Registered letter Collorafi

Bernard COLLORAFI 21B Chemin de l'Estelle 06110 LE CANNET Le Cannet, 10 January 1997 Monsieur Denis HENNEQUIN résident Directeur Génér IcDonald's France S 1, Rue Gustave Eiffel 78045 GUYANCOURT CEDEX Dear Denis, Thank you for kindly receiving me in the presence of Isabelle KUSTER on the subject of the forthcoming opening of the two restaurants of ANTIBES Ouest and VALLAURIS for which McDonald's has obtained a building permit and for I noted your formal refusal to allocate these two restaurants to me, despite the overwhelming arguments I was able to put forward. I remind you first of all that even before these opening projects, I suffered serious harm as a result of the obligation in which I found myself to open, in the vicinity of my restaurant in the CARREFOUR shopping centre, a restaurant Indeed, you had decided, in order to counter the opening of a QUICK, to set up at the Weisweller roundabout this DRIVE restaurant. was therefore under the absolute obligation to open it myself because it was unthinkabl u'un autre Franchise McDonald's coming to set up in the very heart of my zon primary catchment area. This opening, which took place three months ago, has already caused the turnover of my first restaurant to fall by 35%. Given the new operating costs, the profitability of my two restaurants is considerably lower than the one I had with my initial restaurant, even if it may be noted that the total turnover is roughly equivalent. It is therefore certain that notwithstanding the opening of these two new restaurants and in any event my profitability for 1996 is already in jeopardy, and in any case very much lower than that of previous years. In this situation, already difficult for me, I will therefore face in a few months, if you persist in your decision, the internal competition of two McDonald's restaurants which will cause my market share to fall very significantly. I would thus be able neither to achieve the objectives set for me for these two restaurants, nor to return to the previous profitability, far from it. 4. Market studies show that a significant part of my customers comes from the future catchment area of these restaurants. They will therefore unduly take away part of my customers. The solution which would have consisted, following your decision to set up two restaurants at ANTIBES Ouest and at VALLAURIS, in entrusting these restaurants to me, would have allowed me, thanks to my experience and my teams, to absorb this shock and to win new market share for McDonald's. Most of the market share that the two new restaurants will win will come from my own customers, rather than from new customers. If the decision you notified to me not to allocate these two restaurants to me were confirmed, I would consider it a genuine casus belli, all the more serious as I have been a franchisee for ten years (18th franchisee and 46th restaurant in France). I formally challenge this policy which consists not only in favouring another Franchisee, but in favouring yourselves insofar as you are in a joint venture with Patrick GILARSKI. You can indeed use advertising, promotional and management means immeasurably superior to mine. You can empty my restaurants of most of their substance, and reduce me to such a level that I would have no other solution than to leave. I cannot believe for a moment that this is your plan, but it risks being the result 6. Consequently, I ask you one last time but very firmly, to reflect on your final decision. Its maintenance would oblige me to defend my interests with the determination that I showed in the service of the development of my McDonald's restaurants. Urgently hoping that you will reply to me in the coming days, please accept, dear Denis, my best regards.