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EXHIBIT 10.130
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
STANDARD SUBLEASE
(SHORT-FORM TO BE USED WITH POST 1995 AIR LEASES)
1. PARTIES. This sublease, dated, for reference purposes only. December 8,
1998 is made by and between Wilshire Technologies, Inc., A California
Corporation ("SUBLESSOR") and Software of the Month Club Group, Inc., A
California Corporation ("SUBLESSEE").
2. PREMISES. Sublessor hereby subleases to Sublessee and Sublessee hereby
subleases from Sublessor for the term, at the rental, and upon all of the
conditions set forth herein, that certain real property, including all
improvements therein, and commonly known by the street address of 0000 Xxxxxx
Xxxxx, Xxxxxxxx, XX 00000 located in the County of San Diego , State of
California and generally described as (describe briefly the nature of the
property) approximately a 7,170 square foot warehouse portion of a larger
building. (See Exhibit A attached) ("PREMISES").
3. TERM.
3.1. TERM. The term of this Sublease shall be for twenty-four (24) months
commencing on January 1, 1999 , and ending on December 31, 2000 ,
unless sooner terminated pursuant to any provision hereof.
3.2. DELAY IN COMMENCEMENT. Sublessor agrees to use its best commercially
reasonable efforts to deliver possession of the Premises by the
commencement date. If, despite said efforts, Sublessor is unable to
deliver possession as agreed, the rights and obligations of Sublessor
and Sublessee shall be as set forth in Paragraph 3.2 of the Master
Lease (as modified by Paragraph 7.3 of this Sublease).
4. RENT.
4.1. BASE RENT. Sublessee shall pay to Sublessor as Base Rent for the
Premises equal monthly payments of $3,871.80 in advance, on the first
(1st) day of each month of the term hereof. Sublessee shall pay
Sublessor upon the execution hereof $3,871.80 as Base Rent for
January, 1999. (See addendum 12.1). Base Rent for any period during
the term hereof which is for less than one month shall be a pro rata
portion of the monthly installment.
4.2. RENT DEFINED. All monetary obligations of Sublessee to Sublessor under
the terms of this Sublease (except for the Security Deposit) are
deemed to be rent ("RENT"). Rent shall be payable in lawful money of
the United States to Sublessor at the address stated herein or to such
other persons or at such other places as Sublessor may designate in
writing.
5. SECURITY DEPOSIT. Sublessee shall deposit with Sublessor upon execution
hereof $3,871.80 as security for Sublessee's faithful performance of Sublessee's
obligations hereunder. The rights and obligations of Sublessor and Sublessee as
to said Security Deposit shall be as set forth in Paragraph 5 of the Master
Lease (as modified by Paragraph 7.3 of this Sublease).
6. USE.
6.1. AGREED USE. The Premises shall be used and occupied only for office,
assembly, distribution and related uses for a computer software
fulfillment company and for no other purpose.
6.2. COMPLIANCE. (See addendum 12.2).
6.3. ACCEPTANCE OF PREMISES AND LESSEE. Sublessee acknowledges that:
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(a) it has been advised by Brokers to satisfy itself with respect to
the condition of the Premises (including but not limited to the electrical, HVAC
and fire sprinkler systems, security, environmental aspects, and compliance with
Applicable Requirements), and their suitability for Sublessee's intended use.
(b) Sublessee has made such investigation as it deems necessary with
reference to such matters and assumes all responsibility therefor as the same
relate to its occupancy of the Premises, and
(c) neither Sublessor, Sublessor's agents, nor any Broker has made
any oral or written representations or warranties with respect to said matters
other than as set forth in this Sublease.
In addition, Sublessor acknowledges that:
(a) Broker has made no representations, promises or warranties
concerning Sublessee's ability to honor the Sublease or suitability to occupy
the Premises, and
(b) it is Sublessor's sole responsibility to investigate the
financial capability and/or suitability of all proposed tenants.
7. MASTER LEASE
7.1. Sublessor is the lessee of the Premises by virtue of a lease,
hereinafter the "MASTER LEASE", a copy of which is attached hereto
marked Exhibit B, wherein Xxxxx Xxxxxxxx and Xxxxxx Xxxxxx is the
lessor, hereinafter the "MASTER LESSOR"
7.2. This Sublease is and shall be at all times subject and subordinate to
the Master Lease.
7.3. The terms, conditions and respective obligations of Sublessor and
Sublessee to each other under this Sublease shall be the terms and
conditions of the Master Lease except for those provisions of the
Master Lease which are directly contradicted by this Sublease in which
event the terms of this Sublease document shall control over the
Master Lease. Therefore, for the purposes of this Sublease, wherever
in the Master Lease the work "Lessor" is used it shall be deemed to
mean the Sublessor herein and wherever in the Master Lease the word
"Lessee" is used it shall be deemed to mean the Sublessee herein.
7.4. During the term of this Sublease and for all periods subsequent for
obligations which have arisen prior to the termination of this
Sublease, Sublessee does hereby expressly assume and agree to perform
and comply with, for the benefit of Sublessor and Master Lessor, each
and every applicable obligation of Sublessor under the Master Lease.
7.5. The obligations that Sublessee has assumed under paragraph 7.4 hereof
are hereinafter referred to as the "SUBLESSEE'S ASSUMED OBLIGATIONS".
The obligations that Sublessee has not assumed under paragraph 7.4
hereof are hereinafter referred to as the "SUBLESSOR'S REMAINING
OBLIGATIONS".
7.6. Sublessee shall hold Sublessor free and harmless from all liability,
judgments, costs, damages, claims or demands, including reasonable
attorneys fees, arising out of Sublessee's failure to comply with or
perform Sublessee's Assumed Obligations.
7.7. Sublessor agrees to maintain the Master Lease during the entire term
of this Sublease, subject, however, to any earlier termination of the
Master Lease without the fault of the Sublessor, and to comply with or
perform Sublessor's Remaining Obligations and to hold Sublessee free
and harmless from all liability, judgments, costs, damages, claims or
demands arising out of Sublessor's failure to comply with or perform
Sublessor's Remaining Obligations.
7.8. Sublessor represents to Sublessee that the Master Lease is in full
force and effect and that no default exists on the part of any Party
to the Master Lease.
8. ASSIGNMENT OF SUBLEASE AND DEFAULT.
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8.1. Sublessor hereby assigns and transfers to Master Lessor the
Sublessor's interest in this Sublease, subject however to the
provisions of Paragraph 8.2 hereof.
8.2. Master Lessor, by executing this document, agrees that until a Default
shall occur in the performance of Sublessor's Obligations under the
Master Lease, that Sublessor may receive, collect and enjoy the Rent
accruing under this Sublease. However, if Sublessor shall Default in
the performance of its obligations to Master Lessor then Master Lessor
may, at its option, receive and collect, directly from Sublessee, all
Rent owing and to be owed under this Sublease. Master Lessor shall
not, by reason of this assignment of the Sublease nor by reason of the
collection of the Rent from the Sublessee, be deemed liable to
Sublessee for any failure of the Sublessor to perform and comply with
Sublessor's Remaining Obligations.
8.3. Sublessor hereby irrevocably authorizes and directs Sublessee upon
receipt of any written notice from the Master Lessor stating that a
Default exists in the performance of Sublessor's obligations under the
Master Lease, to pay to Master Lessor (See addendum 12.3) statement
and request from Master Lessor, and that Sublessee shall pay such Rent
to Master Lessor without any obligation or right to inquire as to
whether such Default exists and notwithstanding any notice from or
claim from Sublessor to the contrary and Sublessor shall have no right
or claim against Sublessee for any such Rent so paid by Sublessee.
8.4. No changes or modifications shall be made to this Sublease without the
consent of Master Lessor.
9. CONSENT OF MASTER LESSOR.
9.1. In the event that the Master Lease requires that Sublessor obtain the
consent of Master Lessor to any subletting by Sublessor, then, this
Sublease shall not be effective unless, within ten days of the date
hereof, Master Lessor signs this Sublease thereby giving its consent
to this Subletting.
9.2. In the event that the obligations of the Sublessor under the Master
Lease have been guaranteed by third parties then neither this
Sublease, nor the Master Lessor's consent, shall be effective unless,
within 10 days of the date hereof, said guarantors sign this Sublease
thereby giving their consent to this Sublease.
9.3. In the event that Master Lessor does give such consent then:
(a) Such consent shall not release Sublessor of its obligations or
alter the primary liability of Sublessor to pay the Rent and perform
and comply with all of the obligations of Sublessor to be performed
under the Master Lease.
(b) The acceptance of Rent by Master Lessor from Sublessee or anyone
else liable under the Master Lease shall not be deemed a waiver by
Master Lessor of any provisions of the Master Lease.
(c) The consent to this Sublease shall not constitute a consent to
any subsequent subletting or assignment.
(d) In the event of any Default of Sublessor under the Master Lease,
Master Lessor may proceed directly against Sublessor, any guarantors
or anyone else liable under the Master Lease or this Sublease without
first exhausting Master Lessor's remedies against any other person or
entity liable thereon to Master Lessor.
(e) Master Lessor may consent to subsequent subletting and
assignments of the Master Lease or this Sublease or any amendments or
modifications thereto without notifying Sublessor or any one else
liable under the Master Lease and without obtaining their consent and
such action shall not relieve such persons from liability.
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(f) In the event that Sublessor shall Default in its obligations
under the Master Lease, See addendum 12.4) option and without being
obligated to do so, may require Sublessee to attorn to Master Lessor
in which event Master Lessor shall undertake the obligations of
Sublessor under this Sublease from the time of the exercise of said
option to termination of this Sublease but Master Lessor shall not be
liable for any prepaid Rent not any Security Deposit paid by
Sublessee, nor shall Master Lessor be liable for any other Defaults of
the Sublessor under the Sublease.
9.4 The signatures of the Master Lessor and any Guarantors of Sublessor at
the end of this document shall constitute their consent to the terms
of this Sublease.
9.5 Master Lessor acknowledges that, to the best of Master Lessor's
knowledge, no Default presently exists under the Master Lease of
obligations to be performed by Sublessor and that the Master Lease is
in full force and effect.
9.6 In the event that Sublessor Defaults under its obligations to be
performed under the Master Lease by Sublessor, Master Lessor agrees to
deliver to Sublessee a copy of any such notice of default. Sublessee
shall have the right to cure any Default of Sublessor described in any
notice of default within ten days after service of such notice of
default on Sublessee. If such Default is cured by Sublessee then
Sublessee shall have the right of reimbursement and offset from and
against Sublessor.
10. BROKER'S FEES.
10.1 Upon execution hereof by all parties, Sublessor shall pay to Business
Real Estate Brokerage Co. a licensed real estate broker, ("Broker"), a fee as
set forth in a separate agreement between Sublessor and Broker, or in the event
there is no such separate agreement, the sum of $ per agreement for brokerage
services rendered by Broker to Sublessor in this transaction.
10.2 Sublessor agrees that if Sublessee exercises any option or right of
first refusal as granted by Sublessor herein, or any option or right
substantially similar thereto, either to extend the term of this Sublease, to
renew this Sublease, to purchase the Premises, or to lease or purchase adjacent
property which Sublessor may own or in which sublessor has an interest, then
Sublessor shall pay to Broker a fee in accordance with the schedule of Broker in
effect at the time of the execution of this Sublease. Notwithstanding the
foregoing, Sublessor's obligation under this Paragraph 10.2 in limited to a
transaction in which Sublessor is acting as a Sublessor, lessor or seller.
10.3 Master Lessor agrees that if Sublessee shall exercise any option or
right of first refusal granted to Sublessee by Master Lessor in connection with
this Sublease, or any option or right substantially similar thereto, either to
extend or renew the Master Lease, to purchase the Premises or any part thereof,
or to lease or purchase adjacent property which Master Lessor may own or in
which Master Lessor has an interest, or if Broker is the procuring cause of any
other lease or sale entered into between Sublessee and Master Lessor pertaining
to the Premises, any part thereof, or any adjacent property which Master Lessor
owns or in which it has an interest, then as to any of said transactions, Master
Lessor shall pay to Broker a fee, in cash, in accordance with the schedule of
Broker in effect at the time of the execution of this Sublease.
10.4 Any fee due from Sublessor or Master Lessor hereunder shall be due and
payable upon the exercise of any option to extend or renew, upon the execution
of any new lease, or, in the event of a purchase, at the close of escrow.
10.5 Any transferee of Sublessor's interest in this Sublease, or of Master
Lessor's interest in the Master Lease, by accepting an assignment thereof, shall
be deemed to have assumed the respective obligations of Sublessor or Master
Lessor under this Paragraph 10. Broker shall be deemed to be a third-party
beneficiary of this paragraph 10.
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11. ATTORNEY'S FEES. If any party named herein brings an action to enforce the
terms hereof or to declare rights hereunder, the prevailing party in any
such action, on trial and appeal, shall be entitled to his reasonable
attorney's fees to be paid by the losing party as fixed by the Court.
12. ADDITIONAL PROVISIONS. [If there are no additional provisions, draw a line
from this point to the next printed word after the space left here. If
there are additional provisions place the same here.]
See Addendum - Attached
Exhibit A "Floor Plan" - Attached
Hazardous Materials Disclaimer - Attached
Exhibit I - Master Lease
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ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY REAL ESTATE BROKER AS TO THE LEGAL
SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS SUBLEASE OR THE
TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO:
1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS
SUBLEASE
2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF
THE PREMISES, SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE
POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PROPERTY, THE
STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND
THE SUITABILITY OF THE PREMISES FOR SUBLESSEE'S INTENDED USE.
WARNING: IF THE SUBJECT PROPERTY IS LOCATED IN A STATE OTHER THAN CALIFORNIA,
CERTAIN PROVISIONS OF THE SUBLEASE MAY NEED TO BE REVISED TO COMPLY WITH THE
LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED.
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Executed at: Wilshire Technologies, Inc.
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on: By: Xxxx Xxx Xxxxxx, President & CEO
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Address: By: /s/Xxxx Xxx Xxxxxx
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"Sublessor" (Corporate Seal)
Executed at: Software of the Month Club Group, Inc.
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on: By: Xxxxxxx X. Xxxxx -- CFO
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Address: By: /s/Xxxxxxx X. Xxxxx
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"Sublessee" (Corporate Seal)
Executed at: Xxxxx Xxxxxxxx and Xxxxxx Xxxxxx
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on: By: /s/Xxxxx Xxxxxxxx
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Address: By: /s/Xxxxxx Xxxxxx
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"Master Lessor" (Corporate Seal)
NOTE: THESE FORMS ARE OFTEN MODIFIED TO MEET CHANGING REQUIREMENTS OF LAW AND
NEEDS OF THE INDUSTRY. ALWAYS WRITE OR CALL TO MAKE SURE YOU ARE UTILIZING THE
MOST CURRENT FORM: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, 000 XX. XXXXXX
XX., XXXXX 000, XXX XXXXXXX, XX 00000. (000) 000-0000.
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ADDENDUM TO SUBLEASE DATED DECEMBER 9, 1998 BY AND BETWEEN WILSHIRE
TECHNOLOGIES, INC., A CALIFORNIA CORPORATION, AS SUBLESSOR AND SOFTWARE OF
THE MONTH CLUB GROUP, INC., A CALIFORNIA CORPORATION, AS SUBLESSEE FOR
THE PROPERTY AT 0000 XXXXXX XXXXX, XXXXXXXX,
XXXXXXXXXX
This addendum modifies the Sublease in the following particulars only. Should
the terms and conditions of this addendum conflict with the terms and conditions
of the Sublease, the terms and conditions of this addendum shall prevail.
12.1 BASE RENT: January 1,1999 to December 31, 1999 = $3,871.80 per month
modified gross.
January 1,2000 to December 31, 2000 = $4,015.20 per
month modified gross.
12.2 (6.2 MODIFIED) COMPLIANCE: Sublessee acknowledges it is accepting the
Premises in its "as is" condition, has inspected the Premises and satisfied
itself as to the condition and compliance with all applicable statutes,
laws, regulations, covenants, conditions, and restrictions of record. Note:
Sublessee is responsible for determining whether or not the zoning is
appropriate for its intended use, and acknowledges that past uses of the
Premises may no longer be allowed.
12.3 (8.3 MODIFIED): the Rent due and to become due under the Sublease,
provided Sublessor has received 10 days prior written notice of such
Default during which time Sublessor may cure the Default. Sublessor agrees
that, except as provided above, Sublessee shall have the right to rely upon
any such...
12.4 (9.3 (f) MODIFIED): then, after 10 days written notice to Sublessor
during which it may cure such Default, Master Lessor, at its...
12.5 TENANT IMPROVEMENTS: Sublessor, at Sublessor's sole cost and expense,
shall install a chain-link fence, 8 feet in height, demising the premises
to include a sliding gate next to the dock-high door, 8 feet in width.
Sublessee shall install a modular office with restroom at Sublessee's
expense, subject to the written consent of Sublessor and Master Lessor of
plans, specifications, method of payment and manner of installation.
Sublessee acknowledges and agrees that any and all of Sublessee's
improvements or alterations of the premises be removed, repaired and
restored to its original condition by Sublessee by the last day of the
Sublease term.
12.6 OPTION TO RENEW: Provided Sublessee is not then in Default and has no
more than one cured Default during the previous term, Sublessee shall have
two (2) Options to Renew the Sublease each for a period of twelve (12)
months. Sublessee shall exercise its Option(s) by giving Sublessor written
notice at least six (6) months prior to the ending date of the existing
lease term. The Rent shall be as follows:
January 1, 2001 to December 31, 2001 = $4,158.60 per month modified
gross.
January 1, 2002 to December 31, 2002 = $4,302.00 per month modified
gross.
12.7 PARKING: Sublessee shall have use of 10 unassigned parking spaces in
the southeast part of the parking area.
12.8 SIGNAGE: Sublessee shall have the right to place signage on the
building in accordance with the Master Lessor's and Sublessor's criteria
and prior written approval and subject to the CC&R's of the park.
12.9 DOCK HIGH ACCESSIBILITY: Sublessee shall have access to the dock-high
loading door during normal business hours of Sublessor.
12.10 TRASH, WATER AND ELECTRICAL: Sublessee shall reimburse Sublessor
($150.00) per month for trash and water usage and ($100.00) per month for
electrical usage. These charges will be reviewed on a quarterly basis and
can be adjusted by Sublessor based upon cost and usage.
12.11 RIGHTS AND REMEDIES: All rights and remedies available to the Master
Lessor pursuant to the terms of the Master Lease or by law as to the
Sublessor, shall be available to Sublessor as to the Sublessee.
12.12 BROKERAGE FEE: Sublessor shall pay Business Real Estate a brokerage
fee of 6% of the total sublease consideration of the initial sublease term
and option terms if exercised. The fee is due and payable upon the full
execution of subleases and at the time the Option(s) to Renew is exercised.
12.13 ADDITIONAL RENT: All amounts due under provisions of Master Lease are
sole responsibility of the Sublessor.
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CONSULT YOUR ATTORNEY/ADVISORS - THIS DOCUMENT HAS BEEN PREPARED FOR APPROVAL BY
YOUR ATTORNEY. NO REPRESENTATION OR RECOMMENDATION IS MADE BY SUBLESSOR AS TO
THE LEGAL EFFECT OR TAX CONSEQUENCES OF THIS DOCUMENT OR TO THE TRANSACTION TO
WHICH IT RELATES. THESE ARE QUESTIONS FOR YOUR ATTORNEY.
AGREED AND ACCEPTED:
SUBLESSOR SUBLESSEE
Wilshire Technologies, Inc. Software of the Month Club Group, Inc.
A California Corporation Corporation A California Corporation
By: /s/Xxxx Xxx Xxxxxx By: /s/Xxxxxxx X. Xxxxx
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Xxxx Xxx Xxxxxx --President & CEO Xxxxxxx X. Xxxxx -- CFO
Date: December 15, 1998 Date: December 10, 1998
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MASTER LESSOR
Xxxxx Xxxxxxxx and Xxxxxx Xxxxxx
By: /s/Xxxxx Xxxxxxxx By: /s/Xxxxxx Xxxxxx
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Xxxxx Xxxxxxxx Xxxxxx Xxxxxx
Date: Date:
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