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(LOGO) EXHIBIT 10.31
GE CAPITAL
Fleet Services
_____________________________________________________________________________
Fleet # 8107
LEASE AGREEMENT Client #
_____________________________________________________________________________
This Lease Agreement (herein the "Agreement") is made and entered into as of
August 22, 1991 by and between Gelco Corporation, a Minnesota corporation,
doing business as GE Capital Fleet Services (herein the "LESSOR"), and Burger
King Distribution Services, a Division of Burger King Corporation, a Florida
corporation (herein the "LESSEE").
(1) LEASE OF VEHICLES: SEE ADDENDUM.
Upon delivery and acceptance of each vehicle, XXXXXX agrees that
XXXXXX's obligation to pay rent and other amounts hereunder with respect to
such Vehicle shall be unconditional, and LESSEE shall not be entitled to any
reduction of, or set-off against, such amounts whatsoever (provided, however,
that any payment by LESSEE shall not predjudice XXXXXX's right to claim
adjustment or reimbursement) nor shall this Lease terminate or the obligations
of LESSEE be affected by reason of any defect in, damage to or loss of
possession, use or destruction of any Vehicle from whatsoever cause, unless
such obligations have been terminated pursuant to the express terms hereof.
(2)(a) TERM OF AGREEMENT: The term of this Agreement shall be indefinite
commencing on the date hereof, and continuing until terminated in the manner set
forth in this Agreement. Notwithstanding the termination of this Agreement, all
Vehicles then leased by XXXXXX, shall continue to be subject to the terms,
conditions and covenants contained in this Agreement, until each of such terms,
conditions and covenants has been fulfilled and no such termination shall affect
rights or obligations in existence prior to the effective date of termination.
(b) VEHICLE LEASE TERM: SEE EXHIBIT O.
(3) LESSEE'S OPERATION OF VEHICLES: LESSEE shall use the Vehicles
primarily in the United States for business purposes and in a safe and lawful
manner and shall comply with all federal, state, county and municipal statutes,
ordinances and regulations which may be applicable to the leasing, use or
operation of the Vehicles. In addition, XXXXXX shall prepare and furnish to
LESSOR all documents, returns or forms legally required to be prepared by
XXXXXX. LESSEE shall be solely responsible for any fines or penalties assessed
for violations of any statute, ordinance, bylaw or regulation of any duly
constituted governmental authority, as a result of the use or operation of the
Vehicles by any of LESSEE's employees, agents, sublessees or subcontractors.
XXXXXX agrees to operate only those Vehicles which have insurance coverage as
provided herein and to comply with all conditions of insurance related to the
Vehicles, to maintain the Vehicles and all accessories and equipment thereof in
safe and good mechanical condition and running order at all times during the
term of this Agreement and to furnish all supplies, accessories, and other
essentials required for the use or operation of the Vehicles. In no event will
the Vehicles to be used to transport any hazardous substances, except as may be
transported in separate packages or containers by Vehicles in the ordinary
course of LESSEE's business, provided that such transportation is not subject
to labeling or placarding under the Hazardous Mateials Transportation Act.
(4) LESSOR DISCLAIMER: FOR AND DURING THE TERM OF ANY VEHICLE LEASE,
LESSOR HEREBY ASSIGNS TO LESSEE ALL MANUFACTURER'S WARRANTIES APPLICABLE TO THE
VEHICLES. THERE ARE NO WARRANTIES OR OTHER RIGHTS PROVIDED BY THE LESSOR OTHER
THAN THE MANUFACTURER'S WARRANTIES ASSIGNED TO LESSEE COPIES OF WHICH XXXXXX
ACKNOWLEDGES HAVING PREVIOUSY RECEIVED. LESSOR MAKES NO REPRESENTATION OR
WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO ANY VEHICLE,
INCLUDING ITS DESIGN, OPERATION OR CONDITION, MERCHANTABILITY, OR ITS FITNESS
FOR A PARTICULAR PURPOSE. LESSEE ACKNOWLEDGES THAT LESSOR IS NOT THE
MANUFACTURER, DESIGNER OR A DISTRIBUTOR OF THE VEHICLE. LESSOR SHALL HAVE NO
LIABILITY WHATSOEVER FOR ANY FAILURE OF OR DELAY IN DELIVERY OF THE VEHICLE OR
FOR THE BREACH OF ANY REPRESENTATION OR WARRANTY MADE BY THE MANUFACTURER.
XXXXXX MAKES NO REPRESENTATION AS TO THE TREATMENT BY LESSEE OF THIS LEASE FOR
FINANCIAL STATEMENT OR TAX PURPOSES.
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(5) COSTS AND EXPENSES, FEES AND CHARGES: LESSEE covenants that it will pay
all costs expenses, charges and taxes (other than federal income or state income
taxes) incurred in connection with the titling, registration, delivery,
purchase, sale, rental, installation, use or operation of the Vehicles during
the term of this Agreement in addition to the rental herein provided. If LESSOR
incurs or is compelled to pay any of such costs LESSEE shall, upon demand from
LESSOR, promptly reimburse LESSOR for same. If LESSOR is required to pay any
fines, tickets, penalties or other charges related to a violation by LESSEE of
any local, state or federal law or regulation, LESSEE shall, upon demand,
promptly reimburse LESSOR for same and pay an additional charge of $15.00 for
the administrative expenses incurred by LESSOR processing each fine, ticket,
penalty or other such charge on behalf of LESSEE.
(6) REGISTRATION PLATES, ETC.: LESSEE shall at its own expense, obtain all
registration plates and other plates, permits or licenses required to be
obtained in the name of LESSOR except for the initial registration plates which
LESSOR shall obtain at LESSEE's expense. LESSOR shall issue to LESSEE, for such
purpose, powers of attorney and/or other necessary authority. Both LESSOR and
LESSEE covenant and agree to cooperate and to furnish any and all information
or documentation which may be reasonably necessary to enable compliance with
the provision of this Section or any local, state or federal law or regulation.
(7) RENTAL CHARGES: LESSEE will pay LESSOR and XXXXXX will accept as payment
from LESSEE, as rental for the Vehicles, charges in accordance with the
Exhibits to this Agreement. All payments of rental shall be in United States
legal tender.
Time is of the essance. All charges are due and payable upon receipt of
invoice but not earlier than the first (1st) day of the month for which the
rentals are due. LESSEE shall pay to LESSOR a late payment penalty in the
amount of one percent (1%) or the highest legal interest rate, whichever is
less, per month or fraction thereof of any invoice the payment of which is not
in the possession of the LESSOR on or before the twenty-fifth (25th) day from
the date of such invoice for if such 25th day falls on a weekend or holiday,
then the immediately preceding business day).
Any Vehicle delivered and accepted or sold after the fifteenth (15th) day of
any month will be treated as a delivery or sale as of the first (1st) day of
the following month, and any Vehicle delivered and accepted or sold on or prior
to the fifteenth (15th) day of any month will be treated as a delivery and
acceptance or sale as of the first (1st) day of such month; provided, however,
that in the event LESSEE elects to terminate all or any material percentage of
the Vehicles at the same time, such disposition shall be treated as a
disposition on the last day of such month.
In the event a lapse of time shall occur between the delivery to LESSOR of
part of any Vehicle, such as a chassis, and delivery of any other part, such as
a body, tank, etc., and it shall become necessary for LESSOR to advance funds
to pay for such incomplete Vehicle, LESSOR, in such event, may pay for such
incomplete Vehicle, and either (i) xxxx XXXXXX immediately or (ii) charge
LESSEE for interim financing at a rate of one percent (1%) over the prime rate
which shall be payable by LESSEE at the time of delivery and acceptance of the
complete Vehicle. For purposes of the foregoing, "Prime Rate" shall be defined
to mean the highest rate quoted as the "Prime Rate" in the column entitled
"Money Rates" published in the Wall Street Journal on the Delivery Date. All
incomplete Vehicles thus acquired shall, with the exception of the payment of
rentals, be subject to the terms and conditions of this Agreement.
XXXXXX agrees to carefully review each billing or other statement provided by
XXXXXX. All statements rendered by XXXXXX shall be presumed correct and
accurate and in the case of billing statements constitute an account stated
between XXXXXX and LESSEE unless, within thirty (30) days after receipt
thereof, XXXXXX shall deliver written objection thereto specifying any errors
in the statement. In such event, XXXXXX's sole liability and XXXXXX's exclusive
remedy shall be to make appropriate adjustments in LESSEE's account. All
charges are based upon XXXXXX's standard operating routines computer systems
capabilities, and existing business policy. Additional services and special
handling required by LESSEE will be subject to separate negotiation. Nothing
contained in this Agreement shall prevent LESSOR from obtaining compensation
from manufactures, suppliers or other vendors.
(8) SURRENDER AND DISPOSITION OF VEHICLES:
(a) LESSEE shall have the right, at any time after the first twelve (12)
months of the Vehicle Lease Term for any Vehicles leased hereunder, upon 15
days written notice thereof to LESSOR, to surrender for disposition with or
without replacement any one (1) or more of the Vehicles. Upon such election
LESSEE shall, at its own expense, surrender the Vehicles at such place as may
be mutually agreed upon between LESSEE and LESSOR not to exceed 1,000 miles.
Such surrender shall include all license plates, registration certificates,
documents of title and odometer certifications and other documentation
necessary to effect the sale of the Vehicle. LESSOR shall sell such Vehicles
within a reasonable time after the date of surrender of possession unless
otherwise mutually agreed. The surrender of any Vehicle shall not be effective
until LESSOR (i) takes actual possession of such Vehicle or (ii) five business
days after receipt of written notice, whichever shall first occur.
(b) LESSOR shall, and LESSEE may, solicit from prospective purchasers in
the wholesale vehicle market cash bids for such Vehicles on an AS IS, WHERE IS
BASIS, WITHOUT RECOURSE OR WARRANTY. Such Vehicles shall be sold in a
commercially reasonable manner for cash payable in full upon delivery. Without
limiting the generality of the foregoing, LESSOR shall have the right to sell
such Vehicles to any dealer or broker or at any wholesale automobile auction,
including companies affiliated with LESSOR in an amount not less than the
highest bid received by LESSOR and LESSEE. In the event LESSOR sells any
vehicle owned by LESSEE or any third party, LESSEE shall indenmify LESSOR from
all liabilities directly or indirectly related to such sale and pay LESSOR a
fee of $40.00 per vehicle.
(c) SEE ADDENDUM.
(d) SEE EXHIBIT O AND ADDENDUM.
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(9) INSURANCE: LESSEE will purchase and mantain in force during the time
this Agreement is in effect, insurance policies in at least the amounts listed
below, covering the Vehicles between the time of delivery and acceptance thereof
to LESSEE and surrender to LESSOR. Said insurance shall be written by an
insurance company or companies rated B+ or better in the A.M. Best Insurance
guide insuring LESSEE against any loss, damage claims, suits actions or
liability, and by endorsement naming XXXXXX as an Additional Named Insured and
Loss Payee; provided, however, so long as LESSEE is not in default hereunder,
XXXXXX agrees to immediately assign the proceeds to LESSEE to effect repairs to
or replacement of the Vehicle. Such endorsement or endorsements shall provide in
each case that said insurance company or companies shall give to LESSOR at least
thirty (30) days' notice in writing of proposed cancellation, modification, or
alteration of any said insurance.
TYPE AMOUNT
Public Liability and Property Damage $1,000,000 Combined Single
(comprehensive automobile liability) Limit (per occurrence)
Collision, Fire and Theft (ALL RISK) Not less than LESSOR's Unamortized
Book Value
The above insurance should also include the following in amounts not
less than the applicable minimum legal requirements: (a) uninsured/underinsured
motorist coverage and (b) no fault protection. Prior to the date that any
vehicle is placed in service by XXXXXX, LESSEE shall furnish LESSOR with a
certificate of insurance or other evidence thereof acceptable to LESSOR.
Policies covering the aforementioned fire and theft and collision insurance
shall bear endorsements to the effect that proceeds thereof shall be payable to
LESSOR and/or LESSEE as their interests may appear. XXXXXX, in the event of
Default, hereby appoints XXXXXX as XXXXXX's attorney-in-fact to receive payment
of and endorse all checks and other documents and to take any other actions
necessary to pursue insurance claims and recover payments if XXXXXX fails to do
so. If XXXXXX fails to pursue claims and reorder payments within a reasonable
time, any direct out-of-pocket expense of LESSOR in adjusting or collecting
insurance shall be borne by LESSEE. In the event a Vehicle is involved in any
material accident involving personal injuries or property damages exceeding
$5,000.00, LESSEE shall immediately notify LESSOR and provide (i) copies of all
reports provided to an insurance carrier or governmental agency and (ii) copies
of any legal papers relating to the accident.
(10) INDEMNIFICATION BY LESSEE: LESSEE COVENANTS AND AGREES TO
INDEMNIFY, SAVE HARMLESS AND DEFEND LESSOR, ANY EMPLOYEE OF LESSOR, AND ANY
PARENT, SUBSIDIARY OR AFFILIATE OF LESSOR, AGAINST ANY AND ALL LIABILITY, CLAIMS
FOR LOSS, DAMAGE, OR INJURY AND FROM AND AGAINST ANY SUITS, ACTIONS, OR LEGAL
PROCEEDINGS OF ANY KIND BROUGHT AGAINST LESSOR FOR OR ON ACCOUNT OF ANY
PERSON(S), OR LEGAL ENTITY, OR ON ACCOUNT OF ANY INJURIES RECEIVED OR SUSTAINED
BY ANY PERSON(S) OR LEGAL ENTITY IN ANY MANNER, DIRECTLY OR INDIRECTLY CAUSED
BY, INCIDENT TO, OR GROWING OUT OF, WHOLLY OR IN PART, THE USE, OPERATION OR
MAINTENANCE OF THE VEHICLES BETWEEN THE TIME OF DELIVERY THEREOF TO LESSEE AND
THE TIME OF SURRENDER THEREOF BY XXXXXX TO LESSOR FOR DISPOSITION. PROVIDED,
HOWEVER, THAT IN THE EVENT LESSOR SELLS ANY VEHICLE TO LESSEE OR ANY EMPLOYEE OF
LESSEE, XXXXXX'S COVENANTS OF INDEMNITY SHALL CONTINUE as to the condition of
the Vehicle at the time of the sale and any implied warranties related to such,
sale. LESSOR shall not sell tractors or trailers to LESSEE'S employees. XXXXXX
further agrees to take upon itself the settlement of all such claims and the
defense of any suit or suits, or legal proceedings of any kind brought to
enforce such claim or claims, and to pay all judgments entered into such suit or
suits and all costs, attorneys' fees or other expenses. XXXXXX shall not
stipulate any judgments on XXXXXX's behalf in order to consumate any settlement
without XXXXXX's prior consent.
LESSEE FURTHER COVENANTS AND AGREES TO HOLD LESSOR HARMLESS FROM ANY
LOSS, DAMAGE, THEFT OR DESTRUCTION OF THE VEHICLES FROM THE DATE OF DELIVERY
AND ACCEPTANCE OF THE VEHICLES BY LESSEE TO THE DATE OF SURRENDER OF POSSESSION
OF THE VEHICLE.
The foregoing LESSEE's covenants of indemnity do not encompass any gross
negligence or willful misconduct by LESSOR, but are otherwise absolute and
unconditional and shall continue in full force and effect notwithstanding the
termination of this Agreement, for events which occur prior to the surrender of
a Vehicle by LESSEE to LESSOR for disposition.
THE PROVISIONS OF THIS SECTION COMPREHEND, BUT WITHOUT LIMITATION,
LIABILITY AND CLAIMS, HOWSOEVER ARISING, WHETHER BY REASON OF NEGLIGENCE, BREACH
OF WARRANTY, DEFECT IN MANUFACTURE OR MAINTENANCE OR OTHERWISE, AND EVEN THOUGH
STRICT LIABILITY BE CLAIMED, LESSOR shall not seek amounts from LESSEE which
have already been paid by XXXXXX's insurance provider.
(11) LESSOR-LESSEE RELATIONSHIP: This is an agreement of lease only. It
is agreed that this is not an agreement of partnership or employment of LESSOR
or of any of LESSOR's employees by XXXXXX and that LESSOR is an independent
contractor. Except as may be specifically provided in an executed Power of
Attorney, neither XXXXXX nor any employee of LESSEE shall have any authority to
act on behalf of XXXXXX or be deemed to be the agent, servant or employee of
XXXXXX. Nothing herein contained shall give or convey to LESSEE any right, title
or interest in and to any Vehicle leased hereunder except as XXXXXX and LESSEE
shall have no option to purchase any Vehicle. In the event that, contrary to the
intention of the parties hereto, this Lease is deemed to be other than a lease.
LESSEE hereby grants XXXXXX a security interest in the Vehicles and all
proceeds, accessions, chattel paper, equipment and general intangibles related
thereto to secure all of LESSEE's obligations hereunder. At LESSOR's request,
XXXXXX agrees to execute any financing statements or other instruments necessary
or expedient for filing, recording or perfecting the interest and title of
LESSOR.
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(12) STATEMENTS AND RIGHTS OF INSPECTION: LESSOR shall have the right
to inspect any Vehicle and the records of LESSEE pertaining to LESSEE's Vehicles
at any reasonable time upon reasonable notice at XXXXXX's expense.
The creditworthiness of Burger King Corporation is a material condition
to this Agreement. LESSEE shall porvide LESSOR with Burger King Corporation's
annual audited statements.
(13) DEFAULT BY LESSEE: SEE ADDENDUM.
(14) ASSIGNMENTS: SEE ADDENDUM.
(15) SUBSIDIARIES, PARENTS AND AFFILIATES: This Agreement shall not
apply to present or future parents, subsidiaries or affiliates of LESSEE
without the consent of LESSOR and LESSEE, except as may be permitted by the
assignment provisions in (14)(b) herein.
(16) MODIFICATIONS: This Agreement contains the entire understanding of
the parties and merges all oral understandings herein. Any modifications,
changes, or amendments may be made only in writing subscribed by XXXXXX and
XXXXXX. Failure of either party to enforce any right granted herein shall not
be deemed a waiver of such right.
(17) EXECUTION AND GOVERNING LAW: THIS AGREEMENT SHALL NOT BECOME
EFFECTIVE AS OF THE DATE ON PAGE 1 HEREOF AFTER EXECUTION BY AN AUTHORIZED
REPRESENTATIVE OF THE LESSOR AND XXXXXX. THE LAWS OF THE STATE OF MINNESOTA
SHALL GOVERN ALL QUESTIONS OR DISPUTES, WHETHER SOUNDING IN TORT OR CONTRACT,
RELATING TO THE INTERPRETATION, PERFORMANCE, VALIDITY, ENFORCEMENT, OR EFFECT
OF THIS AGREEMENT, WITHOUT REGARD TO CHOICE OF LAW PRINCIPLES THEREOF.
(18) SEVERABILITY: If any portion of this Agreement shall be found to
be illegal, invalid or contrary to public policy, the same may be modified or
stricken by a Court of competent jurisdiction to the extent necessary to allow
the Court to enforce such provision in a manner which is as consistent with the
original intent of the provision as possible. The striking or modification by
the Court of any provision shall not have the effect of invalidating the
Agreement as a whole.
(19) WAIVER OF JURY TRIAL: BOTH PARTIES TO THIS AGREEMENT HEREBY WAIVE
ANY AND ALL RIGHT TO ANY TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING
DIRECTLY OR INDIRECTLY HEREUNDER.
(20) MISCELLANEOUS: This Agreement is for the benefit of and may only
be enforced by the respective parties and their successors and permitted
assignees and is not for the benefit of and may not be enforced by any third
party. This Agreement is the product of negotiations between the parties. Each
provision hereof shall be read and interpreted in accordance with its common
and ordinary meaning and no ambiguity in language shall be read or interpreted
in favor of or against either party.
(21) ODOMETER DISCLOSURE STATEMENT: Federal law (and State law, if
applicable) requires that the Lessee disclose the mileage to the Lessor in
connection with the transfer of ownership of the leased vehicle. Failure to
complete an odometer disclosure form or making a false statement may result in
fines and/or imprisonment.
(22) ADDENDUM AND EXHIBITS: THE ADDENDUM AND EXHIBITS A, B, C, L AND O
ARE ATTACHED HERETO AND INCORPORATED HEREIN BY REFERENCE.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by duly authorized representatives.
Gelco Corporation dba Burger King Distribution Services, a Division of
GE Capital Fleet Services Burger King Corporation
(LESSOR) ------------------------------------------------
(LESSEE)
BY: /s/ X.X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxx
------------------------- ---------------------------------
Title: Vice President Title: President
---------------------- ------------------------------
Date: August 22, 1991 Date: August 22, 1991
----------------------- -------------------------------
Attest: /s/ Xxxxxxx Xxxxx Attest: Xxxxxxx X. Xxxxxx
--------------------- ----------------------------
Assistant Secretary
Address: Three Capital Drive Principal Place of Business
-------------------- & Mailing Address 00000 Xxx Xxxxxx Xxxx
-----------------------
Eden Prarie, MN 55344 Miami, Florida 33157
---------------------------- -----------------------------------------
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FORM OF
EXHIBIT A
BURGER KING DISTRIBUTION SERVICES
BOOK
UNIT YEAR MAKE MODEL VIN VALUE
--------------------------------------------------------------------------------
FINAL SUMS
----------------------------------------------------------------------
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GE CAPITAL
[LOGO] Fleet Services
________________________________________________________________________________________
FORM OF Client # ___________________
LEASE EXHIBIT B Fleet # ____________________
________________________________________________________________________________________
AMORTIZATION RATES
Effective:_____________________________ Date of Master Lease: ___________________
This Exhibit B is a part of and subject to the Lease Agreement by and between the
undersigned. The term Vehicle(s) as used herein shall have the same meaning as the terms
Vehicle(s) have when used in the Lease Agreement and related Exhibits. If more than one
amortization is selected by Xxxxxx, such selection shall be indicated on the
Vehicle Order.
XXXXXX's Capitalized cost of each Vehicle shall be amortized at an equal rate per
month from the date in service of such Vehicle by LESSOR pursuant to the amortization
period selected by LESSEE from among the following:
Term in Months and Percentage Per Month
Automobles Term / / 36 / / 40 / / 44 / / 48 / / 50 / / _____ / / _____
% ______ ______ ______ ______ ______ / / _____ / / _____
Light Trucks Term / / 36 / / 40 / / 44 / / 48 / / 50 / / 60 / / _____ / / _____
% ______ ______ ______ ______ ______ ______ / / _____ / / _____
Medium Duty Trucks Term / / 48 / / 60 / / 72 / / 84 / / _____ / / _____
% ______ ______ ______ ______ / / _____ / / _____
Heavy Duty Trucks Term / / 60 / / 72 / / 84 / / 96 / / _____ / / _____
% ______ ______ ______ ______ / / _____ / / _____
Other Reefer
Trailers Term / / 36 / / 40 / / 44 / / 48 / / 50 / / 60 / / _____ / / _____
% ______ ______ ______ ______ ______ ______ / / _____ / / _____
______________
The Capitalized Cost of a Vehicle is computed by adding together the following amounts:
(i) The Manufacturer's invoice price of the Vehicle including sales tax, if
applicable;
(ii) The invoice price of any additions or modifications to the Vehicle(s) made
pursuant to LESSEE's request;
(iii) Charges in accordance with the following schedule:
MAKE MARK-UP CHARGES
All Domestic Vehicles ...................................................
All Cadillac, Xxxxxxx, Xxxxxxxx ............................ Individually Negotiated
Light trucks ............................................................
Vehicles requiring immediate delivery (out of stock), including
pool vehicles or vehicles purchased/ordered direct from
dealers .......... $_____ or _____ % of the capitalized value*; whichever is greater
Foreign vehicles (including vehicles imported by domestic
manufacturers) .. $_____ or _____ % of the capitalized value*; whichever is greater
Non-vehicular Equipment .................................... Individually Negotiated
Medium and Heavy Duty Trucks and Trailers and Tractors...... Individually Negotiated
Vehicles delivered to Alaska and Hawaii .................... Individually Negotiated
Other ...................................................................
Other ...................................................................
Other ...................................................................
* Capitalized value shall be the sum of items (i) and (ii) above
Gelco Corporation dba Burger King Distribution Services, a
GE CAPITAL FLEET SERVICES Division of Burger King Corporation
________________________________________
(LESSOR) (LESSEE)
By: ____________________________________ By: _____________________________________
Title: _________________________________ Title: __________________________________
Date: __________________________________ Date: ___________________________________
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Client #_______
Fleet #________
FORM OF
EXHIBIT C
FIXED RATE BASED ON TREASURY NOTES - FOR TRAILERS ONLY, FOR LEASE AGREEMENT
LEVEL PAYMENTS OVER AGREED PERIODS DATED AUGUST 22, 1991
_______________________________________________________________________________
RENTAL CHARGES EFFECTIVE DATE: VEHICLES ON ROAD ON OR AFTER _____________
This Exhibit C is part of and subject to the Lease Agreement between the
undersigned (the "Agreement"). The terms used herein shall have the same
meaning as the terms in the Agreement and related Exhibits except as to terms
specifically defined herein. The following terms are used herein:
"Treasury Note Rate" shall mean the yield listed on Page 217 of the Telerate
Treasury Yield Rate in effect on the fifteenth (15th) day of the month
preceding the Delivery Date (or if such day falls on a weekend or holiday, then
the immediately preceding business day), for the current "on-the-run" Treasury
Notes maturing in ___ years. If for any reason the Telerate Treasury Yield
Recap ceases publication or is otherwise unavailable, then reference shall be
made to the Wall Street Journal. The rate shall be the yield which most closely
approximates par for the appropriate maturity.
"Average Unamortized Book Value" shall mean one-half of the sum of the
Unamortized Book Value at (1) the beginning of the first month of an Agreed
Period and (2) the beginning of the last month of an Agreed Period.
"Monthly Interest Rate" shall mean the Treasury Note Rate ____________________
________________________ divided by 12.
"Agreed Period(s)" shall mean an initial period of ___ months and, if
applicable, a period equal to the remaining months in the amortization term.
LESSEE will pay LESSOR and XXXXXX will accept as payment from LESSEE, as rental
for each Vehicle, charges in accordance with Exhibit A. Such rentals shall be
based upon Lessor's Capitalized Cost of each Vehicle as specified in Exhibit B,
and shall be the sum of the folowing:
(1) An amortization charge per Vehicle, payable monthly, computed using
the amortization rate provided for on Exhibit B and selected by
XXXXXX; plus
(2) A sum, equal to ___% of the Capitalized Cost per Vehicle per month,
payable monthly, throughout the Lease Term of each Vehicle as
LESSOR's management fee; and
(3) An interest charge, payable monthly, determined by multiplying the
Average Unamortized Book Value for each Agreed Period by the
Monthly Interest Rate. Upon disposition of a Vehicle, LESSEE shall
pay to LESSOR deficit interest in an amount equal to the difference
between actual simple interest and the averaged interest billed by
XXXXXX as regards such Vehicle.
GE CAPITAL FLEET SERVICES (LESSOR) PROSOURCE SERVICES CORPORATION (LESSEE)
By: ______________________________ By: ___________________________________
Title: ___________________________ Title: ________________________________
Date: ____________________________ Date: _________________________________
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GE CAPITAL
[LOGO] Fleet Services
_______________________________________________________________________________
FORM OF
EXHIBIT L
LESSEE CERTIFICATION
PURSUANT TO INTERNAL REVENUE CODE AS AMENDED
_______________________________________________________________________________
The undersigned ("LESSEE") hereby acknowledges that all Vehicles subject to
that certain Lease Agreement by and between LESSEE and Gelco Corporation, dba
GE Capital Fleet Services ("LESSOR"), are included in this Certification.
1. LESSEE certifies under penalty of perjury that it intends the Vehicles
leased pursuant to the Lease Agreement to be used more than fifty
percent (50%) in the trade or business of the LESSEE; and
2. XXXXXX has been advised by XXXXXX that, XXXXXX and not LESSEE, will be
treated as the owner of the property subject to the Lease Agreement for
Federal Income Tax purposes.
Burger King Distribution Services, a Division of
Burger King Corporation
_________________________________________________
(LESSEE)
By: _____________________________________________
Title: __________________________________________
Date: ___________________________________________
9
{LOGO} GE Capital
Fleet Services
_______________________________________________________________________________
Fleet # _________
Client # _________
Master #__________
FORM OF EXHIBIT O -- OPERATING LEASE
_______________________________________________________________________________
This Exhibit amends and modifies that certain Lease Agreement
(hereinafter "Agreement") by and between the undersigned.
For the purposes of this Exhibit, and the Agreement, the following
definitions shall apply:
NET PROCEEDS -- The amount by which the proceeds realized from the sale
of a Vehicle surrendered for sale exceeds the reasonable costs and expenses
incurred by LESSOR in readying such Vehicle for and effectuating such sale,
but excluding Contingent Rentals, if any, paid by Lessee to Lessor.
CONTINGENT RENTALS -- Reasonable costs incurred or assessed by LESSOR
to repair or recondition Vehicles that are surrendered for sale with excessive
wear and tear.
GUARANTEED RESIDUAL -- That portion of the Unamortized Book Value of a
Vehicle at the time of surrender guaranteed by XXXXXX as determined herein.
RENEWAL PERIOD(S) -- The month-to-month periods beginning at the end of
the minimum lease term during which LESSEE may continue to lease a particular
Vehicle.
The parties hereby agree to amend the terms of the Agreement in
accordance with the following:
Section (2)(b) of the Agreement is hereby deleted and replaced with the
following:
(2)(b) VEHICLE LEASE TERM: The minimum lease term for each Vehicle
shall be twelve (12) months commencing the date the Vehicle is delivered to
and accepted by LESSEE, after which LESSEE shall be deemed to have elected to
renew the Agreement for such Vehicle on a month-to-month basis unless notice of
surrender of such Vehicle is provided to LESSOR. However, in no event shall
the lease term for any Vehicle extend beyond fifty (50) months for automobiles,
seventy-two (72) months for light trucks, ninety-six (96) months for medium
and heavy duty trucks and tractors and 120 months for reefer trailers, unless a
different maximum lease term is set forth on any other Exhibit to the
Agreement.
Section (8)(d) of the Agreement is hereby deleted and replaced with the
following:
(8)(d) In the event the Net Proceeds upon sale are in excess of
the Unamortized Book Value of the Vehicle, as of the applicable date
under the Agreement, such excess shall be paid to LESSEE, promptly
after consummation of the sale; provided, however, if LESSEE is in
default of the Agreement with respect to any Vehicle on lease, such
excess shall be first applied in reduction of any payment in default
and the balance of such excess shall be paid to LESSEE. In the event
said Net Proceeds upon sale are less than the Unamortized Book Value of
the Vehicle as of the applicable date under the Agreement, but equal
to or more than the Guaranteed Residual, then LESSEE shall reimburse
LESSOR for the difference between said Net Proceeds and said
Unamortized Book Value. In the event said Net Proceeds are less than
the Guaranteed Residual, LESSOR shall be responsible for the
difference between said Guaranteed Residual and the Net Proceeds; and
LESSEE shall reimburse LESSOR for the difference between the
Guaranteed Residual value and said Unamortized Book Value.
(e) SEE ADDENDUM
(f) (i) The Guaranteed Residual to be used in the event the
Vehicle is sold at the end of the minimum lease term is
16% of the Capitalized Cost of the Vehicle.
(ii) The Guaranteed Residual to be used in the event the
Vehicle is sold at the end of a Renewal Period is __%
of the Unamortized Book Value of the Vehicle as of
the end of the month preceding such Renewal Period.
SEE ADDENDUM.
10
3. This Amendment is effective as of for all Vehicles
on lease at that date and all Vehicles placed in service thereafter. Except as
amended by this Exhibit, all other terms and conditions of the Agreement are
ratified and confimed and remain in full force and effect.
Gelco Corporation dba Burger King Distribution Services,
GE Capital Fleet Services (LESSOR) A Division of Burger King Corporation
_____________________________________
(LESSEE)
By: _______________________________ By: _________________________________
Title: ____________________________ Title: ______________________________
Date: _____________________________ Date: _______________________________
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ADDENDUM TO LEASE AGREEMENT
This is an Addendum to the Lease Agreement dated the 22nd day of August, 1991,
the ("Agreement") between Gelco Corporation, d/b/a/ GE Capital Fleet Services,
as LESSOR and Burger King Distribution Services, a Division of Burger King
Corporation, as LESSEE.
The parties hereby agree to the following amendments to the Agreement:
The first paragraph of Section (1) of the Agreement is hereby deleted and
replaced with the following:
(1) LEASE OF VEHICLES: LESSOR hereby agrees to lease to XXXXXX and
XXXXXX hereby agrees to hire from LESSOR certain automobiles, trucks, tractors,
trailers or equipment (herein "Vehicle(s)") from time to time during the term of
this Agreement. Whenever LESSEE desires to lease Vehicles, LESSEE shall submit
to LESSOR an assignment of LESSEE's Vehicle Purchase Agreement in writing in
connection with XXXXXX's initial order of 72 tractors and 59 trailers on a
form acceptable to LESSOR and LESSEE, or a Vehicle Requisition in writing and
pursuant to a form acceptable to LESSOR, or by electronic or telephonic means.
Upon receipt of such Vehicle Purchase Agreement or Vehicle Requisition, LESSOR
shall confirm and accept such request in a similar manner, order the Vehicles
if not previously ordered by XXXXXX, and upon receipt of an invoice therefore,
pay the manufacturer for the invoice amount of the Vehicles. LESSEE's lease and
acceptance of any Vehicles ordered by it shall take effect on the terms and
conditions specified in this Agreement and the Exhibits attached hereto
immediately upon delivery of each Vehicle to its designated location by LESSOR
or its designated agent to and acceptance by LESSEE or its designated agent,
provided that the Vehicle conforms to LESSEE's specifications (herein "Delivery
Date"). XXXXXX's acceptance of a Vehicle shall constitute a warranty by LESSEE
that the party accepting such Vehicle has the authority to do so on behalf of
LESSEE, and that the Vehicle conforms to LESSEE's Vehicle Purchase Agreement or
Vehicle Requisition, provided, however, XXXXXX's acceptance hereunder shall not
be construed as a waiver of LESSEE's rights against the manufacturer or a
waiver of the warranties of the manufacturer. LESSEE shall take delivery of a
Vehicle within five (5) business days of notice to LESSEE that such Vehicle is
available for delivery. In the event the purchase of any Vehicle is cancelled
by XXXXXX, XXXXXX agrees to reimburse LESSOR for all reasonable and necessary
expenses incurred by XXXXXX as a result of such cancellation.
Section (8) (c) of the Agreement is hereby deleted and replaced with the
following:
Section (8) (c) If LESSEE, after written notice to LESSOR of surrender
of a Vehicle for disposition, elects to continue to operate and retain
possession of the Vehicle, then the rentals and other obligations in the
Agreement shall continue until the Vehicle is sold by XXXXXX, provided that the
maximum lease terms set forth in Section (2)(b) herein are not exceeded, and the
unamortized cost will continue to decline at the same rate until the sale is
concluded. If LESSEE elects to surrender possession of the Vehicle to LESSOR
then the rentals and other obligations under the Agreement shall cease except
for the terms contained in Section (8) herein and the unamortized cost to be
applied to the sale will be the unamortized cost at the date of surrender of
possession of the Vehicle to LESSOR.
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The rentals shall be subject to retroactive upward or downward
adjustment based upon the proceeds received from such sale as set forth below.
Section (8)(d)(e) of the Agreement as amended by Exhibit O is hereby deleted
and replaced with the following:
(8)(d)(e) If the LESSOR determines that there has been excessive wear
and tear of the Vehicle surrendered and the LESSEE disagrees that the Vehicle
has suffered excessive wear and tear, it shall be submitted to a manufacturer's
factory authorized representative or independent appraiser agreed upon between
the parties to determine if the Vehicle has sustained excessive wear and tear
based on the mileage, age and test results, whose determination shall be final
and the costs of such inspection will be split between LESSOR and LESSEE. The
manufacturer's factory authorized representative or independent appraiser shall
also determine the extent of the excessive wear and tear to the Vehicle and the
range and cost of available repairs. XXXXXX and XXXXXX agree to negotiate in
good faith to determine the reasonable and necessary repairs to be effected to
the Vehicle in order to effect a sale of the Vehicle. The cost of effecting
such agreed repairs shall be the amount of Contingent Rentals billed to LESSEE.
Contingent Rentals are deemed to be additonal rental charges and shall be paid
by LESSEE in accordance with the provision of this Agreement.
Add the following paragraph at the end of Section (8)(d) of the Agreement as
amended by Exhibit O:
In the event of a total loss of the Vehicle by fire, damage or theft
and the Vehicle is not repaired or replaced applying the Insurance Proceeds
(including the salvage proceeds, if any), the Agreement with respect to such
Vehicle will be terminated and the Insurance Proceeds shall be applied in
accordance with the terms and conditions contained in Section (8)(d) herein,
except that such Insurance Proceeds shall be applied the same as the Net
Proceeds upon a sale of the Vehicle under Section (8)(d) herein. If the
Insurance Proceeds are less than the unamortized book value of the Vehicle,
LESSEE will be liable for the deficit.
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Add the following 2 paragraphs at the end of Section (10) of the Agreement:
In the event of a total loss of the Vehicle by fire, damage or theft
and the Vehicle is not repaired or replaced applying the Insurance Proceeds
(including the salvage proceeds, if any), the Agreement with respect to such
Vehicle will be terminated and the Insurance Proceeds shall be applied in
accordance with the terms and conditions contained in Section (8)(d) herein,
except that such Insurance Proceeds shall be applied the same as the Net
Proceeds upon a sale of the Vehicle under Section (8)(d) herein. If the
Insurance Proceeds are less than the unamortized book value of the Vehicle,
LESSEE will be liable for the deficit.
Notwithstanding the foregoing, XXXXXX's covenants of indemnity shall
only apply where there is no valid and collectible insurance coverage provided
by LESSEE, applicable to such indemnity obligations of LESSEE.
Section (13) of the Agreement is hereby deleted and replaced with the following
(13)(a) and (13)(b):
(13)(a) DEFAULT BY LESSEE: In the event LESSEE, after five (5) days'
written notice from LESSOR, shall fail to make the payments as herein provided
or after twenty (20) days' written notice, shall fail to perform any of its
covenants under this Agreement, or in the event LESSEE or any quarantor (a)
shall make a general assignment for the benefit of creditors, or suffer a
receiver or trustee to be appointed of all or substantially all of its assets,
or file or suffer to be filed any petition under any bankruptcy or insolvency
law of any jurisdiction which is not dismissed within sixty (60) days; or (b) is
in default under any other Agreement it may have with the LESSOR; or (c) shall
deliver or make any representation or warranty made herein, or in any document
delivered to LESSOR in connection herewith which shall prove to be false or
misleading in any material respect; then in such event LESSOR may, at its
option, in addition to any other remedies which may be available to it at law or
in equity:
(i) terminate this Agreement with respect to any or all of the
Vehicles hereunder, in which event such Vehicles shall immediately
be delivered, at LESSEE's cost and expense, to a location or
locations specified by LESSOR not in excess of 1,000 miles and
recover from LESSEE all unpaid rentals due and other charges due
prior to the termination and repossession of such Vehicles by
XXXXXX, together with all reasonable costs and expenses, including
reasonable attorneys' fees, incurred by LESSOR in connection with
terminating this Agreement and repossessing such Vehicles. XXXXXX
shall thereafter be released from any further liability under this
Agreement except with respect to the LESSEE's indemnity covenants
in connection with events that occurred prior to the termination
and repossession of the Vehicles and LESSOR shall be entitled to
retain any and all proceeds from the sale or other disposition of
the Vehicles; or
14
(ii) repossess any or all Vehicles hereunder without terminating this
Agreement and charge LESSEE with any deficiency between the amount due from
LESSEE and the amount realized by leasing such Vehicles until they can be
sold by LESSOR in accordance with the terms and conditions contained in
Section (8) in mitigation of LESSEE's damages, while retaining its right
to collect the full rental due for the period prior to termination and
repossession, and all reasonable costs and expenses, including reasonable
attorneys' fees, incurred in connection with terminating this Agreement
and repossessing said Vehicles.
In addition to LESSEE's obligations to LESSOR under either subparagraph (i)
or (ii) above, LESSOR shall be entitled to receive from LESSEE a minimum of
twelve (12) months management fee on Vehicles in service for less than twelve
(12) months at the date of default.
In case of failure by LESSEE to comply with any provision of this
Agreement, LESSOR shall have the right, but not the obligation, at its option,
to effect such compliance as in LESSOR's sole discretion is appropriate, in
whole or in part, and all reasonable costs and expenses of LESSOR incurred in
effecting such compliance shall be immediately due and payable. LESSOR's
effecting such compliance shall not in any way be deemed to constitute a waiver
of any default by XXXXXX.
(13) (b) DEFAULT BY LESSOR: In the event LESSOR, after five (5) days'
written notice from LESSEE, shall fail to make any payments as herein provided
or after twenty (20) days' written notice, shall fail to perform any of its
covenants under this Agreement, or in the event LESSOR (a) shall make a general
assignment for the benefit of creditors, or suffer a receiver or trustee to be
appointed of all or substantially all of its assets or file or suffer to be
filed any petition under any bankruptcy or insolvency law of any jurisdiction
which is not dismissed within sixty (60) days or (b) deliver or make any
representation or warranty made herein, or in any documents delivered to LESSEE
in connection herewith which shall prove to be false or misleading in any
material respect; then in such event LESSEE may, at its option, in addition to
any other remedies which may be available to it at law or in equity:
(i) terminate this Agreement with respect to any or all of the Vehicles
hereunder, in which event any terminated Vehicles shall be delivered, at
LESSEE's cost and expense within a reasonable period of time, to a location
or locations specified by LESSOR not in excess of 1,000 miles to LESSOR,
and pay to LESSOR all unpaid rentals and other charges due to the date of
termination and surrender of such Vehicles, and LESSEE shall be entitled to
recover from LESSOR all reasonable costs and expenses, including reasonable
attorneys' fees, incurred by XXXXXX in connection with the termination of
this Agreement and surrender of such Vehicles. XXXXXX shall thereafter be
released from any further liability under this Agreement except with
respect to the LESSEE's indemnity covenants in connection with events that
occurred prior to the termination and repossession of the Vehicles and
LESSOR shall be entitled to retain all proceeds from the sale or other
disposition of the Vehicles; or
15
(ii) so long as LESSEE is entitled to continue in possession of
the Vehicles under the terms of this Lease, it may elect to continue
the Agreement with respect to any or all of the Vehicles until it has
acquired replacement vehicles and then terminate the Agreement with
respect to such Vehicles in accordance with the terms contained in
(i) above.
In case of failure by XXXXXX to comply with any provision of this
Agreement, LESSEE shall have the right, but not the obligation, at its option,
to effect such compliance as in LESSEE's sole discretion is appropriate, in
whole or in part, and all reasonable costs and expenses of LESSEE incurred in
effecting such compliance shall be immediately due and payable. LESSEE's
effecting such compliance shall not in any way be deemed to constitute a waiver
of any default by XXXXXX.
LESSOR SHALL IN NO EVENT BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL,
EXEMPLARY, PUNITIVE, INCIDENTAL OR INDIRECT DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOSS OF GOODWILL, BUT SHALL BE LIABLE FOR ACTUAL AND DIRECT DAMAGES
SUSTAINED BY XXXXXX.
Section (14) of the Agreement is hereby deleted and replaced with the
following (14)(a) and (b):
(14)(a) ASSIGNMENT BY XXXXXX: XXXXXX may from time to time assign all
or any part of its right, title and interest in this Agreement, including all
moneys and claims for moneys due and to become due hereunder, provided,
however, that the LESSEE shall be entitled to remain in possession of any
leased Vehicles under the terms of this Agreement until expiration of the lease
term, including renewal terms, as long as the LESSEE shall not be in default.
No such assignment by LESSOR shall relieve LESSOR of its obligations and
liabilities hereunder; provided, however, LESSOR shall not assign its interest
in the Agreement and title to the Vehicles unless the Assignee shall assume the
obligations and liabilities of LESSOR in writing under the Agreement.
(14)(b) ASSIGNMENT BY XXXXXX: LESSEE may from time to time assign or
transfer its right, title and interest in this Agreement or the Vehicles to its
parent, subsidiary or affiliated corporation so long as LESSOR has determined
that such corporation has financial strength equal to or greater than the
LESSEE. LESSEE may sublease its right title and interest in the Agreement or
the Vehicles, provided, however, no such sublease shall relieve the LESSEE of
its obligations and liabilities under the Lease and LESSEE shall obtain
LESSOR's prior written consent which consent shall not unreasonably be withheld.
16
Except as permitted above, LESSEE shall not otherwise assign or
transfer its right, title and interest in this Agreement or the Vehicles
without the written consent of LESSOR, which consent shall not unreasonably be
withheld.
The parties hereby agree to add the following Sections (23) and (24) to the
Agreement:
(23) NOTICES: All notices provided for herein will be sent certified
mail, return receipt requested, postage prepaid to the parties at the respective
addresses listed below or at such other address(es) as required by the parties
in writing.
(24) QUIET ENJOYMENT: LESSOR hereby warrants that it has full right,
title and interest in and to the Vehicles described herein and that LESSOR has
an unencumbered right to lease the Vehicles to LESSEE. LESSOR hereby covenants
and guarantees that, so long as LESSEE is not in default of its terms,
conditions and covenants of this Agreement, LESSEE shall be entitled to the
peaceful and quiet enjoyment of the Vehicles during the initial term and any
renewal terms.
GELCO CORPORATION D/B/A BURGER KING DISTRIBUTION SERVICES,
GE CAPITAL FLEET SERVICES a Division of BURGER KING CORPORATION
BY________________________ By_______________________________
Its_______________________ Its_______________________________
