1
EXHIBIT 10.32
[LOGO] AMPLICON FINANCIAL LEASE
0 XXXXXX XXXXXX XXXXX, XXXXX 000 - XXXXX XXX, XXXXXXXXXX 00000 AGREEMENT
714.751-7551 - 800.755-5055 - FACSIMILE 714.751-7557
ORDER NO. OL-10575
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LESSEE
Back Yard Burgers, Inc.
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STREET CITY STATE COUNTY ZIP
0000 Xxxxxx Xxxx Xxxxx Xxxxxxx XX Xxxxxx 00000
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1. AGREEMENT/LEASE: Amplicon, Inc. ("Amplicon") agrees to lease to Lessee the
hardware, software and/or other equipment ("Property") described on the
Lease Schedule (s) ("Schedule(s)") referencing this Lease Agreement
("Agreement") and Lessee agrees to lease from Amplicon the Property subject
to the terms set forth herein and on each Schedule(s) that the parties may
from time to time enter into with respect to this Agreement. Each Schedule
identified as being a part of this Agreement incorporates the terms of this
Agreement and constitutes a separate lease agreement and is referred to
herein as the "Lease." The Lease is in force and is binding upon Lessee and
Amplicon upon signed acceptance by Amplicon.
2. UNIFORM COMMERCIAL CODE ACKNOWLEDGMENT: Lessee acknowledges that it has
received and approved any written "Supply contract" covering the Property
purchased from the Supplier for lease and Amplicon has informed or advised
Lessee, either previously or by this lease, of the following: (i) the
identity of the Supplier; (ii) that Lessee may have rights under the Supply
Contract; and (iii) that Lessee may contact the Supplier for a description
of any such rights. This Lease is a "Finance Lease." (The terms "Finance
Lease," "Supply Contract" and "Supplier" as used in this Lease have the
meanings only as ascribed to them under Division 10 of the California
Uniform Commercial Code and have no effect on any tax or accounting
treatment of the Lease). This provision survives termination of the Lease.
3. NO WARRANTIES: AMPLICON IS NOT THE MANUFACTURER, DEVELOPER, PUBLISHER,
DISTRIBUTOR, LICENSOR OR "SUPPLIER" OF THE PROPERTY AND MAKES NO EXPRESS OR
IMPLIED WARRANTY OR REPRESENTATION AS TO FITNESS, QUALITY, DESIGN,
CONDITION, CAPACITY, SUITABILITY, VALUE, MERCHANTABILITY, OR PERFORMANCE OF
THE PROPERTY OR THE MATERIAL OR WORKMANSHIP THEREOF OR AGAINST INTERFERENCE
BY LICENSORS OR OTHER THIRD PARTIES, IT BEING AGREED THAT THE PROPERTY IS
LEASED "AS IS" AND THAT ALL SUCH RISKS ARE TO BE BORNE BY LESSEE. Lessee
selected the Property and represents that all the Property is suitable for
Lessee's purposes. Amplicon assigns to Lessee during the term of the lease
any warranty rights it may have received from the Supplier as a result of
Amplicon's purchase of the Property. If Lessee has any claims regarding the
Property or any other matter arising from Lessee's relationship with the
Supplier, Lessee must make them against the Supplier. This provision
survives termination of the Lease.
4. AUTHORIZATION DATE AND LEASE DURATION: A Schedule commences and rent is due
beginning on the date that Lessee certifies in writing to Amplicon that all
of the Property has been received and accepted by Lessee as installed,
tested and ready for use, and Lessee authorizes Amplicon in writing to
disburse payment to the Supplier ("Authorization Date"). Unless and until
Lessee provides such written authorization, Amplicon will not disburse
payment to Suppliers. The Term of each Schedule is reflected on the
Schedule and begins on the first day of the calendar quarter following the
Authorization Date. A calendar quarter commences on the first day of
January, April, July and October. Lessee has the right to use the Property
at the specific locations shown on the Schedule throughout the duration of
this Lease in accordance with the provisions of this Lease. The Term
extends for an additional twelve month period ("Extension Term") at the
rental rate delineated on the Schedule unless Lessee provides to Amplicon
written notice of Lessee's election not to extend the Term at least one
hundred eighty days prior to the expiration of the Term.
5. RENTALS: The rent payable is shown on the Schedule(s). The quarterly rent
is due to Amplicon, in advance, for each quarter or portion of a quarter
beginning on the Authorization Date and continuing for each quarter that
this Lease is in effect. Rent for portions of a quarter are based on a
daily rental equal to one-ninetieth of the quarterly rent. ALL RENTS SHALL
BE PAID WITHOUT NOTICE OR DEMAND AND WITHOUT ABATEMENT, DEDUCTION OR SETOFF
OF ANY AMOUNT WHATSOEVER. THE OPERATION AND USE OF THE PROPERTY IS SOLELY
AT THE RISK OF LESSEE AND THE OBLIGATION OF LESSEE TO PAY RENT UNDER THE
LEASE SHALL BE ABSOLUTE AND UNCONDITIONAL. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, LESSEE HEREBY WAIVES THE FOLLOWING RIGHTS AND REMEDIES
CONFERRED UPON LESSEE BY LAW: (I) RIGHT TO CANCEL OR TERMINATE THIS LEASE,
(II) RIGHT TO REJECT THE PROPERTY, (III) RIGHT TO REVOKE ACCEPTANCE OF THE
PROPERTY, (IV) RIGHT TO RECOVER DAMAGES FROM AMPLICON FOR ANY BREACH OF
WARRANTY, AND (V) RIGHT TO RECOVER ANY CONSEQUENTIAL DAMAGES WHATSOEVER.
Rents will be paid to Amplicon unless otherwise instructed in writing by
Amplicon or its assignee.
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THIS LEASE AGREEMENT AND THE APPLICABLE SCHEDULE(S) CONTAIN THE ENTIRE
AGREEMENT BETWEEN AMPLICON AND LESSEE WITH RESPECT TO THE SUBJECT MATTER
HEREOF. THE LEASE CAN ONLY BE MODIFIED IN WRITING, WITH SUCH MODIFICATIONS
SIGNED BY A PERSON AUTHORIZED TO SIGN AGREEMENTS ON BEHALF OF LESSEE AND BY
AN AUTHORIZED SIGNER OF AMPLICON. NO ORAL OR OTHER WRITTEN AGREEMENTS,
REPRESENTATIONS OR PROMISES SHALL BE RELIED UPON BY, OR BE BINDING ON, THE
PARTIES UNLESS MADE A PART OF THIS LEASE BY A WRITTEN MODIFICATION SIGNED
BY AN AUTHORIZED SIGNER OF LESSEE AND AMPLICON.
LESSEE: AMPLICON, INC.
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(Signature) (Signature)
This Lease is subject to acceptance by Amplicon's Finance committee. BY
SIGNING BELOW, THE SIGNER CERTIFIES THAT HE OR SHE HAS READ THIS LEASE
AGREEMENT, INCLUDING THE REVERSE SIDE, HAS HAD AN OPPORTUNITY TO DISCUSS
ITS TERMS WITH AMPLICON, AND IS AUTHORIZED TO SIGN ON BEHALF OF LESSEE.
Until this Lease has been signed by an authorized signer of Amplicon, it
will constitute a firm offer by Lessee.
LESSEE/OFFEROR AMPLICON, INC.
OFFER: Back Yard Burgers, Inc. ACCEPTANCE:
By: By:
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Name: Xxxxxxx X. Xxxx Name: Amplicon Finance Committee
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Title: Chief Financial Officer Title: Amplicon Finance Committee
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Date: May 6, 1999 Date: May 6, 1999
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6. INDEMNITY: Lessee assumes liability for, and agrees at its own expense to
indemnify and defend Amplicon, its employees, officers, directors and
assigns, from and against any and all claims, liabilities, losses, damages,
and expenses (including legal expenses) of every kind or nature (including,
without limitation, claims based upon strict liability) arising out of the
use, condition (including latent and other defects, whether or not
discoverable by Lessee or Amplicon), operation or ownership of any items of
Property (including, without limitation, any claim for patent, trademark or
copyright infringement) or for any interruptions of service, loss of
business or consequential damages. These indemnities and assumptions
survive the termination of this Lease.
7. PERFORMANCE OF LESSEE'S OBLIGATIONS BY AMPLICON: If Lessee fails to perform
any of its obligations under this Lease, Amplicon may, at its option
perform them for Lessee without waiving Lessee's default. Any amount paid
by Amplicon, and any expense (including reasonable attorney's fees) or any
other liability incurred by Amplicon as a result of its performance of
Lessee's obligations will be payable by Lessee to Amplicon upon demand.
8. FURTHER ASSURANCES AND NOTICES: Lessee's signing of this Lease constitutes
a firm offer. In consideration of Amplicon's time and effort in reviewing
and acting on the offer, Lessee agrees that its offer is irrevocable for
twenty business days after Amplicon's receipt of the offer and of all
credit information requested by Amplicon. Amplicon's signing of the Lease,
including the Schedule, constitutes acceptance of Lessee's offer. Lessee
agrees to sign and provide any documents which Amplicon deems necessary for
the signing and filing of Uniform Commercial Code (UCC) Financing
Statements (which Lessee agrees may be signed by Amplicon on Lessee's
behalf). Lessee authorizes Amplicon to insert applicable dates as necessary
to complete all documentation for the Lease. Prior to Amplicon's acceptance
of the Lease and for the duration of the Lease, Lessee agrees to promptly
provide Amplicon with all credit information reasonably requested by
Amplicon including, but not limited to, comparative audited financial
statements for the most current annual and interim reporting periods.
Lessee's failure to provide such information to Amplicon is an event of
default under the Lease. ALL NOTICES TO AMPLICON MUST BE IN WRITING AND
SENT CERTIFIED MAIL RETURN RECEIPT REQUESTED TO THE ADDRESS SHOWN ABOVE OR
SUCH OTHER ADDRESS AS TO WHICH LESSEE HAS BEEN NOTIFIED IN WRITING.
9. DEFAULT: If rent or any other amount is not paid within ten days of its due
date, Lessee agrees to pay a late charge equal to five percent (5%) of the
unpaid amount. Each month thereafter, past due amounts remaining unpaid
hereunder shall bear interest at the lesser of one and one half percent
1 1/2%) per month, compounded monthly or the maximum rate allowed by law.
An Event of Default shall occur if: (a) Lessee fails to pay any rent or
other payment under the Lease when due and the failure continues for ten
days; (b) Lessee fails to perform or observe any of the covenants or
obligations in this Lease other than Lessee's rental obligations, and such
failure is not cured within ten days after written notice has been
provided; (c) Lessee makes an assignment for the benefit of its creditors,
files any petition or takes any action under any bankruptcy, reorganization
or insolvency laws; (d) an involuntary petition is filed under any
bankruptcy statute against Lessee or any receiver, trustee or custodian is
appointed to take possession of Lessee's properties, unless such petition
or appointment is set aside or withdrawn within sixty days of said filing
or appointment; (e) Lessee attempts to or does remove, transfer, sell,
sublicense, encumber, part with possession, or sublet any of the Property;
(f) Lessee attempts to assign or transfer this Lease or its interest under
the Lease or moves any of the Property from the locations(s) set forth on
the Schedule without Amplicon's prior written consent; or (g) Lessee
undergoes a sales, buyout, change in control, or change in ownership of any
type, form or manner which, as judged solely by Amplicon, results in a
material deterioration in Lessee's credit worthiness.
10. REMEDIES: Upon an Event of Default, Amplicon may exercise at its sole
option any one or more of the remedies permitted by law, including but not
limited to the following: (a) through legal action, enforce performance by
Lessee of the applicable covenants and obligations of this Lease or recover
damages for the breach of those covenants or obligations; (b) terminate the
Lease and Lessee's rights under the Lease; (c) by notice in writing to
Lessee, recover all amounts due on or before the date Amplicon declared
this Lease to be in default, plus, as liquidated damages for the loss of a
bargain and not as a penalty, accelerate and declare to be immediately due
and payable all rentals and other sums payable under the Lease without any
presentment, demand, protest or further notice (all of which are hereby
expressly waived by Lessee), at which time the same shall become
immediately due and payable; and (d) take immediate possession of the
Property, or any part of the Property, from Lessee free from claims by
Lessee. In the case of Software, it is agreed that Lessee's unauthorized
use, disclosure, or transfer of the Software will cause Amplicon
significant damages which, at the time the parties enter the lease, are
impossible to quantify or predict. Therefore, if Lessee is found to be
using (in any manner) all or any portion of the Software after the
termination of this Lease, or if Supplier terminates a license of Lessee's
right to use the Software for an alleged breach of the use, disclosure, or
transfer restrictions imposed on Lessee, the parties hereby agree that
liquidated damages shall be payable immediately by Lessee to Amplicon in an
amount which is equal to two times the amount paid by Amplicon for the
Software. The exercise of any of the foregoing remedies by Amplicon will
not constitute a termination of this Lease unless Amplicon so notifies
Lessee in writing. If Amplicon repossesses the Property, Amplicon may rent
or sell the Property in such a manner and at such times as Amplicon may
determine and without notice to Lessee. In the event Amplicon rents the
property, any rentals received by Amplicon for the remaining Term(s) of the
Schedule shall be applied to the payment of: (i) all costs and expenses
including reasonable attorneys' fees) incurred by Amplicon in enforcing its
remedies under this Lease, and (ii) the rentals for the remainder of the
Term(s) and all other sums then remaining unpaid under this Lease. All
rentals received by Amplicon for the period commencing after the remaining
Term(s) shall be retained by Amplicon. Lessee will remain liable to
Amplicon to the extent that the aggregate amount of the sums referred to in
clauses (i) and (ii) above exceed the aggregate rentals received by
Amplicon under such agreements for the remaining Term(s) applicable to the
Property covered by such agreements. In the event that Amplicon sells the
Property, the proceeds will be applied to the sum of: (1) all costs and
expenses (including reasonable attorneys' fees) incurred by Amplicon in
enforcing its remedies under this Lease and in disposing of the Property,
(2) the rentals accrued under this Lease, but unpaid up to the time of such
disposition, (3) any and all other sums other than rentals then owing to
Amplicon by Lessee under the Lease, and (4) the stipulated value as would
be determined in the event of a Casualty Occurrence (as defined in the
terms and conditions to the Schedule) on the date of the Property's
disposition. The remaining balance of such proceeds, if any, will be
applied first to reimburse Lessee for any sums previously paid by Lessee as
liquidated damages (as set forth in (c) above), and any remaining amounts
will be retained by Amplicon. Lessee will remain liable to Amplicon to the
extent that the aggregate amount of the sums referred to in clauses (1)
through (4) above exceeds the proceeds received by Amplicon in connection
with the disposition of the Property. Amplicon's remedies under this Lease
shall not be deemed exclusive. Waiver of any default or breach of this
Lease shall not be construed as a waiver of subsequent or continuing
defaults or breaches.
11. DISPUTE RESOLUTION: THE PARTIES AGREE THAT ALL DISPUTES, WHETHER BASED IN
TORT OR CONTRACT, RELATING TO OR ARISING OUT OF THIS LEASE (COLLECTIVELY,
"LEASE DISPUTES") WILL BE SUBMITTED TO THE ORANGE COUNTY, CALIFORNIA
OFFICE OF ENDISPUTE, INC., DBA J-A-M-S/ENDISPUTE ("JAMS") FOR A TRIAL OF
ALL ISSUES OF LAW AND FACT CONDUCTED BY A RETIRED JUDGE OR JUSTICE FROM THE
PANEL OF JAMS, APPOINTED PURSUANT TO A GENERAL REFERENCE UNDER CALIFORNIA
CODE OF CIVIL PROCEDURE SECTION 638(1) (OR ANY AMENDMENT, ADDITION OR
SUCCESSOR SECTION THERETO) UNLESS AMPLICON OR ITS ASSIGNEE SELECTS AN
ALTERNATIVE FORUM. IF THE PARTIES ARE UNABLE TO AGREE ON A MEMBER OF THE
JAMS PANEL, THEN ONE SHALL BE APPOINTED BY THE PRESIDING JUDGE OF THE
CALIFORNIA SUPERIOR COURT FOR THE COUNT OF ORANGE. IN THE EVENT THAT JAMS
IN THE COUNTY OF ORANGE CEASES TO EXIST, THEN THE PARTIES AGREE THAT ALL
LEASE DISPUTES WILL BE FILED AND CONDUCTED IN THE CALIFORNIA SUPERIOR COURT
FOR THE COUNT OF ORANGE, UNLESS AMPLICON OR ITS ASSIGNEE SELECTS AN
ALTERNATIVE FORUM. LESSEE AGREES TO SUBMIT TO THE PERSONAL JURISDICTION OF
THE CALIFORNIA SUPERIOR COURT FOR ALL LEASE DISPUTES. LESSEE WAIVES ITS
RIGHTS TO A JURY TRIAL IN ANY ACTION ARISING OUT OF OR RELATING TO THIS
LEASE. If any party to this Lease brings any action to enforce any of the
terms, or to recover for any breach, then the prevailing party is entitled
to recover from the other party reasonable attorneys' fees and costs,
including all JAMS related costs and costs of collection (including
judgment enforcement and collection costs).
12. MISCELLANEOUS: All agreements, representations and warranties contained in
this Lease, or in any document or certificate delivered pursuant to or in
connection with this Lease, shall expressly survive the termination of this
Lease. If any provision of this Lease is determined by competent authority
to be unenforceable, such determination shall not invalidate the remaining
provisions of the Lease. To the extent permitted by applicable law, Lessee
waives any provision of law which renders any provisions hereof prohibited
or unenforceable in any respect. This Lease has been entered into and shall
be performed in California and, therefore, THIS LEASE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
CALIFORNIA (EXCLUSIVE OF PRINCIPLES OF CONFLICT OF LAWS). Time is of the
essence of this Lease and each provision thereof.
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ADDENDUM "A"
WITH RESPECT TO
LEASE AGREEMENT ORDER NO. OL-10575
AND LEASE SCHEDULE NO. 01
This Addendum is supplemental to and made a part of Lease Agreement Order No.
OL-10575, dated May 6, 1999 (the "Agreement"), Lease Schedule No. 01, dated N/A
and other related documents under the Agreement and Lease Schedule (collectively
the "Lease"). The parties to the Lease include Back Yard Burgers, Inc.
("Lessee") and Amplicon, Inc. ("Amplicon").
Capitalized terms used in this Addendum without definition shall have the
meanings set forth in the Lease, unless specifically modified. This Addendum is
to be construed as supplemental to, and a part of, the Lease.
Lessee and Amplicon acknowledge and agree that the Lease is hereby amended with
respect to Lease Schedule No. 01, as follows:
Section J. USE, OPERATION AND MAINTENANCE OF THE PROPERTY:
In line two (2) delete the words, "keep in force for the duration of
the Lease the best standard Supplier's maintenance agreement(s) which
will cause the supplier(s) to"
In line three (3) delete the words, "in accordance with such
maintenance agreement(s) and entitle Lessee (through Amplicon, if
necessary) to obtain available enhancements, updates, upgrades and
changes." and replace it with "to maintain the satisfactory operation
of the Property throughout the Term of the Lease."
ADD THE FOLLOWING SECTION TO THE LEASE SCHEDULE
Section Q. EARLY TERMINATION/PURCHASE OPTION:
Provided no event of default, as the same is more fully described in
the Lease, has occurred or is continuing, Amplicon and Lessee hereby
agree that Lessee may, at its sole option and with at lest ninety (90)
days prior written notice to Amplicon, elect to exercise the Early
Termination/Purchase Option as more fully described herein. The first
date (the "First Exercise Date") on which Lessee may exercise the Early
Termination/Purchase Option shall occur at the end of the Twelfth (12)
month of the Term of the Lease; if not exercised on that date, by
providing written notice to Amplicon as specified herein, Lessee shall
have the same option at the end any quarter through the 51st month (the
"Last exercise date"). If Lessee does not elect to exercise the Early
Termination/Purchase Option on or prior to the Last Exercise Date Early
Termination/Purchase Option shall be null and void, and all other
provisions of the Lease shall remain in full force and effect.
Provided that Lessee has satisfied all of the foregoing conditions and
in order to exercise the Early Termination Option, Lessee shall pay to
Amplicon the total payment of:
1. all rentals accrued under this Lease, but unpaid up to the
Exercise Date;
2. the "Termination amount" equal to the present value of all
remaining rental obligations discounted at 5% per year, and
exercise either option (I) or (II) according to the terms and
conditions of the Lease Schedule.
3. all applicable taxes and any and all other sums other than
rentals then owing to Amplicon by Lessee under the Lease;
In all other respects, the terms and conditions of the Lease, as originally
written, shall remain in full force and effect. The Lease, as amended herein,
sets forth the entire and final understanding between the parties with respect
hereto. The terms of the Addendum have been negotiated and jointly drafted by
Amplicon and Lessee and, therefore, the language of the Addendum shall not be
construed in favor or against either party. The undersigned represent that they
have the authority to enter into the Lease, and that the same shall be legally
binding and enforceable on the respective principals.
IN WITNESS WHEREOF the parties hereto, by their authorized signatories have
executed this Addendum at the date set forth below their respective signatures.
LESSEE: BACK YARD BURGERS, INC. Amplicon, Inc.
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By: By:
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Name: Xxxxxxx X. Xxxx Name: Amplicon Finance Committee
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Title: Chief Financial Officer Title: Amplicon Finance Committee
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Date: May 6, 1999 Date: May 6, 1999
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[LOGO] AMPLICON FINANCIAL LEASE
0 XXXXXX XXXXXX XXXXX, XXXXX 000 - XXXXX XXX, XXXXXXXXXX 00000 SCHEDULE
714.751-7552 - 800.755-5055 - FACSIMILE 714.751-7557
ORDER NO. OL-10575
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LESSEE CONTACT
Back Yard Burgers, Inc. Xxxx Xxxx
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XXXXXX XXXXX XX.
0000 Xxxxxx Xxxx Xxxxx (000) 000-0000 Ext. 1226
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CITY STATE COUNTY ZIP FACSIMILE NO.
(000) 000-0000
Xxxxxxx XX Xxxxxx 00000
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A. THIS SCHEDULE IS ISSUED WITH RESPECT TO THE LEASE AGREEMENT ORDER
NO.OL-10575 DATED MAY 6, 1999. All of the terms of this Schedule and the
Lease Agreement combine to form an individual Lease with an independent
Term.
B. Any Deposit under this Schedule shall be returned to Lessee (without
interest thereon) if Amplicon does not accept this Schedule. Upon
acceptance of this Lease by Amplicon any such Deposit shall be applied to
the rent due in the last month of the Term unless otherwise specified
herein.
C. Term (months): 60 (Sixty) months
D. Deposit : $ 11,334.00
E. Monthly Rent : $ 11,334.00
F. Property : $600,000.00 to be used for Restaurant Equipment
THE ACTUAL MONTHLY PAYMENT WILL BE DETERMINED BY MULTIPLYING THE MONTHLY LEASE
RATE FACTOR OF 0.01889 BY THE ACTUAL PROPERTY COST. THE MONTHLY LEASE RATE
FACTOR MAY BE ADJUSTED UPWARD IN ACCORDANCE WITH MOVEMENT OF LIKE-KIND TERM
U.S. TREASURY NOTES. THIS ADJUSTED RATE SHALL THEN BE MULTIPLIED BY THE FINAL
ACTUAL PROPERTY COST TO DETERMINE THE FIXED RENTAL PAYMENT UPON AUTHORIZATION OF
THE LEASE. THE BASE U.S. TREASURY NOTE YIELD WILL BE 4.64%
Upon Lessee's request a Schedule can be closed at the end of any quarter where a
minimum of $100,000.00 of Property has been put on the Lease Schedule.
Quantity Property Description Serial #
PROPERTY TO BE MORE FULLY DESCRIBED ON EXHIBIT "A" ATTACHED HERETO AND MADE A
PART HEREOF AT A LATER DATE.
G. AT THE EXPIRATION OF THE TERM OR, IF EXTENDED, AT THE EXPIRATION OF THE
EXTENSION TERM LESSEE SHALL: (I) PURCHASE ALL, BUT NOT LESS THAN ALL, OF THE
PROPERTY FOR THE GREATER OF 15% OF THE TOTAL COST PAID BY AMPLICON WITH RESPECT
TO THE PROPERTY OR ITS THEN FAIR MARKET VALUE ("FMV"), PLUS ALL APPLICABLE
SALES/USE TAXES THEREON AND ALL ACCRUED BUT UNPAID INTEREST, TAXES PENALTIES
AND/OR OTHER SUMS DUE UNDER THE LEASE; (II) PROMPTLY RETURN ALL, BUT NOT LESS
THAN ALL, OF THE PROPERTY AND LEASE REPLACEMENT PROPERTY FROM AMPLICON WHICH AS
A COST EQUAL TO OR GREATER THAN THE ORIGINAL COST OF THE PROPERTY; OR (III)
EXTEND THE SCHEDULE FOR A PERIOD OF ONE ADDITIONAL YEAR AT THE RENTAL RATE
DELINEATED HEREIN. WITH RESPECT TO OPTION (I), FMV IS THE PRICE A WILLING BUYER
(WHO IS NEITHER A USED PROPERTY DEALER OR RESELLER) WOULD PAY FOR THE PROPERTY
IN AN ARM'S LENGTH TRANSACTION TO A WILLING SELLER UNDER NO COMPULSION TO SELL;
PROVIDED, (A) THE PROPERTY IS ASSUMED TO BE IN THE CONDITION IN WHICH IT IS TO
BE MAINTAINED UNDER THE LEASE; (B) THE PROPERTY IS VALUED ON AN INSTALLED BASIS;
AND (C) THE COST OF REMOVAL OF THE PROPERTY FROM ITS PRESENT LOCATION IS NOT A
DEDUCTION FROM THE VALUATION. IF LESSEE ELECTS TO PURCHASE THE PROPERTY AND THE
PARTIES ARE NOT ABLE TO AGREE ON FMV AT LEAST 30 DAYS PRIOR TO THE EXPIRATION OF
THE APPLICABLE TERM, AMPLICON WILL APPOINT AN INDEPENDENT APPRAISER (REASONABLY
ACCEPTABLE TO LESSEE) TO DETERMINE FMV, AND THAT DETERMINATION SHALL BE FINAL,
BINDING AND CONCLUSIVE AS LESSEE'S PURCHASE PRICE, AND LESSEE SHALL PAY ALL
SALES/USE TAXES THEREON. LESSEE SHALL BE RESPONSIBLE FOR THE COST OF THE
APPRAISAL WITH RESPECT TO OPTION (II), LESSEE AND AMPLICON SHALL EACH HAVE
ABSOLUTE DISCRETION REGARDING THEIR AGREEMENT OR LACK OF AGREEMENT TO THE TERMS
OF A LEASE FOR REPLACEMENT PROPERTY. IF LESSEE HAS NOT ELECTED OPTION (I) OR
(II) BY THE END OF THE TERM OR, IF EXTENDED, THE EXTENSION TERM, THEN OPTION
(III) SHALL PREVAIL. THEREAFTER, THIS LEASE WILL CONTINUE SUBJECT TO TERMINATION
BY EITHER LESSEE OR AMPLICON AT THE END OF ANY MONTH, PROVIDED AT LEAST NINETY
DAYS PRIOR WRITTEN NOTICE IS DELIVERED TO THE OTHER PARTY.
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THE INDIVIDUAL SIGNING BELOW CERTIFIES THAT HE OR SHE HAS READ THIS SCHEDULE
(INCLUDING THE TERMS ON THE REVERSE SIDE) AND THE LEASE AGREEMENT, AND IS
AUTHORIZED TO SIGN THIS SCHEDULE ON BEHALF OF LESSEE.
THIS SCHEDULE ALONG WITH THE LEASE AGREEMENT CONTAIN THE ENTIRE AGREEMENT
BETWEEN AMPLICON AND LESSEE WITH RESPECT TO THE SUBJECT MATTER HEREOF. THIS
AGREEMENT CAN ONLY BE MODIFIED IN WRITING, WITH SUCH MODIFICATIONS SIGNED BY A
PERSON AUTHORIZED TO SIGN AGREEMENTS ON BEHALF OF LESSEE AND BY AN AUTHORIZED
SIGNER OF AMPLICON. NO ORAL OR OTHER WRITTEN AGREEMENTS, REPRESENTATIONS OR
PROMISES SHALL BE RELIED UPON OR BE BINDING ON THE PARTIES UNLESS MADE A PART OF
THIS LEASE BY A WRITTEN MODIFICATION SIGNED BY AN AUTHORIZED SIGNER OF BOTH
LESSEE AND AMPLICON.
LESSEE/OFFEROR AMPLICON, INC.
OFFER: Back Yard Burgers, Inc. ACCEPTANCE:
By: By:
------------------------------- -------------------------------
Name: Xxxxxxx X. Xxxx Name: Amplicon Finance Committee
----------------------------- ----------------------------
Title: Chief Financial Officer Title: Amplicon Finance Committee
---------------------------- ---------------------------
Date: May 6, 1999 Date: May 6, 1999
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5
H. RIGHT TO INSPECT THE PROPERTY: Amplicon may during reasonable business
hours enter upon any premises where the Property is located to confirm
compliance with the terms of the lease.
I. TAXES ON THE PROPERTY: All fees, assessments and taxes (except those based
upon the net income of Amplicon) which may now or hereafter become due or
are imposed upon the ownership, sale, possession and/or use of the Property
are to be paid by Lessee. While Lessee will be responsible for payment of
all personal property taxes, Amplicon will file all personal property tax
returns. Amplicon is not responsible for contesting any valuation of, or
tax imposed on, the Property (but may do so strictly as an accommodation to
Lessee) and will not be liable or accountable to Lessee therefor. Amplicon
retains any and all federal and state tax credits or benefits relating to
the Property.
J. USE, OPERATION AND MAINTENANCE OF THE PROPERTY: Lessee at its own expense,
will provide a suitable place for the operation of the Property, and keep
in force for the duration of the Lease the best standard Supplier's
maintenance agreement(s) which will cause the Supplier(s) to make all the
necessary repairs, adjustments, and replacements in accordance with such
maintenance agreement(s) and entitle Lessee (through Amplicon, if
necessary) to obtain available enhancements, updates, upgrades and changes.
K. ADDITIONS AND MODIFICATIONS TO THE PROPERTY: All additions and
modifications to the Property become a part of the Property and are owned
by Amplicon. Software, as described on any Schedule(s), includes all
updates, revisions, upgrades, new versions, enhancements, modifications,
derivative works, maintenance fixes, translations, adaptations, and copies
of the foregoing or of the original version of the Software whether
obtained from the Supplier, licensor or from any source whatsoever, and
references in this Lease to Software will be interpreted as references to
any and all of the foregoing. All additions and modifications to the
Property must be free and clear of any liens or rights of other parties.
L. INSURING THE PROPERTY: While the Property is in transit and for the
duration of the Lease, Lessee at its own expense shall maintain (i)
comprehensive public liability insurance (naming Amplicon or its assigns as
additional insured) for bodily injury and property damage resulting from
the maintenance, use or transport of the Property and (ii) property and
casualty insurance (naming Amplicon and/or its assigns as sole loss payee)
covering all risks of loss or damage to the Property from any cause
whatsoever including, without limitation, fire and theft. All insurance
will be from an insurer(s) and in a form and amount satisfactory to
Amplicon. Lessee shall deliver to Amplicon the original policies or
certificates of such insurance (and each renewal or replacement thereof)
and evidence of the payment of the premiums for such insurance policies.
All policies will provide that no cancellation or material modification of
such insurance shall be effective without thirty days prior written notice
to Amplicon.
M. RISK OF LOSS TO THE PROPERTY: While the Property is in transit and
throughout the duration of the Lease, Lessee assumes all responsibility for
loss or damage or other Casualty Occurrence, as defined herein, to the
Property and shall hold Amplicon harmless. A Casualty Occurrence occurs if,
for any reason whatsoever, any of the Property is lost, stolen,
requisitioned, taken, confiscated, destroyed or irreparably damaged by any
cause whatsoever. In the case of Software, the erasure, inoperability or
other incapacity of the Software triggered by a preprogrammed termination
of limiting design or routine embedded in the Software is also deemed a
Casualty Occurrence. In the event of a Casualty Occurrence as to any
Property, Lessee will immediately inform Amplicon in writing. On the next
succeeding rental payment date, Lessee will (i) either replace the Property
with like-kind Property, free and clear of any liens or rights of other
parties, acceptable to Amplicon or Amplicon's assignee and continue to pay
all rentals without interruption as they come due, or (ii) pay to Amplicon
all past due rentals and other amounts then late or due and an amount equal
to the stipulated value as determined by the Casualty Schedule annexed to
the Lease ("Stipulated Value"). When Lessee makes this payment to Amplicon,
the rentals cease to accrue and the Lease with respect to that Schedule
ends. Insurance proceeds received by Amplicon as a result of a Casualty
Occurrence will be applied to reduce Lessee's obligation to pay the
Stipulated Value.
N. OWNERSHIP OF THE PROPERTY: Amplicon at all times retains ownership, title
and/or control over Lessee's right to use the Property in accordance with
the terms of the Lease. Lessee shall protest and defend, at its own
expense, Amplicon's title and/or rights in the Property against all claims
and liens and keep the Property free and clear of all such claims and
liens. The Property is and shall remain personal property of Amplicon. To
the extent Software is being provided to Lessee solely because of payments
made by Amplicon to the Supplier and, accordingly, Lessee agrees that
Amplicon has an interest in the license. Lessee agrees that if it or any of
its affiliates receives anything of value from the Supplier (including
without limitation, a trade-in, substitution, discount or upgrade
allowance) other than Lessee's rights to use the Software reflected on the
Schedule for the duration of this Lease, Lessee will advise Amplicon and
pay to Amplicon an amount equal to such additional value obtained by
Lessee. Lessee agrees that it will not surrender, transfer or modify the
license agreement without first obtaining the written consent of Amplicon.
O. RETURN OF PROPERTY: If Lessee elects to return the Property as provided for
in the Lease, Lessee will discontinue the use of the Property, pay to
Amplicon an inspection refurbishment and restocking fee equal to five
percent of the Property's original cost, and immediately, at its own
expense, ship the Property, with all manuals, cables, cartons and packing
materials as originally furnished by Supplier, to a location within the
United States in accordance with the Property return instructions provided
by Amplicon. In the case of Software, Lessee will destroy all intangible
Software items, and deliver to Amplicon all tangible items constituting
Software. At Amplicon's request, Lessee will also certify in a written form
acceptable to Amplicon that: (i) all tangible Software has been delivered
to Amplicon; (ii) all intangible records have been destroyed; (iii) Lessee
has not retained the Software in any form; (iv) Lessee will not use the
Software after termination and (v) Lessee has not received from Supplier(s)
anything of value relating to or in exchange for Lessee's use, rental or
possession of the Software during the duration of the Lease (including a
trade-in, substitution or upgrade allowance). Until Lessee has complied
with all of the requirements of this Section, rent payment obligations will
continue from month to month at the rental rate delineated on the Schedule.
P. ASSIGNMENT OF LEASE AND/OR PROPERTY: AMPLICON MAY ASSIGN ANY OF ITS RIGHTS
IN THE LEASE AND/OR THE PROPERTY TO AN ASSIGNEE ("ASSIGNEE"). LESSEE HEREBY
CONSENTS TO SUCH ASSIGNMENT AND FURTHER AGREES AS FOLLOWS: (1) ASSIGNEE
DOES NOT ASSUME ANY OF THE OBLIGATIONS OF AMPLICON UNDER THE LEASE; (2) TO
PAY ALL ASSIGNED MONIES DUE UNDER THE LEASE UNCONDITIONALLY WITHOUT OFFSET
AND LESSEE FURTHER AGREES THAT SUCH MONIES SHALL BE PAYABLE NOTWITHSTANDING
ANY DEFENSE OR COUNTERCLAIM WHATSOEVER WHETHER BY REASON OF BREACH OF THE
LEASE, THE EXERCISE OF ANY RIGHT HEREUNDER, OR OTHERWISE, WHICH LESSEE MAY
NOW OR HEREAFTER HAVE AGAINST AMPLICON (LESSEE RESERVES ITS RIGHT TO ASSERT
ANY SUCH DEFENSE OR COUNTERCLAIM DIRECTLY AGAINST AMPLICON); (3) TO PROVIDE
AMPLICON WITH A COPY OF ANY NOTICES SENT BY LESSEE TO ASSIGNEE UNDER THE
LEASE; (4) THAT SUBJECT TO AND WITHOUT IMPAIRMENT OF LESSEE'S LEASEHOLD
RIGHTS IN AND TO THE PROPERTY COVERED UNDER THE LEASE; LESSEE SHALL HOLD
SAID PROPERTY AND THE POSSESSION THEREOF FOR THE ASSIGNEE TO THE EXTENT OF
THE ASSIGNEE'S RIGHTS THEREIN, AND (5) SUCH ASSIGNMENT DOES NOT CHANGE
LESSEE'S OBLIGATIONS UNDER THIS LEASE OR INCREASE THE BURDEN AND RISKS
IMPOSED ON LESSEE. WITHOUT THE PRIOR WRITTEN CONSENT OF AMPLICON, LESSEE
SHALL NOT ASSIGN THIS LEASE OR ITS INTEREST IN THE LEASE IN ANY FORM OR
MANNER INCLUDING, BUT NOT LIMITED TO, AN ASSIGNMENT DUE TO A SALE, MERGER,
LIQUIDATION, SUB-LEASE, LEVERAGED BUYOUT, CHANGE OF OWNERSHIP OR
CHANGE-IN-CONTROL.
