIGHTS AND SETTLEMENT

 

Section 2.1. Rights as a Stockholder. Your Restricted Stock Units will not give you any right to vote on any matter submitted to the Company’s stockholders.  You will have voting rights with respect to the shares of Stock that underlie your Restricted Stock Units only after the shares have actually been issued to you.  You will have no other rights of a stockholder with respect to the RSUs evidenced by this Agreement unless and until the shares of Stock underlying the Restricted Stock Units are issued and delivered to you under this Agreement

 

Section 2.2. Restrictions on Transferability. You will not have any right to sell, assign, transfer, pledge, hypothecate or otherwise encumber your Restricted Stock Units.  Any attempt to effect any of the preceding in violation of this Section 2.2, whether voluntary or involuntary, will be void.

 

Section 2.3. Settlement; Payment in respect of Your Restricted Stock Units.

 

(a) In the event of your death or a Change in Control, the Company will deliver to you within 30 days of such event the number of shares of Stock then underlying your fully vested Restricted Stock Unit Award; and

  

2

  

(b) In the event of your (i) termination of service by the Company without Cause, (ii) termination of service by you for Good Reason, or (iii) termination of service due to Disability, the Company will deliver to you the number of shares of Stock then underlying your vested Restricted Stock Units upon the original vesting dates specified on page one of this Agreement (each a fixed distribution date), regardless of the accelerated vesting provided in Section 1.2(a) or (b); expressly provided, however, that to the extent that such Stock becomes distributable on account of your “separation from service” at a time when you are a Specified Employee (as defined in Treasury Regulation Sections 1.409A-1(h) and 1.409A-1(i), respectively,) such Stock shall not be distributed until six months and one day following your separation from service.  Any reference to “termination of service” in this Agreement shall mean “separation from service” as defined under the default rules of Treasury regulations issued under Code Section 409A.

 

Section 2.4. Adjustment Due to Change in Capitalization. If any adjustment in the Company’s capitalization occurs before all of the Restricted Stock Units are settled pursuant to Section 2.3, the number of shares of Stock underlying each remaining Restricted Stock Unit shall be appropriately and equitably adjusted to the extent provided in the Plan.

 

ARTICLE III

ADMINISTRATION

 

Section 3.1. Administration. The Committee is authorized to interpret your Award and this Agreement and to make all other determinations necessary or advisable for the administration and interpretation of your Award to carry out its provisions and purposes.  Determinations, interpretations or other actions made or taken by the Committee pursuant to the provisions of this Agreement shall be final, binding and conclusive for all purposes and upon all persons.  The Committee may consult with legal counsel, who may be counsel to the Company, and shall not incur any liability for any action taken in good faith in reliance upon the advice of counsel.

 

ARTICLE IV

MISCELLANEOUS

 

Section 4.1. Tax Withholding.  The Company’s obligation to deliver shares of Stock underlying your Restricted Stock Units shall be subject to your payment of any applicable federal, state and local withholding taxes.  You may elect to remit in cash an amount sufficient to satisfy the amount due for employment taxes and the statutory minimum Federal, state and local income taxes (the “Tax Liability”) attributable to your Award on the date that your Restricted Stock Units vest.  Alternatively, you may elect to have shares of Stock deliverable in respect of your Award withheld by the Company, or to deliver to the Company previously acquired Stock, in both cases, having a fair market value sufficient to satisfy your Tax Liability.

 

Section 4.2. IRC Section 409A. Notwithstanding anything in this Agreement to the contrary, it is the intention of the parties that this agreement comply with Section 409A of the Code, and all regulations or other guidance issued thereunder, and this agreement and the payments of any benefits hereunder will be operated and administered accordingly.  However, neither the Company nor the Committee shall have any liability to any person in the event Section 409A of the Code applies to this award or any payments hereunder in a transaction that result in adverse tax consequences to the Award holder or any beneficiaries or transferees.

 

  

3

  

Section 4.3. Requirements of Law. The granting of your Award and the issuance of Stock underlying your RSUs will be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

 

Section 4.4. No Impact on Benefits. Your Award will not be compensation for purposes of calculating your rights under any employee benefit plan, unless otherwise specifically provided in such other plans.

 

Section 4.5. Securities Law Compliance; Put Right.

 

(a)  The Company shall have the authority to determine the instruments by which your Award shall be evidenced.  Instruments evidencing your Award may contain such other provisions as the Company deems advisable.  The undersigned understands that the Company has filed with the Securities and Exchange Commission a Form S-8 registration statement under the Securities Act of 1933, as amended (the “Securities Act”), with respect to the Plan and the shares covered by this Agreement.  The Company will endeavor to keep such registration statement effective, but in the event the Company notifies you that such registration statement is not then effective, you agree to refrain from sales of shares of Stock until such time as the Company advises you that such registration statement has become effective.

 

(b)  In the event that on the date of delivery of shares of Stock underlying your Restricted Stock Unit, any of the following shall be true (i) the shares of Stock underlying your Restricted Stock Units may not be sold by you at such time under Rule 144 of the Securities Act, or pursuant to a currently effective registration statement under the Securities Act, (ii) you are unable to sell the shares of Stock underlying your Restricted Stock Units due to any Company imposed trading restriction or you otherwise are in possession of material, non-public information regarding the Company or its securities or (iii) the Stock is not listed on a national stock exchange, the Company shall be obligated, following notice from you as provided below, to repurchase such number of shares of Stock at the Fair Market Value of the Stock on the date of such repurchase as required to meet the Company’s required minimum tax withholding with respect to the shares of Stock delivered pursuant to your Restricted Stock Unit (based on minimum statutory withholding rates for federal, state and local purposes, including payroll taxes, that are applicable to such supplemental taxable income).  Notwithstanding the immediately preceding sentence, in the event the Internal Revenue Service determines that the fair market value of the shares of Stock underlying your Restricted Stock Units is greater than the Fair Market Value as determined under the Plan and you have incurred additional liability for income taxes, the Fair Market Value for purposes of this subparagraph (b) shall be increased to the value determined by the Internal Revenue Service.  You must give your notice to the Company of your election to exercise the right to require the Company to repurchase a portion of the shares of Stock underlying your Restricted Stock Units not less than two (2) business days before the delivery date.  In the event you do not exercise such right, you shall be deemed to have elected to forego such right.

 

  

4

  

Section 4.6. Trading Window Periods. By entering into this Agreement you expressly agree that: (i) during all periods of your service with the Company or its affiliates, or while you are otherwise maintained on the payroll of the Company or its affiliates, you agree to abide by all Company securities trading policies, including adherence to any trading “window” periods with respect to purchases or sales of Company stock and (ii) upon any cessation or termination of your service with the Company and its affiliates for any reason, you agree that for a period of three (3) months following the effective date of any such termination or cessation of your service or, if later, for a period of three (3) months following the date as of which you are no longer on the payroll of the Company and its affiliates, you agree to continue to abide by all such policies and trading windows established from time to time by the Company.

 

Section 4.7. Binding Effect. This Agreement is binding on you and your executors, administrators, heirs and personal and legal representatives and on the Company and its successors or assigns.  This Agreement may be assigned by the Company.

 

Section 4.8. Entire Agreement. This Agreement, including the Cover Page and the Plan, contains the entire Agreement and all terms between you and the Company with respect to this Award, and there are no other understandings, warranties or representations with respect to this Award.

 

Section 4.9. No Right to Employment.  Nothing in this Agreement gives you the right to continue working for or with the Company nor changes the right which the Company has to terminate or change the terms of your employment or service at any time.

 

Section 4.10. Governing Law/Jurisdiction.  This Agreement and your Award shall be governed by the laws of the State of Delaware (other than its conflict of law principles).

 

Section 4.11. Conflict. Any determination or interpretation by the Committee under or pursuant to this Agreement shall be final, binding and conclusive for all purposes and upon all persons affected hereby.  In the event of a conflict between any term of this Agreement and the terms of the Plan, the terms of the Plan shall control.  Headings contained herein are intended for reference only and shall not affect the interpretation hereof.

Section 4.12. Amendment.  This Agreement cannot be changed or terminated orally.  The Company at any time, and from time to time, may amend the terms of this Agreement; provided, however, that the rights under this Agreement shall not be impaired by any such amendment without your written consent, unless such action is necessary to comply with any applicable law, regulation or rule.

Section 4.13. Delivery of Documents and Notices.  Any document relating to participating in the Plan and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Award provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid, addressed to the Company at ____________ or to you at the address set forth on page one of this Agreement or at the e-mail address maintained for you by the Company, or at such other address as you or the Company may designate in writing from time to time to the other party.

 

 

  

5

  

(a)         Description of Electronic Delivery. The Plan document, Plan prospectus, Award Agreement and proxy statements and financial reports of the Company (including any filings with the Securities and Exchange Commission), may be delivered to you electronically.  Such means of delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the Plan, the delivery of the document via e-mail or such other delivery determined at the Committee’s discretion.

(b)           Consent to Electronic Delivery. You hereby consent to the electronic delivery of the documents identified in this Section.  You may receive from the Company a paper copy of any documents delivered electronically at no cost if you contact the Company by telephone, through a postal service or electronic mail.

Section 4.14. Data Privacy Consent.  You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by the Company for the exclusive purpose of implementing, administering and managing your participation in the Plan.  You understand that the Company holds certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social security number or other identification number, salary, nationality, job title, any shares of Stock held in the Company, details of all Awards or any other entitlement to shares of Stock awarded, canceled, exercised, vested, unvested or outstanding in your favor, for the purpose of implementing, administering and managing the Plan (“Data”).  You understand that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere, and that the recipient’s country may have different data privacy laws and protections than your country.  You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom you may elect to deposit any shares of Stock pursuant to an Award.  You understand that you may, at any time, view such Data and request any necessary correction to such Data.

 

  

6Healthy Life franchise agreement

 

(Store name)

 

 

  

  

  

 

Contents 

 

	
1

	
Definitions and interpretation

	
1

	  	  	  
	
2

	
Cooling off period

	
7

	  	  	  
	
3

	
Grant of franchise

	
7

	  	  	  
	
4

	
Term of agreement

	
9

	  	  	  
	
5

	
Payments

	
11

	  	  	  
	
6

	
The Premises

	
11

	  	  	  
	
7

	
Reports, records and access by Healthy Life

	
14

	  	  	  
	
8

	
Intellectual property

	
16

	  	  	  
	
9

	
Business name

	
18

	  	  	  
	
10

	
Healthy Life Manuals

	
18

	  	  	  
	
11

	
Confidentiality

	
19

	  	  	  
	
12

	
Employees and training

	
20

	  	  	  
	
13

	
Advertising, marketing and promotion

	
20

	  	  	  
	
14

	
Products

	
23

	  	  	  
	
15

	
Club Life

	
24

	  	  	  
	
16

	
General conduct and compliance with the Healthy Life System

	
25

	  	  	  
	
17

	
Transfer of franchise

	
26

	  	  	  
	
18

	
Default and termination

	
28

	  	  	  
	
19

	
Restraint

	
32

	  	  	  
	
20

	
Warranties and reliance

	
34

	  	  	  
	
21

	
Liability

	
35

	  	  	  
	
22

	
Costs and stamp duty

	
37

	  	  	  
	
23

	
GST

	
37

	  	  	  
	
24

	
Dispute resolution

	
38

	  	  	  
	
25

	
Guarantee and indemnity

	
39

	  	  	  
	
26

	
Franchisee as trustee

	
42

	  	  	  
	
27

	
Miscellaneous

	
43

	  	  	  
	
Schedule

	  	
47

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	
 

 

 

  

i

  

 

 

Healthy Life franchise agreement 

	
Dated

	  
	  	  	  
	
Parties

	Healthy Life Partners Pty Limited ACN 084 265 421 of 316 Horsley Road, Milperra, New South Wales 2214 (Healthy Life)
	  	  	  
	  	The person(s) or company named in the schedule (Franchisee)
	  	  	  
	  	The person(s) or company named in the schedule (Guarantor)
	  	  	  
	
Recitals

	
A

	
Healthy Life has developed the Healthy Life System.

	  	  	  
	  	
B

	
Healthy Life owns or is licensed to use the Trade Marks in connection with the operation of the Healthy Life System.

	  	  	  
	  	
C

	
The Franchisee wishes to enter into the business of operating a Healthy Life Store using the Healthy Life System.

	  	  	  
	  	
D

	
The Franchisee acknowledges that strict adherence to the Healthy Life System is essential for the protection of the Healthy Life Image and the Healthy Life System.

 

It is agreed:

 

	
1

	
Definitions and interpretation

 

	
1.1

	
DEFINITIONS

 

In this agreement:

 

Administration Fee means the annual administration fee payable by the Franchisee set out in the schedule

 

Approved Product means:

 

	
  

	
(a)

	
any health supplement, nutrition supplement, vitamin, health food product or associated product, that meets Healthy Life’s quality standards, from time to time, and

 

	
  

	
(b)

	
any Healthy Life branded product

 

	
  

	
(c)

	
any product Healthy Life has approved for sale from Healthy Life Stores

 

Business Name means the business name set out in the schedule or any other name approved by Healthy Life

 

Claim means any claim, suit, action, proceedings or litigation whether:

 

	
  

	
(a)

	
criminal, administrative or by way of arbitration, or

 

	
  

	
(b)

	
before any court, arbitrator, expert, tribunal, board, commission, authority, agency, department or officer

 

Club Life means the loyalty club program operated by Healthy Life or any other loyalty club program operated in its place by Healthy Life

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

  

1

  

 

Code means the Franchising Code of Conduct set out in the Trade Practices (Industry Codes – Franchising) Regulations 1998

 

Commencement Date means the date set out in the schedule for the commencement of trading of by the Franchisee

 

Confidential Information means information, in any format:

 

	
  

	
(a)

	
that is by its nature confidential or that the Franchisee knows or ought to know is confidential

 

	
  

	
(b)

	
that is designated by Healthy Life as confidential

 

	
  

	
(c)

	
including:

 

	
  

	
(i)

	
information relating to Healthy Life, the Healthy Life business, the Healthy Life System, any Healthy Life manual, any Healthy Life disclosure document,

 

	
  

	
(ii)

	
this agreement

 

Disclosure Document means the disclosure document Healthy Life prepared pursuant to the Code and all subsequent versions of that document

 

Effective Control means the control of a party including:

 

	
  

	
(a)

	
as defined in section 50AA of the Corporations Act 2001

 

	
  

	
(b)

	
the direct or indirect control of the composition of its board of directors, more than half of the voting power of its members or more than half of its issued share capital

 

Existing Retailer means a person who was operating a health or nutrition product retail store from the Premises immediately prior to entering this agreement

 

Franchise means the business of operating a Healthy Life Store from the Premises

 

Franchise Data means information relating to the operation of the Franchise in any nominated period or periods, including:

 

	
  

	
(a)

	
Gross Sales

 

	
  

	
(b)

	
other data reasonably specified by Healthy Life from time to time including:

 

	
  

	
(i)

	
retail data including data relating to:

 

	
  

	
(1)

	
customers, such as customer counts

 

	
  

	
(2)

	
sales, such as number, value and composition of sales

 

	
  

	
(3)

	
Approved Products, such as the volume and identity of Approved Products sold

 

	 	
(ii) 

	
operations data including data relating to costs, employees and efficiency

 

	
  

	
(iii)

	
data that may be used for benchmarking purposes

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

2

  

 

Franchise Fee means the payment set out in the schedule

 

Gross Sales means the amount of all sales, revenue or takings, exclusive of GST, of or in relation to the Franchise, regardless of collection in the case of sales on credit, less all refunds, exclusive of any GST, made to customers in good faith and in accordance with Healthy Life’s policies

 

GST means goods and services tax imposed under the GST Act

 

GST Act means the A New Tax System (Goods and Services Tax) Act 1999 (Cth)

 

Healthy Life Image means the image used by Healthy Life from time to time to identify the Healthy Life brand or a shop as a Healthy Life Store including designs, colour schemes, signs, artwork, posters, place cards, layout and fittings

 

Healthy Life Manuals means information in any form prepared or issued by Healthy Life from time to time relating to the operation of:

 

	
  

	
(a)

	
the Franchise

 

	
  

	
(b)

	
a Healthy Life Store

 

	
  

	
(c)

	
any aspect of the Healthy Life System

 

Healthy Life Store means a business operated using the Healthy Life System

 

Healthy Life System means the comprehensive system developed and amended from time to time by Healthy Life for the promotion and retail sale of health supplements, nutrition supplements, vitamins, health food products and associated products using, including and containing specifications, methods and standards relating to the use of:

 

	
  

	
(a)

	
the Intellectual Property

 

	
  

	
(b)

	
Healthy Life’s expertise, and know-how and experience

 

Insolvency Event means an event by which a party:

 

	
  

	
(a)

	
is insolvent, insolvent under administration, or states that it is unable to pay its debts when they become due and payable

 

	
  

	
(b)

	
is placed in or under any form of external administration including if a party or its property is subject to the appointment of an administrator, a controller, receiver or receiver and manager, a liquidator or an official manager

 

	
  

	
(c)

	
is made subject to any compromise or arrangement with any of its creditors or members or scheme for its reconstruction or amalgamation, otherwise than as a result of voluntary corporate reconstruction

 

	
  

	
(d)

	
is wound up or dissolved, or an order or resolution is made to wind up or dissolve the party

 

	
  

	
(e)

	
is or applies to be protected from any of its creditors under any applicable legislation

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

3

  

 

	
  

	
(f)

	
has any of its property seized under any distress or execution

 

	
  

	
(g)

	
has anything similar to any of the events in paragraphs (a) to (f) happen to it under the law of any applicable jurisdiction

 

Intellectual Property means any intellectual property relevant to the Healthy Life System from time to time, including:

 

	
  

	
(a)

	
any copyright, patent, design, trade mark or know-how used in or forming part of the Healthy Life System

 

	
  

	
(b)

	
the Trade Marks

 

	
  

	
(c)

	
any names Healthy Life uses in connection with the Healthy Life System

 

	
  

	
(d)

	
the Business Name

 

	
  

	
(e)

	
any Confidential Information

 

	
  

	
(f)

	
the Healthy Life Image

 

Joining Fee means the amount set out in the schedule

 

Landlord means the landlord under the Lease

 

Lease means the lease of the Premises

 

	
  

	
(i)

	
Liability means:

 

	
  

	
(a)

	
all liability

 

	
  

	
(b)

	
all loss including loss of profit and consequential loss

 

	
  

	
(c)

	
damage

 

	
  

	
(d)

	
costs including legal costs and expenses on a solicitor and own client basis

 

Licence means any licence to occupy the Premises granted to the Franchisee

 

Marketing Contribution means the amount of contribution to the Marketing Fund payable by the Franchisee as set out in the schedule

 

Marketing Fund means the fund into which Healthy Life pays the Marketing  Contributions as received from the franchisees of the Healthy Life System, and which would not include any marketing funds, rebates or moneys as received by Healthy Life, or its related bodies corporate, from suppliers.

 

Novation means the termination of a Franchise and entry into a new franchise with a Transferee on the same terms as the terminated Franchise

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

4

  

 

Premises means the premises set out in the schedule or any replacement premises Healthy Life agrees to in writing

 

Renewal Fee means the fee set out the schedule

 

Restraint Areas means:

 

	
  

	
(a)

	
the Territory

 

	
  

	
(b)

	
a radius of:

 

	
  

	
(i)

	
500 metres

 

	
  

	
(ii)

	
one kilometre

 

	
  

	
(iii)

	
two kilometres

 

	
  

	
(iv)

	
three kilometres

 

from:

 

	
  

	
(v)

	
any Healthy Life Store

 

	
  

	
(vi)

	
the Premises

 

Restraint Period means:

 

	
  

	
(a)

	
one year after the termination or expiry of this Agreement

 

	
  

	
(b)

	
two years after the termination or expiry of this Agreement

 

	
  

	
(c)

	
three years after the termination or expiry of this Agreement

 

Store Manager means any person appointed by the Franchisee to manage or be in charge of the operations of the Franchise for any period of time, including any day or part of a day

 

Tax means:

 

	
  

	
(a)

	
any tax, levy, rate, duty, fee, deduction, compulsory loan or withholding, or

 

	
  

	
(b)

	
any income, stamp or transaction duty or charge

 

	
  

	
(c)

	
any interest, penalty or charge in respect (a) or (b)

 

which is imposed or collected by any governmental agency

 

Term means the period specified in the schedule

 

Territory means the area specified in the schedule

 

Trade Marks means the trade marks specified in the schedule,  the trade name “Healthy Life” and the Healthy Life logo and other related trade marks, trade names, designs, labels, signs and symbols used to identify and distinguish Healthy Life Stores and the products sold in those stores

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

5

  

 

Transfer means an arrangement in which the Franchise is assigned, transferred, or sold in the terms of clause 17 and includes a Novation;

 

Transferee means a franchisee who seeks to acquire a franchise business through either a Transfer or Novation of the franchised business;

 

Transfer Fee means the amount set out in the schedule;

 

Valuer means a person nominated by the president of the Australian Institute of Chartered Accountants or any successor

 

Warehouse Agreement means a written agreement between Healthy Life, or such other company as might be nominated from time to time by Healthy Life to operate the supply of goods to Healthy Life franchisees, and the Franchisee and the Guarantor, as to the terms and conditions of supply of goods to the Franchisee and the payment by the Franchisee for the goods as supplied.

	
1.2

	
INTERPRETATION

 

In this agreement unless the context or an express statement indicates a contrary intention:

 

	
  

	
(a)

	
a reference to:

 

	
  

	
(i)

	
the singular includes the plural and vice versa

 

	
  

	
(ii)

	
an individual or person includes a corporation, partnership, venture, association, authority, trust, state or government

 

	
  

	
(iii)

	
a party is to a party to this agreement and includes that party’s executors, administrators, successors and permitted assignees

 

	
  

	
(iv)

	
a document including this agreement, is to that instrument, deed, document or agreement as amended, novated, renewed, substituted or supplemented at any time

 

	
  

	
(v)

	
any legislation is to any amendment, re-enactment, substitution or consolidation of that legislation, and includes any subordinate legislation issued under that legislation

 

	
  

	
(vi)

	
a day is to a period of time commencing at midnight and ending 24 hours later

 

	
  

	
(vii)

	
a week is to a week commencing immediately after 12.00 midnight on Sunday of each calendar week and conclude at 12.00 midnight on the following Sunday (inclusive)

 

	
  

	
(viii)

	
a month is to a calendar month.

 

	
  

	
(ix)

	
dollars or $ is to an amount in Australian currency

 

	
  

	
(x)

	
time is to time in Sydney, Australia

 

	
  

	
(b)

	
where an expression is defined, another part of speech or grammatical form of that expression has a corresponding meaning

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

6

  

 

	
  

	
(c)

	
any recitals, table of contents and headings in this document are for convenience only and do not affect interpretation

 

	
  

	
(d)

	
including and similar expressions are not to be treated as words of limitation

 

	
  

	
(e)

	
related body corporate has the meaning given to that expression in the Corporations Act 2001

 

	
  

	
(f)

	
supplier means a person making a supply

 

	
  

	
(g)

	
an obligation not to do something includes an obligation not to cause and not to permit it to be done

 

	
  

	
(h)

	
where consent or approval is required under this agreement the requirement will mean the prior written consent or approval

 

	
  

	
(i)

	
any action to be taken by any party in performing any obligations under this agreement must be taken at that party’s own cost

 

	
  

	
(j)

	
this agreement is not to be construed against Healthy Life because it was responsible for the drafting of this agreement.

 

	
2

	
Cooling off period

 

	
2.1

	
COOLING OFF PERIOD

 

If the Franchisee terminates this agreement within any cooling off period set out in the Code:

 

	
  

	
(a)

	
Healthy Life will refund all payments made by the Franchisee under this agreement less $2,500 to cover Healthy Life’s administrative expenses

 

	
  

	
(b)

	
clauses 1, 18 and 19 will still apply.

 

	
3

	
Grant of franchise

 

	
3.1

	
GRANT

 

Subject to the Franchisee and the Guarantor complying with clause 3.6, Healthy Life grants the Franchisee the right to operate the Franchise:

 

	
  

	
(a)

	
using the Healthy Life System

 

	
  

	
(b)

	
from the Premises

 

	
  

	
(c)

	
on the terms and conditions contained in this agreement.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

7

  

 

	
3.2

	
RESERVATION OF HEALTHY LIFE’S RIGHTS

 

Subject to clause 3.3, Healthy Life may, regardless of the proximity to, or the economic impact or competitive effect upon the Franchise:

 

	
  

	
(a)

	
locate, develop and operate:

 

	
  

	
(i)

	
Healthy Life Stores and

 

	
  

	
(ii)

	
outlets other than Healthy Life Stores for the wholesale or retail sale of health supplements, nutrition supplements, vitamins, health food products and associated products

 

	
  

	
(b)

	
continue to operate any existing Healthy Life Store within the Territory

 

	
  

	
(c)

	
use the Healthy Life System

 

	
  

	
(d)

	
sell, or authorise the sale of Approved Products or products similar to Approved Products, to any person including for resale by that person

 

	
  

	
(i)

	
anywhere in the world including via the internet and from retail or wholesale outlets inside and outside of the Territory.

 

	
3.3

	
OFFER FOR RIGHT OF FIRST REFUSAL

 

If Healthy Life proposes, inside the Territory, to:

 

	
  

	
(a)

	
locate, develop and operate a Healthy Life Store; or

 

	
  

	
(b)

	
sell or grant a franchise of a Healthy Life Store, Healthy Life must offer the Franchisee a first right of refusal to accept  the grant of a franchise to operate as a franchise that Healthy Life Store :

 

	
  

	
(c)

	
if the Franchisee has materially observed and performed all of the Franchisee’s obligations under this agreement throughout the Term

 

	
  

	
(d)

	
subject to any conditions reasonably required by Healthy Life including entry into a franchise agreement, licence agreement or other documents.

 

	
3.4

	
ACCEPTANCE OF OFFER FOR RIGHT OF FIRST REFUSAL

 

	
  

	
(a)

	
The Franchisee must, with respect to any offer received under clause 3.3:

 

	
  

	
(i)

	
keep any offer confidential; and

 

	
  

	
(ii)

	
accept or reject the offer within one month of receiving the offer by providing to Healthy Life in writing either its acceptance or its rejection of the offer.

 

	
  

	
(b)

	
The Franchisee acknowledges that for an offer under clause 3.3 to be deemed by Healthy Life as accepted by the Franchisee, the written notice referred to in clause 3.4(a)(ii) must first be received and acknowledged by Healthy Life as a valid acceptance of the offer made in the terms of 3.4(a)(ii).

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

8

  

 

	
3.5

	
REJECTION OF OFFER  FOR RIGHT OF FIRST REFUSAL

 

If the Franchisee rejects the offer received under clause 3.3 in the terms of 3.4(a)(ii), or fails to respond to the offer in the terms of 3.4(a)(ii), the Franchisee acknowledges that Healthy Life will have an automatic right inside the Territory to:

 

	
  

	
(a)

	
locate, develop and operate a Healthy Life Store; or

 

	
  

	
(b)

	
sell or grant a franchise of a Healthy Life Store.

 

	
3.6

	
FRANCHISEE AND GUARANTOR TO SIGN WAREHOUSE AGREEMENT

 

Prior to Healthy Life granting the rights in clause 3.1, the Franchisee and the Guarantor must sign and deliver up to Healthy Life a Warehouse Agreement in terms acceptable to Healthy Life.

 

	
4

	
Term of agreement

 

	
4.1

	
TERM

 

This agreement commences on the date it is signed by both parties and continues for the Term unless terminated or modified in accordance with this agreement.

 

	
4.2

	
COMMENCEMENT DATE

 

The Franchisee must use its best endeavours to commence operation of the Franchise on the Commencement Date.

 

	
4.3

	
FURTHER TERM

 

Healthy Life must grant to the Franchisee a further Franchise for a term up to a maximum of five years if:

 

	
  

	
(a)

	
the Premises are available for the further term and the Franchisee enters into a lease of the Premises or complies with clause 6.11

 

	
  

	
(b)

	
Healthy Life is, at the end of the Term, in the business of offering Healthy Life franchises

 

	
  

	
(c)

	
the Franchisee:

 

	
  

	
(i)

	
gives Healthy Life notice in writing requesting the renewal not more than nine months and not less than seven months before the end of the Term

 

	
  

	
(ii)

	
has materially observed and performed all of the Franchisee’s obligations under this agreement throughout the Term

 

	
  

	
(iii)

	
completes, at the Franchisee’s expense, any re-training, refresher training or staff training as Healthy Life may require

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

9

  

 

	
  

	
(iv)

	
not later than 28 days prior to the end of the Term has:

 

	
  

	
(1)

	
signed a new Healthy Life franchise agreement in the form Healthy Life then uses for Healthy Life’s franchise of Healthy Life Stores (but which may exclude this clause 4.3 and may be different in form and substance to this agreement with increased fees)

 

	
  

	
(2)

	
paid to Healthy Life the Renewal Fee, the then current Administration Fee and Healthy Life’s costs (including legal costs and disbursements) related to the renewal of the Franchise without set-off or deduction

 

	
  

	
(3)

	
executed a deed of release in the form Healthy Life requires relinquishing all claims against Healthy Life, Healthy Life’s employees, agents, consultants, to the extent permitted by law

 

	
  

	
(4)

	
upgraded the Franchise to the then current Healthy Life Image

 

	
  

	
(5)

	
upgraded the Premises to the then current requirements of the landlord of the Premises.

 

	
4.4

	
HOLD OVER

 

If the Franchisee continues to operate the Franchise after this agreement ends and before the Franchisee signs a new agreement, the Franchisee does so on a monthly licence, subject to:

 

	
  

	
(a)

	
the terms and conditions contained in this agreement that are applicable to a monthly licence; and

 

	
  

	
(b)

	
either party’s right to terminate the monthly licence with one month’s notice.

 

	
4.5

	

END OF TERM ARRANGEMENTS

 

	
  

	
(a)

	
If the Term is 6 months or longer, Healthy Life must notify the Franchisee, at least 6 months before the end of the Term, of Healthy Life’s decision:

 

	
  

	
(i)

	
to renew or not to renew this agreement; or

 

	
  

	
(ii)

	
to enter into a new franchise agreement.

 

	
  

	
(b)

	
If the Term is less than 6 months, Healthy Life must notify the Franchisee, at least 1 month before the end of the Term, of Healthy Life’s decision:

 

	
  

	
(i)

	
to renew or not to renew this agreement; or

 

	
  

	
(ii)

	
to enter into a new franchise agreement.

 

	
  

	
(c)

	
The Franchisee acknowledges that the notice provided under clause 4.5(b) does not in any way limit or override the Franchisee’s or Healthy Life’s obligations regarding the requirements for notice in the circumstances referred to in clause 4.4(b).

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

10

  

 

	
5

	
Payments

 

	
5.1

	
JOINING FEE

 

The Franchisee must pay the Joining Fee to Healthy Life on the date the Franchisee signs this agreement.

 

	
5.2

	
FRANCHISE FEE AND MARKETING CONTRIBUTION

 

The Franchisee must pay Healthy Life in respect of Gross Sales for each month and within 30 days of the end of each month:

 

	
  

	
(a)

	
the Franchise Fee

 

	
  

	
(b)

	
the Marketing Contribution.

 

	
5.3

	
INCREASE IN MARKETING CONTRIBUTION

 

If the majority of franchisees agree to raise the Marketing Contribution above 1%:

 

	
  

	
(a)

	
Healthy Life may increase the Marketing Contribution

 

	
  

	
(b)

	
the Franchisee must pay the new Marketing Contribution.

 

	
5.4

	
ADMINISTRATION FEE

 

The Franchisee must pay Healthy Life the Administration Fee:

 

	
  

	
(a)

	
on the date the Franchisee signs the agreement as pro-rata amount of the annual Administration Fee

 

	
  

	
(b)

	
each January during the Term within 30 days from the date Healthy Life bills the Franchisee.

 

	
5.5

	
TRADE CREDITORS

 

The Franchisee must pay the Franchisee’s trade creditors from time to time strictly in accordance with the supplier’s applicable terms of trade.

 

	
5.6

	
LEGAL COSTS

 

The Franchisee must pay to Healthy Life its costs (including legal costs and disbursements) related to the negotiation, preparation, issue and execution of the Franchise Agreement.

 

	
6

	
The Premises

 

	
6.1

	
SITE ASSESSMENT

 

The Franchisee acknowledges that it has:

 

	
  

	
(a)

	
independently researched the location and nature of Premises for the purposes of assessing the viability of the Premises as a Healthy Life Store, and

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

11

  

 

	
  

	
(b)

	
has not relied on any information given to it by Healthy Life about the site or Healthy Life’s approval of the site.

 

	
6.2

	
BUILDING AND APPROVALS

 

The Franchisee must prior to commencement of the fit out of the Premises:

 

	
  

	
(a)

	
without limiting clause 6.12, take out all insurances a prudent business person would take and, at the minimum, take out the insurances Healthy Life reasonably requires

 

	
  

	
(b)

	
obtain all necessary permits, licences, consents and approvals from any relevant authorities

 

	
  

	
(c)

	
to the extent permitted at law, the Franchisee must enter into a contract with a builder approved by Healthy Life for the construction of the fit out.  Healthy Life takes no responsibility for the builder or the fit out of the Premises.

 

	
6.3

	
FIT OUT, IMAGE AND LAYOUT

 

Subject to clause 6.4(b), the Franchisee must ensure that the fit out, layout, furnishings, fixtures signs and appearance of the Premises at all times complies with the Healthy Life System and all specifications contained in the Healthy Life Manuals.

 

	
6.4

	
EXISTING RETAILERS

 

Existing Retailers must:

 

	
  

	
(a)

	
change the storefront signage to conform with the then current Healthy Life Store front sign prior to the Commencement Date

 

	
  

	
(b)

	
update the rest of the Premises to conform with the requirements in clause 6.3 by the earlier of:

 

	
  

	
(i)

	
the date required by the Landlord

 

	
  

	
(ii)

	
the first refurbishment date in the Lease

 

	
  

	
(iii)

	
any other date agreed with Healthy Life.

 

	
6.5

	
MAINTAINING AND UPDATING THE PREMISES

 

The Franchisee must:

 

	
  

	
(a)

	
replace, or repair all partitions, shelving, furnishings, fixtures and fittings at the Premises so that they are in good and workable condition

 

	
  

	
(b)

	
update the Premises to conform with the then current Healthy Life Image on the renewal of this agreement

 

	
  

	
(c)

	
repaint the Premises every five years from the date of occupation of the first date the Franchisee occupied the Premises or at any other time Healthy Life reasonably requires or as specified in the Lease or Licence

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

12

  

 

	
  

	
(d)

	
not make any alterations (structural or otherwise) to the Premises without obtaining the prior written approval of Healthy Life and the Landlord

 

	
  

	
(e)

	
keep the Premises clean, orderly, in good repair and ensure the Premises comply with all applicable health and safety regulations.

 

	
6.6

	
EQUIPMENT AND TECHNOLOGY

 

The Franchisee must install any computer system, software or point of sale system and acquire any equipment:

 

	
  

	
(a)

	
necessary to comply with its obligations under this agreement, and

 

	
  

	
(b)

	
as Healthy Life may reasonably require from time to time for the efficient operation of the Healthy Life System.

 

	
6.7

	
ADVICE BY HEALTHY LIFE

 

Healthy Life will oversee the progress of the fit out of the Premises, to the extent reasonably requested by the Franchisee or Healthy Life considers necessary, advising on likely compliance with the Healthy Life System and Healthy Life Manuals.

 

	
6.8

	
OPERATION

 

The Franchisee must:

 

	
  

	
(a)

	
not carry on the Franchise from any place other that the Premises

 

	
  

	
(b)

	
not operate any business other than the Franchise from the Premises

 

	
  

	
(c)

	
keep the Premises open for business during the trading hours of the shopping complex in which the Premises is located or otherwise as directed by Healthy Life.

 

	
6.9

	
RELOCATION

 

If the Lease expires or is terminated or it is otherwise necessary to relocate the Premises, the Franchisee must nominate new premises, and submit the details to Healthy Life for Healthy Life’s prior written approval, which will not be unreasonably withheld.

 

	
6.10

	
LEASE

 

The Franchisee must ensure that wherever it leases the Premises directly from the Landlord, that wherever possible:

 

	
  

	
(a)

	
the term of the Lease corresponds with the Term

 

	
  

	
(b)

	
the Lease contains a consent to an assignment of the Lease to Healthy Life, at Healthy Life’s request, on expiry or termination of this agreement.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

13

  

 

	
6.11

	
LICENCE

 

If Healthy Life leases the Premises and wants to license the Premises to the Franchisee:

 

	
  

	
(a)

	
the Franchisee must enter into a Licence and perform and observe at all times the terms, conditions and covenants of the Licence

 

	
  

	
(b)

	
If Healthy Life terminates the Licence, the Franchisee must ask the Landlord to:

 

	
  

	
(i)

	
assign the Lease to the Franchisee, or

 

	
  

	
(ii)

	
grant a new Lease of the Premises to the Franchisee on terms reasonably acceptable to the Franchisee and Healthy Life which, if lawful, includes an obligation that the Franchisee pays Healthy Life’s reasonable costs and expenses.

 

	
6.12

	
INSURANCE

 

The Franchisee must take out and maintain during the Term adequate insurances with reputable insurers:

 

	
  

	
(a)

	
naming Healthy Life as an insured

 

	
  

	
(b)

	
in respect of the Franchise, the Franchisee and the assets used in the Franchise, of types and in amounts prudent for a business in the nature of the Franchise and consistent with the proper conduct of the Franchise and all related activities of the Franchisee including:

 

	
  

	
(i)

	
public liability insurance for at least $xxx

 

	
  

	
(ii)

	
any insurance required by the Landlord

 

	
  

	
(iii)

	
risks for any minimum amounts directed by Healthy Life from time to time.

 

	
7

	
Reports, records and access by Healthy Life

 

	
7.1

	
RECORD KEEPING

 

The Franchisee must keep:

 

	
  

	
(a)

	
records of all Franchise Data

 

	
  

	
(b)

	
complete and correct books of accounts and business records

 

	
  

	
(c)

	
any other records set out in the Healthy Life Manuals.

 

	
7.2

	
FRANCHISE DATA REPORTS

 

The Franchisee must give the Franchise Data to Healthy Life:

 

	
  

	
(a)

	
at the times and intervals

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

14

  

 

	
  

	
(b)

	
in the format

 

	
  

	
(c)

	
by the means of delivery, including by electronic transmission or by installing software and following procedures that will allow Healthy Life direct electronic access reasonably requested by Healthy Life.

 

	
7.3

	
USE OF FRANCHISE DATA

 

Healthy Life may, provided the Franchise is not identified without its consent, disclose the Franchise Data given to it by the Franchisee to any other person for:

 

	
  

	
(a)

	
general benchmarking and analysis

 

	
  

	
(b)

	
use in the sales, marketing and promotion of products

 

	
  

	
(c)

	
the benefit of the Franchisee, any other franchisee, or the Healthy Life System.

 

	
7.4

	
FINANCIAL INFORMATION REPORTS

 

If Healthy Life has reasonable grounds to believe that the Franchise has performance issues, the Franchisee must give Healthy Life details of its gross profits, profit and loss statements and balance sheets, at times, in a format and for periods reasonably required by Healthy Life.

 

	
7.5

	
AUDIT

 

The Franchisee must, at all times and without prior notice:

 

	
  

	
(a)

	
allow Healthy Life or its representatives or agents to:

 

	
  

	
(i)

	
access the Premises

 

	
  

	
(ii)

	
audit and investigate all aspects of the Franchise

 

	
  

	
(iii)

	
inspect, copy and remove all records and data relating to the Franchise including all information located at the Premises and all information the Franchisee is required to keep or give to Healthy Life under clauses 7.1, 7.2 or 7.4, regardless of:

 

	
  

	
(1)

	
where it is located, including by giving appropriate authority to Healthy Life to access records or data held by any person and directions to any other person to give records or data to Healthy Life

 

	
  

	
(2)

	
how it is recorded, held or stored, including by inspecting, copying or removing the means of recording, holding or storing the information and even if unrelated or personal information is recorded, held or stored with the records or data

 

	
  

	
(3)

	
whether unrelated or personal information is mixed, recorded, held or stored with the records or data.

 

	
  

	
(b)

	
co-operate with Healthy Life’s representatives or agents for the purposes of clause 7.5(a).

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

15

  

 

	
7.6

	
COST OF AUDIT

 

Healthy Life’s costs relating to any audit under clause 7.5(a) including the cost of Healthy Life’s representatives or agents and any subsequent investigations or analysis must be paid by:

 

	
  

	
(a)

	
the Franchisee, if the audit shows that the Franchisee has underpaid the Franchisee Fee by one percent or more in any period

 

	
  

	
(b)

	
Healthy Life, in all other cases.

 

	
8

	
Intellectual property

 

	
8.1

	
OWNERSHIP BY HEALTHY LIFE

 

The Franchisee acknowledges that:

 

	
  

	
(a)

	
Healthy Life owns or is entitled to use the Intellectual Property, and

 

	
  

	
(b)

	
this agreement and the conduct of the Franchise does not give the Franchisee or any other person any interest in the Intellectual Property, other than a non-exclusive licence on the terms contained in this agreement.

 

	
8.2

	
GRANT OF LICENCE OF INTELLECTUAL PROPERTY

 

Healthy Life grants the Franchisee a non-transferable, non-exclusive licence to use the Intellectual Property only:

 

	
  

	
(a)

	
in operation of the Franchise, and

 

	
  

	
(b)

	
in accordance with this agreement.

 

	
8.3

	
USE OF INTELLECTUAL PROPERTY

 

The Franchisee must:

 

	
  

	
(a)

	
only use the Intellectual Property in accordance with any directions given by Healthy Life including in the Healthy Life Manuals

 

	
  

	
(b)

	
not use the Intellectual Property contrary to any direction given by Healthy Life

 

	
  

	
(c)

	
not use the Trade Marks in combination with any other name, logo, or trade mark, except in connection with the Franchise

 

	
  

	
(d)

	
not register or seek to register any Intellectual Property with the exception of the Business Name

 

	
  

	
(e)

	
not give or revoke a notice under section 132 of Trade Marks Act 1995 relating to the importation of goods that infringe any Trade Mark

 

	
  

	
(f)

	
not alter, add to, deface, or remove, wholly or partly any Intellectual Property at the Premises, or elsewhere

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

16

  

 

	
  

	
(g)

	
not give permission to any person to apply or use the Intellectual Property

 

	
  

	
(h)

	
not use the Intellectual Pproperty without the express written consent of Healthy Life as given in this agreement, or as otherwise first given in writing by the Healthy Life.

 

	
8.4

	
CHANGE OF INTELLECTUAL PROPERTY

 

Healthy Life may:

 

	
  

	
(a)

	
change the Healthy Life Image

 

	
  

	
(b)

	
relinquish all or part of the Intellectual Property and adopt in its place other intellectual property, including a new Healthy Life Image if it is appropriate to do so provided that any changes will apply in due course to a majority of the other comparable Healthy Life Stores trading in Australia.

 

	
8.5

	
IMPLEMENTATION

 

Without limiting any of the Franchisee’s obligations under clauses 6.3, 6.4 and 6.5, as a result of Healthy Life’s decision under clause 8.4, the Franchisee must:

 

	
  

	
(a)

	
make any changes directed by Healthy Life in and to the Franchise

 

	
  

	
(b)

	
pay all of its costs relating to the changes.

 

	
8.6

	
HEALTHY LIFE’S GOODWILL

 

The Franchisee acknowledges that:

 

	
  

	
(a)

	
any and all goodwill in respect of the Healthy Life System and the Intellectual Property and arising from the Franchisee carrying on the Franchise endures to Healthy Life’s exclusive benefit

 

	
  

	
(b)

	
nothing, including this agreement, the Franchisee’s performance of its obligations under this agreement or the conduct of the Franchise gives the Franchisee any interest in the Healthy Life’s goodwill.

 

	
8.7

	
RIGHT OF ACTION

 

The Franchisee:

 

	
  

	
(a)

	
acknowledges that Healthy Life is entitled to protect and maintain all of Healthy Life’s rights with respect to the Intellectual Property against infringement, misuse or unauthorised use and against challenges as Healthy Life sees fit its absolute discretion

 

	
  

	
(b)

	
must at Healthy Life’s request give Healthy Life reasonable assistance to defend or protect Healthy Life’s rights in the Intellectual Property

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

17

  

 

	
  

	
(c)

	
must promptly report to Healthy Life any infringement, misuse or unauthorised use of any Intellectual Property, of which it becomes aware

 

	
  

	
(d)

	
not without Healthy Life’s consent bring any proceedings, including infringement proceedings, in respect of any Intellectual Property, regardless of whether Healthy Life refuses or neglects to bring any proceedings.

 

	
9

	
Business name

 

	
9.1

	
BUSINESS NAME

 

The Franchisee must:

 

	
  

	
(a)

	
only use the Business Name in connection with and to conduct, the Franchise

 

	
  

	
(b)

	
at the Franchisee’s expense:

 

	
  

	
(i)

	
on or before the Commencement Date, apply for any registration required by law to use the Business Name in accordance with this agreement

 

	
  

	
(ii)

	
maintain or renew that registration

 

	
  

	
(c)

	
give to Healthy Life, at Healthy Life’s request:

 

	
  

	
(i)

	
proof that the Business Name is registered

 

	
  

	
(ii)

	
a signed but undated document to cease trading under the Business Name or transfer the Business Name to an unnamed person.

 

	
9.2

	
SEPARATE IDENTITY

 

The Franchisee must:

 

	
  

	
(a)

	
display at the Premises a sign identifying the company name of the business and the registered Business Name

 

	
  

	
(b)

	
identify itself as an independent operator of the Franchise in all documents and in the manner directed by Healthy Life.

 

	
10

	
Healthy Life Manuals

 

	
10.1

	
LOAN

 

Healthy Life must lend or give the Franchisee access to any Healthy Life Manuals during the Term.

 

	
10.2

	
OWNERSHIP AND CHANGE

 

The Franchisee acknowledges that Healthy Life:

 

	
  

	
(a)

	
at all times remains the owner of the Healthy Life Manuals and all interest in the Healthy Life Manuals

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

18

  

 

	
  

	
(b)

	
may change the Healthy Life Manuals from time to time.

 

	
10.3

	
USE OF HEALTHY LIFE MANUALS

 

The Franchisee must:

 

	
  

	
(a)

	
keep the Healthy Life Manuals confidential

 

	
  

	
(b)

	
keep the Healthy Life Manuals in a secure place at the Premises

 

	
  

	
(c)

	
only use the Healthy Life Manuals in the conduct of the Franchise

 

	
  

	
(d)

	
at all times deal with the Healthy Life Manuals as if they are Healthy Life’s property

 

	
  

	
(e)

	
not copy any part of the Healthy Life Manuals except with Healthy Life’s consent

 

	
  

	
(f)

	
immediately give the Healthy Life Manuals and copies to Healthy Life if Healthy Life asks for them

 

	
  

	
(g)

	
pay for the cost of replacement of the Healthy Life Manuals if the Healthy Life Manuals are lost or destroyed.

 

	
11

	
Confidentiality

 

	
11.1

	
CONFIDENTIAL INFORMATION

 

The Franchisee and the Guarantors jointly and severally undertake that each Franchisee and the Guarantor must:

 

	
  

	
(a)

	
keep confidential all Confidential Information

 

	
  

	
(b)

	
not disclose the Confidential Information to any person except to their respective officers, employees and advisers who:

 

	
  

	
(i)

	
have a specific need to have access to the Confidential Information

 

	
  

	
(ii)

	
are aware of the terms upon which the Confidential Information has been disclosed to the Franchisee, and

 

	
  

	
(iii)

	
who agree to keep confidential all Confidential Information

 

	
  

	
(c)

	
ensure that any person to whom any Confidential Information is disclosed under clause 11.1(b) keeps that information confidential and does not disclose it to any person

 

	
  

	
(d)

	
immediately on demand, return any Confidential Information to Healthy Life including any copies or any documents containing or based on any part of the Confidential Information.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

19

  

 

	
11.2

	
SURVIVAL

 

The obligations in this clause 11 will survive the termination or expiration of this agreement.

 

	
12

	
Employees and training

 

	
12.1

	
EMPLOYEES

 

The Franchisee:

 

	
  

	
(a)

	
must employ, at the Franchisee’s cost, a sufficient number of competent, qualified and trained employees to efficiently conduct and manage the Franchise

 

	
  

	
(b)

	
must ensure that the Franchisee’s employees wear clean and tidy uniforms and name badges as Healthy Life reasonably specifies from time to time

 

	
  

	
(c)

	
is exclusively responsible for all terms of employment and all other requirements of and obligations to the Franchisee’s employees.

 

	
12.2

	
STORE MANAGER

 

The Franchisee:

 

	
  

	
(a)

	
may, if the Franchisee is an individual, act as the Store Manager.  If the Franchisee is not acting as the Store Manager, the Franchisee must appoint a Store Manager reasonably acceptable to Healthy Life

 

	
  

	
(b)

	
must ensure that every Store Manager has appropriate competence, qualifications, training and knowledge to operate and manage the Franchise in accordance with reasonably acceptable standards, this agreement and any directions given by Healthy Life

 

	
  

	
(c)

	
acknowledges and agrees that if the Franchisee is in breach of this clause 12.2, Healthy Life may in its absolute discretion direct that the Franchisee appoints a replacement Store Manager reasonably acceptable to Healthy Life within 14 days after Healthy Life’s direction.

 

	
13

	
Advertising, marketing and promotion

 

	
13.1

	
HEALTHY LIFE’S OBLIGATIONS

 

Healthy Life:

 

	
  

	
(a)

	
may conduct advertising, marketing, public relations and promotions in its absolute discretion, including with respect to media, form, style, frequency, geographic coverage

 

	
  

	
(b)

	
must give the Franchisee, at the Franchisee’s cost, access to reasonably adequate quantities of any advertising material Healthy Life develops for use in the Franchise

 

	
  

	
(c)

	
must, subject to clause 13.1(j), pay the Marketing Contribution into the Marketing Fund

 

	
  

	
(d)

	
must use the Marketing Fund to pay:

 

	
  

	
(i)

	
the cost of developing, producing, operating and administering any advertising, marketing, public relations and promotions referred to in clause 13.1(a), including Healthy Life’s reasonable overheads, administrative and staffing costs

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

20

  

 

	
  

	
(ii)

	
costs associated with the administration of the Marketing Fund

 

	
  

	
(iii)

	
the cost of preparing and auditing financial statements of the Marketing Fund’s receipts and expenses

 

	
  

	
(e)

	
may administer the Marketing Fund as Healthy Life considers appropriate and need not spend:

 

	
  

	
(i)

	
all contributions to the Marketing Fund in the year in which contributions are received, and may in Healthy Life’s absolute discretion, accumulate a reserve in the Marketing Fund

 

	
  

	
(ii)

	
a proportionate part of the contributions in any particular area or on behalf of any particular franchisees

 

	
  

	
(f)

	
must within 4 months after the end of the last financial year, prepare an annual financial statement detailing all of the fund’s receipts and expenses for the last financial year;

 

	
  

	
(g)

	
must have the statement audited by a registered company auditor within 4 months after the end of the financial year to which it relates;

 

	
  

	
(h)

	
must give to the franchisee a copy of:

 

	
  

	
(i)

	
the statement referred to in clause13.1(f), within 30 days of preparing the statement; and

 

	
  

	
(ii)

	
the auditor’s report referred to in clause13.1(g), if such a report is required, within 30 days of preparing the report

 

	
  

	
(i)

	
acts as principal in relation to the Marketing Fund, and not as the Franchisee’s trustee, agent or fiduciary

 

	
  

	
(j)

	
may dissolve the Marketing Fund and require the Franchisee to directly spend the Marketing  Contribution on approved advertising.

 

	
13.2

	
FRANCHISEE’S ACKNOWLEDGEMENT

 

The Franchisee acknowledges that Healthy Life does not have to comply with having the statement audited as outlined under clause 13.1(g) for a financial year if:

 

	
  

	
(a)

	
75% of Healthy Life’s franchisees in Australia, who contribute to the Marketing Fund, have voted to agree that Healthy Life  does not have to comply with clause 13.1(g); and

 

	
  

	
(b)

	
that agreement is made within 3 months after the end of the financial year.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

21

  

 

	
13.3

	
ADVERTISING AND PARTICIPATION BY THE FRANCHISEE

 

The Franchisee must:

 

	
  

	
(a)

	
at the Franchisee’s cost

 

	
  

	
(i)

	
comply with all of Healthy Life’s reasonable decisions with respect to all matters relating to advertising, marketing, public relations and promotion

 

	
  

	
(ii)

	
actively promote the Franchise including conduct advertising, marketing and promotional programs in the Franchisee’s geographic area in addition to any advertising Healthy Life may conduct

 

	
  

	
(iii)

	
participate fully in all customer loyalty, joint promotional programs, product promotions and all other advertising, marketing, public relations and promotions reasonably required by Healthy Life including by:

 

	
  

	
(1)

	
displaying promotional material and signage

 

	
  

	
(2)

	
purchasing and merchandise approved promotional products in accordance with Healthy Life’s advertising, marketing and promotion schedule

 

	
  

	
(3)

	
maintaining reasonable stock levels of approved promotional products for the duration of each promotion cycle and to ensure customers are not misled during any promotion

 

	
  

	
(4)

	
participating in programs where the Franchisee is required to give any customer products for no charge or at substantial discounts and regardless of whether that customer is a customers of the Franchisee

 

	
  

	
(b)

	
obtain Healthy Life’s prior written consent before conducting the advertising, marketing and promotions and submit to Healthy Life all advertising, artwork and other material that the Franchisee proposes to use in any of the Franchisee’s advertising, marketing and promotions

 

	
  

	
(c)

	
not make any false, misleading, exaggerated or unwarranted claims statements and otherwise ensure that its advertising, marketing and promotions comply with all applicable laws

 

	
  

	
(d)

	
not operate or attempt to operate any online sales of Healthy Life branded products nor operate a website for online sales of any Healthy Life branded products, and the Franchisee acknowledges that at all times only Healthy Life has this right and that Healthy Life may exercise this right as it considers appropriate.

 

	
13.4

	
HEALTHY LIFE TO RETAIN OWNERSHIP OF ADVERTISING MATERIAL AND COPYRIGHT

 

All advertising copy, artwork and other marketing, public relations and promotions material that uses Healthy Life’s Intellectual Property whether prepared by, for or on behalf of Healthy Life, or by for or on behalf of the Franchisee, together with all associated copyright and other intellectual property rights will, on its creation, be vested in Healthy Life and remain Healthy Life’s property.  The Franchisee must do all things Healthy Life reasonably requires to give effect to the provisions of this clause.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

22

  

 

	
14

	
Products

 

	
14.1

	
APPROVED PRODUCTS

 

Healthy Life may from time to time:

 

	
  

	
(a)

	
give the Franchisee a list of products that are Approved Products

 

	
  

	
(b)

	
give the Franchisee a list of products that are not Approved Products, and

 

	
  

	
(c)

	
add or subtract products from either list in its absolute discretion.

 

	
14.2

	
STOCKING APPROVED PRODUCTS

 

The Franchisee must:

 

	
  

	
(a)

	
only stock and sell Approved Products

 

	
  

	
(b)

	
not stock or sell any product if the product ceases to be an Approved Product or if Healthy Life notifies them the product is not an Approved Product

 

	
  

	
(c)

	
stock, promote and position Approved Products, including any or all Healthy Life branded products, in accordance with reasonable directions given by Healthy Life from time to time and the Healthy Life Manuals, including with respect to:

 

	
  

	
(i)

	
the quantities of any specific Approved Product or range of Approved Products

 

	
  

	
(ii)

	
the general or specific mix and ratio of Approved Products

 

	
  

	
(d)

	
maintain during the Term, sufficient quantities of the Approved Product necessary for the conduct of Franchise.

 

	
14.3

	
ACKNOWLEDGEMENT

 

The Franchisee acknowledges that:

 

	
  

	
(a)

	
that Healthy Life or a related body corporate may generate profits as a result of the Franchisee’s purchases of Approved Products

 

	
  

	
(b)

	
Healthy Life may receive rebates, commissions, discounts, advertising incentives, contributions or other payments from suppliers including any amount which may be offered on account of the Franchisee’s purchases of products, to assist in the development of Healthy Life’s business

 

	
  

	
(c)

	
Healthy Life will use reasonable endeavours to establish and maintain business relationships with suppliers of Approved Products.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

23

  

 

	
14.4

	
PRICE

 

Healthy Life may issue the Franchisee with price lists showing the recommended retail prices of the Approved Products.  The prices are not minimum prices.  The Franchisee may sell Approved Products at, above, or below the recommended prices in its absolute discretion.

 

	
15

	
Club Life

 

	
15.1

	
CLUB LIFE PROGRAM

 

Healthy Life may operate the Club Life program in its absolute discretion, including with respect to media, form, style, frequency, geographic coverage, promotions and offers.

 

	
15.2

	
PARTICIPATION

 

Without limiting its obligations under clause 13.2, the Franchisee must:

 

	
  

	
(a)

	
participate in and comply with the Club Life program in accordance with any reasonable directions given by Healthy Life, including by:

 

	
  

	
(i)

	
offering any products to a person at no charge or at substantial discounts in accordance with any Club Life promotion regardless of whether that person is a customer of the Franchisee

 

	
  

	
(ii)

	
asking customers if they wish to participate in the Club Life promotion and collecting customer information in accordance with the law and any directions given by Healthy Life

 

	
  

	
(iii)

	
give collected customer information to Healthy Life

 

	
  

	
(b)

	
if the Franchisee is an Existing Retailer:

 

	
  

	
(i)

	
subject to the law and clauses 15.2(b)(ii) and 15.3, give Healthy Life any existing list of customer information for use on the Club Life program during the Term, and

 

	
  

	
(ii)

	
if the Franchisee chooses, or if Healthy Life decides it is necessary, contact each customer on at Healthy Life’s expense to ask if the customer wishes to participate in the Club Life program.  If any customer does not wish to participate in the Club Life program the Franchisee does not have to give that customer information for that customer.

 

	
15.3

	
OWNERSHIP OF CUSTOMER LISTS

 

Ownership in all customer information is vested in Healthy Life when it is collected by the Franchisee and remains Healthy Life’s property.  At the end of the Term, with respect to customer information collected by an Existing Retailer prior to the date of this agreement, Healthy Life:

 

	
  

	
(a)

	
may contact each customer to advise them of their ongoing benefits available under the Club Life program

 

	
  

	
(b)

	
must not make subsequent contact with any customer unless the customer maintains membership of the Club Life program

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

24

  

 

	
  

	
(c)

	
must return a copy of that customer information to the Existing Retailer.

 

	
16

	
General conduct and compliance with the Healthy Life System

 

	
16.1

	
CONDUCT OF FRANCHISE

 

The Franchisee must:

 

	
  

	
(a)

	
immediately remedy any breach of this agreement notified to it by Healthy Life

 

	
  

	
(b)

	
operate the Franchise:

 

	
  

	
(i)

	
in a diligent, proper and business-like manner

 

	
  

	
(ii)

	
in a way that will not impair or damage, Healthy Life’s goodwill, reputation, marketing strategy or competitive standing or the Healthy Life System

 

	
  

	
(iii)

	
in accordance with the Healthy Life System, the Healthy Life Manuals, this agreement, the Code and Healthy Life’s reasonable recommendations and directions

 

	
  

	
(c)

	
use the Franchisee’s best endeavours to promote Healthy Life’s and the Franchisee’s mutual business interests

 

	
  

	
(d)

	
maintain financial stability and good credit standing

 

	
  

	
(e)

	
without limiting any obligation imposed by this agreement, maintain good customer relations and service levels as determined by normal retailing standards

 

	
  

	
(f)

	
at the Franchisee’s cost

 

	
  

	
(i)

	
participate in all programs, courses, surveys or initiatives organised or recommended by Healthy Life

 

	
  

	
(ii)

	
obtain and maintain membership of Complementary Healthcare Council of Australia for the Term and attain full accreditation under the Complementary Healthcare Council of Australia’s Accreditation Program

 

	
  

	
(g)

	
comply with all applicable laws or requirements of any authority or governmental agency including:

 

	
  

	
(i)

	
procure and maintain any registrations, licences or permits which required in connection with the Franchise

 

	
  

	
(ii)

	
pay all applicable Taxes imposed on it in connection with the Franchise

 

	
  

	
(h)

	
comply with the National Privacy Principles and Healthy Life’s privacy policies in force from time to time regarding the collection and use of any personal information

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

25

  

 

	
  

	
(i)

	
not grant any mortgage, charge, bill of sale or other security over the Franchise or any part of the Franchise or asset of the Franchise without Healthy Life’s prior written consent, which Healthy Life will not unreasonably withhold if Healthy Life is reasonably satisfied that Healthy Life’s rights are protected in the event of termination of this agreement.

 

	
16.2

	
INSPECTION BY HEALTHY LIFE

 

Healthy Life, or its representatives or agents may enter the Premises without notice at all reasonable times during normal business hours, or by appointment, and in a manner which will not cause undue inconvenience to the conduct of the Franchise for any purpose including:

 

	
  

	
(a)

	
examining the Premises

 

	
  

	
(b)

	
talking to or assisting the Franchisee or the Franchisee’s employees

 

	
  

	
(c)

	
inspecting and checking operations, furnishings, stock, equipment and supplies

 

	
  

	
(d)

	
determining whether the Franchise is being operated in accordance with this agreement.

 

	
16.3

	
CONSUMER COMPLAINTS

 

The Franchisee must give Healthy Life the details of any significant consumer complaint, including copies of any correspondence and written details of any conversation as soon as practicable after the complaint is made.

 

	
17

	
Transfer of franchise

 

	
17.1

	
GENERAL

 

The Franchisee must not Transfer its rights and obligations under this agreement in part. The Franchisee may Transfer the whole of the Franchisee’s rights and obligations under this agreement in accordance with this clause 17.

 

	
17.2

	
RIGHT OF FIRST REFUSAL

 

If the Franchisee wishes to Transfer its rights and obligations under this agreement, the Franchisee must, in writing:

 

	
  

	
(a)

	
request Healthy Life’s consent to a Transfer

 

	
  

	
(b)

	
give Healthy Life all the relevant details in relation to the Transfer including:

 

	
  

	
(i)

	
a copy of any bona fide written offer or draft agreement for sale of the Franchisee’s business

 

	
  

	
(ii)

	
a statement of all the terms of the proposed Transfer and the identity of the purchaser

 

	
  

	
(c)

	
offer to Healthy Life to purchase the Franchise on terms no less favourable than those in 17.2(b).  Healthy Life has 14 days from receipt of the written offer to accept the offer.  If Healthy Life does not accept the offer the Franchisee may Transfer the Franchise and its rights and obligations under this agreement:

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

26

  

 

	
  

	
(i)

	
on terms no more favourable to the Transferee than the terms offered to Healthy Life under this clause

 

	
  

	
(ii)

	
subject to clause 17.3.

 

	
17.3

	
CONSENT REQUIRED FOR TRANSFER

 

Healthy Life will not withhold its consent to the Franchisee’s Transfer of its rights and obligations under this agreement if:

 

	
  

	
(a)

	
the Franchisee is not in breach of this agreement at the time of the request

 

	
  

	
(b)

	
the Franchisee has, in a timely manner, prior to the proposed Transfer, given Healthy Life all of the information required by clause 17.2(b)

 

	
  

	
(c)

	
the proposed Transferee meets Healthy Life’s then current reasonable selection criteria for franchisees

 

	
  

	
(d)

	
the Franchisee and the proposed Transferee demonstrates to Healthy Life’s reasonable satisfaction that the proposed purchaser is a respectable, responsible and solvent person having sufficient business experience, capability and financial resources to properly carry on the Franchise in accordance with the terms of the then current franchise agreement, and:

 

	
  

	
(i)

	
if the proposed Transferee is a corporation or a partnership, the provisions of this clause will apply to each of the individuals who are to be the directors, members or partners

 

	
  

	
(ii)

	
the Franchisee and the proposed Transferee cooperates with Healthy Life by making available all information Healthy Life requires to make these determinations

 

	
  

	
(e)

	
the proposed purchaser has agreed to purchase all of the Franchisee’s assets related to conducting the Franchise and has assumed all of the Franchisee’s liabilities in respect of the Franchise

 

	
  

	
(f)

	
Healthy Life’s consent to the Transfer will not have a significantly adverse effect on the Healthy Life System

 

	
  

	
(g)

	
at or prior to completion of the Transfer:

 

	
  

	
(i)

	
the proposed purchaser enters into a then current franchise agreement with Healthy Life for the remainder of the Term and pays Healthy Life any money owing under the new franchise agreement on the date of signing

 

	
  

	
(ii)

	
the Franchisee and the Guarantor have:

 

	
  

	
(1)

	
paid or satisfied in full, all amounts the Franchisee owes to Healthy Life or any related body corporate of Healthy Life, under this agreement, the Warehouse Agreement, or any other agreement

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

27

  

 

	
  

	
(2)

	
paid or satisfied all the Franchisee’s liabilities and obligations to third parties arising out of the conduct of the Franchise

 

	
  

	
(3)

	
signed all documents and done all things as may be required to complete the Transfer

 

	
  

	
(4)

	
paid the then current Transfer Fee to Healthy Life

 

	
  

	
(iii)

	
the Franchisee and the Guarantors have, to the extent permitted by law, given Healthy Life a release of any liability Healthy Life may have to the Franchisee or the Guarantors.

 

	
17.4

	
COSTS OF TRANSFER

 

The Franchisee must pay Healthy Life’s costs, including legal costs and disbursements, of and incidental to the Transfer.

 

	
17.5

	
ASSIGNMENT BY HEALTHY LIFE

 

Healthy Life may assign, transfer or otherwise dispose of Healthy Life’s interest in this agreement to any person who may succeed to Healthy Life’s business whether by purchase of assets or shares or upon merger, reconstruction or amalgamation, and the Franchisee and the Guarantors must do all things and execute all documents to enable Healthy Life to effectively assign, transfer or otherwise dispose of Healthy Life’s interest at Healthy Life’s cost. From the date of the assignment Healthy Life will have no further obligation to the Franchisee for events occurring after the assignment.

 

	
17.6

	
SUB-LICENCE

 

The Franchisee must not sub-licence or grant and interest to any person of the Franchise or any part of it, or and of its rights under this agreement in any form.

 

	
18

	
Default and termination

 

	
18.1

	
TERMINATION WITHOUT NOTICE PERIOD

 

If any of the following events occurs, Healthy Life may without prejudice to any other remedy and without recourse to dispute resolution under clause 24, immediately terminate this agreement by notice in writing to the Franchisee:

 

	
  

	
(a)

	
the Franchisee no longer holds a licence that the Franchisee must hold to carry on the Franchise

 

	
  

	
(b)

	
the Franchisee becomes bankrupt, insolvent, under administration or an externally administered body corporate

 

	
  

	
(c)

	
the Franchisee voluntarily abandons the Franchise or the Healthy Life System

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

28

  

 

	
  

	
(d)

	
the Franchisee or one of the Franchisee’s officers is convicted of a serious offence as defined by the Code

 

	
  

	
(e)

	
the Franchisee operates the Franchise in a way that endangers public health or safety

 

	
  

	
(f)

	
the Franchisee is fraudulent in connection with operation of the Franchise, or

 

	
  

	
(g)

	
the Franchisee agrees to the termination of this agreement each of which, apart from paragraph (g) is considered a fundamental breach of this agreement.

 

	
18.2

	
TERMINATION WITH NOTICE PERIOD

 

Healthy Life may, in Healthy Life’s sole discretion, to the extent permitted at law, and without limiting any rights under clause 18.1 or this agreement, terminate this agreement:

 

	
  

	
(a)

	
if any of the following events occurs, each of which is considered a fundamental breach of this agreement:

 

	
  

	
(i)

	
the Franchisee fails to start operating the Franchise on the Commencement Date

 

	
  

	
(ii)

	
the Franchisee breaches any other agreement between Healthy Life and the Franchisee

 

	
  

	
(iii)

	
the Franchisee does or attempts to do anything which requires Healthy Life’s consent without first obtaining Healthy Life’s consent

 

	
  

	
(iv)

	
there is an Insolvency Event in relation the Franchisee or any Guarantor

 

	
  

	
(v)

	
there is, without the consent of Healthy Life which not must be unreasonably withheld, a change in the Effective Control of the Franchisee or any of the Guarantors

 

	
  

	
(vi)

	
the Franchisee fails or refuses to pay:

 

	
  

	
(1)

	
any amount due under this agreement on or before its due date on more than three occasions during the Term

 

	
  

	
(2)

	
any amount the Franchisee owes to Healthy Life or a related body corporate of Healthy Life, within seven days after due date for payment or a demand for payment

 

	
  

	
(3)

	
any creditor within 21 days of the due date for payment

 

	
  

	
(vii)

	
the Franchisee stops, suspends or threatens to stop or suspend payment of all or any of the Franchisee’s debts

 

	
  

	
(viii)

	
the Franchisee fails to honour, on more than two occasions during the Term, cheques presented for payment

 

	
  

	
(ix)

	
the Franchisee stocks, sells or offers for sale any product that is not an Approved Product on more than two occasions during any six months period

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

 

  

29

  

 

	
  

	
(x)

	
the Franchisee fails to comply with any applicable laws or requirements of any governmental agency in connection with the operation of the Franchise unless there is a real dispute as to the violation or status of that law, rule or regulation and the Franchisee is contesting that violation or status in the courts or other appropriate forum

 

	
  

	
(xi)

	
any of the Franchisee’s warranties, representations or statements is or becomes false or incorrect

 

	
  

	
(xii)

	
the Franchisee, the Franchisee’s directors or officers (if applicable) or any of the Guarantors is convicted of any criminal offence punishable by a term of imprisonment

 

	
  

	
(xiii)

	
the Franchisee or any of the Guarantors dies

 

	
  

	
(xiv)

	
the Franchisee operates the Franchise in a way, or does anything which Healthy Life reasonably considers may bring Healthy Life into disrepute or may otherwise detrimentally affect Healthy Life or impair or damage, Healthy Life’s goodwill, reputation, marketing strategy or competitive standing or the Healthy Life System

 

	
  

	
(xv)

	
Healthy Life considers, in Healthy Life’s sole discretion but acting reasonably, that the Franchisee’s performance of this agreement or the Franchisee’s operation of the Franchise is wholly unsatisfactory, and

 

	
  

	
(xvi)

	
as a separate ground, the Franchisee breaches this agreement:

 

	
  

	
(1)

	
persistently

 

	
  

	
(2)

	
in a material way

 

	
  

	
(3)

	
on more than two occasions during any six month period

 

	
  

	
(b)

	
after giving notice to the Franchisee that:

 

	
  

	
(i)

	
Healthy Life proposes to terminate this agreement because of the occurrence of something listed under clause 18.2

 

	
  

	
(ii)

	
tells the Franchisee what, if anything, Healthy Life requires it to do to remedy the breach

 

	
  

	
(iii)

	
allows the Franchisee a reasonable time, up to 30 days, to remedy the breach.

 

	
18.3

	
CONSEQUENCES OF EXPIRATION OR TERMINATION

 

On or before the expiration or termination of this agreement for any reason, the Franchisee must, at the Franchisee’s own expense:

 

	
  

	
(a)

	
immediately stop using the Healthy Life System, the Intellectual Property and all Confidential Information.  Without limiting these obligations the Franchisee must immediately:

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

30

  

 

	
  

	
(i)

	
destroy or deliver up to Healthy Life, at Healthy Life’s option, all documents or materials containing any Intellectual Property or Confidential Information

 

	
  

	
(ii)

	
advise Healthy Life in writing of the names and addresses of any persons who may be in possession of Confidential Information

 

	
  

	
(iii)

	
assign to Healthy Life or Healthy Life’s nominee all the Franchisee’s registrations and rights relating to the use of any Intellectual Property

 

	
  

	
(iv)

	
sign and deliver to Healthy Life all forms required to cease trading under the Business Name or transfer the Business Name to an unnamed person

 

	
  

	
(v)

	
remove all signs and other indication of the Healthy Life Image from the Premises, and otherwise cease using the Healthy Life Image

 

	
  

	
(vi)

	
deliver to Healthy Life all Healthy Life Manuals and other documents relating to the Franchise

 

	
  

	
(b)

	
immediately pay Healthy Life all amounts due and payable up to the date of termination under this agreement

 

	
  

	
(c)

	
pay all amounts due to any person in relation to the Premises or the Franchise

 

	
  

	
(d)

	
return to Healthy Life all Healthy Life branded stock and for which Healthy Life will pay to the Franchisee, within 30 days of the return of that stock to Healthy Life, an amount equal to the purchase price as paid by the Franchisee for the Healthy Life branded product, so long as that stock is delivered in a good and saleable condition, (and which the Franchisee acknowledges will be determined solely by Healthy Life by reference to the shelf life and condition of the products at the time of the return  of that stock to Healthy Life)

 

	
  

	
(e)

	
cease doing anything that indicates, or which may tend to indicate, that the Franchisee is or was Healthy Life’s Franchisee or is or was in any way associated with the Healthy Life System

 

	
  

	
(f)

	
permit Healthy Life and Healthy Life’s representatives to enter the Premises and do all things which the Franchisee is required to do under this agreement, at the Franchisee’s cost, or verify that the Franchisee has done everything required

 

	
  

	
(g)

	
if the Franchisee requests and Healthy Life agrees, do all things necessary to immediately sell and transfer to Healthy Life or Healthy Life’s nominee, all or any of the assets and other rights and interests of the Franchisee used in the Franchise (including, but not limited to, the interests of the Franchisee under the Lease) at their fair market value based on an arms length sale to a willing but not anxious purchaser as separate items and not in the context of a going concern.  If the parties do not agree on the fair market value of any assets to be transferred, either party may request the Valuer to determine the value.  The Valuer’s decision will be final.  Healthy Life must pay the purchase price within 60 days after the amount of the purchase price has been determined.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

31

  

 

	
18.4

	
POST TERMINATION

 

Following the expiration or termination of this agreement for any reason and without limiting any other obligation in this agreement including 18.4, the Franchisee and each Guarantor must:

 

	
  

	
(a)

	
continue to be bound by the terms of this agreement which expressly or by reasonable implication are to be observed or performed after the expiration or termination

 

	
  

	
(b)

	
not without Healthy Life’s consent, solicit, endeavouring to solicit, entice away or employ any of Healthy Life’s or Healthy Life’s franchisees’ officers, directors, managers, employees or consultants

 

	
  

	
(c)

	
not utilise any part of the Healthy Life System, the Healthy Life Image, the Intellectual Property or the Confidential Information in any way.

 

	
18.5

	
ATTORNEY

 

The Franchisee irrevocably appoints Healthy Life as the Franchisee’s attorney to sign any documents or do anything Healthy Life considers necessary or prudent following any failure of the Franchisee to do so or upon a breach of this agreement by the Franchisee.

 

	
18.6

	
SET OFF AUTHORISED

 

If the Franchisee has not paid Healthy Life any amount due at any time payable to Healthy Life whether under this agreement or otherwise, Healthy Life may withhold payment and claim set off in respect of payments due to the Franchisee on any account.

 

	
19

	
Restraint

 

	
19.1

	
RESTRAINT

 

Each of the Franchisee and Guarantor must not, without Healthy Life’s consent, have an interest in, engage in, operate or carry on, in any capacity, including:

 

	
  

	
(a)

	
on its own account

 

	
  

	
(b)

	
directly or indirectly, including through or as an agent, employee, contractor, manager, advisor, consultant, partner, trustee, beneficiary, director, shareholder (other than as a shareholder in a public company of less than 10% of the issued capital)

 

	
  

	
(c)

	
through, or to any person, firm, association, joint venture, partnership or corporation

 

in any business, except for the Franchise, that:

 

	
  

	
(d)

	
markets or sells health supplements, nutrition supplements, vitamins, health food products or associated products or any Approved Product

 

	
  

	
(e)

	
is similar or identical to the Franchise (other than through a Healthy Life Store), or using a system similar or identical to the Healthy Life System

 

	
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(f)

	
is competitive with any part of the Franchise or any Healthy Life Store during

 

	
  

	
(g)

	
the Term, and

 

	
  

	
(h)

	
the Restraint Period:

 

	
  

	
(i)

	
in the Restraint Area, or

 

	
  

	
(ii)

	
if the Franchisee is an Existing Retailer, in the Restraint Area from any location other than the Premises.

 

	
19.2

	
SEPARATE AND CUMULATIVE OBLIGATIONS

 

Each of the restraint obligations in clause 19.1, including as a result of combining each of the Restraint Periods and each of the Restraint Areas, is a separate and independent restraint obligation, although they are cumulative in effect.

 

	
19.3

	
RESTRAINTS REASONABLE AND NECESSARY

 

Healthy Life, the Franchisee, and the Guarantors consider each of the restraint obligations in clause 19.1 to be reasonable for the purposes of protecting Healthy Life’s proper interests, the Healthy Life System and Healthy Life’s business, and intend the restraints to operate to the maximum extent.

 

	
19.4

	
SEVERABILITY

 

If any restraint obligations in clause 19.1 including any part any obligation, a Restraint Periods or a Restraint Areas , is void as unreasonable for the protection of Healthy Life’s interests, or otherwise found to be void, invalid or otherwise unenforceable, then:

 

	
  

	
(a)

	
that restraint obligation must be deemed to be severed from this agreement to the extent it is void, invalid or otherwise unenforceable, and

 

	
  

	
(b)

	
the remainder of the restraint obligations will remain binding on the Franchisee and the Guarantors and in full force and effect.

 

	
19.5

	
ACKNOWLEDGEMENTS BY FRANCHISEES AND GUARANTORS

 

Each Franchisee and Guarantor acknowledges that:

 

	
  

	
(a)

	
each of the restraint obligations in clause 19.1 clause is separate, independent and several is binding on each Franchisee and Guarantor jointly and several

 

	
  

	
(b)

	
they have received legal advice or had the opportunity of obtaining legal advice and chose not to receive it in relation to this agreement, and in particular this clause 19

 

	
  

	
(c)

	
that monetary damages alone would not be adequate compensation to Healthy Life for the breach of clause 19.1, and that Healthy Life is entitled to seek an injunction from a court of competent jurisdiction if:

 

	
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(i)

	
the Franchisee and the Guarantors fail to comply or threaten to fail to comply with clause 19.1, or

 

	
  

	
(ii)

	
Healthy Life has reason to believe the Franchisee or the Guarantors will not comply with clause 19.1.

 

	
19.6

	
SURVIVAL

 

The obligations in this clause 19 will survive the termination or expiration of this agreement.

 

	
20

	
Warranties and reliance

 

	
20.1

	
THE FRANCHISEE’S WARRANTIES

 

Each Franchisee and Guarantor jointly and severally warrants and undertakes to Healthy Life:

 

	
  

	
(a)

	
as an inducement to Healthy Life entering into this agreement and as a condition of this agreement, that all of the information each of the Franchisee and the Guarantors have supplied or at any time supply to Healthy Life relating to any matter including:

 

	
  

	
(i)

	
the ownership and control of the Franchisee

 

	
  

	
(ii)

	
the Franchisee’s previous business experience

 

	
  

	
(iii)

	
the Franchisee’s and Guarantor’s financial position

 

	
  

	
(iv)

	
the Franchise

 

	
  

	
(v)

	
is accurate, true and correct in every particular and none of the information is misleading, whether by inclusion of misleading information or omission of material information or both.

 

	
  

	
(b)

	
acknowledge that in entering this agreement, Healthy Life has relied on the warranties referred to in this clause 20.1, and any information the Franchisee and the Guarantors provide to Healthy Life under clause 20.1(a).

 

	
20.2

	
NO RELIANCE

 

Each Franchisee and Guarantor acknowledges that prior to signing this agreement it has:

 

	
  

	
(a)

	
carefully read and understood this agreement and the Disclosure Document

 

	
  

	
(b)

	
has not relied on any express or implied warranty or promise made by Healthy Life or its officers, employees, agents, related bodies corporate and contractors person on Healthy Life’s behalf, including about:

 

	
  

	
(i)

	
anything contained in any of Healthy Life’s catalogues or publicity material

 

	
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(ii)

	
any information including financial information about the performance of any other Healthy Life Store, or the potential performance of the Franchise

 

	
  

	
(iii)

	
any information about the Premises other than as expressly set out in this agreement and in  the Disclosure Document.

 

	
20.3

	
INCONSISTENCY WITH DISCLOSURE

 

Where there is any inconsistency between this agreement and the Disclosure Document, the terms of this agreement prevail.

 

	
20.4

	
SURVIVAL OF REPRESENTATIONS AND WARRANTIES

 

The representations and warranties given in clause 20:

 

	
  

	
(a)

	
survive the execution, termination and expiration of this agreement

 

	
  

	
(b)

	
are regarded as repeated with respect to the facts and circumstances then subsisting on each occasion the Franchisee seeks an approval of any matter by Healthy Life.

 

	
21

	
Liability

 

	
21.1

	
RESPONSIBILITY, INDEMNITY AND RELEASE

 

To the extent permitted by law, each Franchisee and Guarantor covenants and agrees with Healthy Life that the Franchisee:

 

	
  

	
(a)

	
assumes sole and entire responsibility for all third party Claims; and

 

	
  

	
(b)

	
releases Healthy Life and its officers, employees, agents, related bodies corporate and contractors from all third party Claims; and

 

	
  

	
(c)

	
indemnifies Healthy Life and its officers, employees, agents, related bodies corporate and contractors on a continuing and full indemnity basis against all Liability suffered or incurred by Healthy Life its officers, employees, agents, related bodies corporate and contractors or in relation to any Liability suffered or incurred by the Franchisee, its officers, employees, related bodies corporate, agents and contractors arising from a third party claim arising from or in connection with:

 

	
  

	
(d)

	
a breach by the Franchisee of this agreement or any other agreement between Healthy Life and the Franchisee

 

	
  

	
(e)

	
the Franchisee’s conduct of the Franchise and any dealing with third parties including customers

 

	
  

	
(f)

	
the supply of Approved Products by the Franchisee

 

	
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(g)

	
any injury to, or loss of property of, any person in, or on, the Premises

 

	
  

	
(h)

	
any negligent or wilful act or omission of the Franchisee, its officers, employees, related bodies corporate and agents or others for whom the Franchisee is legally responsible other than to the extent that the breach is caused directly by Healthy Life’s negligent acts or omissions, or as a result of Healthy Life’s failure to fully comply with Healthy Life’s obligations under this agreement.

 

	
21.2

	
BENEFIT OF INDEMNITY AND RELEASES

 

Healthy Life holds the benefit of the indemnities and releases given by the Franchisee and Guarantors to any person other than Healthy Life under clause 21.1 on trust for the benefit of that person.

 

	
21.3

	
EXCLUSION OF WARRANTIES

 

Subject to clause 21.4 all terms, conditions, warranties, undertakings, or inducements whether express, implied, statutory or otherwise relating in any way to this agreement, goods, services, advice or assistance Healthy Life supplied to the Franchisee, the Intellectual Property, the Healthy Life System or Approved Products are excluded unless there is an express statement to the contrary in this agreement contained as an express term of this agreement.

 

	
21.4

	
LIMITATION OF LIABILITY

 

Nothing in this agreement will exclude, restrict or modify any condition, warranty or liability which may at any time be implied by any trade practices, fair trading, sale of goods or credit legislation or regulation or any other state or federal law where to do so is illegal or would render any provision of this agreement void.  Where permitted by legislation, Healthy Life’s total liability:

 

	
  

	
(a)

	
in respect of any implied condition, warranty or liability will be limited at the option of Healthy Life to:

 

	
  

	
(i)

	
in the case of goods, any one or more of the following:

 

	
  

	
(1)

	
the replacement of the goods or the supply of equivalent goods

 

	
  

	
(2)

	
the repair of the goods

 

	
  

	
(3)

	
the payment of the cost of replacing the goods or of acquiring equivalent goods, or

 

	
  

	
(4)

	
the payment of the cost of having the goods repaired

 

	
  

	
(ii)

	
in the case of services:

 

	
  

	
(1)

	
the supply of the services again or

 

	
  

	
(2)

	
the payment of the cost of having the services supplied again, and

 

	
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(b)

	
to the Franchisee arising out of or in connection with this agreement, including in respect of any loss or damage (including consequential loss or damage) however caused which the Franchisee might suffer or incur or which may arise directly or indirectly in respect of rights under this agreement, goods, services, advice or assistance Healthy Life supplied to the Franchisee, the Intellectual Property, the Healthy Life System, Approved Products or Healthy Life’s failure or omission to comply with Healthy Life’s obligations under this agreement, whether arising in contract, tort (including negligence) or otherwise, will in no circumstances exceed the liability outlined in (a).

 

	
22

	
Costs and stamp duty

 

	
22.1

	
PAYMENT BY FRANCHISEE

 

The Franchisee must pay:

 

	
  

	
(a)

	
all Taxes payable with respect to:

 

	
  

	
(i)

	
this agreement and any payment made or received in respect of this agreement

 

	
  

	
(ii)

	
any transaction associated with or signed under this agreement contemplated under this agreement including any including in respect of any lease and sub-lease of the Premises

 

	
  

	
(b)

	
its own legal and other costs and expenses in connection with this agreement

 

	
  

	
(c)

	
Healthy Life’s legal costs of $2,500 plus GST for the negotiation, preparation, execution, delivery and stamping of this agreement and all other agreements between the Franchisee and Healthy Life.

 

	
  

	
(d)

	
must pay Healthy Life’s costs (including legal costs on a solicitor and own client basis) related to the Franchisee’s breach of this agreement or Healthy Life’s enforcement of Healthy Life’s rights under this agreement.

 

	
22.2

	
INDEMNITY

 

Each Franchisee and Guarantor jointly and severally indemnifies Healthy Life and keeps Healthy Life indemnified against any liability or amount payable under this clause.

 

	
22.3

	
TAX

 

If a Tax is, at the date of this agreement or subsequently, imposed by any regulation or law of any government and requires an amount to be deducted by the Franchisee from any amount payable to Healthy Life in accordance with the terms of this agreement, then the Franchisee will indemnify or reimburse Healthy Life for any amount so deducted so as to restore the amount to the amount it would have been but for that Tax.

 

	
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Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

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23

	
GST

 

	
23.1

	
DEFINITIONS

 

Expressions in this clause which are not defined in this agreement but which are defined in the GST Act, have the same meaning as in the GST Act.

 

	
23.2

	
CONSIDERATION IS EXCLUSIVE OF GST

 

Unless otherwise expressly stated, any amount, price, value or other sum that is:

 

	
  

	
(a)

	
payable or to be provided under this agreement

 

	
  

	
(b)

	
referred to in this agreement and which is relevant in determining a payment to be made by one of the parties to the other is exclusive of any GST.

 

	
23.3

	
GST ON TAXABLE SUPPLY

 

If GST is payable on any supply made under this agreement:

 

	
  

	
(a)

	
the recipient of the taxable supply must pay to the supplier an amount equal to the GST payable on the taxable supply in addition to and at the same time as payment for the taxable supply is required to be made under this agreement

 

	
  

	
(b)

	
the supplier must give the recipient a tax invoice for the taxable supply.

 

	
23.4

	
PENALTIES

 

If the supplier becomes subject to any penalties or interest resulting from late payment of GST because of the recipient’s failure to comply with this clause, then the recipient must pay on demand an additional amount equal to the amount of those penalties and interest.

 

	
24

	
Dispute resolution

 

	
24.1

	
PROCEDURES

 

Where a dispute arises between the parties to this agreement:

 

	
  

	
(a)

	
the complainant must tell the other party in writing the nature of the dispute, what outcome the complainant wants and what action the complainant thinks will settle the dispute

 

	
  

	
(b)

	
the parties must make every effort to resolve the dispute by mutual negotiation

 

	
  

	
(c)

	
if the parties do not reach a resolution of the dispute within 21 days of the date of the written complaint being given to the other party either party may give notice in writing to advise the other that it seeks to have the dispute resolved by mediation as follows:

 

	
  

	
(i)

	
if the parties do not agree on the appointment of a mediator, the dispute must be referred to a mediator nominated by the Mediation Advisor pursuant to the Code

 

	
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Healthy Life franchise agreement (MASTER)

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(ii)

	
the mediator:

 

	
  

	
(1)

	
may decide the time and place for mediation and the parties must attend and seek to resolve the dispute

 

	
  

	
(2)

	
may determine procedures and may or may not allow the appearance of lawyers and may engage other expert assistance

 

	
  

	
(3)

	
must be satisfied that the parties have made a determined and genuine effort to resolve the dispute and have co-operated with the mediator

 

	
  

	
(4)

	
must act fairly, in good faith and without bias with the purpose of seeking a resolution of the dispute and will treat all matters in confidence

 

	
  

	
(5)

	
have regard to the fairness and reasonableness of any matters pertaining to the dispute and Healthy Life’s need to maintain the integrity of the Healthy Life Image and the Healthy Life System

 

	
  

	
(6)

	
must deal with any matter as expeditiously as possible

 

	
  

	
(iii)

	
the parties to the mediation agree that:

 

	
  

	
(1)

	
everything that occurs before the mediator will be in confidence and in closed session

 

	
  

	
(2)

	
all discussions will be without prejudice

 

	
  

	
(3)

	
no one can call into evidence in any subsequent litigation any document brought into existence specifically for the purpose of the mediation process

 

	
  

	
(4)

	
the mediator is immune from liability

 

	
  

	
(5)

	
the mediation costs will be borne by the parties on an equal basis

 

	
  

	
(6)

	
they will each bear their own cost of attending the mediation.

 

	
25

	
Guarantee and indemnity

 

	
25.1

	
GUARANTEE FOR CONSIDERATION

 

Each of the Guarantors jointly, severally, unconditionally and irrevocably agree to the obligations set out in this clause 25:

 

	
  

	
(a)

	
as consideration for Healthy Life, at the request of the Guarantors, entering into this agreement

 

	
  

	
(b)

	
for valuable consideration, the receipt and sufficiency is acknowledged by the Guarantors

 

	
  

	
(c)

	
acknowledging that if there is more than one Guarantor Healthy Life may, in its discretion, proceed against any one or more Guarantors.

 

	
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Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

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25.2

	
GUARANTEE

 

Each Guarantors guarantees to Healthy Life that the Franchisee will duly perform and observe each and every warranty, undertaking, agreement and other obligation on the Franchisee’s part contained in this agreement regardless of any legal limitation or incapacity of or other circumstances relating to the Franchisee including

 

	
  

	
(a)

	
the payment of all monies on the dates, at the times, and in the manner specified

 

	
  

	
(b)

	
the indemnities given by the Franchisee under clause 21.

 

	
25.3

	
INDEMNITY

 

Each Guarantors indemnifies Healthy Life and its officers, employees, agents, related bodies corporate and contractors on a continuing and full indemnity basis against all Liability suffered or incurred by Healthy Life its officers, employees, agents, related bodies corporate and contractors arising from or in connection with:

 

	
  

	
(a)

	
any breach or non-observance by the Franchisee of this agreement including any of the obligations or conditions contained or implied in this agreement or any other agreement between Healthy Life and the Franchisee

 

	
  

	
(b)

	
any act, neglect or default of the Franchisee or any of the Franchisee’s officers, employees, related bodies corporate and agents or others for whom the Franchisee is legally responsible in connection with the Franchise.

 

	
25.4

	
CONTINUING INDEMNITY

 

The indemnity in clause 25.3 will continue and each Guarantor remains liable to Healthy Life even if:

 

	
  

	
(a)

	
Healthy Life has exercised any of Healthy Life’s rights under this agreement including Healthy Life’s rights of termination

 

	
  

	
(b)

	
the guarantee in clause 25.2 is for any reason wholly or partly unenforceable.

 

	
25.5

	
DELAY AND OTHER MATTERS

 

The obligations and liability of each Guarantor under this agreement is not affected:

 

	
  

	
(a)

	
if Healthy Life:

 

	
  

	
(i)

	
grants time or other indulgences or concessions to the Franchisee or Guarantors

 

	
  

	
(ii)

	
compounds, compromises, releases, abandons, waives, varies, relinquishes or renews of any its rights against the Franchisee or the Guarantors

 

	
  

	
(iii)

	
neglects or fails to enforce any of its rights against the Franchisee or the Guarantors

 

	
  

	
(b)

	
by any other act, matter or thing which under the law relating to sureties would or might but for this provision release the Guarantor from its obligations.

 

	
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25.6

	
CONTINUING AND PRINCIPAL OBLIGATIONS

 

The obligations and liability of each Guarantor set out in this clause 25 are:

 

	
  

	
(a)

	
a continuing security and may not be wholly or partially discharged while:

 

	
  

	
(i)

	
any money is or may become owing under this agreement

 

	
  

	
(ii)

	
any payment Healthy Life received may subsequently be avoided as a result of any law relating to insolvency or otherwise

 

	
  

	
(iii)

	
while the Franchisee has any outstanding obligations under any other term of this agreement

 

	
  

	
(b)

	
a principal obligation and are not ancillary or collateral to any other obligation or subject to any condition precedent

 

	
  

	
(c)

	
in addition to and not at substitution for any other rights which Healthy Life may have

 

	
  

	
(d)

	
enforceable without prior recourse to any other rights or remedies

 

	
  

	
(e)

	
enforceable against any Guarantor who has signed it even if it has not been signed by or may not be enforceable against any other party.

 

	
25.7

	
LIABILITY AS PRINCIPAL

 

Each Guarantor waives any rights the Guarantor may have to require Healthy Life to proceed first against or claim payment from the Franchisee to the intent that as between Healthy Life on the one hand and the Guarantors on the other hand, the Guarantor is considered to be liable as a principal as if the Guarantor entered into this agreement.

 

	
25.8

	
NON-REVOCATION

 

The obligations and liability of each Guarantor under this clause will not be revoked, discharged or affected by any of the following events whether the event occurs with or without the knowledge or consent of the Guarantor:

 

	
  

	
(a)

	
the death, incapacity, bankruptcy, insolvency, winding up or change either in the name or constitution (notwithstanding any provision of the law relating to partnerships) of Healthy Life, the Guarantor or the Franchisee

 

	
  

	
(b)

	
any variation of the terms of, or the Transfer or termination of, any contract or arrangement between Healthy Life and the Franchisee (including withdrawal of agency and credit facilities)

 

	
  

	
(c)

	
Healthy Life’s granting at any time or other indulgence to the Franchisee or the compounding or compromising or the full or partial release of the Franchisee from any liability

 

	
  

	
(d)

	
any judgment Healthy Life obtains against the Franchisee

 

	
  

	
(e)

	
Healthy Life’s delay, mistake, act or omission whether it prejudices the Guarantor or not

 

	
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(f)

	
the taking, discharge, impairment or release wholly or partially of any additional or substituted security or guarantee or indemnity in respect of the Franchisee obligations to Healthy Life or Healthy Life’s enforcing or not enforcing any security, guarantee or indemnity, or

 

	
  

	
(g)

	
any invalidity or irregularity surrounding the execution of this Guarantee by the Guarantor.

 

	
25.9

	
NO OBLIGATION TO NOTIFY OF DEFAULT

 

Healthy Life does not have to:

 

	
  

	
(a)

	
notify the Guarantor of any default by the Franchisee

 

	
  

	
(b)

	
marshal in favour of the Guarantor any security, funds or assets which it holds or may be entitled to receive or have a claim upon.

 

	
25.10

	
NO RECOVERY IN COMPETITION WITH HEALTHY LIFE

 

The Guarantor must not without Healthy Life’s consent either directly or indirectly, at any time in relation to the winding up or bankruptcy or any formal or informal arrangement with creditors of the Franchisee or any person jointly or severally liable with the Franchisee or the Guarantor:

 

	
  

	
(a)

	
recover or claim any sum paid under this agreement

 

	
  

	
(b)

	
claim or receive the benefit of any distribution, dividend or payment

 

	
  

	
(c)

	
claim to be subrogated to Healthy Life’s position in respect of, or claim the benefit or transfer of, or participate in, any security Healthy Life now or afterwards hold, or

 

	
  

	
(d)

	
prove or claim in competition with Healthy Life or exercise or attempt to exercise those rights so as to lessen any amount which Healthy Life would otherwise have been entitled to receive in any winding up, bankruptcy or arrangement with creditors.  The receipt by Healthy Life of any amount will not prejudice Healthy Life’s right to receive payment in full from the Guarantor.

 

	
25.11

	
SET OFF

 

Healthy Life may set off the whole or any part of any liability of the Guarantor and/or the Franchisee to Healthy Life against any amount payable by Healthy Life to the Franchisee and/or the Guarantor on any account.  However the Guarantor may not deduct, withhold or set off any amount from or against any payment due by the Guarantor to Healthy Life, nor raise any defence counter claim, estoppel or set off which may have been available to the Franchisee.

 

	
26

	
Franchisee as trustee

 

	
26.1

	
APPLICATION

 

This clause 26 applies if the Franchisee enters this agreement as trustee of any trust.

 

	
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last amended 17 November 2010

	  

 

  

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26.2

	
WARRANTIES

 

The Franchisee warrants that:

 

	
  

	
(a)

	
it has entered into this agreement in its capacity as trustee of the trust and for the benefit of the beneficiaries of the trust

 

	
  

	
(b)

	
it has power under the trust deed to enter into and observe its obligations under this agreement

 

	
  

	
(c)

	
it is the only trustee of the trust and there has been no proposal or decision to appoint an additional trustee to the trust

 

	
  

	
(d)

	
it has not been removed from, ceased to act, or resigned from the office of trustee of the trust and there has been no proposal or decision to remove the Franchisee as trustee of the trust

 

	
  

	
(e)

	
it is not in default under the trust deed

 

	
  

	
(f)

	
it has a right, and will at all times have a right, to be fully indemnified out of the assets of the trust in respect of obligations of the Franchisee under this agreement and the assets of the trust are sufficient to satisfy that right of indemnity.

 

	
26.3

	
OBLIGATIONS

 

The Franchisee must not permit any of the following events to occur without Healthy Life’s prior written consent, to the extent it has any control over the event:

 

	
  

	
(a)

	
any resettlement, appointment, or distribution of any of the assets of the trust

 

	
  

	
(b)

	
any retirement or replacement of trustee or any appointment of a new trustee of the trust

 

	
  

	
(c)

	
any amendment to the trust deed establishing the trust

 

	
  

	
(d)

	
any breach of the provisions of the trust deed.

 

	
27

	
Miscellaneous

 

	
27.1

	
ENTIRE AGREEMENT

 

In relation to its subject matter this agreement:

 

	
  

	
(a)

	
constitutes the entire agreement between the parties

 

	
  

	
(b)

	
supersedes any previous understandings or agreements.

 

	
27.2

	
AMENDMENT

 

This agreement may only be amended, supplemented, replaced or novated by a document executed by all the parties.

 

	
27.3

	
COUNTERPARTS

 

This agreement may be executed in any number of counterparts and all of those counterparts taken together constitute one and the same document.

 

	
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last amended 17 November 2010

	  

 

  

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27.4

	
JOINT AND SEVERAL

 

Where:

 

	
  

	
(a)

	
two or more parties have an obligation or liability under this agreement, the obligation or liability is joint and several

 

	
  

	
(b)

	
a party consists of two or more people, then the obligations and liability of those persons under this agreement is joint and several.

 

	
27.5

	
DEFAULT INTEREST

 

The Franchisee must Healthy Life’s interest, at a rate being 2% above the overdraft rate of Healthy Life’s current bankers calculated on daily basis, on any overdue amount the Franchisee owes to Healthy Life and Healthy Life may recover the interest from the Franchisee despite termination of this agreement.

 

	
27.6

	
NO SET OFF

 

The Franchisee must not withhold payment to Healthy Life or claim any set off against any payments due to Healthy Life for any reason other than for any amount for which the Franchisees has a final judgement or order.

 

	
27.7

	
FORCE MAJEURE

 

Except for the payment of money, neither Healthy Life nor the Franchisee is liable to the other for any loss caused by the failure to observe and perform the terms and conditions of this agreement on its part to be observed and performed where that that failure is caused by anything beyond the reasonable control of the breaching party including war, insurrection, fire, floods, strikes, lockouts, delays in transport, breakdowns in machinery, any other action by any authority or governmental agency.

 

	
27.8

	
INDEPENDENT CONTRACTORS

 

Healthy Life and the Franchisee:

 

	
  

	
(a)

	
are each independent contractors are not and will not be considered as joint venturers, partners or agents of each other except to the extent that any relationship is expressed in writing to exist between them, and

 

	
  

	
(b)

	
do not have a fiduciary relationship.

 

	
27.9

	
WAIVER

 

Unless specifically stated to the contrary in this agreement, a party’s:

 

	
  

	
(a)

	
failure to enforce or a delay in enforcing any of its rights under this agreement does not constitute a waiver of those rights

 

	
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Healthy Life franchise agreement (MASTER)

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(b)

	
partial exercise of a right does not preclude any further exercise of that or any other right

 

	
  

	
(c)

	
waiver of any right arising under this agreement or remedy arising upon default under this agreement must be in writing and signed by the party granting the waiver.

 

	
27.10

	
SEVERANCE

 

If any provision of this agreement is held to be prohibited, invalid or unenforceable in any jurisdiction:

 

	
  

	
(a)

	
that provision is ineffective to the extent of the prohibition, invalidity or unenforceability in that jurisdiction

 

	
  

	
(b)

	
the validity or enforceability of that provision is not affected in any other jurisdiction

 

	
  

	
(c)

	
the remaining provisions of this agreement are not affected.

 

	
27.11

	
SIGNATORIES

 

Each person who signs this document on behalf of a party declares that that person has no notice of the revocation or suspension of the power under the authority by which the person signs this document.

 

	
27.12

	
FURTHER ASSURANCES

 

The Franchisee and Guarantors must do everything reasonably necessary to give effect to this agreement and the transactions contemplated by it, including the execution of documents.

 

	
27.13

	
EXCLUSION OF MORATORIUM

 

To the extent not excluded by law, a provision of any legislation which at any time directly or indirectly:

 

	
  

	
(a)

	
lessens or otherwise varies or affects in favour of the Franchisee, any obligations under this agreement, or

 

	
  

	
(b)

	
stays, postpones or otherwise prevents or prejudicially affects Healthy Life’s exercise of any power or rights under this agreement, is negatived and excluded from this agreement and all relief and protection conferred on the Franchisee by or under that legislation is also negatived and excluded.

 

	
27.14

	
PRIOR UNDERSTANDING

 

The Franchisee acknowledges that prior to having executed this agreement, the Franchisee has carefully read the provisions of this agreement and has understood them.

 

	
27.15

	
GOVERNING LAW

 

This agreement is governed by the law in force in New South Wales and the parties submit to the non-exclusive jurisdiction of the courts of or exercising jurisdiction in New South Wales.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

45

  

 

	
27.16

	
NOTICES

 

The parties’ addresses for delivery of notice are set out in the schedule and on page 1 of this agreement.  A notice by a party:

 

	
  

	
(a)

	
is taken to be given if it is made in writing and issued by the sender, and delivered by hand, post, facsimile or electronically

 

	
  

	
(b)

	
subject to clause (c) is taken as being received:

 

	
  

	
(i)

	
if it is delivered by hand or courier - when actually delivered

 

	
  

	
(ii)

	
if it is posted:

 

	
  

	
(1)

	
in Australia to an address in Australia, on the 3rd Business Day after posting

 

	
  

	
(2)

	
in Australia to an address outside Australia, on the 7th Business Day after posting

 

	
  

	
(3)

	
outside Australia to an address in or outside Australia, on the 7th Business Day after posting

 

	
  

	
(iii)

	
if it is sent electronically or by facsimile, when the device through which the notice is sent reports that the notice has been sent.  The report must be in readable form and capable of being reproduced on paper.

 

	
  

	
(c)

	
that is received or taken to be received under clause 27.16(b) on a day that is not a Business Day or after 5.00pm on a Business Day, is taken to be received on the next Business Day.

 

	
27.17

	
SPECIAL CONDITIONS

 

This agreement incorporates and must be read subject to any special conditions set out in the schedule.

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

46

  

Schedule

	
Franchisee

	  
	
Guarantors

	  
	
Premises

	  
	
Business Name

	  
	
Commencement Date

	  
	
Term

	
5 years

	
Joining Fee

	
$xxx+ GST

	
Legal Fee

	
$xxx + GST

	
Franchise Fee

	
xx% of Gross Sales plus GST

	
Marketing Contribution

	
xx% of Gross Sales plus GST capped at $10,000 plus GST per annum

	
Administration Fee

	
$xxxx plus GST per annum + CPI

	
Renewal Fee

	
$xxx plus GST

	
Transfer Fee

	
$xxxx plus GST if transferred to a non-Healthy Life franchisee

 

$xxxx plus GST if transferred to an existing Healthy Life franchisee

	
Territory

	  

	
Trade Marks

	  	
Registration number

	
Classes

	  	

	
1271763

	
3, 5, 16, 25, 29, 30, 35, 39, 41, 42

	 	 	 	 
	  	
CLUBLIFE

	
970549

	
16, 41 and 44

	 	 	 	 
	  	

	
1271779

	
3, 5, 16, 25, 29, 30, 35, 41 and 43

	  	

	
643815

	
3, 5, 16, 25, 29, 30, 35 39, 41, 42

	  	
 

	
1286503

	
3,5 and 44

	
Special Conditions

	
Legal costs in clause 22.1(c) are to be $xxxx plus GST

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

47

  

 

Signed as an agreement: 

 

	
Executed by Healthy Life Partners Pty

	
  )

	  
	
Limited ACN 084 265 421

	
  )

	  
	  	  	

  

	  	  	

Signature

	

  

	  	  
	

Signature

	  	

  

	  	  	

Full name (print please)

	

  

	  	  
	

Full name (print please)

	  	  
	  	  	
Secretary

	

Director

	  	

Position

	

Position (insert whether Secretary or Director)

	  	  

 

Execution clause for Franchisee (choose one of three options):

Option 1: If Franchisee is an individual rather than a company, use this clause

	
Signed by

	
 

	
  )

	  
	
in the presence of:

	
  )

	  
	  	  	

   

	  	  	

Signature of franchisee

	

Signature of witness

	  	  
	  	  	  
	

  

	  	  
	

Full name (print please)

	  	  

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

48

  

 

Option 2: If Franchisee is sole director company, and that director is also the sole secretary use this clause

 

	
Executed by

	
 

	
  )

	

 

	  	
  )

	
Signature

	  	  	  
	
 

	  	  
	
Company name and ACN

	  	

  

	  	  	

Full name (print please)

	  	  	  
	  	  	
Sole Director and sole Secretary

	  	  	

Position

 

Date signed: ______________________

 

Option 3: If Franchisee is any other sort of company use this clause

	
Executed by

	
  )

	  
	  	
  )

	  
	  	  	
  

	
Company name and ACN

	  	
Signature

	  	  	  
	  	  	

  

	

  

	  	

Full name (print please)

	

Signature

	  	  
	

  

	  	

Director

	
 

	  	

Position

	
Full name (print please)

	  	  
	

  

	  	  
	 	 	 
	

Position (insert whether secretary or director)

	  	  

 

Date signed: ______________________

Execution clause for each of the Guarantors:

	
Signed by

	
 

	
  )

	  
	
in the presence of:

	
  )

	  
	  	  	

  

	

  

	  	

Signature of guarantor

	

Signature of witness

	  	  
	  	  	  
	

  

	  	  
	

Full name (print please)

	  	  

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

49

  

	
Signed by

	
 

	
  )

	  
	
in the presence of:

	
  )

	  
	  	  	

  

	

  

	  	

Signature of guarantor

	

Signature of witness

	  	  
	  	  	  
	

  

	  	  
	

Full name (print please)

	  	  

 

	
Corporate/525658_4

	
Healthy Life franchise agreement (MASTER)

last amended 17 November 2010

	  

 

  

50

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