SUBLEASE AGREEMENT
THIS SUBLEASE dated as of this 4th day of May, 1998, is
made by and between VERTEX INDUSTRIES, INC., a New Jersey
corporation ("Sublandlord") and THEA & XXXXXX, INC. ("Subtenant").
RECITALS:
A. WHEREAS, pursuant to a Lease dated October 15, 1997
(hereinafter referred to as the "Base Lease"), Ninth Avenue
Equities Co., Inc. ("Base Landlord"), demised and leased to Vertex
Industries, Inc., as Tenant, the premises at 00 Xxxxx Xxxxxx, Xxxx
xx Xxxxxxx, Xxxxxx of Passaic, State of New Jersey (the "Warehouse
Space");
B. WHEREAS, Sublandlord desires to lease a portion of the
Warehouse Space to Subtenant and Subtenant desires to lease from
Sublandlord the Warehouse Space, subject to all of the terms,
covenants and conditions in this Sublease;
NOW, THEREFORE, for good and valuable consideration, receipt
of which is hereby acknowledged, the parties agree as follows:
1. Summary of Basic Terms:
(a) Premises: Approximately 17,100 square feet of the
office building, commonly known as 00 Xxxxx Xxxxxx, Xxxxxxx, Xxx
Xxxxxx, 00000-0000, substantially as shown on the floor plan
attached hereto as Exhibit "A".
(b) Permitted Use: The Subtenant shall use the
Premises only for storage of electrical conduit, cable and
assorted electrical supplies, or for such other purpose with the
prior written permission of Sublandlord, which permission shall
not be unreasonably withheld.
(c) Initial Sublease Term: Commencing June 1, 1998,
and ending on May 31, 2003, unless sooner terminated as elsewhere
provided herein.
(d) Annual Net Rent Per Square Foot: $3.10 per square
foot on an annual basis from June 1, 1998 through May 31, 2001;
$3.20 per square foot on an annual basis from June 1, 2001 through
May 31, 2003.
(e) Security: 2 months rent to be handled in
accordance with the provisions of Section 4.
2. Demise and Term:
Sublandlord hereby leases the Premises to Subtenant and
Subtenant hereby leases the Premises from Sublandlord, subject to
all of the terms, covenants and conditions in this Sublease.
3. Rent:
Subtenant shall pay to Sublandlord as rent for the
Premises a monthly rent (the "Monthly Rent") equal to the Annual
Net Rent Per Square Foot divided by 12. The Monthly Rent shall be
payable in advance on or before the first day of the first full
calendar month of the Lease Term (the "First Month") and on or
before the first day of each successive calendar month thereafter
during the Lease Term. The Monthly Rent for any period during the
Lease Term which is for less than a full one month period shall be
prorated based on a thirty (30) day month. The Monthly Rent and
all other rent hereunder shall be paid without prior notice or
demand, without deduction or offset, in lawful money of the United
States of America which shall be legal tender at the time of
payment, at the office of the Sublandlord.
June 1, 1998 through May 31, 2001, Annual Net Rent
shall be $53,010; Monthly Net Rent shall be $4,417.50. June 1,
2001 through May 31, 2003, Annual Net Rent shall be $54,720;
Monthly Net Rent shall be $4,560.00.
In addition to the Monthly Rent, the Subtenant agrees
to pay the Sublandlord the following shares of the
Sublandlord's expenses under the Base Lease: (i) thirty three
and one half percent (33 1/2%) of Sublandlord's expenses for
gas; (ii) forty one percent (41%) of Sublandlord's expenses for
taxes; (iii) fifty percent (50%) of Sublandlord's expenses for
dumpsters; and (iv) ten percent (10%) of Sublandlord's expenses
for electricity.
4. Security:
Sublandlord hereby acknowledges receipt from
Subtenant of a Security Deposit in the amount stated in Article
1(f) hereof to be held by Sublandlord as security for the
performance by Subtenant of Subtenant's covenants and
obligations under this Agreement, it being expressly understood
that such deposit shall not be considered an advance payment of
rental or a measure of Sublandlord's damages in case of Default
by Subtenant. The Security Deposit shall be held by
Sublandlord in a separate interest bearing account on behalf of
Subtenant and the Security Deposit shall not be commingled with
any other funds held by Sublandlord. Upon the occurrence of
any event of default beyond the expiration of any applicable
grace period. Sublandlord may, from time to time, without
prejudice to any other remedy, use such fund to the extent
necessary to make good any arrears of rental and any other
damage, injury, expense or liability caused to Sublandlord by
such event of default beyond the expiration of any applicable
grace period. Following any such application of the Security
Deposit, Subtenant shall pay to Sublandlord on demand the
amount so applied in order to restore the Security Deposit to
eh amount thereof immediately prior to such application. If
Subtenant is not then in default hereunder beyond the
expiration of any applicable grace period, any remaining
balance of such Deposit shall be returned to Subtenant upon the
termination of this Agreement; provided, however, Sublandlord
shall have the right to retain and expend such remaining
balance for cleaning and repairing the Premises if Subtenant
shall fail to deliver up the same at the expiration or earlier
termination of this Agreement in the condition required by the
provisions of this Agreement.
5. Incorporation by Reference:
This Sublease shall be expressly subject and
subordinate to all of the terms, covenants and conditions
contained in the Base Lease, except such terms, covenants and
conditions as are specifically inconsistent with the terms
hereof or as set forth in Paragraph 8 below (the "Excluded
Provisions"). With the exception of the Excluded Provisions or
inconsistent terms, Subtenant acknowledges that any obligations
of the Sublandlord under the Base Lease, but not with respect
to Rent and Additional Rent, and only with respect to the
Sublease Premises shall be the responsibility and obligation
also of the Subtenant.
6. Excluded Provisions:
The following provisions of the Base Lease,
identified by Article, are specifically excluded from the
provisions of this Sublease, paragraphs 3, 5.01(a) and 25.
7. Indemnification:
Sublandlord hereby indemnifies and holds Subtenant
harmless from any and all liability (including, but not limited
to, legal fees and disbursements) in connection with any and
all hazardous materials located on the Premises.
8. Representations of Sublandlord:
(a) Sublandlord hereby warrants and represents that
(i) it is leasing certain premises pursuant to the Base Lease,
which includes the demised premises; (ii) the Base Lease is in
full force and effect; (iii) it has a valid leasehold interest
in the demised premises under the Base Lease; (iv) the Sublease
sets forth the entire agreement of the parties with respect to
Subtenant's leasing of the demised premises; (v) as of the date
hereof, there exists, to the best of Sublandlord's knowledge,
no circumstances, condition or act of default beyond any
applicable grace and cure periods which would entitle or permit
the Base Landlord to terminate the Base Lease; and (vi) it will
not modify or surrender the Base Lease so as to deprive
Subtenant of its rights or remedies under this Sublease without
the prior written consent of Subtenant.
(b) Sublandlord shall send a copy of any notice of
default or notice of termination of the Base Lease received
from the Base Landlord to Subtenant.
(c) Sublandlord covenants that it will (i) pay all
rent and additional rent when due pursuant to, and (ii) observe
all the other terms and conditions of, the Base Lease provided
that (a) it is not prevented from doing so by Subtenant and (b)
Subtenant is not in default hereunder. If Sublandlord shall
fail to observe any of the terms and/or fail to pay any such
amounts to the Base Landlord as and when such amounts shall be
due and payable, and provided further that (i) Sublandlord has
not made such payments and/or observed such terms within a
period equal to one-half of the applicable grace period, if
any, under the Base Lease and (ii) Sublandlord has not notified
Subtenant that Sublandlord has obtained an injunction against
the Base Landlord with respect to the enforcement of any
default notice sent by the Base Landlord to Sublandlord as a
result of Sublandlord's failure to make such payments and/or
observe the terms of the Base Lease, then in such event,
Subtenant may, but shall not be obligated to, expend such sums
as may be necessary to observe or perform such terms,
provisions and conditions and/or pay such rent, additional rent
and other charges to the Base Landlord for the account of
Sublandlord, and any amount so paid shall become immediately
due and payable to Subtenant from Sublandlord upon demand, and
if not so paid by Sublandlord. Subtenant shall have the right
to offset such amounts against future fixed and additional
rental payments hereunder, notwithstanding anything to the
contrary contained herein.
(d) If, at any time during the term of this
Sublease, (i) Sublandlord is in default of its obligations
under the Base Lease beyond any applicable grace and cure
periods and (ii) Sublandlord receives a notice of termination
of the Base Lease from the Base Landlord pursuant to the
provisions of the Base Lease which Sublandlord is not
contesting or defending against, then, only in such event,
shall Subtenant have the right, in addition to and without
prejudice to those rights of recovery which may be available
through other actions or procedures at law or in equity, to
terminate this Sublease upon written notice to Sublandlord.
9. Representations of Subtenant:
Subtenant represents that it maintains general
liability insurance sufficient to cover the potential
liabilities as set forth in Article 5.01(b) of the Base Lease.
It is understood that Subtenant will not be responsible for
insurance coverage, pursuant to any of the other provisions of
Article 5 of the Base Lease, such responsibility being that of
the Sublandlord. Subtenant shall provide Sublandlord with
suitable certificates from the insurer evidencing such
coverage.
10. Miscellaneous:
(a) Assignability: Unless otherwise agreed to in
writing by both parties hereto, the rights, obligations and
benefits established by this Sublease shall be nonassignable by
either of the parties hereto and any such attempt of assignment
shall be null and void and of no effect whatsoever.
(b) Entire Agreement: This Sublease contains the
entire agreement of the parties with respect to the subject
matter hereof, and may not be changed except by a writing
signed by the party against whom enforcement or discharge is
sought.
(c) Waiver of Breach: The waiver by either party of
a breach of any provision of this Sublease by the other party
shall not operate or be construed as a waiver of any subsequent
breach of any other party.
(d) Captions and Headings: The paragraph headings
throughout this Agreement are for convenience and reference
only, and shall in no way be deemed to define, limit or add to
the meaning of any provision of this Sublease.
(e) State Law: This Sublease, its interpretation
and its application shall be governed by the laws of the State
of New Jersey.
(f) Costs: In the event of any legal proceeding
between any of the parties to enforce or defend the terms and
rights set forth in this Sublease, the prevailing party or
parties shall be paid all costs of such legal proceeding,
including, but not limited to, attorneys' fees by the other
party or parties.
(g) Notices and Waivers: Any notice or waiver
required or permitted to be given by the parties hereto shall
be in writing and shall be deemed to have been given, when
personally delivered, or three (3) business days after being
mailed by certified or registered mail, or faxed during regular
business hours of the recipient and there is confirmation of
receipt, or sent by prepaid full rate telegram to the following
addresses:
If to Sublandlord:
VERTEX INDUSTRIES, INC.
00 Xxxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000-0000
Attn: Xx. Xxxxxx X. Xxxx
If to Subtenant:
THEA & XXXXXX, INC.
000 Xxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
Attn: Messrs. Xxxxxxx & Xxxx Xxxx
(h) The parties acknowledge and agree that no real
estate broker has any interest in this transaction or has
participated in any way in the culmination of this Sublease.
IN WITNESS WHEREOF, the parties have executed this
Sublease on the date specified below next to their respective
signatures.
SUBLANDLORD: SUBTENANT:
VERTEX INDUSTRIES, INC. THEA & XXXXXX, INC.
BY:s/Xxxxxx X. Xxxx, Pres. BY:s/Joes Thea
DATE: 4 May, 1998 DATE: 5 May, 1998
