1
Exhibit 10.62
EQUIPMENT SUBLEASE
THIS EQUIPMENT SUBLEASE (this "Sublease") is made and entered into as
of the 28 day of March, 2000, by and between INTEGRATED INFORMATION SYSTEMS,
INC., a Delaware corporation ("IIS"), and xxxxxxxx.xxx, inc., a Delaware
corporation, ("goracing").
RECITALS
A. Action Performance Companies, Inc., an Arizona corporation and sole
shareholder of goracing ("Action") and goracing (goracing and Action are
hereinafter collectively referred to as the "Retaining Parties") have entered
into certain equipment leases with General Electric Capital Corporation, a New
York Corporation ("GE Capital"), dated as of December 22, 1998, and August 9,
1999, respectively (the "Master Equipment Leases") whereby the Retaining Parties
lease certain equipment (the "GEAC Equipment") located at and used as part of
the occupancy of 0000 X. Xxxxxxx Xxxxx, Xxxxx, Xxxxxxx (the "Premises").
B. Action has entered into a Lease Agreement with H-B TEMPE, L.L.C., an
Arizona limited liability company ("Tempe") dated June 28, 1999 for the Premises
(the "Hohokam Lease").
C. As of the date hereof, Action intends to enter into a Sublease with
IIS (the "Hohokam Sublease") whereby IIS will assume certain of the rights and
obligations of Action under the Hohokam Lease.
D. As of the date hereof, the Retaining Parties intend to enter into an
Equipment Sublease with IIS (the "Equipment Sublease") whereby IIS assumes all
of the rights and obligations of the Retaining Parties under the Master
Equipment Leases.
E. As of the date hereof, goracing intends to enter into an Asset
Purchase Agreement with IIS (the "Asset Purchase Agreement") whereby IIS will
purchase certain assets from goracing that are currently located on and are
being used as part of the occupancy of the Premises (the "Purchased Equipment").
The Purchased Equipment is listed on Schedules A and B of the Asset Purchase
Agreement. (The GEAC Equipment and the Purchased Equipment is collectively
referred to hereinafter as the "Equipment").
F. A portion of the Equipment is located in the portion of the Premises
that is currently not subject to the Hohokam Sublease (the "Retained Premises")
and/or is currently being used by goracing (the "goracing Equipment"). The
goracing Equipment includes, but is not limited to certain furniture, fixtures,
computers and network equipment.
G. goracing desires to sublease from IIS and IIS desires for goracing
to sublease the goracing Equipment upon the terms and conditions contained
herein.
1
2
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. GRANT. IIS hereby subleases the goracing Equipment to goracing, and
goracing hereby subleases the goracing Equipment from IIS, on the terms and
conditions herein set forth.
2. RENT.
(a) BASE RENT. In exchange for the leasehold interest of the
goracing Equipment, goracing shall pay IIS $8,000 per month (the "Base Rent"),
which shall be due and payable on the 1st day of each month beginning on April
1, 2000.
(b) ADJUSTMENTS TO BASE RENT.
(i) FIRST FLOOR RETAINED PREMISES EXPANSION RIGHT. In
the event that IIS exercises its First Floor Retained Expansion Right (as
defined in Section 5 of the Hohokam Sublease) the Base Rent shall be reduced by
$3,000 per month beginning on the date such exercise becomes effective.
(ii) SURRENDER OF FIRST FLOOR RETAINED PREMISES. In
the event that Action surrenders its right to the First Floor Retained Premises
(as defined in Section 3(C) of the Hohokam Sublease) the Base Rent shall be
reduced by $3,000 per month beginning on the date such surrender becomes
effective.
(iii) SECOND FLOOR RETAINED PREMISES EXPANSION RIGHT.
In the event that IIS exercises its Second Floor Retained Expansion Right (as
defined in Section 8 of the Hohokam Sublease) the Base Rent shall be reduced by
$5,000 per month beginning on the date such exercise becomes effective.
(iv) SURRENDER OF SECOND FLOOR RETAINED PREMISES. In
the event that Action surrenders its right to the Second Floor Retained Premises
(as defined in Section 3(C) of the Hohokam Sublease) the Base Rent shall be
reduced by $5,000 per month beginning on the date such surrender becomes
effective.
3. TERM.
(a) BASE TERM. goracing's rights and obligations under this
Sublease shall commence as of the date set forth above and shall expire upon the
Expiration Date of the Hohokam Sublease (as defined in Section 1(H) of the
Hohokam Sublease).
(b) ADJUSTMENTS TO THE TERM. In the event that IIS exercises
its First Floor Retained Premises Expansion Right or its Second Floor Retained
Premises Expansion Right, or in the event that Action surrenders its rights to
the First Floor Retained Premises or the Second
2
3
Floor Retained Premises, the term of this Sublease, with respect to the portion
of the Equipment located in or associated with the respective retained or
surrendered area, shall be reduced to the effective date of such exercise or
surrender.
(c) AUTOMATIC TERMINATION. In the event that Action's
occupancy of the Premises is completely terminated in accordance with the terms
and conditions of the Hohokam Sublease, this Sublease shall simultaneously, and
automatically terminate (without being deemed, however, to be a waiver by
goracing of any other rights or remedies it may have under this Sublease).
4. NETWORKING EQUIPMENT. The parties agree that the Equipment includes
approximately $170,000 of networking equipment more fully described on Exhibit A
hereto (the "Networking Equipment"). The parties further agree that in exchange
for a monthly payment of $5,000, goracing shall have exclusive use of the
Networking Equipment until such Networking Equipment is no longer needed by
goracing, but in no event shall such period of use extend beyond May 30, 2000.
5. LATE PAYMENT CHARGE. If any amount due to IIS is not received in
full by IIS on or before five (5) days after the date any such payment is due,
then goracing shall pay to IIS a late payment charge in the amount of ten
percent (10%) of the amount then due. This provision shall not be construed to
allow or permit goracing to make payments after the due date, or to waive any of
IIS's rights in connection with late payments made by goracing.
6. NOTICES. All notices of communication required or permitted
hereunder or with regard to the Base Equipment Leases shall be in writing and
may be given by depositing the same in the United States mail, addressed to the
party to be notified, postage prepaid and registered or certified with return
receipt requested, or by delivering the same in person to an officer or agent of
such party.
(i) If to goracing, addressed to it at:
xxxxxxxx.xxx, inc.
0000 Xxxx Xxxxxxxx Xxxx
Xxxxx, Xxxxxxx 00000
Attn: Chief Financial Officer
Fax: (000) 000-0000
With a copy to:
Xxxxxxxxx Xxxxxxx, LLP
0 X. Xxxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
3
4
(ii) If to IIS, addressed to it at:
Integrated Information Systems, Inc.
0000 X. Xxxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx Xxxxxxx
Fax: (000) 000-0000
With a copy to:
Xxxxx & Xxxxxx, LLP
One Arizona Center
000 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx Xxxxxxxxxxx, Esq.
Fax: (000) 000-0000
7. GENERAL PROVISIONS.
(a) ENTIRE AGREEMENT. This Agreement contains the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof.
(b) CONTROLLING LAW. This Agreement and all questions relating
to its validity, interpretation, performance and enforcement, shall be governed
by and construed, interpreted and enforced in accordance with the laws of the
State of Arizona, notwithstanding any Arizona or other conflict-of-law provision
to the contrary.
(c) COSTS AND FEES. goracing agrees to reimburse IIS and IIS
agrees to reimburse goracing for any reasonable costs and expenses, including
attorney's fees, incurred by such party in connection with the enforcement or
preservation of any right or remedy of the other party under this Agreement.
4
5
IN WITNESS WHEREOF, THE PARTIES HAVE EXECUTED THIS SUBLEASE AS OF THE
DATE FIRST ABOVE WRITTEN.
IIS:
INTEGRATED INFORMATION SYSTEMS, INC., a Delaware corporation
By: /s/ Xxxxx X. Xxxx
----------------------------------------------------------
Name: Xxxxx X. Xxxx
-------------------------------------------------------
Its: Vice President
-------------------------------------------------------
GORACING:
xxxxxxxx.xxx, Inc., a Delaware corporation
By: /s/ Xxxxx Xxxxxxx
----------------------------------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------------------------------
Its: Chief Financial Officer
-------------------------------------------------------
5
6
EXHIBIT A
6
7
EXHIBIT A TO EQUIPMENT SUBLEASE (IIS TO GORACING)
BRAND MODEL DESCRIPTION QUANTITY PRICE EA. TOTAL
----------------------------------------------------------------------------------------------------------
Compaq 1850R High density Proliant service 3 $ 3,260 $ 9,780
Compaq 1600R Proliant service 1 3,095 3,095
Compaq 400PII Processor for server 4 1,560 6,240
Compaq 256MB Memory kit for server 4 1,670 6,680
Compaq 128MB Memory kit for server 4 826 3,304
Compaq Smart-2DH SCSI array controller 4 1,645 6,580
Compaq 4.3GIG Internal hard drive 8 503 4,024
Compaq 9.1GIG External hot-pluggable drive 14 1,080 15,120
Compaq DLT ArrayII DLT Drive system 1 26,685 26,685
Compaq StorEdge U1 array storage system 1 1,457 1,457
Compaq Rack&access Rack & keyboard, etc. 1 3,305 3,305
Compaq UPS 3000 Rack mountable UPS system 1 1,853 1,853
Compaq FLMon Flat monitor for servers 1 1,295 1,295
Cisco Catalyst 6509 Switch for connectivity 1 7,196 7,196
Cisco PWR supply 2nd Power supply for Catalyst 1 2,876 2,876
Cisco SupE1 SUP Engine for Catalyst 1 7,196 7,196
Cisco MSM mod MSM Module for Catalyst 1 14,396 14,396
Cisco CAT6000 48prt 48 Port Switch module for Catalyst 4 9,356 37,424
Cisco 0000 Xxxxxx Xxxxxx for connectivity 1 4,745 4,745
Cisco CAT6000 gig Gigabit module for Catalyst 1 7,196 7,196
------
TOTAL $170,447
Fixed Asset Schedules Page 1 of 1 Assets Retained by xxxxxxxx.xxx
