Exhibit 10.1
Pursuant to Item 601(b)(10)(iv) of Regulation S-X, this exhibit omits certain information, identified by [*], that is not material and that the registrant treats as private or confidential.
AMENDMENT NO. 1 TO MASTER LICENSE AGREEMENT
This Amendment No. 1 to Master License Agreement (“Amendment No. 1”), is entered into as of April 15, 2022, by and between YRI China Franchising LLC, as assignee of Yum! Restaurants Asia Pte. Ltd. (“Licensor”), and Yum! Restaurants Consulting (Shanghai) Company Limited (“Licensee”).
RECITALS
In consideration of the foregoing and the mutual covenants and consideration set forth herein, the receipt and sufficiency of which are hereby acknowledged, Licensor and Licensee agree as follows:
“Agreement” means the Original Agreement as modified by Amendment No. 1.
“Taco Bell Brand Development Initiative” means the specific development initiative for the Taco Bell Brand in the Territory set forth in Exhibit A-1.
“2.1.3 Without limitation of Section 2.1.2, subject to Sections 2.1.3.A, through 2.1.3.E, Licensee shall cause the average annual Gross Revenue for each Brand Restaurant Business for each
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Measurement Period to exceed the Gross Revenue of such Brand Restaurant Business for the applicable Benchmark Year (“Sales Growth Metric”).
In the event of two (2) consecutive SGM Breaches for a Brand Restaurant Business, Licensor shall be entitled to exercise its rights under Section 15.4.4.”
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IN WITNESS WHEREOF, the Parties have entered into this Amendment No. 1 as of the date first written above.
YRI CHINA FRANCHISING LLC
/s/ Jessica Holleran |
By: Jessica Holleran
Title: President
YUM! RESTAURANTS CONSULTING (SHANGHAI) COMPANY LIMITED
/s/ Joseph Chan |
By: Joseph Chan
Title: Chief Legal Officer
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EXHIBIT A-1
TACO BELL BRAND DEVELOPMENT INITIATIVE
The Parties acknowledge and agree that the following provisions regarding the Taco Bell Brand are part of the Master License Agreement, as amended by Amendment No. 1 (the “Agreement”), and shall apply solely with respect to the Taco Bell Brand and solely in respect of the time periods below.
For the avoidance of doubt, capitalized terms used and not otherwise defined in this Exhibit A-1 shall have the respective meanings assigned to such terms in the Agreement.
“2022 Measurement Condition” means that, as of the 2022 Measurement Date, there are at least 100 Taco Bell Restaurants that are (i) operated under the Taco Bell Brand by a Sublicensee in the Territory pursuant to a Sublicense and (ii) open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Government Authority due to COVID-19 or a similar epidemic or pandemic).
“2022 Measurement Date” means December 31, 2022; provided, however, that if, as of December 31, 2022, there are at least 90 (but less than 100) Taco Bell Restaurants that are operated under the Taco Bell Brand by a Sublicensee in the Territory pursuant to a Sublicense and that are open to customers for business during regular business hours on a continuous basis (except as may be prohibited temporary basis by Governmental Authority due to COVID-19 or a similar epidemic or pandemic), the 2022 Measurement Date shall be March 15, 2023.
“2025 Measurement Condition” means that, as of the 2025 Measurement Date, there are at least 225 Taco Bell Restaurants that are (i) operated under the Taco Bell Brand by a Sublicensee in the Territory pursuant to a Sublicense and (ii) open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Governmental Authority due to COVID-19 or a similar epidemic or pandemic).
“2025 Measurement Date” means (i) for purposes of determining whether the 2025 Measurement Condition has been satisfied, December 31, 2025, provided, however, that if, as of December 31, 2025 there are at least 220 (but less than 225) Taco Bell Restaurants that would satisfy the requirements set forth in clauses (i) and (ii) of the definition of 2025 Measurement Condition, the 2025 Measurement Date shall be extended to the end of the Grace Period, and (ii) for purposes of determining any amount payable pursuant to Section 5(a), the later of December 31, 2025 and the end of the Grace Period (if invoked by Licensee).
“Aggregate Investment Cap” means [*], reduced by [*] if there is a Net New Unit Shortfall for 2023 and reduced by [*] if there is a Net New Unit Shortfall for 2024 (it being understood that if there is a Net New Unit Shortfall for both 2023 and 2024, the aggregate reduction to the Aggregate Investment Cap shall be [*]).
“Grace Period” means, as to a date, the thirty (30) day period after such date.
“Net New Units” means, for any calendar year, the positive difference (if any) between (i) the number of Taco Bell Restaurants operated by a Sublicensee in the Territory that are open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Governmental Authority as a result of COVID-19 or a similar epidemic or pandemic) as of the end of
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such calendar year, and (ii) the number of Taco Bell Restaurants operated by a Sublicensee in the Territory that are open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Governmental Authority as a result of COVID-19 or a similar epidemic or pandemic) as of the end of the immediately prior calendar year. Notwithstanding anything to the contrary herein, if the 2022 Measurement Date is extended to March 15, 2023, Net New Units for calendar year 2023 will exclude any Taco Bell Restaurants that were opened in 2023 but that were required for Licensee to satisfy the 2022 Measurement Condition. Notwithstanding anything to the contrary herein, (1) if a Grace Period is invoked as contemplated by Section 5(a) in respect of calendar year 2023, Net New Units for calendar year 2024 will exclude any Taco Bell Restaurants that were opened during such Grace Period, and (2) if a Grace Period is invoked as contemplated by Section 5(a) in respect of calendar year 2024, Net New Units for calendar year 2025 will exclude any Taco Bell Restaurants that were opened during such Grace Period. In the event that a Grace Period has been invoked for a calendar year as contemplated by Section 5(a), “Net New Units” means, for that calendar year and for purposes of calculating any amount payable pursuant to Section 5(a), the positive difference (if any) between (x) the number of Taco Bell Restaurants operated by a Sublicensee in the Territory that are open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Governmental Authority as a result of COVID-19 or a similar epidemic or pandemic) as of the end of the Grace Period following such calendar year, and (y) the number of Taco Bell Restaurants operated by a Sublicensee in the Territory that are open to customers for business during regular business hours on a continuous basis (except as may be prohibited on a temporary basis by Governmental Authority as a result of COVID-19 or a similar epidemic or pandemic) as of the end of the immediately prior calendar year (or, if a Grace Period has been invoked for such immediately prior calendar year, as of the end of such Grace Period).
“Net New Unit Investment Amount” means:
“Net New Unit Shortfall” means (i) for 2023, that the Net New Units for 2023 are not at least [*]; (ii) for 2024, that the Net New Units for 2024 are not at least [*]; and (iii) for 2025, that the Net New Units for 2025 are not at least [*].
“NNU Narrow Shortfall” means a shortfall of [*] Net New Units or less from a NNU Milestone. For example, for calendar year 2024, there is a NNU Narrow Shortfall if the Net New Units for such calendar year are within [*] Net New Units or less of [*], [*], or [*].
“NNU Milestone” means for each calendar year, the milestone number of Net New Units to achieve an increase the US$ amount payable per Net New Unit, e.g., in calendar year 2024, the NNU Milestones are [*], [*] and [*] Net New Units.
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“Taco Bell Restaurant” means a Restaurant operated under the Taco Bell Brand.
“Up-front Investment” means [*].
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