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POLICIES AND PROCEDURES MANUAL
CHAPTER 2 - RETAILER RULES AND REGULATIONS
2.01 Applicability of These Rules
The Retailer Rules and Regulations contain specific rules, regulations, procedures, instructions and directives which apply to Lottery Retailers as defined by the Georgia Lottery for Education Act (“Act”). The Georgia Lottery Corporation (GLC) will, from time to time, amend these Rules and Regulations and adopt new Rules and Regulations. When this occurs, all existing Lottery Retailers will be advised of these changes. By signing a Retailer Contract, each Retailer shall comply with all terms, conditions, obligations and requirements of Retailers set forth in these Rules and Regulations, as they may be amended from time to time. When and if a Retailer is unwilling to agree to amendments and revisions to these Rules and Regulations, the Retailer’s sole recourse shall be to notify the GLC, within 30 days of being advised by GLC of the changes, that the Retailer is voluntarily canceling its Retailer Contract. In the event of a conflict between the Act, the Retailer Rules and Regulations, and the Retailer Contract, the Act will govern the Retailer Rules and Regulations, and the Retailer Rules and Regulations will govern the Retailer Contract.
2.02 Definitions
Capitalized terms used herein shall have the meanings set forth in Appendix A attached hereto, unless otherwise defined in context.
2.03 General Rules
(A) At each respective Retailer Business Location listed in the Retailer Contract for which a Certificate of Authority has been issued, each Retailer shall sell GLC lottery Tickets, but only for those lottery games authorized by the GLC, in the GLC’s sole discretion, to be sold at each such Retailer Business Location. The lottery games authorized by the GLC may include Instant Games, On-Line Games, and any other games which may be developed, distributed and sold under the authority of the GLC. For each of the GLC lottery games that the Retailer is authorized by GLC to sell, the Retailer shall abide by any and all Rules and Regulations adopted by GLC to govern each respective game.
(B) No Lottery Retailer may sell any GLC lottery Tickets at any location unless that Lottery Retailer has in effect a Retailer Contract issued in accordance with the Act which has not been terminated, suspended, canceled or revoked. No Lottery Retailer shall sell any lottery Tickets or Shares except from a Retailer Business Location listed in its Retailer Contract and as evidenced by the display of a Certificate of Authority for such Retailer Business Location; however, in certain instances, the GLC may issue a temporary Certificate of Authority to specifically authorize the sale of Tickets from a temporary location.
(C) If GLC issues a Certificate of Authority for more than one Retailer Business Location listed in the Retailer Contract, to the extent that it may be necessary for administrative or regulatory purposes, the Retailer Contract shall be deemed a separate contract for each such Retailer Business Location. In the event that the GLC and Retailer may enter into more than one Retailer Contract for any specific Retailer Business Location, whether at time of Retailer Contract renewal or otherwise, the most recently dated Retailer Contract shall amend, renew, replace, and restate any prior Retailer Contract in its entirety for each of the Retailer Business Locations listed therein.
(D) No Lottery Retailer can be exclusively engaged at any Retailer Business Location in the business of selling lottery Tickets, nor sell Tickets from a mobile or residential location.
(E) For each location at which Tickets are to be sold, a Retailer Contract is required which lists the designated location as a Retailer Business Location. A Retailer applicant who desires to operate more than one (1) Retailer Business Location to sell Tickets must submit separate information for each such location in such form as the GLC may require. The GLC, in its sole discretion, may authorize the sale of lottery Tickets for all, any or none of the GLC’s lottery games from each such respective location.
(F) No Retailer Contract is assignable or transferable, in whole or in part, to any person or entity. No Retailer Contract is transferable to any location(s) other than as specified in the Retailer Contract. For purposes of a Retailer Contract, any of the following will be deemed to be an impermissible assignment of the Retailer Contract which may result in the Retailer Contract for that Retailer Business Location being suspended or revoked: the change in ownership of a controlling equity interest in the Retailer; or the addition or deletion of any of the owners holding more than ten (10) percent of the Retailer; or the sale of all or substantially all of the assets of the Retailer; or a change in the location of the Retailer’s business or in the nature of the business of the Retailer. Any proposed new owner must file a new application for a Retailer Contract. If the required prior notice is provided to the GLC in writing at least twenty (20) days before any proposed business or location change or change in ownership, an interruption of Lottery Terminal operation may possibly be avoided.
(G) An applicant or Retailer shall notify the GLC of any change in the information in the applicant’s or Retailer’s most recent application for a Retailer Contract or renewal of a Retailer Contract. The applicant or Retailer shall notify the GLC of the change in the information within ten (10) days following the date of the change. Notwithstanding the preceding sentence, a corporate applicant or Retailer is not required to notify the GLC under this subsection of a transfer of less than ten (10) percent of the corporate stock unless the transfer results in a change in ownership of a controlling equity interest in the Retailer or the addition or deletion of any of the owners holding more than ten (10) percent of the Retailer.
(H) No person shall sell a Ticket or Share at a price other than established by the GLC, unless authorized in writing by the CEO. No person other than a duly contracted Lottery Retailer shall sell lottery Tickets, but this shall not be construed to prevent a person who may lawfully purchase Tickets or Shares from making a gift of lottery Tickets or Shares to another. Nothing shall be construed to prohibit the GLC from designating certain of its representatives and employees to sell or give lottery Tickets or Shares directly to the public.
(I) Lottery Tickets or Shares may be given by merchants as a means of promoting goods or services to customers or prospective customers, subject to prior approval by the GLC.
(J) Retailers shall not condition the sale of lottery Tickets upon the purchase of any other goods or services and shall not impose any other unauthorized restriction or condition upon the sale or redemption of lottery Tickets. Neither Retailer nor its employees shall request, demand or accept gratuities or other remuneration of any kind in exchange for the performance of any obligation required under the Retailer Contract, unless specifically authorized by the GLC.
(K) No lottery Tickets shall be sold to Minors (persons under eighteen (18) years of age). Retailer shall establish such safeguards as are necessary to ensure that no sales are made or prizes paid to Minors, except as otherwise provided in the Act and Rules and Regulations. However, this does not prohibit the purchase of a lottery Ticket by a person eighteen (18) years of age or older for the purpose of making a gift to any person of any age. Retailer shall place any vending machine utilized for the purpose of dispensing Instant Tickets only in locations on the premises which are within the view of such Retailer or an employee of same, and said vending machine shall bear a conspicuous label prohibiting its use by Minors.
(L) Retailers shall not extend credit to the purchaser of lottery Tickets and shall not accept a check, credit card, charge card or food stamps for the purchase of a lottery Ticket.
(M) Retailers shall not sell lottery Tickets by mail, telephone, fax or other similar method of communication.
(N) Retailers shall make the purchase of Tickets conveniently and readily accessible to their customers during the Retailers’ normal business hours, unless circumstances arise that are out of the control of the Retailer and could not have been avoided by the exercise of due care.
(O) Retailers shall maintain a copy of game rules, as well as “how to play” brochures, for all Instant Games and On-Line Games being sold for the GLC at the Retailer Business Location at any particular time.
(P) Retailers shall only accept from players official Georgia Lottery Play Slips that are manually prepared.
(Q) Retailers shall maintain a GLC Retailer Reference Manual, or its equivalent on the GLC On-Line Terminal, on the premises during normal business hours and ensure that it contains all current GLC Retailer information.
(R) Retailers shall not sell lottery Tickets or Shares in the state of Georgia other than those issued to it by the GLC.
(S) Retailers shall not knowingly sell a Ticket or combination of Tickets to any person or entity which would guarantee such purchaser a grand prize win or a jackpot win.
(T) Retailer shall attend training sessions from time to time, as requested by the GLC.
(U) Retailer shall:
(1) immediately report to the GLC’s Security Department any knowledge of unlawful activities or other improprieties that concern the operations of the GLC or the GLC’s lottery games;
(2) immediately report all stolen Instant Tickets to the GLC’s Security Department as soon as possible upon discovery of the theft. In addition, the Retailer shall file a police report for the stolen Tickets. A copy of the police report shall be forwarded to the GLC upon request; and
(3) fully cooperate with the GLC in the investigation of any lost, stolen, altered, or counterfeit lottery Tickets or other unlawful or improper activities affecting the operations of the GLC or the GLC’s lottery games.
(V) If more than one Retailer Business Location is to be covered by a Retailer Contract, each such location shall be listed in a Schedule I attached to the Retailer Contract. Locations may be added or deleted from Schedule I by mutual agreement of Retailer and GLC, effective upon the date of a revised Schedule I signed by both Retailer and GLC; however, GLC may cancel, deny, revoke, suspend, terminate, or refuse to renew the Retailer Contract with regard to any individual location(s) for any of the reasons set forth in Section 2.07 below.
(W) In the event that the Retailer’s business, or any of its Retailer Business Locations, is sold, the Retailer shall continue to be liable for the successor owner’s GLC transactions as if the successor owner were an agent of the Retailer, unless and until timely written notice from Retailer on or before such transfer is delivered to GLC specifically requesting cessation of GLC sales at the transferred Retailer Business Location(s). The CEO may adopt from time to time any appropriate and necessary procedures to verify the ownership of a Retailer and/or any Retailer Business Location to ensure that Tickets in fact are sold only by Retailers under an approved Retailer Contract, all in accordance with the Act and the Rules and Regulations.
2.04 Other Retailer Obligations and Agreements
(A) Retailer shall maintain such financial and accounting records relating to lottery Ticket sales and its performance under the Retailer Contract, in such form as the GLC shall from time to time prescribe. Retailer shall file reports with the GLC specifying the Retailer’s receipts and transactions relating to the sale of lottery Tickets on such forms and in such manner as shall be required from time to time by the GLC. Retailer shall make such records available for inspection and review at any time during Retailer’s normal business hours by any GLC employees or agents designated to take such action by the CEO.
(B) By entering into the Retailer Contract, the Retailer:
(1) acknowledges that the GLC has made no representations or warranties as to whether Retailer may or may not be prohibited from engaging in the sale of lottery Tickets by reason of any controlling federal statute, rule or regulation; and
(2) represents and warrants to the GLC that it is not prohibited from entering into the Retailer Contract or engaging in the sale of lottery Tickets by any deed, lease, contract, charter, bylaw or other restriction; and
(3) represents and warrants to the GLC that Retailer fully satisfies all requirements for a “Retailer” as defined in the Act; and
(4) agrees and acknowledges that failure by Retailer to comply with any of the terms or provisions of the Retailer Contract, including the provisions of the Act and the Rules and Regulations, shall constitute a breach of the Retailer Contract; and
(5) agrees and acknowledges that Retailer shall be liable for all costs incurred by the GLC in enforcing the Retailer Contract and in collecting any amounts due to the GLC from Retailer thereunder, including interest on the outstanding balance due accruing at the rate of one percent (1%) per month, and including court costs and attorneys’ fees not to exceed 15% of the outstanding balance due; and
(6) agrees and acknowledges that it shall defend, protect and hold harmless the State of Georgia, the GLC, and any and all officers, directors, employees and agents thereof, from and against all claims, suits or actions arising from any willful or negligent act or omission of Retailer or its officers, directors, employees or agents while performing its obligations under the Retailer Contract; and
(7) agrees and acknowledges that it is responsible for any loss or property damage to the GLC or its Vendors which results from a willful or negligent act or omission of Retailer or which results from the failure on the part of Retailer to secure, maintain and administer any such property in accordance with sound management practices.
(8) agrees and acknowledges that it is responsible for making or having made, and bearing all costs associated therewith, any and all necessary or appropriate modifications to its telecommunications systems or facilities which are reasonably requested by the GLC to facilitate the installation, operation and maintenance of any lottery related equipment, including Lottery Terminals and display monitors.
(C) Retailer shall not subcontract any of its duties or obligations under the Retailer Contract.
(D) Retailer shall exercise control and supervision over its employees selling lottery Tickets and shall be fully responsible and liable for their conduct, as it relates to the sale of lottery Tickets. Retailer shall provide instructions to its employees concerning the Act, the Rules and Regulations and the Retailer Contract.
(E) Retailer shall maintain any and all bank accounts required by the GLC.
(F) Retailer shall not sell any lottery Tickets or hold itself out as a Lottery Retailer if the Retailer Contract is no longer in force for any reason, whether by virtue of suspension, termination, revocation, cancellation or non-renewal.
(G) Retailer shall return to the GLC all lottery Tickets, goods, materials, and lottery equipment delivered to the Retailer pursuant to the Retailer Contract upon cancellation, denial, termination, suspension, revocation or non-renewal of the Retailer Contract or upon demand by the GLC.
(H) Retailer shall not use a GLC insignia, logo, trademark, service mark or name of any GLC lottery game in an advertisement without the prior written authorization of the CEO in each instance.
(I) Retailer shall not display or publish lottery related material which may be considered derogatory or adverse to the operation or dignity of the GLC or the State of Georgia. Retailer shall remove any such materials from the Retailer Business Location upon the request of the GLC.
(J) Retailer shall accurately complete, timely return, and otherwise comply with any and all information update requests or other forms required by the GLC from time to time during the term of the Retailer Contract. Such information requests shall include, but not be limited to: requests by the GLC for information to verify the ownership of any Retailer Business Location; requests to verify the continuing qualification of a Retailer under the Act, Rules and Regulations, and under the Retailer Contract; and periodic requests made to renew a Retailer Contract in accordance with the Act and Rules and Regulations.
(K) Retailer shall perform its obligations under the Retailer Contract solely as an independent contractor of the GLC, and not as an agent, partner, joint venturer or employee of the GLC or the State of Georgia.
(L) Notices.
1. Retailer shall notify the GLC in writing at least twenty (20) calendar days in advance of any of the following changes:
a. voluntary cancellation of the Retailer Contract by Retailer pursuant to Section 2.07 below; or
b. the change in any Retailer Business Location(s) listed in the Retailer Contract; or
c. the change in the designated separate bank account from which payments are to be made (see Section 2.12 below); or
d. the change in ownership of Retailer’s business at any Retailer Business Location in the event that the new owner has applied to become a Retailer at such location pursuant to Section 2.03(F) above.
2. Retailer shall notify the GLC in writing no more than ten (10) calendar days after the occurrence of any of the following changes:
a. the change in any of the information submitted to GLC in the Retailer’s most recent application, including ownership changes, pursuant to Section 2.03(G) above; or
b. the death or incapacity of owner(s), partner(s), sole proprietor, etc.; or
c. any change causing Retailer no longer to satisfy fully all requirements of a “Retailer” as defined in the Act. Specifically, without limitation, Retailer shall submit such notice if, at any time during the term of the Retailer Contract, Retailer or any of its owners are convicted of, or enter a plea of guilty or nolo contendere, to a criminal offense prohibited by the Act, or have assessed against them a tax delinquency, within ten (10) calendar days of the occurrence of such event.
(M) No waiver by either the GLC or the Retailer of any term or provision of the Retailer Contract, or of any default thereunder, shall affect such party’s rights thereafter to enforce such term or provision or to exercise any right or remedy in the event of any other default, whether or not similar.
(N) The invalidity or unenforceability of any term or provision of the Retailer Contract shall not affect or diminish the validity or enforceability of the remaining provisions contained therein.
2.05 Retailer Selection Criteria
(A) Retailer selection criteria established by the GLC are designed to comply with all requirements of the Act, to provide clear and objective guidelines to Retailer applicants and to maximize the participation of Retailers in the State of Georgia.
(B) Retailer applicants will be eligible to become Retailers and be eligible to be authorized by GLC, in GLC’s sole discretion, to sell Tickets for Instant Games at one or more of its Retailer Business Locations if:
(1) the applicant returns a completed application form; and
(2) the applicant provides a listing of all proprietors, partners, corporate officers and shareholders of closely held corporations holding more than ten (10) percent of the ownership interest in the applicant; and
(3) the applicant provides a certification of compliance with the provisions of the Act; and
(4) the applicant provides a notarized consent form from each proprietor, partner, corporate officer or shareholder of closely held corporations holding more than ten (10) percent of the ownership interest, thereby allowing the GLC to investigate criminal, financial and tax status; and
(5) the applicant is not reported as delinquent in filing or payment of taxes by the Georgia Department of Revenue; and
(6) the applicant, including all proprietors, partners, corporate officers or shareholders holding more than ten (10) percent of the ownership interest, have not been convicted of a criminal offense prohibited by the Act; and
(7) the applicant, including all proprietors, partners, corporate officers or shareholders holding more than ten (10) percent of the ownership interest, either:
a) meets an acceptable level of creditworthiness as assessed through an independent credit agency, and has an acceptable level of creditworthiness, in the GLC’s sole discretion, based upon the current or prior payment history with the GLC; or
b) provides a financial security deposit or other credit enhancement acceptable to the GLC; and
(8) the applicant submits the required application fee for each Retailer Business Location; and
(9) the applicant establishes a separate bank account in the name of the Retailer as “Trustee for the Georgia Lottery Corporation” for lottery proceeds and provides the banking information to the GLC which enables collection of the net lottery proceeds by way of Electronic Funds Transfer (EFT); and
(10) the applicant has one (1) or more individuals from each Retailer Business Location attend and successfully complete the training program prescribed by the GLC; and
(11) none of the applicant’s proposed Retailer Business Locations is an establishment featuring entertainment which would not be consistent with the dignity of the State of Georgia, the GLC, and the citizens they serve; and, specifically, the applicant is not in the business of conducting or allowing to be conducted on its premises at any proposed Retailer Business Location, live shows and exhibits in which sexually explicit nude portions of the human body are displayed, nor does the applicant’s business, at any proposed Retailer Business Location, derive fifteen (15) percent or more of its gross income from the selling or loaning for monetary consideration pictures, photographs, drawings, sculptures, motion picture films, books, pamphlets, magazines, printed matter however reproduced, sound recordings or similar visual representations or images of a person or portion of the human body which depicts sexually explicit nudity, sexual conduct, or sadomasochistic abuse or explicit and detailed verbal descriptions or narrative accounts of sexual excitement, sexual conduct, or sadomasochistic abuse; and
(12) after a visit to each proposed Retailer Business Location by a Lottery Merchandising Representative, the GLC determines that all information provided by the Retailer appears accurate and that each such retail establishment sells products other than lottery Tickets, provides services other that those described in Section 2.05 (B) (11) of these rules and is not a mobile or residential location.
(13) Retailer signs a Retailer Contract or Retailer Contracts, in form and content satisfactory to the GLC, which list all proposed Retailer Business Locations.
(14) For an applicant, including all proprietors, partners, corporate officers or shareholders holding more than ten (10) percent of the ownership interest, that has ever held a like position or ownership interest in any GLC Retailer which has or has had an outstanding unpaid balance owing to the GLC, the applicant:
(a) must satisfy in full any legally enforceable outstanding balance which was not paid to the GLC when due; and
(b) may be required, in the GLC’s sole discretion, to provide a financial security deposit or other credit enhancement acceptable to the GLC.
(15) The applicant provides either: (i) a personal guaranty of performance signed by each proprietor, partner, member, corporate officer or shareholder of closely held businesses, who hold more than ten (10) percent of the ownership interest; or (ii) provides such other acceptable credit enhancements or agrees to such other contract terms as allowed by the GLC in its sole discretion in accordance with uniform criteria approved by the CEO.
(16) For a Retailer Business Location which has previously not been successful as a lottery retailer, as determined in the sole discretion of the GLC, and for which there is one (or more) outstanding balance(s) remaining unpaid to the GLC, the GLC may deny or defer the approval of any new Retailer Contract application for that same Retailer Business Location for such time period as may be determined by the GLC in its sole discretion in accordance with uniform criteria approved by the CEO.
The foregoing notwithstanding, the GLC may deny a Retailer Contract to any Retailer applicant in accordance with Section 2.07 of the Retailer Rules and Regulations.
(C) In addition to the foregoing, a Retailer will be eligible to be authorized by GLC, in GLC’s sole discretion, to sell Tickets for On-Line Games at one or more of its Retailer Business Locations if:
(1) the Retailer is already authorized by GLC to sell Tickets for Instant Games; and
(2) the Retailer Business Location is the highest selling Instant Games Retailer Business Location in its postal zip code, or the GLC determines that there is a need for additional Lottery Terminals in that postal zip code, or the Retailer meets other uniform criteria established by the GLC; and
(3) the Retailer has complied with the installation requirements for an On-Line Games Lottery Terminal at each such Retailer Business Location; and
(4) the Retailer has had one or more employees from each such Retailer Business Location attend On-Line Games training; and
(5) the Retailer has not been delinquent with EFT transactions within the previous ninety (90) days; and
(6) the Retailer has demonstrated adherence to all GLC Rules and Regulations, including but not limited to payment of prizes to lottery players as demonstrated by the GLC’s record of Retailer validations and sales.
(D) All Retailer applicants will be informed within reasonable time periods of their failure to comply with any of the provisions in Section 2.05(B) and 2.05(C) above as well as specific details of the non-compliance. The GLC will assist the Retailer applicant on a “best efforts” basis to resolve any outstanding issue.
(E) Notwithstanding the criteria in Section 2.05(B) and 2.05(C) above, the GLC, in its sole discretion, may authorize exceptions to the listed criteria and authorize a Retailer to sell Tickets for Instant Games or On-Line Games when the Retailer does not meet all the criteria. The intent of this provision is to allow the GLC to ensure compliance with the intent and spirit of the Act by enforcing the mandatory retailer selection criteria set forth in the Act, while allowing other exceptions to the GLC Retailer Rules and Regulations when appropriate to follow the mandates of the Act to maximize revenue while ensuring that the GLC is operated with integrity and dignity and free of political influence. Accordingly, appropriate example exceptions would include, but not be limited to, the following examples, which would allow the GLC to ensure that: (1) Instant Games, On-Line Games, and Lottery Terminals are available in all geographic areas of the state, are represented in a variety of trade styles, are accessible to Retailers which are “minority businesses”, as defined by the Act, and are available to support marketing initiatives with specific Retailers; and (2) administrative difficulties for Retailer applicants are avoided (e.g., consent forms would not necessarily need to be required from all corporate officers in a large multi-state conglomerate); and (3) appropriate businesslike risk-management decisions are made, such as waiving the requirement for personal guarantees for: (a) large publicly traded corporations with substantial net worth; (b) business entities that provide other forms of acceptable credit enhancements; or (c) for businesses with a long history of compliance with the terms of the GLC Retailer Contract.
(F) By signing a Retailer Contract, the Retailer shall be subject to the Act and Rules and Regulations, and, in particular, those Rules and Regulations governing the specific lottery games which the GLC has authorized the Retailer to sell.
2.06 Application, Service and Fidelity Fund Fees
(A) Applications submitted to the GLC for each Retailer Business Location, including applications for a change of ownership of an existing Retailer Business Location, must be accompanied by a cashier’s check, money order or business check (personal checks are not acceptable) in the amount necessary to cover: (i) a uniform application fee in the amount as may be determined by the GLC in its sole discretion, plus (ii) a deposit in the amount of $100.00 per Retailer Business Location to the Fidelity Fund established under the authority of the Act.
(B) The Fidelity Fund has been established pursuant to the Act and any losses due to the nonfeasance, malfeasance or misfeasance of a Retailer may be paid out of this fund.
(C) If a potential Retailer submits the application fee of $25.00 and either fails to qualify as a Retailer or withdraws their application prior to initiating the sale of Tickets, they will not receive a refund of this fee. However, those potential Retailers required to make a contribution to the Fidelity Fund who fail to qualify or withdraw their application prior to initiating the sale of Tickets will receive a refund of the amount deposited to the Fidelity Fund.
(D) A Retailer shall pay a service fee of $15.00 per week for each installed On-Line Lottery Terminal. This fee shall be included automatically in the settlement process and collected by EFT. This service fee may be waived in the discretion of the GLC in accordance with uniform minimum sales criteria and other criteria which may be established by the GLC from time to time.
(E) All Lottery Retailer Contracts may be renewable annually at the discretion of the GLC unless sooner canceled, terminated, suspended or revoked: provided, however, so long as the GLC has adequate personnel and resources, the GLC will require as part of the annual renewal process complete new contracts, applications and related information to be submitted no less frequently than every five (5) years. The GLC at its discretion may charge a renewal fee applicable to all Retailers.
2.07 Termination, Cancellation, Suspension and Revocation of the Retailer Contract
(A) The Retailer Contract may be canceled by Retailer at any time upon twenty (20) calendar days prior written notice to the GLC.
(B) If the CEO or CEO’s designee(s) determine, in their sole discretion, that cancellation, denial, revocation, suspension or termination of the Retailer Contract is in the best interest of the GLC, the State of Georgia or the public welfare, the CEO or CEO’s designee(s) may at any time cancel, deny, revoke, suspend or terminate the Retailer Contract upon written notice to Retailer; provided, however, Retailer shall first be entitled to a hearing on such cancellation, denial, revocation, suspension or termination in accordance with the Act and the Rules and Regulations; provided, further, that the CEO or CEO’s designee(s) may temporarily suspend Retailer’s rights under the Retailer Contract without prior notice, pending any prosecution, hearing or investigation, in accordance with the Act.
(C) In addition to the foregoing, the GLC may immediately cancel, deny, revoke, suspend, terminate, or refuse to renew a Retailer Contract if the Retailer or any of its owners:
(1) violates a provision of the Act or of the Rules and Regulations; or
(2) is or has been, or retains an employee involved in the sale of lottery Tickets who is or has been, convicted of a criminal offense related to the security or integrity of the GLC or a lottery in any other jurisdiction; or
(3) is or has been, or retains an employee involved in the sale of lottery Tickets who is, or has been, convicted of a gambling-related offense, false statements, false swearing or perjury in this or any other jurisdiction or a crime punishable by more than one year of imprisonment or a fine of more than $1,000.00 or both unless the person’s civil rights have been restored and at least five (5) years have elapsed from the date of the completion of the sentence without a subsequent conviction of a crime described above; or
(4) commits fraud, misrepresentation or deceit; or
(5) provides false or misleading information to the GLC; or
(6) acts in a manner prejudicial to the security or integrity, or the public confidence in the security or integrity, of the GLC; or
(7) conducts business for the sole purpose of selling lottery Tickets; or
(8) is delinquent in the payment of any federal, state or local taxes owed by it; or
(9) changes any Retailer Business Location for which GLC has issued a Certificate of Authority under the Retailer Contract; or
(10) fails to accurately or timely account for proceeds or prizes from the sale of lottery Tickets; or
(11) fails to accurately or timely account for lottery Tickets received from the GLC; or
(12) fails to comply with any term of the Retailer Contract; or
(13) fails to maintain a minimum level of sales, as established by the GLC from time to time; or
(14) substantially changes the ownership of Retailer without prior written notice to, or consent of, the GLC; or
(15) files for or is placed in bankruptcy, receivership, insolvency or similar proceedings or fails to pay its debts as they become due; or
(16) resides in the same household as any director, officer or employee of the GLC; or
(17) contracts with any other person or entity for lottery goods or services without the prior written approval of the GLC; or
(18) fails to meet any of the objective criteria established by the GLC pursuant to the Act; or
(19) is subjected to any material change, as determined to be material in the sole discretion of the GLC, in any matter considered by the GLC in entering this Retailer Contract; or
(20) fails to maintain the designated account from which Electronic Funds Transfers (EFT) payments are to be made, withdraws the authorization for the GLC to initiate EFT transactions to and from such designated account, or fails to have sufficient funds available in such designated account on the dates specified by the GLC.
(D) Any request for a hearing shall be in writing, addressed to the CEO, and must be filed with the GLC within five (5) calendar days of receipt of the notice of cancellation, denial, termination, revocation, suspension, or refusal to renew the Retailer Contract. The request must include a statement of the factual basis for the protest, and it must be signed by the Retailer. All requests for hearings shall be sent by certified mail, return receipt requested or hand delivered.
(E) All disputes shall be handled in accordance with the procedures outlined in the GLC’s Vendor, Supplier and Retailer Dispute Resolution Procedures and Remedies, available upon request. Prior to seeking judicial relief with respect to any claim or controversy in connection with a Retailer Contract, a Retailer must first pursue and exhaust any and all remedies available to it in accordance with the aforementioned dispute resolution procedures. By executing a Retailer Contract, each Retailer agrees that the Retailer Contract shall be governed by and construed in accordance with the laws of the State of Georgia, and, in accordance with the Act, any action arising thereunder must be brought in the Superior Court of Fulton County, Georgia. Likewise, Retailer waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the venue of any proceeding which is brought in the Superior Court of Fulton County, Georgia.
2.08 Payment of Prizes
(A) During normal business hours, each Retailer is required to immediately validate (through the GLC Lottery Terminal) and pay Low-Tier Prizes and Mid-Tier Prizes (i.e., prizes $600 or less) for any winning lottery Ticket from all lottery games that the Retailer is authorized by GLC to sell. Retailers are encouraged to pay in cash, but they may pay Mid-Tier Prizes ($20.00 - $600.00) with a business check or money order if this is disclosed in advance of validation to the Claimant. Consistent reported failure to pay prizes to Claimants or the issuance of a non-sufficient funds (NSF) prize check is sufficient grounds to suspend or terminate the Retailer Contract.
(B) Before attempting to validate a winning Ticket, the Retailer should instruct the Claimant to write their name on the back of the Ticket.
(C) For Instant Games and On-Line Games, Retailers must establish that the Ticket is a winning Ticket by using the GLC validation system. If the Retailer does not receive the appropriate authorization to pay from the system and the Ticket does not meet all the validation requirements as set forth in either the Instant Game Rules and Regulations or the On-Line Game Rules and Regulations, the Ticket should be returned unpaid to the Claimant. If the Retailer does receive the appropriate authorization to pay from the system and the Ticket does meet all the validation requirements as set forth in either the Instant Game Rules and Regulations or the On-Line Game Rules and Regulations, the Retailer is required to pay to the Claimant the prize amount won. If a Retailer validates a winning Ticket on the system, but in fact does not pay the player the prize for that Ticket, the Retailer Contract may be placed in jeopardy. Reported instances of a Retailer validating winning tickets and receiving corresponding credits from the GLC, but not paying the prizes to the Claimant, will be investigated by the GLC; if the reported instances are confirmed by the GLC’s investigation, the Retailer shall be subject to appropriate sanctions under the Retailer Rules and Regulations and under applicable law.
(D) After validating and paying a winning Instant Game Ticket or a winning On-Line Game Ticket, the Retailer must retrieve, deface, and destroy the Ticket. In order to properly deface a Ticket, the Retailer must punch a hole through the bar code area of the Ticket, stamp the Ticket paid, or tear the Ticket in half. Retailers shall be responsible for defacing and destroying all Instant Game and On-Line Game Tickets redeemed for prizes and credited to their account using the GLC validation system. In the event that a winning Ticket is presented to the GLC by a Player for payment, which ticket is not defaced and has been previously credited to a Retailer’s account, the GLC may determine in its sole discretion that a prize payment to the Player is appropriate, all in accordance with uniform criteria approved by the CEO; when the GLC makes such prize payment for a ticket that is recorded as “previously paid” on the GLC validation system, the retailer that originally received credit for paying the winning Ticket’s prize, but did not deface and destroy the Ticket as required, will have its account adjusted for the redeemed ticket amount and the respective cashing bonus. Retailer accounts will not be adjusted, nor credit given, in the event a Ticket is presented to the GLC by a Retailer, or on behalf of a Retailer, subsequent to such Ticket being validated. If a Retailer attempts to pay a prize on a winning Ticket that is defaced or obviously counterfeit, the Retailer Contract may be placed in jeopardy.
(E) Retailers should never cash Instant Game or On-Line Game Tickets that the GLC validation system indicates are “previously paid”. Retailers that honor previously paid Tickets shall be held financially liable for them. If a Retailer attempts to pay a prize on a winning Ticket that is defaced or obviously counterfeit, the Retailer Contract with the GLC may be placed in jeopardy.
(F) For High-Tier Prizes (prizes of more than $600), Retailers shall provide Claimants with GLC Winner Claim Forms and, when requested, assist the Claimants in completing the Winner Claim Form or direct them to the nearest GLC District Office or Claim Center.
(G) A Retailer shall not charge any player or Claimant a fee for validating a winning Ticket, paying a winning Ticket, verifying a non-winning Ticket, or for cashing a check or money order issued by the same Retailer for payment of a prize.
(H) If a Claimant of a winning Ticket is less than eighteen (18) years of age, the prize must be claimed by an adult member of the person’s family or a legal representative of the person on behalf of such person.
2.09 Minimum Sales Requirements
(A) Instant Game Ticket sales for a single Retailer Business Location. If the GLC has authorized a Retailer to sell Tickets for Instant Games at one or more of its Retailer Business Location(s), the Retailer shall settle at least one (1) Pack of Instant Tickets in any four (4) week period for each such Retailer Business Location; otherwise, the GLC may place the Retailer on probation with regard to each such Retailer Business Location. The GLC will notify the Retailer of the probation. Any subsequent failure to settle one (1) Pack of Instant Tickets at any such Retailer Business Location in any succeeding four (4) week period for six (6) months after the probation notice is sent may result in the termination of the Retailer Contract for the respective Retailer Business Location(s).
(B) On-Line Game Ticket Sales for a single Retailer Business Location. If the GLC, in its sole discretion, has authorized a Retailer to sell Tickets for On-Line Games at one or more of its Retailer Business Location(s), the Retailer shall achieve an average of $1,000.00 in total Instant Game and On-Line Game Ticket sales per week, for each such Retailer Business Location, for the first twenty-six (26)) weeks of On-Line Games Ticket sales; otherwise, the GLC may withdraw its authorization for the Retailer to sell On-Line Games for each Retailer Business Location which does not achieve the required minimum weekly sales average. After the successful completion of twenty-six (26) weeks of On-Line Games Ticket sales at a Retailer Business Location, any subsequent failure by the Retailer to maintain an average of $1,000.00 in weekly total Instant Game and On-Line Game Ticket sales at such Retailer Business Location, in any period designated by the GLC, may result in the GLC notifying the Retailer that such Retailer Business Location has not met the minimum sales requirements. Upon notification, the Retailer will have an additional thirteen (13) weeks to raise its average total Instant Game and On-Line Game Ticket sales to $1,000.00 per week for such Retailer Business Location. If a Retailer does not meet the $1,000.00 weekly average total Instant Game and On-Line Game Ticket sales for such Retailer Business Location by the end of the thirteen (13) week period, the GLC may withdraw its authorization for the Retailer to sell On-Line Games for each Retailer Business Location which does not achieve the required minimum weekly sales average.
(C) Provisional On-Line Game Ticket Sales at a newly acquired Retailer Business Location for locations previously qualified to sell Tickets for On-Line Games. In addition to the foregoing, whenever the ownership of a Retailer Business Location, which has been authorized by the GLC to sell Tickets for On-Line Games, is changed to a different Retailer or Retailer applicant, the GLC may allow that Retailer Business Location to sell Tickets for On-Line Games as well as Instant Tickets after the change of ownership, but only if the following further conditions are satisfied by the Retailer or Retailer applicant:
(1) The acquiring Retailer at that Retailer Business Location has been approved by the GLC as a Lottery Retailer pursuant to a signed Retailer Contract and meets all criteria established by the GLC for the sale of Tickets for On-Line Games, including without limitation those criteria set forth in Section 2.05(C) of the Retailer Rules and Regulations;
(2) Prior to the change of ownership, that Retailer Business Location maintained, to the satisfaction of the GLC, an average of $1,000.00 in total Instant Game and On-Line Game Ticket sales per week; and
(3) The selling Retailer has made complete financial settlement with the GLC, to the GLC’s satisfaction, for that Retailer Business Location. Upon approval of the Retailer application of the acquiring Retailer, but prior to the financial settlement with the GLC of the selling Retailer, the GLC may (i) deny or defer the approval of any new Retailer Contract application for that Retailer Business Location for such time period as may be determined by the GLC in its sole discretion in accordance with uniform criteria approved by the CEO; or (ii) condition approval of the acquiring Retailer upon the posting of a Financial Security Deposit, limit approval to authorize the sale of Tickets for Instant Games only at that Retailer Business Location, or require such other uniform restrictions as may be approved by the CEO.
The on-going minimum sales requirements set forth in Subsections 2.09(A) and 2.09(B) above shall continue to apply to the transferred Retailer Business Location. Failure to satisfy any of the conditions set forth in Subsection 2.09(B) may result in the GLC withdrawing its authorization to sell Tickets for On-Line Games and removing the On-Line Games Lottery Terminal from the transferred Retailer Business Location.
(D) Additional On-Line Game Lottery Terminal(s) for a single Retailer Business Location. For Retailers which are already authorized to sell Tickets for On-Line Games, the GLC, in its sole discretion, may authorize additional On-Line Game Lottery Terminals at Retailer Business Locations which satisfy the following criteria:
(1) Installation of additional On-Line Game Lottery Terminals at a Retailer Business Location shall be based primarily upon the Retailer’s total Instant Game and On-Line Game Ticket sales at that Retailer Business Location. As a general rule, installation of a second On-Line Game Lottery Terminal will be considered after the Retailer achieves a minimum average total Instant Game and On-Line Game Ticket sales of $20,000 per week for a period of four (4) weeks at the Retailer Business Location. Installation of a third On-Line Game Lottery Terminal will be considered after the Retailer achieves a minimum average total Instant Game and On-Line Game Ticket sales of $40,000 per week for a period of four (4) weeks at the Retailer Business Location. Installation of any additional On-Line Game Lottery Terminals beyond three (3) at a Retailer Business Location shall be at the sole discretion of the GLC. The foregoing notwithstanding, the GLC may, in its sole discretion, establish from time to time other uniform criteria for determining a Retailer’s qualifications for installation of any additional On-Line Game Lottery Terminals, such as risk-management enhancements, including, but not limited to, personal guarantees, shortened settlement periods for Packs of Instant Game Tickets, or other appropriate credit enhancements, like Financial Security Deposits.
(2) In order for a Retailer to assure its retention of each additional On-Line Game Lottery Terminal, beyond its first On-Line Game Lottery Terminal, at a Retailer Business Location, average weekly total Instant Game and On-Line Game Ticket sales at that Retailer Business Location must be maintained, in any thirteen (13) week period designated by the GLC, at an amount greater than or equal to the minimum sales amounts required to qualify initially for each such additional On-Line Game Lottery Terminal, as set forth in Subsection 2.09(D)(1) above. Failure to maintain such minimum sales amounts may result in the GLC notifying the Retailer that such Retailer Business
Location has not met the minimum sales requirements. Upon notification, the Retailer will have an additional thirteen (13) weeks to raise its average total Instant Game and On-Line Game Ticket sales to the required minimums. If a Retailer Business Location fails to meet the minimum average total Instant Game and On-Line Game Ticket sales requirement by the end of the thirteen (13) week period, the GLC may require the removal and return of each additional On-Line Game Lottery Terminal which is not justified by the sales at the Retailer Business Location during such thirteen (13) week period.
(3) As a general rule, no Retailer Business Location shall qualify for installation of additional On-Line Game Lottery Terminals unless that Retailer Business Location sells Tickets for a minimum of six (6) different Instant Games or the maximum number of such games available if less than six (6).
If an additional On-Line Game Lottery Terminal has been removed from a Retailer Business Location, that Retailer Business Location, as a general practice, will not be considered for an additional On-Line Game Lottery Terminal for a period of six (6) months.
(E) Corporate Retailer Accounts. If the GLC, in its sole discretion, has designated a Retailer as a Corporate Retailer Account, each Retailer Business Location in that Corporate Retailer Account shall be authorized by the GLC to sell Tickets for On-Line Games as soon as: (1) the GLC has received the required application and contract forms for that Retailer Business Location; and (2) the Corporate Retailer Account has complied with all other criteria set forth in Section 2.05(C) above for that Retailer Business Location. Each Corporate Retailer Account shall achieve an aggregate average of $50,000.00 in total Instant Game and On-Line Game Ticket sales per week, for the first twenty-six (26)) weeks of its On-Line Games Ticket sales; otherwise, the GLC may withdraw its authorization for the Corporate Retailer Account to sell On-Line Games for each Retailer Business Location which does not achieve the required minimum weekly sales average set forth in Section 2.09(B) above. After the successful completion of twenty-six (26) weeks of On-Line Games Ticket sales for the Corporate Retailer Account, any subsequent failure by the Corporate Retailer Account to maintain an aggregate average of $50,000.00 in weekly total Instant Game and On-Line Game Ticket sales, in any period designated by the GLC, may result in the GLC notifying that Corporate Retailer Account that it has not met the minimum sales requirements. Upon notification, the Corporate Retailer Account will have an additional thirteen (13) weeks to raise its aggregate average total Instant Game and On-Line Game Ticket sales to $50,000.00 per week. If a Corporate Retailer Account does not meet the $50,000.00 weekly aggregate average total Instant Game and On-Line Game Ticket sales by the end of the thirteen (13) week period, the GLC may withdraw its authorization to sell On-Line Games for each Retailer Business Location which does not achieve the required minimum weekly sales average set forth in Section 2.09(B) above.
(F) Additional Retailer Business Location Acquired by Existing Retailer. In addition to the foregoing, whenever a Retailer, which is already authorized to sell Tickets for On-Line Games, acquires a new Retailer Business Location, the GLC may allow that Retailer Business Location to sell Tickets for On-Line Games as well as Instant Tickets as soon as practical after the existing Retailer acquires that Retailer Business Location, but only if the following further conditions are satisfied by the existing Retailer:
(1) The GLC has received the required application and contract forms for that Retailer Business Location; and
(2) The existing Retailer has complied with all other criteria set forth in Section 2.05(C) above for that Retailer Business Location; and
(3) The existing Retailer has acquired that Retailer Business Location in the same ownership name and entity as used for its other existing Retailer Business Locations; and
(4) For the other existing Retailer Business Locations of the existing Retailer, either:
The on-going minimum sales requirements set forth in Subsections 2.09(A) and 2.09(B) above shall continue to apply to the newly acquired Retailer Business Location. Failure to satisfy any of the conditions set forth in Subsection 2.09(B) may result in the GLC, in its sole discretion, withdrawing its authorization to sell Tickets for On-Line Games and removing the On-Line Games Lottery Terminal from the newly acquired Retailer Business Location.
2.10 Merchandising
(A) Unless the GLC agrees otherwise in writing, each Retailer shall offer to its customers all available lottery games and Tickets which the GLC has authorized the Retailer to sell at any given Retailer Business Location. The Retailer shall use the lottery Ticket dispensers and/or vending machines provided by the GLC for the sale of Instant Tickets. The Retailer shall place such dispensers, vending machines, and any Lottery Terminals provided by the GLC in a prominent location in the Retailer’s establishment near the cash register or check-out area.
(B) Each Retailer shall prominently display, in an area visible to the Retailer’s customers at each Retailer Business Location authorized by GLC, the Certificate of Authority for such Retailer Business Location issued to it by the GLC. Retailer shall return each such Certificate of Authority to the GLC immediately upon any termination, denial, cancellation, suspension, revocation or non-renewal of the Retailer Contract.
(C) In accordance with instructions issued from time to time by the GLC, the Retailer shall:
(1) maintain displays, notices and materials supplied by, or on behalf of, the GLC;
(2) prominently display and maintain such signage and point-of-sale materials as may be supplied by, or on behalf of, the GLC to be used in conjunction with lottery Ticket sales, including door decals, game posters, display Tickets, danglers, change mats, lighted interior signs, banners, odds of winning, and any other items provided by the GLC;
(3) utilize and properly maintain Instant Ticket dispensers, vending machines, Lottery Terminals, and such other Lottery-related equipment that may be provided by, or on behalf of, the GLC;
(4) make available to potential lottery customers player brochures supplied by the GLC from time to time and explain lottery game rules;
(5) abide by any and all promotional guidelines established by the GLC; and
(6) provide adequate supplies of Winner Claim Forms, entry envelopes and Play Slips, and, if Retailer is authorized to sell On-Line Games, provide adequate space for a play station.
2.11 Settlement and Retailer Invoicing
(A) The accounting period for purposes of preparing Retailer invoices shall be from Sunday at 6:00 a.m. through Saturday at midnight.
(B) All Packs of Instant Tickets settled in an accounting period and all sales of On-Line Games lottery products occurring within the accounting period will be invoiced to the Retailer. The Retailer invoice will be available through the GLC Lottery Terminal after 6:00 a.m. on the Sunday immediately following the end of the accounting period.
(C) For Instant Games, all Ticket Packs settled from Sunday through Saturday in an accounting period will be included in the Retailer invoice for that accounting period. As a general rule, a Pack of Instant Tickets will settle (i.e. become a Settled Pack) during the accounting period twenty-one (21) days after the pack was activated (i.e. became an Activated Pack). The predetermined formula or schedule for determining the time of settlement of Packs of Tickets may be modified at the discretion of the GLC in accordance with uniform criteria approved by the CEO from time to time; the intent of this provision is to allow the GLC the discretion to vary settlement periods to better manage the GLC financial risk exposure, including, but not limited to, situations in which the GLC is dealing with large chain store Retailers, with Retailers where Instant Tickets sales or inventory turnover is much more rapid than the 21 day settlement period covered by the general rule, with Retailers whose required Financial Security Deposit does not cover the GLC’s true risk exposure, and with Retailers who have a history of non-compliance with GLC Rules and Regulations.
(D) The Retailer invoice will provide a calculation of the proceeds due the GLC during the accounting period. The proceeds will be equal to the retail value of Settled Packs of Instant Game Tickets, plus the retail value of On-Line Game Ticket sales, less applicable sales Commissions and bonuses, less any validations of winning Tickets by the Retailer, plus service fees, plus or minus any adjustments to the Retailer account as calculated by the GLC.
(E) For purposes of calculating the Retailer invoice, free Ticket prizes validated by the Retailer shall have the same value as the applicable retail value of a free Ticket provided to the Claimant.
(F) The Retailer Commission shall be at least five (5) percent of all Ticket sales for Instant Games and On-Line Games.
(G) The Retailer cashing bonus shall be two (2) percent of prizes on all winning Instant Game Ticket and On-Line Game Ticket validations and payments for Low-Tier Prizes and Mid-Tier Prizes. “Free” Instant Tickets have a face value equal to the Ticket cost.
2.12 Banking, Deposits, and Payment Requirements
(A) Each Retailer shall have a fiduciary duty to preserve and account for all proceeds from the sale of lottery Tickets collected by it and shall be responsible and liable for all such proceeds. Unless otherwise authorized and directed by GLC, each Retailer is required to establish a separate bank account in the name of the Retailer as “Trustee for the Georgia Lottery Corporation” in an institution insured by the Federal Deposit Insurance Corporation (FDIC) and to provide the GLC with authorization to transfer lottery proceeds from this account using EFT. All proceeds from the sale of lottery Tickets and all other funds due the GLC shall constitute a trust fund in favor of the GLC until paid to the GLC, and such proceeds are required by law to be deposited daily into the above noted separate bank account no later than the close of the next banking day after the date of their collection by the Retailer. All deposits and transfers of lottery proceeds shall be made in accordance with the Act and the Rules and Regulations.
(B) The GLC will provide notification of the amount of the transfer by way of an invoice produced through the Retailer’s Lottery Terminal. Lottery proceeds due the GLC as calculated on the invoice for an accounting period will be transferred from the Retailer bank account to the GLC on the designated transfer day.
(C) On the appropriate transfer day, if all net lottery proceeds as detailed on the Retailer invoice, are not in the separate Retailer bank account, the Retailer will be deemed to be in default due to non-sufficient funds (NSF). A $25 fee will be charged to the Retailer account for each NSF default. Each time an NSF default occurs, the GLC will immediately contact the Retailer and proceed as follows:
(1) If the NSF default is the first one within a one hundred eighty (180) day period, the GLC shall require the Retailer to deposit the required funds into the separate lottery account within twenty-four (24) hours to enable an automated clearing house (ACH) debit using EFT. If the Retailer fails to deposit the required funds to cover the NSF amount, the Retailer’s Lottery Terminal operation and Instant Ticket deliveries may be immediately suspended; and
(2) If the NSF default is the second one within a one hundred eighty (180) day period, the GLC shall immediately suspend the Retailer’s Lottery Terminal operation and Instant Ticket deliveries until the Retailer pays the overdue account; and
(3) If the NSF default is the third or subsequent one within a one hundred eighty (180) day period, the GLC may immediately suspend the Retailer Contract for up to an additional thirty (30) days, with a review of the Retailer’s account prior to reactivation. The GLC may require, in its sole discretion, a security deposit or other credit enhancement as a condition of reactivation.
(4) If a NSF default is not paid by the retailer within thirty (30) calendar days, regardless of the number of occurrences within a 180-day period, the GLC, in its sole discretion, may require a security deposit or other credit enhancement prior to reactivation.
(5) Notwithstanding any of the above, the GLC, in its sole discretion, may require a security deposit or other credit enhancement for a retailer who no longer meets the GLC’s acceptable level of creditworthiness as assessed through an independent credit agency and/or based upon the current or prior payment history with the GLC.
(D) Failure of a Retailer, including all sole proprietors, partners, corporate officers, or shareholders holding more than ten (10) percent of the ownership interests, to pay a delinquent account shall constitute cause for the GLC, in its sole discretion, to terminate, cancel, suspend, or revoke:
(1) the delinquent Retailer Contract;
(2) any other non-delinquent Retailer Contract also held by the same Retailer; and
(3) any other non-delinquent Retailer Contract for which there is a common ownership interest exceeding ten (10) percent in both the delinquent and the non-delinquent Retailer Contracts held by the same natural person or legal entity, whether a person, partnership, corporation, officer or other owner.
(E) Failure of a Retailer, or its principal officers or owners who hold a greater than ten (10) percent ownership interest, to pay a delinquent Retailer account, shall constitute a material factor in the decision whether to grant the Retailer, or its principal officers or owners who hold a greater than ten (10) percent ownership interest, a Retailer Contract for a different Retailer Business Location, or for a Retailer account under a different name or corporate entity.