EXHIBIT 10.45
SUBLEASE
THIS SUBLEASE (this "Sublease") is made and entered into, effective on the date
set forth below, by and between SYSTEMS & SOFTWARE CONSORTIUM, INC., a
California nonprofit mutual benefit corporation ("SySCI"), and JETFAX, INC., a
DELAWARE CORPORATION (the "Subtenant"), with reference to the following facts:
RECITALS:
A. SySCI is the Lessee under that certain Net, Net, Net Lease dated for
reference purposes as of December 1, 1996 with Xxxxxxxxx Associates, LLC, a
California limited liability company (the "Landlord"), a copy of which Lease is
attached to this Sublease as Exhibit A (the "Master Lease").
B. Under the Master Lease, SySCI has leased those portions of the building
(the "Building") located at 0000 Xxxxxxxxx Xxxxxx in the unincorporated area of
Santa Xxxxxxx County, California known as Goleta and further described in the
Master Lease.
C. Subtenant desires to sublease from SySCI, on the terms and conditions set
forth in this Sublease, that portion of the premises leased by SySCI under the
Master Lease depicted by crosshatch markings on the attached Exhibit B, which
space consists of approximately 4856 square feet (the "Premises"). Subtenant
retains the right of first refusal on the adjoining Annex of approximately 1280
square feet, the S-4 SCIF of approximately 1520 square feet, and the S-4
Computer Room of approximately 850 square feet.
AGREEMENTS:
NOW, THEREFORE, in light of the foregoing and in consideration of the mutual
covenants set forth below, SySCI and Subtenant, intending to be legally bound,
agree as follows:
1 . SUBLEASE OF PREMISES
1.1 Sublease. SySCI hereby subleases to Subtenant the Premises and the
nonexclusive right to use the Common Areas in and about the Building and the
parking facilities adjoining the Building. (Common Areas shall include a
reception area, auditorium, presentation room, locker rooms, lunch area, and
business services room, all located within the portion of the building leased to
SySCI.) Subtenant's non-exclusive right to use the Common Areas and the parking
facilities shall be determined reasonably on an equitable basis by SySCI from
time to time, based generally on the ratio that the square footage of the
Premises bears to the square footage of the building covered by the Master
Lease, other than the Common Area and the parking facilities. The Premises are
subleased in their existing configuration and in their "AS-IS" condition. SySCI
makes no representation or warranty whatsoever concerning the condition of the
Premises or their fitness for any particular use. Notwithstanding the
foregoing, on the Commencement Date, the heating, ventilating and air
conditioning ("HVAC") system, and the electrical, plumbing, sewer, life safety
and, if applicable, security systems (collectively, "Building Systems") serving
the Premises shall be in good working order and repair. If, during the first
thirty (30) days of the Term, any Building System is not in the condition
required by the foregoing sentence, Sublessee shall notify SySCI of the need or
repair and the repair shall be completed at no cost to Sublessee.
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1.2 Terms. This Sublease is subject to all of the terms and conditions of the
Master Lease. Subtenant shall assume and perform the obligations of SySCI under
the Master Lease to the extent that such terms and conditions are applicable to
the Premises subleased pursuant to this Sublease. When the context requires,
each reference in the Master Lease to "Lessor" shall be deemed to refer to
SySCI, and each reference therein to "Lessee" shall be deemed to refer to
Subtenant. As between SySCI and Subtenant, any inconsistency between the terms
of the Master Lease and the terms of this Sublease shall be governed by the
terms of this Sublease. Subtenant shall not commit or permit to be committed on
the Premises any act or omission that would violate any term or condition of the
Master Lease.
1.3 Exceptions. All of the terms and conditions contained in the Master Lease
are incorporated in this Sublease as if fully set forth herein, except for the
provisions of Sections Basic Lease Provision 1 ("Premises", but the remaining
sections of Paragraph 1 are incorporated in this Sublease),
2,3,4,5,6,7,7,8,10,11 and 12; the second sentence and the second full paragraph
of Section 1; Section 2.1 (a) and (b); Section 2.3, Sections 3.1, 3.2, and 3.4;
the second full paragraph of 3.6 (a), 3.6 (b) and 3.7; Section 4, the second-to-
last full paragraph of Section 5.4; the last sentence of Section 6.1; Section
7.7; Section 12.1; Section 12.4: Section 14; Section 15.1; Section 15.2 (a);
Section 18 and Exhibit A. In addition Sublessee shall not be responsible for
complying with any law, requirement, ordinance, statute, or regulation requiring
alteration, maintenance or restoration of the Premises except to the extent
arising solely out of Sublessee's particular use of the Premises.
2. TERM OF SUBLEASE
The term of this Sublease shall commence on AUGUST 1, 1997 and shall end at
midnight, California Time, on JULY 31, 1998. Subtenant shall have the option to
extend the term of this sublease for a one-year period. Commencing at the end
of the one (1) year extension, Subtenant shall have the option to extend the
term of this sublease for an additional 8 month period. Subtenant retains the
option to extend this sublease for an additional year commencing at the end of
the eight (8) month extension, contingent upon the extension of the SySCI Master
Lease by Xxxxxxxxx Associates. With respect to the Master Lease termination
right exercisable by the Landlord as set forth in Section 2.4 of the Master
Lease, so long as Sublessee is not in default under this Sublease beyond
applicable cure periods, SySCI shall use its best efforts to have the Premises
excluded from the nine thousand (9,000) contiguous square feet designated for
termination by Landlord. In addition, notwithstanding anything to the contrary
contained in the Sublease, Sublessee shall have the right to enter the Premises
for a period fourteen (14) days prior to the commencement of the term of this
Sublease, without any obligation to pay Monthly Rent under this Sublease, for
the purpose of installing its equipment, data, telecommunication and cabling
systems, furniture and trade fixtures.
3 . SECURITY DEPOSIT
Upon execution of this sublease, Subtenant shall deliver to SySCI (a)
prepaid Monthly Rent for the first month of the term of the Sublease, and (b)
the amount of $5341.60 as a security deposit for the performance by Subtenant of
its obligations under this Sublease. The security deposit may be paid in two
installments, one half due upon execution, and one half due upon the first day
of the second month of occupancy. If Subtenant defaults in its performance of
any of its obligations under this Sublease, then SySCI may, but shall not be
obligated to, use the security deposit, or any portion thereof, to cure such
default or to compensate SySCI for any damage, including late charges, sustained
by SySCI resulting from Subtenant's default. Immediately upon demand by SySCI,
Subtenant shall pay to SySCI an amount equal to the portion for the security
deposit so expended
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or applied by SySCI as provided herein in order to maintain the security deposit
in the original amount initially deposited with SySCI. If Subtenant is not in
default at the expiration or termination of this Sublease, SySCI shall return
the unexpended portion of the security deposit to the Subtenant, without
interest. SySCI'S obligations with respect to the security deposit shall be
those of a debtor, and not of a trustee, and SySCI shall be entitled to
commingle the security deposit with the general funds of SySCI.
4. USE
Subtenant may use the Premises for the uses permitted by the Master Lease and
for no other purposes whatsoever without the prior written consent of SySCI,
which shall not be unreasonably with held or delayed, and Landlord.
5. RENT
5.1 Monthly Rent. Commencing on AUGUST 1,1997 (the "Rent Commencement Date")
and continuing during each if the term of this Sublease, Subtenant shall pay to
SySCI on or before the first day of each month of the term of this Sublease
gross rent ("Monthly Rent") in the amount of $5341.60. The amount of the Monthly
Rent shall be adjusted annually on each anniversary of the Rent Commencement
Date in accordance with the provisions of Section 3.5 of the Master Lease.
SySCI and Subtenant acknowledge that the rent contemplated in this Section is a
gross rent and that Subtenant shall not be obligated to pay SySCI its otherwise
proportionate share of any additional rent that SySCI is required to pay under
the terms of the Master Lease. Sublessee shall be entitled to receive from
SySCI any abatement of Monthly Rent received by the SySCI from the Landlord
pursuant to the Master Lease to the extent such abatement of Monthly Rent is
attributable to the Premises.
5.2 Late Payment Charge. Subtenant acknowledges that the late payment by
Subtenant to SySCI of any amounts owing pursuant to the terms of this Sublease
(collectively, "Rent") will cause SySCI to incur costs not contemplated by this
Sublease. The exact amount of such costs are extremely difficult and
impracticable to fix. Such costs include, without limitation, financing,
processing and accounting charges, and late charges that may be imposed by SySCI
by the terms of the Master Lease. Therefore, if any installment of Rent due
from Subtenant is not received by SySCI within 3 days of its due date, Subtenant
shall pay to SySCI an additional sum of five percent (5%) of the overdue Rent as
a late charge for any payment of Rent not so paid. The parties agree that this
late charge represents a fair and reasonable estimate of the cost that SySCI
will incur by reason of a late payment by Subtenant. Acceptance of any late
charge shall not constitute a waiver of Subtenant's default with respect to the
overdue amount, or prevent SySCI from exercising any other rights or remedies
available to SySCI.
5.3 Payment. Subtenant shall pay all Rent hereunder to SySCI not later than
the close of business on the date first due, without prior notice or demand,
without offset or reduction. All rent shall be payable in lawful money of the
United States at such place as SySCI shall designate to Subtenant from time to
time in writing. Rent or increased rent for any partial month shall be prorated
on the basis of a thirty-day month.
6. INSURANCE
Subtenant shall procure and maintain policies of insurance, insuring the
Premises and Subtenant's use of the same with the coverages and amounts equal to
or greater (at Subtenant's election) than those that SySCI is obligated to
procure under the terms of the Master Lease. Such policies shall comply with all
of the terms of the Master Lease. Not later than 30
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days prior to the expiration of any such policy, Subtenant shall present to
SySCI evidence of the renewal of such policies, or the purchase of acceptable
replacement policies, for the ensuing period. All such policies shall name both
SySCI and Landlord as additional insureds and shall provide that such policies
will not be subject to cancellation without thirty days' prior written notice to
SySCI.
7. INDEMNIFICATION
Except to the extent caused by the gross negligence of willful misconduct of
SySCI, its agents, employees, contractors or invitees, Subtenant shall
indemnify, protect, defend with counsel reasonably acceptable to SySCI and hold
SySCI harmless from and against any and all claims, liabilities, judgments,
causes of action, damages, costs and expenses (including, without limitation,
reasonable attorneys' fees) caused by or arising in connection with (a) a breach
of Subtenant's obligations under this Sublease and (b) Subtenant's use and
occupancy of the Premises. Except to the extent caused by gross negligence of
willful misconduct of SySCI, its agents, employees, contractors or invitees,
Subtenant shall indemnify, protect, defend with counsel reasonably acceptable to
Subtenant and hold Subtenant harmless from and against any and all claims,
liabilities, judgments, causes of action, damages, costs and expenses
(including, without limitation, reasonable attorneys' fees) caused by or arising
in connection with (a) a breach of Subtenant's obligations under this Sublease
and (b) a breach of SySCI's obligations under the Master Lease.
8. DEFAULT
8.1 Events of Default. The following events shall constitute an event of
default under this Sublease:
8.1.2 Rent. Subtenant's failure to make timely payment of Rent.
8.1.3 Breach. Subtenant's failure to honor or perform any other covenant,
condition, or obligation imposed upon Subtenant by this Sublease.
8.1.4 Lease. Subtenant's failure to honor or perform any covenant, condition,
or obligation imposed upon SySCI, as Lessee under the terms of the Master Lease
that is assumed hereunder by Subtenant.
8.2 Notice and Cure of Nonmonetary Defaults. SySCI shall provide Subtenant
written notice of any nonmonetary default under this Sublease. If the default
is attributable to Subtenant's acts or omissions, Subtenant shall be entitled to
cure any such default within 30 days of receiving such notice. Subtenant
acknowledges that it will not be entitled to receive any notice of a default in
the payment of any sums owing under this Sublease.
8.3 Remedies. If Subtenant fails to pay any sums owing hereunder within 3
days of the date due, or to cure any nonmonetary default within the applicable
cure period specified in Section 8.2, SySCI may terminate this Sublease upon
delivery of written notice to Subtenant. Upon any such occurrence, in addition
to other remedies available to SySCI under law, SySCI immediately shall be
entitled to (a) reenter and take possession of the Premises and evict Subtenant
therefrom through legal process, and (b) to exercise, as to Subtenant, all of
the rights and remedies available to the Landlord under the Master Lease, as if
all such rights and remedies were set forth verbatim herein.
9. OBLIGATIONS OF SySCI
9.1 Preservation of Master Lease. For so long as Subtenant is not in default
in the performance of its
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obligations under this Sublease, SySCI shall perform all of its obligations
under the Master Lease not expressly agreed to or performed by the Sublessee
hereunder, and shall not engage in action or conduct, the purpose or effect of
which is to cause a default under the Master Lease. SySCI shall provide
Subtenant with copies of all notices that SySCI receives from Landlord alleging
any default by SySCI under the Master Lease, or a termination of the Master
Lease.
9.2 Performance of Lessor's Obligations. For so long as this Sublease remains
in effect, SySCI shall use due diligence in attempting to cause the Landlord
under the Master Lease to perform all of the Landlord's duties and obligations
thereunder. If the Landlord defaults in the performance of any such obligations
and fails or refuses to cure any such default, and such uncured defaults pertain
solely to the Premises, then SySCI may, at its election, in lieu of commencing
legal actions or proceedings against the Landlord, assign to Subtenant any
claims, causes of action or remedies that SySCI may have on account of such
uncured defaults, if such uncured defaults pertain solely to the Premises.
9.3 Estoppel; Nondisturbance. Contemporaneously with the execution hereof,
SySCI and Subtenant shall execute and deliver to Landlord a Nondisturbance,
Subordination and Attornment Agreement in the form attached as Exhibit C.
10. ASSIGNMENT OF SUBRENTS
SySCI has agreed in the Master Lease that the rentals payable to SySCI under
this Sublease shall be paid directly by Subtenant to Landlord upon the
occurrence of a default by SySCI under the Master Lease and SySCI's failure to
cure such default within a period of 60 days. Accordingly, after notice is
given by Landlord to Subtenant that the rentals under the Sublease should be
paid to Landlord, Subtenant shall pay to Landlord, or in accordance with
Landlord's directions, all rentals and other monies due and to become due SySCI
under this Sublease. Subtenant shall have no responsibility to ascertain
whether such demand by Landlord is permitted under the Master Lease. Any such
payment to Landlord shall discharge Subtenant's obligations to make such payment
to SySCI. Such payment of rents to Landlord by Subtenant shall continue until
the first to occur of the following: (a) no further rent is due and payable
under the Sublease; and (b) Landlord gives Subtenant notice that SySCI's default
has been cured and instructs Subtenant that the rents shall thereafter be
payable to SySCI.
11. ATTORNEYS' FEES
If either party engages counsel to enforce that party's rights hereunder, or to
resolve a dispute hereunder, the prevailing party shall be entitled to recover
all costs and expenses including attorneys' fees, whether or not litigation is
commenced.
12. SURRENDER
Notwithstanding anything to the contrary contained in this Sublease or the
Master Lease, upon
the expiration or earlier termination of this Sublease, Sublessee shall not be
obligated to remove
(i) any tenant improvements, alterations, additions, or improvements installed
in the Premises by Sublessee prior to the Commencement Date; or (ii) any
Hazardous Materials not stored, used, disposed of or released on or about the
Premises by Sublessee, its, agents, employees or
contractors.
13. AMENDMENT OR MODIFICATION
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Sublessor and Master Lessor shall not amend or modify the Master Lease in any
way so as to
materially or adversely affect Sublessee or its interest hereunder or materially
restrict Sublessee's rights hereunder, without prior written consent of
Sublessee, which shall not be unreasonably withheld or delayed. For purposes of
this Section, any changes or adjustments in any of the terms or provisions of
the Master Lease as a result of the occurrence of any event contemplated in the
Master Lease shall not be considered an amendment or modification which
materially or adversely affects Subtenant or increases any of this obligations.
14. SySCI'S OBLIGATIONS
In addition to SySCI's obligations pursuant to Paragraph 9.2 of this Sublease,
with respect to work, services, repairs, restoration, the provision of insurance
or the performance of any other obligation of Landlord under the Master Lease,
SySCI shall use good faith reasonable efforts to obtain Landlord's performance
of such obligations on Sublessee's behalf
15. SUBLESSOR'S REPRESENTATIONS AND WARRANTIES
As an inducement to Sublessee to enter this Sublease, SySCI represents and
warrants, to the best of SySCI's knowledge and belief, with respect to the
Premises that:
A. The copy of the Master Lease attached hereto is a true and correct copy
thereof, and the Master Lease is in full force and effect, and there exists
under the Master Lease no default or event of default, nor has there occurred
any event which, with the giving of notice or passage of time or both, could
constitute such a default or event of default.
B. There are no pending or threatened actions, suits or proceedings before
any court or administrative agency against SySCI or against Landlord or third
parties which could, in the aggregate, adversely affect the Premises or any part
thereof or the ability of Landlord to perform its obligations under the Master
Lease of SySCI to perform its obligations under this Sublease, and SySCI is not
aware of any facts which might result in any such actions, suit, or proceedings.
C. SySCI has not received any notice from any insurance company of any
defect or inadequacies in the Premises of the premiums for the insurance
thereof.
16. QUIET ENJOYMENT
Subleasee shall peacefully have, hold and enjoy the Premises, subject to the
terms and conditions of this Sublease, provided that Sublessee pays all Monthly
Rent and performs all Sublessee's covenants and agreements contained herein.
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17. CONDITION PRECEDENT
This Sublease and Sublessee's and SySCI's obligations hereunder are conditioned
upon SySCI's obtaining the written consent of the Landlord. If SySCI fails to
obtain the Landlord's consent within thirty (30) days after execution of this
Sublease by SySCI, then Sublessee or SySCI may terminate this Sublease by giving
the other party written notice, and SySCI shall return to Sublessee all
consideration previously paid by Sublessee to SySCI.
IN WITNESS WHEREOF, the undersigned have executed this Sublease, effective on
the date on which all parties have executed both this Sublease and the
Nondisturbance, Subordination and Attornment Agreement required by Section 9.3.
SYSTEMS & SOFTWARE CONSORTIUM, INC., a California nonprofit mutual benefit
corporation
Date
By
Xxxxxxx X. Xxxxxxx, Chairman
Address for Notices
0000 Xxxxxxxxx Xxxxxx
Xxxxx Xxxxxxx, Xxxxxxxxxx 00000
"SUBTENANT"
JetFax, INC.
Date
By
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