EXHIBIT 10.3
SUBLEASE
THIS SUBLEASE ("SUBLEASE") is made and entered into as of the ____ day
of August, 1997, by and between ATLANTIS PLASTICS, INC. successor to Cyanede
Plastics, Inc., a Florida corporation ("SUBLESSOR"), and II EAGLES PLASTICS,
INC., a Tennessee corporation ("SUBLESSEE").
R E C I T A L S:
A. Sublessor is the "Tenant", and XXXX X. XXXXX, is the "Landlord"
("LANDLORD"), under that certain Lease dated July 5, 1992, as amended from time
to time (the "MASTER LEASE"), with respect to that certain land and improvements
more particularly shown on EXHIBIT "A" attached hereto and made a part hereof
(hereinafter referred to as the "PREMISES").
B. Sublessee desires to sublease a portion of the Premises from
Sublessor, and Sublessor desires to sublease a portion of the Premises to
Sublessee, subject to and upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the payment of rent and other
charges provided for in this Sublease, the covenants and conditions hereinafter
set forth, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Sublessor and Sublessee hereby
covenant and agree as follows:
1. RECITALS: The foregoing recitals are true and correct and are
incorporated herein by this reference.
2. SUBLEASE: Sublessor hereby subleases to Sublessee, and Sublessee
hereby subleases from Sublessor, upon the terms and conditions hereinafter set
forth, approximately 19,200 square feet (the "SUBLET PREMISES") located within
the Premises as more particularly shown as building A on the Sketch attached
hereto and made a part hereof as EXHIBIT "B".
3. TERM: The term ("TERM") of this Sublease shall commence on September
1, 1997 ("COMMENCEMENT DATE") and shall continue until and shall expire on April
30, 1998, unless sooner terminated as hereinafter provided ("EXPIRATION DATE").
4. RENT:
A. BASE RENT FOR SUBLET PREMISES. Commencing on the
Commencement Date, and thereafter, throughout the Term of this Sublease,
Sublessee hereby agrees to pay to Sublessor rent for the Sublet Premises ("BASE
RENT")in the net total amount of Forty Thousand and No/100 Dollars($40,000.00)
for the term, payable in equal monthly installments of Five Thousand and No/100
Dollars ($5,000.00), with the first such installment due on the Commencement
Date, and thereafter, on the 1st day of each month throughout the Term of the
Sublease. Each payment of rent under this Sublease is to be made without offset
or deduction whatsoever and to be accompanied by applicable sales tax, both in
lawful money of the United States of America, at Sublessor's address below
specified or elsewhere as designated from time to time by Sublessor's written
notice to Sublessee. The term "Rent" as used in this Sublease shall mean "Base
Rent" and all other charges and costs due by Sublessee to Sublessor under this
Sublease.
B. TAXES/INTEREST. In addition to Base Rent, Sublessee shall
and hereby agrees to pay to Sublessor each month a sum equal to any sales tax,
tax on rental, and any other charges, taxes and/or impositions now in existence
or hereafter imposed based upon the privilege of renting the Sublet Premises
hereunder or upon the amount of Rent and any other charges collected therefor.
Nothing herein shall, however, be taken to require Sublessee to pay any part of
any federal or state taxes on income imposed upon Sublessor.
Failure to pay any installment of Rent or any other payment or charge
required hereunder for a period of ten (10 days after its due date shall
constitute a default under this Sublease.
5. SERVICES; UTILITIES: Sublessee shall be solely responsible for
payment, and shall promptly pay, all charges for telephone and other utilities
(including but not limited to heat, fuel, power, water, electric) furnished to
the Sublet Premises directly by the applicable utilities providers.
Additionally, Sublessee shall pay any and all other charges for utility use or
other services, or otherwise, required to be paid by Sublessor under the Master
Lease, including, without limitation, charges as a result of Sublessee's use of
additional utilities or other services, or otherwise, or as a result of any acts
of Sublessee or Sublessee's use or occupancy of the Sublet Premises, all to be
paid by Sublessee as and when due and payable by Sublessor under the Master
Lease or otherwise within five (5) business days of Sublessee's receipt of any
invoice thereof. Notwithstanding the foregoing, Sublessor agrees to pay all
charges for utilities (Electric, Gas) for the portions of the Premises not
included in this Sublease (i.e. buildings B, C, D and E as shown on Exhibit B).
6. ACCEPTANCE OF PREMISES; CONDITION DURING TERM: Sublessee
acknowledges and agrees that Sublessee has thoroughly investigated the Sublet
Premises, and all other physical aspects of this Sublease transaction, and in
electing to proceed with this Sublease, Sublessee shall have determined that all
of the same is satisfactory to Sublessee in all respects, and that Sublessee is
accepting and subleasing the same hereunder in "AS IS" condition, with all
faults including, those conditions detailed on Exhibit "C" attached hereto and
made a part hereof. Sublessee has and will rely solely on Sublessee's own
investigation and inspection, and has not relied and will not rely on any
representations of Sublessor, in entering into this Sublease.
7. REPAIRS; ALTERATIONS: At all times during the Term hereof, Sublessee
shall keep the Sublet Premises in good order and repair (ordinary wear and tear
excepted), and otherwise in accordance with the obligations imposed on the
"Tenant" under the Master Lease and this Sublease, all at Sublessee's sole cost
and expense. Sublessee shall make no alterations, improvements or renovations to
the Sublet Premises without Sublessor's prior written consent and any permitted
alterations, improved, or renovations must be in compliance with the applicable
terms of the Master Lease. In connection therewith, Sublessee shall submit plans
and specifications for all such proposed alterations to the Sublet Premises to
Sublessor for review and approval.
8. USE; COMPLIANCE: Sublessee will use and occupy the Premises in
accordance with the provisions of paragraph 8 of the Master Lease and shall
fully and promptly comply with all of the requirements of the Master Lease and
all present and future laws, rules, orders, ordinances and regulations
applicable to Sublessee's use of the Sublet Premises.
9. SUBLEASE SUBJECT TO MASTER LEASE: Except as otherwise specifically
set forth herein, this Sublease and Sublessee's leasehold interest granted
hereby are subject and subordinate in all respects to all of the terms and
provisions of the Master Lease and all of such terms are incorporated herein as
if set out in full. Sublessee shall at all times fully and completely comply
with and abide by all terms, provisions, conditions and covenants of "Tenant"
contained in the Master Lease, and Sublessor shall have all rights of "Landlord"
provided for in the Master Lease, all as if Sublessee were the "Tenant"
thereunder and Sublessor were the "Landlord" thereunder. Sublessee hereby agrees
to promptly and properly satisfy all of such obligations of "Tenant" under the
Master Lease, except only for the payment of rent under paragraph (1) of the
Master Lease, the resurfacing of the parking lot under paragraph (2) of the
Master Lease and except as otherwise expressly set forth herein. In the event
that
2
Sublessee fails or refuses to comply with all of the terms, provisions,
conditions and covenants set forth hereunder and/or under the Master Lease
required hereunder to be complied with, in addition to all other rights and
remedies provided for in this Sublease, Sublessor shall have the right, after
giving five (5) business days prior written notice to Sublessee of any such a
default (or no notice if the Master Lease provides for none or such lesser
notice), to take any necessary measures to ensure compliance with such
provisions and/or perform such obligations on behalf of Sublessee, and to the
extent that Sublessor incurs any costs and/or expenses in connection therewith,
to receive reimbursement from Sublessee therefor.
10. INSURANCE FOR SUBLET PREMISES: Sublessee shall maintain at its
expense throughout the Term of this Sublease, Commercial Comprehensive general
and public liability insurance. Such insurance shall afford protection to at
least a combined single limit for bodily injury, death and property damage
liability of One Million and No/100 Dollars ($1,000,000.00) per occurrence and
shall be issued in accordance with the requirements of the Master Lease. It is
Sublessor's intent that any liability insurance provided pursuant to this
paragraph shall be deemed primary insurance coverage in the event of any loss
arising from the Sublet Premises and operations covered by this Sublease.
11. BROKERAGE: The parties each represent and warrant to the other that
they have not dealt with any real estate brokers, salesmen, agents or finders to
whom a brokerage commission is due in connection herewith. If a claim for
commissions in connection with this transaction is made by any broker, salesman
or finder claiming to have dealt through or on behalf of one of the parties
hereto ("INDEMNITOR"), Indemnitor shall indemnify the other party hereunder
("INDEMNITEE"), and Indemnitee's officers, directors, agents and
representatives, from and against all liabilities, damages, claims, costs, fees
and expenses whatsoever (including reasonable attorney's fees and court costs at
all trial and appellate levels) with respect to any such claim. Notwithstanding
anything contained in this Sublease to the contrary, the provisions of this
paragraph shall survive the expiration or earlier termination of this Sublease.
12. SUBLESSOR'S COMPLIANCE: Sublessor shall promptly deliver to
Sublessee copies of all notices applicable to Sublessee received by Sublessor
under the Master Lease, such that Sublessee may comply with any requirements of
this Sublease with respect to any such notice. Sublessee shall promptly deliver
to Sublessor any notices received by Sublessee from Landlord or otherwise
pertaining to the Sublet Premises. Sublessor shall have no other duties or
obligations to Sublessee, with respect to the obligations of Landlord to
Sublessor under the Master Lease, or otherwise. Notwithstanding anything to the
contrary in this Sublease or in the Master Lease, Sublessor shall not be
required to provide any of the services, make any of the repairs, allowances,
improvements or restorations, or perform any of the other obligations that the
Landlord has agreed to provide or make or cause to be provided or made under the
provisions of the Master Lease, including, without limitation, insurance
obligations, repairs, or maintenance, and Sublessee shall rely upon, and look
solely to the Landlord for the provision or making thereof. Sublessor, upon
request of Sublessee, agrees to use reasonable efforts to cause Landlord to
observe and/or perform any such obligations; provided that, without limiting the
generality of the foregoing, the obligations of Sublessor to use "reasonable
efforts" shall not be construed as requiring Sublessor to pay any money or incur
any cost or liability beyond that which it has under this Sublease or to
institute or prosecute any legal action or proceeding. All costs reasonably
incurred by Sublessor in seeking to cause Landlord to perform its obligations
under the Master Lease with respect to the Sublet Premises shall be promptly
paid directly by Sublessee or reimbursed by Sublessee to Sublessor as Sublessor
may direct.
3
If Landlord shall materially default with respect to work,
services, repairs or other obligations under the Master Lease ("LANDLORD'S
OBLIGATIONS") and Sublessor's "reasonable efforts" fail to cause Landlord to
observe or perform Landlord's Obligations, then Sublessee may at its option, in
its own name, and after written notice to Sublessor, conduct such proceedings as
may be required to cause Landlord to observe or perform Landlord's Obligations.
Sublessee shall not make any claim against Sublessor for any
damage which may arise, nor shall Sublessee's obligations hereunder be impaired,
by reason of the failure of the Landlord to keep, observe or perform any of
Landlord's Obligations pursuant to the Master Lease.
13. TIME OF ESSENCE: Time shall be of the essence of all terms and
provisions of this Sublease.
14. ESTOPPEL STATEMENT: Sublessee and Sublessor hereby agree, from time
to time, upon not less than ten (10) days prior written notice by the other or
from Landlord , to deliver to the other or Landlord, as applicable, a statement
in writing certifying (a) that this Sublease is unmodified and in full force and
effect (or, if there have been modifications, that this Sublease as modified is
in full force and effect and stating the modifications); (b) the dates to which
Rent and other charges have been paid; (c) that Sublessor or Sublessee, as
applicable, is not in default under any provisions of this Sublease, or, if in
default, the nature thereof in detail; and (d) other matters reasonably
requested by the other or by Head Landlord.
15. NOTICE: Any notice to be given under this Sublease shall be in
writing and shall be hand delivered, or by United States certified mail, postage
prepaid, return receipt requested as follows:
To Sublessor: Atlantis Plastics, Inc.
57500 C. R. 0 Xxxxx
X. X. Xxx 0000
Xxxxxxx, Xxxxxxx 00000
To Sublessee: II Eagles Plastics, Inc.
0000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
To Head Landlord: At such address as is provided in the
Master Lease for giving of notices to
"Landlord" thereunder.
Either party, from time to time, by such notice, may specify another
address to which subsequent notice shall be sent. Any notice given by hand
delivery or overnight courier (or by other means not specified herein) shall be
deemed given when received, and any notice sent by mail shall be deemed given 3
days following the date of mailing.
16. HOLD HARMLESS OF SUBLESSOR: In consideration of the Sublet Premises
being leased to Sublessee for the above Rent, Sublessee agrees that Sublessee,
at all times, will indemnify and hold harmless Sublessor from all cost, expense,
loss, damage, and liability (including reasonable legal fees and court costs at
trial and all appellate levels) whatsoever, which may arise or be claimed
against Sublessor in favor of any persons, firms or corporations, for any
injuries or damages to the persons or property of any persons, firms or
corporations, as a consequence of or arising from the use or occupancy of the
Sublet Premises by Sublessee, including the parking areas, or as a consequence
of or arising from any acts, omissions, neglect or fault of Sublessee,
Sublessee's agents, employees, or invitees, as a consequence of or arising from
Sublessee's failure to comply with the terms and provisions of this Sublease,
the Master Lease and/or any laws, statutes, ordinances, codes, regulations,
covenants or restrictions as herein provided; and that Sublessor shall not
4
be liable for any damages, losses or injuries to persons or property of
Sublessee which may occur, except when such injury, loss or damage results from
the gross negligence or willful misconduct of Sublessor or of its agents,
employees or invitees. In the event Sublessor should be made a party to any
litigation commenced against Sublessee, then Sublessee shall protect and hold
Sublessor harmless, and shall pay all costs, expenses and reasonable attorney's
fees and costs incurred or paid by Sublessor, in connection with such litigation
and any appeal thereof. All personal property placed or moved into the Sublet
Premises shall be at the sole risk of Sublessee or the owner thereof, and
Sublessor shall not be liable to Sublessee for any damage to said personal
property.
17. ASSIGNMENT; SUBLETTING: Without the prior written consent of
Sublessor, which consent may be given or withheld in Sublessor's sole and
absolute discretion, notwithstanding the incorporated provisions of the Master
Lease to the contrary, Sublessee shall not, directly or indirectly, assign,
transfer, mortgage, pledge or otherwise encumber or dispose of this Sublease or
sublet the Sublet Premises or any part thereof or permit the Sublet Premises to
be occupied by other persons or parties or permit any assignment of this
Sublease by operation of law. Any assignment or sublease hereunder which is not
in compliance with the provisions of this paragraph shall be of no force or
effect and shall constitute a material default under this Sublease. No
assignment or sublease shall relieve Sublessee of its obligation hereunder.
18. CONDITION OF PREMISES ON TERMINATION OF SUBLEASE AND HOLDING OVER:
Sublessee agrees to surrender to Sublessor, at the Expiration Date, the Sublet
Premises in as good condition as the Premises were at the Commencement Date,
ordinary wear and tear and damage by casualty only excepted.
19. TAXES/LICENSES: Sublessee shall be responsible for and shall pay
before delinquency all municipal, county or state taxes assessed during the Term
of this Sublease for any of Sublessee's personal property or against Sublessee's
occupancy interest in the Sublet Premises.
20. DEFAULT: In addition to all of the rights and remedies that
Sublessor may exercise against Sublessee under the terms of this Sublease
(and/or by law) in the event of Sublessee's default, Sublessor shall be entitled
to exercise against Sublessee all of such other and further rights and remedies
as the "Landlord" may exercise against the "Tenant" under the incorporated
provision of the Master Lease. Except as may be provided for below, the
cure/grace periods provided for in the incorporated provisions of the Master
Lease with respect to defaults by the "Tenant" hereunder shall apply to defaults
by Sublessee hereunder.
If any one or more of the following events shall happen (each of which
shall be considered a material default by Sublessee under this Sublease):
A. the failure to Sublessee to comply with all of the terms
hereof, if such failure continues after the expiration of
any applicable notice and grace periods;
B. if Sublessee shall file a voluntary petition in bankruptcy or
shall be adjudicated a bankrupt or insolvent, or shall file
any petition or answer seeking any reorganization,
arrangement, composition, readjustment, liquidation, wage
earner's plan, dissolution or similar relief under the present
or any future federal bankruptcy act or any other present or
future applicable federal, state or other debtor's relief
statute or law, or shall seek or consent to or acquiesce in
the appointment of any trustee, receiver or liquidator of
Sublessee or of all or any substantial part of Sublessee's
properties or of the Sublet Premises; or
5
C. in the event of any proceeding against Sublessee seeking any
reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under the present
or any future federal bankruptcy act or any other present or
future applicable federal, state or other debtor's relief
statute or law; or
D. if the Premises shall be seized under any levy, execution,
attachment or other process of court and the same shall not be
promptly vacated or stayed on appeal or otherwise, or if the
Sublessee's interest in the Premises is sold by judicial sale
and the sale is not promptly vacated or stayed on appeal or
otherwise;
E. any default by Sublessee under the terms of that certain
Equipment Lease between Sublessor and Sublessee of even date
herewith;
then, and in any such event, Sublessor may at any time thereafter terminate this
Sublease and retake possession, and/or declare the balance of the entire Rent
for the entire Term of this Sublease to be immediately due and payable (in which
event Sublessor may then proceed to collect all of the unpaid Rent called for by
this Sublease by distress or otherwise), and/or pursue any other remedy afforded
by law or equity.
Nothing herein contained shall be construed as precluding Sublessor
from having such remedy as may be and become necessary in order to preserve all
right and interest of Sublessor in the Premises and in this Sublease, prior to
the expiration of the grace or notice periods given Sublessee in this Sublease,
if under particular circumstances then existing the allowance of such grace or
the giving of such notice will prejudice or endanger the rights or interest of
Sublessor in this Sublease or in the Premises. All rights and remedies granted
in this Sublease to Sublessor or available at law or equity shall be cumulative
and not mutually exclusive.
21. INVALIDITY OF PROVISION: If any term or provision of this Sublease
or the application thereof to any person or circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Sublease or the application
of such term or provision to persons or circumstances other than those as to
which it is held invalid or unenforceable shall not be affected thereby and each
term and provision of this Sublease shall be valid and be enforceable to the
fullest extent permitted by law. This Sublease shall be construed in accordance
with the laws of the State of Tennessee.
22. SUCCESSORS AND ASSIGNS: All terms and provisions of this Sublease
to be observed and performed by Sublessee shall be applicable to and binding
upon Sublessee's successors and assigns, subject, however, to the restrictions
as to assignment and subletting by Sublessee as provided herein.
23. ATTORNEY'S FEES: If either party defaults in the performance of any
of the terms or provisions of this Sublease and by reason thereof the other
party employs the services of an attorney to enforce performance of the
covenants, or to perform any service based upon defaults, then in any of said
events the prevailing party shall be entitled to receive from the other party
reasonable attorneys fees and all expenses and costs incurred by the prevailing
party pertaining thereto (including costs and fees relating to any appeal) and
in enforcement of any remedy.
24. MISCELLANEOUS: The terms Sublessor and Sublessee as herein
contained shall include singular and/or plural, masculine, feminine and/or
neuter, heirs, successors, personal representatives and/or assigns wherever the
context so requires or admits. Sublessor and Sublessee have participated fully
in the negotiation and preparation hereof, and, accordingly, this
6
Sublease shall not be more strictly construed against either of the parties
hereto. Further, Sublessee shall look solely to Sublessor's leasehold interest
in the Sublet Premises for the satisfaction of any judgments or remedies
obtained by Sublessee against Sublessor under court order or otherwise with
respect to this Sublease, and no other property or assets of Sublessor or its
partners, principals, subsidiaries or parent companies, disclosed or
undisclosed, shall be subject to levy, execution, or other enforcement procedure
for the satisfaction of Sublessee's remedies under or with respect to this
Sublease. All Exhibits attached to this Sublease are hereby incorporated in and
made a part hereof. Nothing in this Sublease shall be deemed to create a
partnership or joint venture between Sublessor and Sublessee, the parties
intending their relationship hereunder to be solely that of Sublessor and
Sublessee.
25. ENTIRE AGREEMENT: This Sublease and the incorporated provisions of
the Master Lease contain the entire agreement between the parties hereto and all
previous negotiations leading hereto, and this Sublease may be modified only by
an agreement in writing signed by Sublessor and Sublessee.
26. CONSENT: Except as otherwise expressly set forth in this Sublease
and/or the Master Lease, wherever the consent or approval of either party hereto
is required, the parties agree that such consent shall not be unreasonably
withheld or delayed.
IN WITNESS WHEREOF, the parties hereto have signed, sealed and
delivered this Sublease in several counterparts each of which shall be deemed an
original, but all constituting a single agreement, as of the day and year first
above written.
Witnesses: SUBLESSOR:
ATLANTIS PLASTICS, INC.
By: /s/ XXXX XXXXX
------------------------------ -------------------------------------
Name: Xxxx Xxxxx
-----------------------------------
Title: Vice President and G.M.
------------------------------ ----------------------------------
[Corporate Seal]
SUBLESSEE:
II EAGLES PLASTICS, INC.
By: /s/ HOBART X. XXXXXXX & XXX X. XXXX
------------------------------ -------------------------------------
Name: Hobart X. Xxxxxxx & Xxx X. Xxxx
-----------------------------------
Title: Partners
------------------------------ ----------------------------------
[Corporate Seal]
7
EXHIBIT "A"
MASTER LEASE
EXHIBIT "B"
SUBLET PREMISES
EXHIBIT "C"
CONDITION SUBLET PREMISES
ITEM CONDITION RESPONSIBLE
---- --------- -----------
1) Insulation New in place Two Eagles
(Wall) Not breaks or tears
2) Metal Walls All pushed into place Two Eagles
3) All interior walls and doors In place, in working order Two Eagles
4) All electrical In working order Two Eagles
5) Metal trim Doors (Dock) Torn and bent Atlantis
6) Exterior doors and locks Working Two Eagles
