AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD SUBLEASE (Long-form to be used with pre-1996 AIR leases)
EXHIBIT 10.2
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
STANDARD SUBLEASE
(Long-form to be used with pre-1996 AIR leases)
1. Parties.
This Sublease, dated, for reference purposes only, April 17, 2001,
is made by and between Xxx Pharmaceuticals, a California corporation ("Sublessor") and Bi-Tank,
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 Xxxxx Xxxxx Xxxxxx, Xxxxx Xx Xxxxx located
in the County of Xxx Xxxxxxx, Xxxxx xx Xxxxxxxxxx 00000 and
generally described as (describe briefly the nature of the property) a
one-story building of approximately 8,400 square feet ("Premises").
3. Term.
3.1 Term. The term of this Sublease shall be for four
(4) years and eight (8) months commencing on April 1, 2001 and
ending on November 30, 2005 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, Sublessor shall not be subject to any
liability therefor, nor shall such failure affect the validity of this
Sublease. Sublessee shall not, however, be obligated to pay Rent or perform its
other obligations until it receives possession of the Premises. If possession
is not delivered within sixty days after the commencement date, Sublessee may,
at its option, by notice in writing within ten days after the end of such sixty
day period, cancel this Sublease, in which event the Parties shall be
discharged from all obligations hereunder. If such written notice is not
received by Sublessor within said ten day period, Sublessee's right to cancel
shall terminate. Except as otherwise provided, if possession is not tendered to
Sublessee when required and Sublessee does not terminate this Sublease, as
aforesaid, any period of rent abatement that Sublessee would otherwise have
enjoyed shall run from the date of delivery of possession and continue for a
period equal to what Sublessee would otherwise have enjoyed under the terms
hereof, but minus any days of delay caused by the acts or omissions of
Sublessee. If possession is not delivered within 120 days after the
commencement date, this Sublease shall automatically terminate unless the
Parties agree, in writing, to the contrary.
4. Rent.
4.1 Base
Rent. Sublessee shall pay
to Sublessor as Base Rent for the Premises equal monthly payments of $ None
See Paragraph 12.b.
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.
6. Use.
6.1 Agreed
Use. The Premises shall be
used and occupied only for warehouse and distribution of bicycles only
and for no other purpose.
6.2 Compliance. Sublessor warrants that the
improvements on the Premises comply with all applicable covenants or
restrictions of record and applicable building codes, regulations and
ordinances ("Applicable
Requirements") in effect on the commencement date. Said
warranty does not apply to the use to which Sublessee will put the Premises or
to any alterations or utility installations made or to be made by Sublessee.
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. If the Premises do not comply with said warranty,
Sublessor shall, except as otherwise provided, promptly after receipt of
written notice from Sublessee setting forth with specificity the nature and
extent of such non-compliance, rectify the same at Sublessor's expense. If
Sublessee does not give Sublessor written notice of a non-compliance with this
warranty within six months following the commencement date, correction of that
non-compliance shall be the obligation of Sublessee at its sole cost and
expense. If the Applicable Requirements are hereafter changed so as to require
during the term of this Sublease the construction of an addition to or an
alteration of the Building, the remediation of any Hazardous Substance, or the
reinforcement or other physical modification of the Building ("Capital Expenditure"), Sublessor
and Sublessee shall allocate the cost of such work as follows:
(a) If such Capital Expenditures are
required as a result of the specific and unique use of the Premises by
Sublessee as compared with uses by tenants in general, Sublessee shall be fully
responsible for the cost thereof provided, however, that if such Capital
Expenditure is required during the last two years of this Sublease and the cost
thereof exceeds six months' Base Rent, Sublessee may instead terminate this
Sublease unless Sublessor notifies Sublessee in writing, within ten days after
receipt of Sublessees's termination notice that Sublessor has elected to pay
the difference between the actual cost thereof and the amount equal to six
months' Base Rent. If the Parties elect termination, Sublessee shall
immediately cease the use of the Premises which requires such Capital
Expenditure and deliver to Sublessor written notice specifying a termination
date at least ninety days thereafter. Such termination date shall, however, in
no event be earlier then the last day that Sublessee could legally utilize the
Premises without commencing such Capital Expenditure.
(b) If such Capital Expenditure is not the
result of the specific and unique use of the Premises by Sublessee (such as
governmentally mandated seismic modifications, then Sublessor shall pay for
said Capital Expenditure and the cost thereof shall be prorated between the
Sublessor and Sublessee and Sublessee shall only be obligated to pay, each
month during the remainder of the term of this Sublease, on the date on which
Rent is due, an amount equal to the product of multiplying the cost of such
Capital Expenditure by a fraction, the numerator of which is one, and the
denominator of which is the number of months of the useful life of such Capital
Expenditure as such useful life is specified pursuant to Federal income tax
regulations or guidelines for depreciation thereof (including interest on the
unamortized balance as is then commercially reasonable in the judgment of
Sublessor's accountant), with Sublessee reserving the right to prepay its
obligation at any time. Provided, however, that if such Capital Expenditure is
required during the last two years of this Sublease or if Sublessor reasonably
determines that it is not economically feasible to pay its share thereof,
Sublessor shall have the option to terminate this Sublease upon ninety days
prior written notice to Sublessee unless Sublessee notifies Sublessor, in
writing, within ten days after receipt of Sublessor's termination notice that
Sublessee will pay for such Capital Expenditure. If Sublessor does not elect to
terminate, and fails to tender its share of any such Capital Expenditure, Sublessee
may advance such funds and deduct same, with interest, from Rent until
Sublessor's share of such costs have been fully paid. If Sublessee is unable to
finance Sublessor's share, or if the balance of the Rent due and payable for
the remainder of this Sublease is not sufficient to fully reimburse Sublessee
on an offset basis, Sublessee shall have the right to terminate this Sublease
upon ten days written notice to Sublessor.
(c) Notwithstanding the above, the
provisions concerning Capital Expenditures are intended to apply only to
non-voluntary, unexpected, and new Applicable Requirements. If the Capital
Expenditures are instead triggered by Sublessee as a result of an actual or
proposed change in use, change in intensity of use, or modification to the
Premises then, and in that event, Sublessee shall be fully responsible for the
cost thereof, and Sublessee shall not have any right to terminate this
Sublease.
6.3 Acceptance
of Premises and Lessee. Sublessee
acknowledges that:
(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 1,
wherein Xxx Pharmaceuticals leased from Art Weiss, Lessor, the building,
Lease is dated April 16, 1990. Also, Amendment No. 1 to 1470 Santa Xxxxx Lease.
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
word "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 obligation of Sublessor under the Master Lease except for the
following paragraphs which are excluded therefrom:
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.
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 the Rent due and to become due
under the Sublease. Sublessor agrees that Sublessee shall have the right to
rely upon any such 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
sublettings and assignments of the Master Lease or this Sublease or any
amendments or modifications thereto without notifying Sublessor or anyone else
liable under the Master Lease and without obtaining their consent and such
action shall not relieve such persons from liability.
(f) In the event that Sublessor shall
Default in its obligations under the Master Lease, then Master Lessor, at its
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 nor 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. Brokers Fee.
10.1 Upon execution hereof by all parties,
Sublessor shall pay to No Broker 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 $ None 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
is 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.
11. Attorney's Fees. If any party or the Broker 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. 12.a. INSURANCE: Sublessee shall obtain a
policy of general commercial liability insurance as required in the Master
Lease, naming Art Xxxxx and Xxx Pharmaceuticals, Inc. as additional insured.
12.b. RENT: All terms and conditions of the sublease agreement, including
payment of rent, shall be the responsibility jointly of Steady Star, Inc. and
Bi-Tank, Inc.
12.c. Sublessee agrees to accept the Premises "as is". Any repairs,
alterations or modifications are to be at the sole cost of Sublessee.
| 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. |
| Executed at: | South El Xxxxx
|
Xxx
Pharmaceuticals
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| on: | 04/24/01
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By /s/ Xxxxxx X. Xxx
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| Xxxxxx X. Xxx | |||||
| Address: | 0000 Xxxxx Xxxxx Xxxxxx
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By
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| So. Xx Xxxxx, XX 00000 | "Sublessor" (Corporate Seal) | ||||
| Executed at: | South EL Monte
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Bi-Tank,
Inc.
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| on: | 4/27/01
|
By /s/ Long Jing Jing
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| Jing Xxxx Xxxx | |||||
| Address: | 0000 Xxxxx Xxxxx Xxx
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By
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| S. XX Xxxxx, XX 00000 | "Sublessee" (Corporate Seal) | ||||
| Executed at: | South El Monte
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Art
Xxxxx
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| on: | 4-24-2001
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By /s/ Art Xxxxx
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| Art Xxxxx | |||||
| Address: | 00000 Xxxx Xxxxxx
|
Xx
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| Xxxxx Xx Xxxxx XX 00000-0000 | "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.
