EXHIBIT 10.1
FIRST AMENDMENT
TO
AMENDED AND RESTATED SUBLEASE AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED SUBLEASE AGREEMENT (this
"AMENDMENT") is made as of January 1, 2004, by and between SMITHS AEROSPACE,
INC., a Delaware corporation, f/k/a Smiths Industries Aerospace & Defense
Systems, Inc., a Delaware corporation ("SUBLANDLORD"), and AMERICAN TECHNOLOGY
CORPORATION, a Delaware corporation ("SUBTENANT").
R E C I T A L S
---------------
A. Sublandlord and Subtenant entered into that certain Amended and
Restated Sublease Agreement dated as of September 1, 2000 (the "SUBLEASE") for
space in that certain building located at 00000 Xxxxxxx Xxxxx Xxxxx Xxxxx, Xxx
Xxxxx, Xxxxxxxxxx 00000, which space is more particularly described in the
Sublease and contains 12,107 square feet (the "ORIGINAL PREMISES").
B. Subtenant has requested that Sublandlord expand the Original
Premises by 11,441 square feet (the "EXPANSION SPACE"). The Original Premises is
depicted in Exhibit A attached hereto, and the Expansion Space and Original
Premises are both depicted in Exhibit B attached hereto.
C. The Term of the Sublease expired on July 31, 2003 (the "ORIGINAL
SUBLEASE EXPIRATION DATE"), but Subtenant has continued to occupy the Original
Premises subject to the terms of the Sublease. Subtenant has requested that
Sublandlord extend the Term to July 31, 2006.
D. The Parties desire to amend the Sublease to, among other things, add
the Expansion Space to the Original Premises and extend the Term, as set forth
in this Amendment.
NOW, THEREFORE, in reliance upon the foregoing and for good and
valuable consideration, the receipt of which is hereby acknowledged, Sublandlord
and Subtenant (together, the "PARTIES" and each sometimes a "PARTY") agree and
hereby amend the Sublease as follows:
A G R E E M E N T
-----------------
1. DEFINITIONS. Any term which is defined in the Sublease, and not
otherwise defined or modified in this Amendment, shall have the meaning ascribed
to it in the Sublease wherever capitalized herein. Each term defined in this
Amendment shall have its defined meaning wherever capitalized herein.
2. EFFECTIVE DATE. This Amendment shall be effective as of the
Effective Date (however, certain provisions of this Amendment shall be
retroactive to the Original Sublease Expiration Date as expressly set forth in
this Amendment). The "EFFECTIVE DATE" is the date upon which Landlord consents
to this Amendment (SEE Section 18 below).
3. DEMISE OF ORIGINAL PREMISES AND EXPANSION SPACE. Effective as of the
Effective Date, but retroactive to the Original Sublease Expiration Date,
Sublandlord hereby demises and subleases to Subtenant, and Subtenant hereby
accepts and subleases from Sublandlord, the Original Premises subject to all the
terms and conditions of the Sublease except as expressly modified herein. In
addition, effective as of the Effective Date, Sublandlord hereby demises and
subleases to Subtenant, and Subtenant hereby accepts and subleases from
Sublandlord, the Expansion Space.
4. EXPANSION SPACE. The Expansion Space shall be subject to all the
terms and conditions of the Sublease except as expressly modified herein .
Subtenant has inspected the Expansion Space and agrees to accept the same "AS
IS, WHERE IS" and with all faults and defects and without any (i)
representations or warranties on the part of Sublandlord with respect to the
condition of the Expansion Space, (ii) agreements, understandings or obligations
on the part of Landlord to perform or pay for any alteration, repairs,
replacements or improvements, or (iii) allowances, abatements, credits or other
concessions or inducements granted with respect to the Original Premises.
5. EXPANDED PREMISES AND NEW PREMISES AREA. Effective as of the
Effective Date, the Premises shall be increased to include the Expansion Space.
Consequently, the Premises shall be comprised of the Original Premises and the
Expansion Space, for a total Premises area of 23,548 square feet. The Premises
(including the Expansion Space) is depicted in Exhibit B attached hereto and is
not subject to verification or re-measurement.
6. EXTENSION OF TERM. Effective as of the Effective Date, but
retroactive to the Original Sublease Expiration Date, the Term of the Sublease
shall be extended by 36 months. The extended Term shall expire on July 31, 2006
(the "EXPIRATION DATE"), unless sooner terminated in accordance with the express
provisions of the Sublease.
7. BASE RENT. Effective as of the Effective Date, but retroactive to
the Original Sublease Expiration Date, Sublandlord shall pay to Subtenant Base
Rent as follows:
-------------------------------- ----------------------- -------------------------- --------------------------------
ANNUAL RATE
TIME PERIOD PER SQUARE FOOT ANNUAL BASE RENT MONTHLY BASE RENT
-------------------------------- ----------------------- -------------------------- --------------------------------
From August 1, 2003 to the $15.85 $191,895.96 $15,991.33
Effective Date
-------------------------------- ----------------------- -------------------------- --------------------------------
From Effective Date to the $14.40 $339.091.20 $28,257.60
Expiration Date
-------------------------------- ----------------------- -------------------------- --------------------------------
8. SUBTENANT'S PROPORTIONATE SHARE OF OPERATING EXPENSES. Effective as
of the Effective Date, but retroactive to the Original Sublease Expiration Date,
Subtenant shall pay to Sublandlord Subtenant's Proportionate Share of Operating
Expenses pursuant to Section 4.2 of the Sublease; provided however, upon the
Effective Date, Subtenant's Proportionate Share shall be increased to 21.45% to
take the Expansion Space into account.
9. SECURITY DEPOSIT. Effective as of the Effective Date, the Security
Deposit shall be increased to $28,257.60. Subtenant has already deposited, in
cash, with Sublandlord the sum of $14,770.54. Therefore, within three days
following the Effective Date, Subtenant shall deposit $13,487.06, in cash, with
Sublandlord.
10. SUBTENANT'S WORK. After the Effective Date, Subtenant, at its sole
cost and expense, shall make the improvements described in Exhibit C attached
hereto ("SUBTENANT'S WORK"), which improvements shall include a new demising
wall that separates the Original Premises and Expansion Space from the space
that will be occupied by x.Xxxxxxx Corporation ("x.Xxxxxxx") after the reduction
of x.Xxxxxxx's premises pursuant to that certain First Amendment to Amended and
Restated Sublease Agreement of even date herewith between Sublandlord and
x.Xxxxxxx. Subtenant's Work shall be (i) completed within a reasonable period
not to exceed 90 days after the Effective Date, (ii) deemed Subtenant
Alterations and (iii) shall be subject to the terms of the Sublease and Master
Lease. Upon completion of the Subtenant's Work, Subtenant shall deliver to
Sublandlord copies of all lien releases, copies of paid invoices, and final
as-built plans. Subtenant shall hold harmless, indemnify and defend Sublandlord
from and against any claim by or liability to the Subtenant's contractor, the
Landlord or any third party, and related expenses (including attorneys' fees
actually and reasonably incurred), arising from or related to the Subtenant's
Work.
2
11. RENT CREDIT. After the Effective Date, Subtenant shall be entitled
to a "RENT CREDIT" equal to the reasonable third party costs actually paid by
Subtenant for the Subtenant's Work, but in no event shall the Rent Credit exceed
$48,334.04. The Rent Credit shall be applied to the first installments of Base
Rent that are due after the Effective Date. Notwithstanding the foregoing,
Subtenant shall not be entitled to receive the Rent Credit (or the then
unapplied portion thereof) if Subtenant is then in Default under this Sublease;
provided however, if Subtenant cures such Default to Sublandlord's reasonable
satisfaction, Sublandlord shall then apply the Rent Credit (or the then
unapplied portion thereof) to the next installments of Base Rent pursuant to
this Section 11.
12. ONSITE PARKING. Effective as of the Effective Date, Subtenant shall
have the right to use 78 unreserved parking stalls located in the open parking
lot within the Master Premises, subject to the terms and conditions of the
Sublease, including, without limitation, Section 7 of the Sublease.
13. BROKERAGE COMMISSIONS. The Parties acknowledge that no realtor,
broker, agent or finder was involved in connection with this Amendment other
than CB Xxxxxxx Xxxxx (Attention: Xxxxx X. Xxxxxx), representing Subtenant, and
CB Xxxxxxx Xxxxx (Attention: Xxxxx Xxxxxx), representing Sublandlord
(collectively, the "BROKERS") and, therefore, that no brokerage commissions or
other fees are due to any realtor, broker, agent or finder other than the
Brokers. Tenant shall hold harmless, indemnify and defend Landlord against any
claim made in connection with this Amendment by any realtor, broker, agent or
finder other than the Brokers based on an alleged act on the part of Tenant or
any of Tenant's agents or employees. Sublandlord and Subtenant acknowledge that
CB Xxxxxxx Xxxxx, Inc. represents both Parties. Sublandlord and Subtenant
confirm that they were timely advised of such dual representation and that they
consented to the same, and that they do not expect the Brokers to disclose to
either of them confidential information of the other Party.
14. DELETION OF CERTAIN PROVISIONS. Sections 5 (Option to Extend Term)
and 6 (Right of First Offer) are hereby deleted from the Sublease, and such
Sections shall be of no further force and effect. Subtenant acknowledges and
agrees that, because the term of the Master Lease expires on August 31, 2006,
Sublandlord shall not (i) extend the Term of the Sublease or renew the Sublease
or (ii) consent to a holdover by Subtenant or any delay in Subtenant's surrender
of the Premises.
15. NO FURTHER AMENDMENT. Except as modified by this Amendment, the
Sublease remains in full force and effect, and unchanged.
16. ENTIRE AGREEMENT. This Amendment contains the entire agreement and
understanding of the Parties with respect to the subject matter of this
Amendment and supersedes and replaces entirely all previous oral and written
understandings or proposals.
17. COUNTERPARTS. This Amendment may be executed in multiple
counterparts, and by each Party on separate counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same
instrument.
18. CONSENT TO SUBLEASE BY LANDLORD. This Amendment shall be contingent
upon and shall not become operative unless and until the Landlord has given its
prior written consent to this Amendment. Sublandlord shall not be responsible
for the failure of Landlord to consent to this Amendment or the failure or
refusal of Landlord to grant any consent of Landlord required by this Amendment,
the Sublease or the Master Lease. Should the Landlord not grant its consent to
this Amendment within 30 days from the date hereof, either Party may terminate
this Amendment upon 15 days prior written notice to the other Party, and this
Amendment shall terminate at the end of such 15-day period unless Landlord
consents to this Amendment before the end of such 15-day period. If this
Amendment is terminated pursuant to the preceding sentence, Sublandlord and
Subtenant shall be released from all obligations with respect to this Amendment
and neither shall have any further rights at law or in equity with respect to
this Amendment. The Parties hereby acknowledge that Landlord's consent to this
Amendment shall not make Landlord a party to this Amendment, shall not create
any contractual liability or duty on the part of Landlord and shall not in any
manner increase, decrease or otherwise affect the rights and obligations of
Landlord, Sublandlord and Subtenant with respect to the Master Premises, the
Premises and the Sublease.
3
19. REDUCTION OPTION. Subtenant shall have the option to exclude from
the Premises and return to Sublandlord the 8,551 square feet of space that is
depicted on Exhibit D attached hereto) (the "REDUCTION SPACE") effective as of a
date (the "REDUCTION DATE") that is at least 60 days after Subtenant's written
exercise notice to Sublandlord, but in no event shall the Reduction Date be
prior to July 31, 2004. As a condition to the effectiveness of such reduction of
the Premises, Subtenant, at its sole cost and expense, shall (i)remove any
improvements and alterations to the Reduction Space made by or on behalf of
Subtenant, and (ii) comply with all of the terms and conditions of the Sublease
applicable upon the expiration of the Sublease Term or the termination of the
Sublease, including, without limitation, those relating to the surrender of the
Reduction Space, the removal of Subtenant's property from the Reduction Space
and the completion of any repairs to, and restoration of, the Reduction Space.
Upon Subtenant's satisfying the foregoing conditions to Sublandlord's reasonable
satisfaction, the square footage of the Premises shall be reduced by the number
of square feet in the Reduction Space, Sublandlord shall recompute the Base Rent
and Subtenant's Proportionate Share based on the remaining number of square feet
in the Premises, and the Parties shall execute an amendment to the Sublease that
sets forth the new square footage of the Premises and re-computed Base Rent and
Subtenant's Proportionate Share.
20. SIGNERS' WARRANTY. Each individual executing or delivering this
Amendment on behalf of a Party hereby represents and warrants to the other Party
that he or she has been duly authorized and empowered to do so.
* * *
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first set forth above.
"SUBLANDLORD" "SUBTENANT"
SMITHS AEROSPACE, INC., AMERICAN TECHNOLOGY CORPORATION,
a Delaware corporation a Delaware corporation
By: By: /s/ XXXXXX XXXXX
------------------------------- -------------------------------
Name: Name:
Title: Title: COO
By:
-------------------------------
Name:
Title:
