Exhibit 10.12(b)
FIRST AMENDMENT TO ASSET PURCHASE
AGREEMENT
This First Amendment to Asset
Purchase Agreement (this “ Agreement ”)
is entered into as of August 31, 2005 (the “ Effective
Date ”) by and between Tully’s Coffee Japan
Co., Ltd., a corporation organized under the laws of Japan (“
Buyer ”), and Tully’s Coffee Corporation,
a Washington corporation (“ Seller ”).
Each of Buyer and Seller is a “ Party ”
and together, the “ Parties .”
RECITALS
A. The Parties entered into an Asset
Purchase Agreement (the “ Agreement ”) as
of August 19, 2005.
B. Buyer and Seller have agreed that
the Closing and payment of the purchase price shall occur no
earlier than 12:01 a.m. Tokyo Time on September 1, 2005 and no
later than 2:00 p.m. Pacific Daylight Time on August 31, 2005.
Assuming such Closing Date, (i) the Parties have also determined
that the relevant Tax Filing Date is October 10, 2005, and (ii) the
Seller has instructed Buyer that the KCL Payoff Amount is
$1,169,098.72.
C. Assuming the Closing Date is
prior to the filing and acceptance of the Exemption Notice, the
Parties acknowledge that (i) the Buyer’s obligations to pay
the Purchase Price at Closing shall be fulfilled if the Buyer wire
transfers $1,169,098.72 to KCL and $12,649,746.19 to Seller,
subject to the obligations of Seller with respect to the Remitted
Amount, and (ii) the Remitted Amount is $3,681,155.09.
D. The Parties wish to amend certain
provisions of the Agreement to reflect the treatment of withholding
taxes in connection with the Closing.
NOW, THEREFORE
, in consideration of the foregoing
and of the mutual promises contained in this Amendment, the Parties
hereby agree as follows:
1. Section 3.7(b) of the Agreement
shall be amended and restated to read as follows:
3.7 Withholding Taxes
.
(b) If the Closing Date occurs after
the filing and acceptance of the Exemption Notice, Buyer shall not
withhold any taxes from Seller on the Purchase Price paid to Seller
or to KCL after the filing of the Exemption Notice. Buyer and
Seller have also independently determined that until such time as
the Exemption Notice is filed with and accepted by the Japanese Tax
Office, Japanese income tax withholding would apply to the Purchase
Price paid to Seller. Buyer and Seller have determined that if the
Exemption Notice is filed and accepted after the Closing Date but
prior to the due date designated by the Japanese Tax Office for the
remittance of tax withheld on the Closing Date (the “
Tax Filing Date ”), Buyer is not required to
remit the tax withholding to the Japanese Tax Office and would be
permitted to refund any withheld amounts to Seller. However, if
such taxes have been withheld and the Exemption Notice has not been
filed with and accepted by the Japanese Tax Office prior to the Tax
Filing
1
Date, then Buyer would be required
to remit the withheld tax to the Japanese Tax Office on the Tax
Filing Date and such taxes would be subject to Seller’s tax
refund claim to the Japanese Tax Office, for reasons of the tax
treaty exemption, after the Exemption Notice is filed and accepted.
If the Closing Date is
