FRENCH VALLEY AVIATION, INC.
HANGAR SUBLEASE
This Sublease is entered into on (May 01, 2007) by and between French Valley
Aviation Inc., referred to in this Sublease as "Sublessor", and San Diego
Airmotive Inc. referred to in this Sublease as "Sub lessee"
RECITALS
1. Sublessor is the tenant under a Lease effective May 1, 1993 ("The lease"
or "Master Lease") by and between French Valley Aviation ("Lessee") and the
County of Riverside ("County") as Lessor covering an approximate 3.0-acre
portion of the French Valley Airport.
2. Sublessor intends to sublease to Sub lessee a portion of the premises
covered by the Master Lease and has obtained or will obtain permission from the
County to sublease to Sub lessee. The space applicable to such portion is
defined as "such space necessary for storage and maintenance operations, ("the
Premises"). Sub lessee intends to sublease such portion from Sublessor.
ARTICLE I. SUBLEASED PREMISES
Agreement to Sublease
Section 1.01 This Sublease agreement is subject and subordinate to all of the
provisions of the Master Lease. If any terms, conditions, statements or
agreements contained in this sublease agreement are incompatible or do not agree
with the terms of the Master Lease, the Master Lease shall govern. This sublease
is subject to final approval by the County. In consideration of the agreements
and covenants contained in this Sublease to be kept and performed by both
parties, Sublessor hereby subleases to Sub lessee and Sub lessee hereby
subleases from Sublessor the Premises described in section 1.02 of this
Sublease.
"Premises" Defined
Section 1.02 "Hangar Premises" means the hangar space that is designated as "an
undivided 13,000 square feet of hangar space and 800 square feet of furnished
office space within the hangar located at the French Valley Airport, 00000
Xxxxxxxxxx Xxxx, Xxxxxxxx 0, Xxxxxxxx, Xxxxxxxxxx 00000. The parties agree that
the amount of "rental floor area" shall be used to calculate the base rent of
the hangar premises.
Right to Use Common Areas
Section 1.03 Sub lessee has the non-exclusive right to use, in common with
others, the Common Areas of the Project.
ARTICLE II. SUB LESSEE'S USE
Permitted Use
Section 2.01 Sub lessee is permitted to use the hanger premises for aviation
related purposes and for activities attendant to its commercial operation as may
be approved by Sublessor and by the county, and in accordance with the
provisions of the Master Lease and this Sublease, and not in conflict with the
Sublease.
Restrictions on Use
Section 2.02 Notwithstanding the generality of the foregoing uses and
provisions, the following requirements and restrictions shall be applicable to
Sub lessee's use of the Premises:
(a) Only the use specified in Section 2.01 is authorized. Sub lessee is
expressly prohibited from using the Premises or any such portion thereof for any
other purpose.
(b) Sub lessee shall not commit or permit the commission of any acts on the
Premises nor use or permit any use of the Premises in any way that:
(i) Increases the existing rates for or causes cancellation of any fire,
casualty, liability, or other insurance policy insuring the Premises or its
contents;
(ii) Violates or conflicts with any law, statute, ordinance or governmental
rule or regulation, whether now in force or hereinafter enacted, governing the
Premises or the Project;
(iii) Obstructs or interferes with the rights of other tenants or occupants
of the Project or injures or annoys them; or
(iv) Constitutes commission of waste on the Premises or the commission or
maintenance of a nuisance as defined by the laws of California.
(c) Sublesse shall maintain insurance coverages as required by the
Sublessor's Master Lease with the County of Riverside that is applicable to the
intended uses.
Cooperation with County of Riverside
Section 2.03 Sub lessee shall cooperate fully with the County of Riverside in
the enforcement of the provisions of the Master Sublease and any ordinances,
rules and regulations promulgated there under.
No Restriction on Sublessor
Section 2.04 Sublessor shall have the absolute right in its sole and arbitrary
discretion to use for its own benefit or to sublease any other hangar to any
person for any purpose or use.
ARTICLE III. TERM OF SUBLEASE
Term of Sublease
Section 3.01 The term of this Sublease shall be for a period of One (1) year,
unless terminated earlier pursuant to the terms of this Sublease. The terms
shall commence on the date set forth above.
Sublease Extensions
Section 3.02 This Sublease may be extended from year to year upon notice by Sub
lessee to Sublessor not less than 30 days prior to the end of any sublease term,
subject to rent increases as set forth herein below. Should Sublessor elect not
to accept extension of the term of this Sublease, it shall notify Sub lessee of
such rejection within 15 days of notice of Sub lessee's intent to extend.
Holding Over
Section 3.03 If Sub lessee holds over and continues in possession of the
Premises after termination of the term of this Sublease, including any extended
term, Sub lessee's continued occupancy of the Premises shall be deemed merely a
tenancy from month to month at a minimum rental of 150% of the last month rental
rate in the Sublease term subject to all the terms and conditions, including the
provisions for additional rent, but excluding the option to extend the term.
ARTICLE IV. RENTS AND OTHER CHARGES
Base Rent
Section 4.01 Sub lessee agrees to pay to Sublessor the sum of $9720.00 per
month, payable on the first (1st) day of each and every month commencing on May
1, 2007 or the date of notice of occupancy from the Sublessor and continuing
through the term Sublease. In addition to this amount the sub lessee will also
pay the actual billing for electrical service and the actual Possessory interest
taxes when submitted with the xxxx.
Adjustment of Fixed Rent
Section 4.02 Commencing with the First anniversary of the Commencement Date of
this Sublease as set forth in Section 3.01, the original fixed rent as described
in Section 4.01 above, shall be increased by the greater of 4% from the amount
paid in the previous annual period or by the increased percentage of the
Consumer Price Index All Items - Los
Angeles - Anaheim - Riverside - All Urban Consumers Index as published by the
United States Department of Labor, Bureau of Labor Statistics, increases over
the Base Period Index. The Base Period Index shall be the month ninety (90) days
prior to the commencement month and shall be that same calendar month for each
subsequent year (comparison month). If the Index or any comparison month is
higher that the Base Period Index, then the basic rent for the next year shall
be increased by an amount equal to the identical percentage commencing on the
anniversary date of the next year of the sublease; that increase rental amount
will become the basic rent for purposes of this Sublease, until further adjusted
upward. In no event shall the basic rent be less than that described in
Paragraph 2 above. (By way of illustration only, if Sub lessee commenced paying
rent in November 1998, then the Base Period index is that for September 1998
(assume 176.31 and that Index shall be compared to the Index for
April 1999 (assume 185.81 and because the Index for September 1999 is 539%
higher, the minimum monthly rent commencing November 1999, shall be 5.39% higher
likewise, the Index for April 2000, shall be compared with the index for
September 1999).
Should the Bureau discontinue the publication of the above Index, or publish the
same less frequently, or alter same in some other manner, then Sublessor shall
adopt a substituted Index or substitute procedure which reasonably reflects and
monitors consumer prices.
Payments
Security Deposit
Section 4.06
(a) Sub lessee shall deposit with Sublessor the sum of Waived, as security for
the full and faithful performance by Sub lessee of the terms, conditions, and
covenants of this Sublease.
(b) If, at anytime during the term of this Sublease, Sub lessee defaults in the
payment of rent, or any portion of the rent, under this Sublease, Sublessor may
appropriate any apply any portion of the Security Deposit reasonably necessary
to remedy any such default in the payment of rent.
(c) If, at anytime during the term of this Sublease, Sub lessee of Sub lessee's
agents of employees damage the Premises through want of ordinary care or any
greater degree of culpability, the Sublessor may appropriate and apply any
portion of the Security Deposit reasonably necessary to put the hangar in clean
condition.
(d) If, on termination of this tenancy, Sub lessee fails to leave the hangar in
a clean condition, then the Sublessor may appropriate and apply any portion at
the Security Deposit reasonably necessary to put the hangar in clean condition.
(e) Sublessor shall return to Sub lessee the portion of the Security Deposit
remaining after any deductions authorized by this Article or otherwise
authorized by law, if any, in the following manner. If the deduction has been
made only for the non-payment of rent, the remaining portion, if any, shall be
returned not later than two weeks after the date Sublessor receives possession
of the Premises. If a deduction has been made for any other reason authorized by
this Article or otherwise authorized by law, the remaining portion, if any,
shall be returned not later than thirty (30) days from the date Sublessor
receives possession of the Premises. Sub lessee shall not be entitled to any
interest on any portion of the Security Deposit.
(f) If, during the term of this Sublease, Sublessor applies all or any portion
of the Security Deposit for a purpose authorized by this Section or otherwise
authorized by law, Sub lessee agrees to restore the amount of the Security so
supplied by Sublessor with the next due payment of rent under this Sublease.
Late Charge
Section 4.07 The parties acknowledge that late payment by Sub lessee to
Sublessor of the rent due hereunder will cause Sublessor to incur costs not
contemplated by this Sublease, the exact amount of such costs being extremely
difficult and impracticable to fix. Such costs may include, but are not limited
to, processing and accounting charges and late charges that may be imposed upon
Sublessor by the terms of any encumbrance and note secured by any encumbrance
covering the Hangar. Therefore, if any installment of monthly rent due hereunder
is not received from Sub lessee by Sublessor within Five (5) days after the date
upon which it became due, Sub lessee shall pay to Sublessor an additional charge
in an amount equal to ten percent (10%) of the rent then due, which sum shall be
immediately due and payable without demand. Additionally, if any monthly payment
of rent is paid by Lessee in the form of a personal check, bank check, or
otherwise, and such check is returned for insufficient funds or any reason
whatsoever, Sub lessee shall immediately pay to Sublessor the monthly rent and
any applicable late charges then due, together with the additional sum of
seventy-five dollars ($75.00), and such payment, to include all monthly and any
other payments called for by the herein Sublease, shall thereafter be paid by
Sub lessee to Sublessor by way of cashier's check and/or money order. The
parties hereto agree that the late charges above stated represents a fair and
reasonable estimate of the costs that Sublessor will incur by reason of such
untimely payment by Sub lessee. Acceptance of any such charge shall not
constitute a waiver of Sub lessee's default with respect to the monthly rent
then due, nor will such acceptance prevent Sublessor from exercising any of the
rights and remedies available to Sublessor. Further, the existence of the herein
provisions in this Sublease shall not extend the time within which Sub lessee is
required to make monthly payments of rent hereunder, and the time to pay monthly
rent hereunder when due shall be a default under the terms of this Sublease,
effective the date that the monthly payment originally became due and without
extension.
ARTICLE V. RULES AND REGULATIONS
Rules and Regulations
Section 5.01 Sublessor shall have the right to establish, modify, amend, and
enforce reasonable rules and regulations with respect to the common areas. Sub
lessee shall fully and faithfully comply with and observe the rules and
regulations for the common area. Sublessor shall not be liable in any way for
failure of any other occupant of a hangar to comply with and observe these rules
and regulations.
Section 5.02 Sub lessee shall provide keys to Sublessor to all aircraft stored
within the Hangar.
Section 5.03 Sub lessee shall provide telephone numbers, including emergency and
after hours numbers to Sub lessee.
ARTICLE VI. INSURANCE
Insurance by Sublessor
Section 6.04 Sublessor shall procure and maintain during the entire term of this
Sublease, all insurance required of it under the Master Lease. In addition to
the foregoing insurance, Sublessor, in its sole discretion, may procure and
maintain other insurance covering the Hangar, including liability insurance for
personal injury, death and property damage.
Sub Lessor's Liability Insurance
Section 6.02 For the mutual benefit of Sublessor and the County of Riverside,
Special Districts, Directors, Officers, Board of Supervisors, Elected Officials,
Employees, Agents, Operators and Sub lessee, Sub lessee shall procure and
maintain or cause to be maintained at its sole cost and expense the following
insurance coverage's during the term sublease or any extensions thereof.
(a) Workers Compensation. If Sub lessee has employees, Workers'
Compensation Insurance (Coverage A) as prescribed by the laws of the State of
California.
(b)Aircraft Hull and Liability Insurance: Aircraft Hull for the full
replacement value of all aircraft stored by the Lessee in the leased Premises
and the contents thereof. The policy will be endorsed to include Sublessor, the
County of Riverside, Special Districts, Directors, Officers, Elected Officials,
Employees, Agents and Representatives as Additional Insured. Sub lessee may
elect to self-insure or un-insure the hull portion of the coverage required
herein; however, if Sub lessee elects not to acquire commercial insurance for
the hull, Sub lessee agrees to hold Sublessor and the County of Riverside
harmless and not make any claim against the Sublessor or County of Riverside for
loss or damage to the hull of his aircraft for any reason whatsoever regardless
of any negligence of the Sublessor or County that may have contributed to said
loss or damage.
(c) Aircraft liability coverage and commercial general liability insurance
including, but not limited to, premises liability and contractual liability with
a limit of liability for bodily injury (including death) aid property damage or
at least $1,00,000 with a per seat limit of not less than $100,000. Coverage
will apply to all owned aircraft and all non-owned or hired aircraft operated by
the Sub lessee. Policy will be endorsed to include the Sublessor and the County
of Riverside, Special Districts, Directors, Officers, Elected Officials,
Employees, Agents and Representatives as Additional Insured.
(d) All risk property insurance covering Sub lessee's personal property
located on, in or about the premises in an amount equal to the full replacement
value of such contents. The risk of loss and/or damage to the Sub lessee's
contents shall at all time be solely the Sub lessee's and in no event shall the
Sublessor or County be responsible for Sub lessee's property.
(e) Public liability insurance in the sum of at least $1,000,000 for injury
to or death, in any accident, insuring the Sub lessee against liability for
injury and/or death occurring in or on the Premises or the common areas.
Sublessor and the County of Riverside, Special Districts, Directors, Officers,
Elected Officials, Employees, Agents and Representative shall be named as
additional insured and the policy shall contain cross-liability endorsement. The
Sub lessee shall maintain all such insurance in full force and effect during the
entire term of this Sublease and shall pay all premiums for the insurance.
Evidence of insurance and of the payment of premiums shall be delivered to
Sublessor and County.
(f) Sub lessee shall provide current certificates of insurance to both the
County and Sublessor showing compliance with the insurance requirements set
forth in sub-sections (a) through (e) above.
Sub lessee shall hold Sublessor harmless from and defend Sublessor against any
and all claims for liability for any injury or damage to ay person or property
whatsoever (a) occurring in, on or about the Hangar or any part of it, and (b)
occurring in, on or about any common areas of the Hangar Project when that
injury or damage was caused in part or in whole by the act, neglect, fault of,
or omission of any duty by Sub lessee, its agents, servants, employees or
invitees.
Destruction of Premises
Section 6.03 If the Premises or the Hangar Project of which it is a part is
damaged or destroyed by any cause not the fault of Sub lessee, Sublessor shall,
at Sublessor's sole cost and expense, promptly repair it and the rent payable
under this Sublease shall be abated for the time and to the extent sub lessee is
prevented from occupying the Premises in its entirety. Notwithstanding the
foregoing, if the Premises or the Hangar Project is damaged or destroyed and the
repair of the damage or destruction cannot be completed within one hundred
twenty (120) days, Sublessor may, in lieu of making he repairs required by this
Section, terminate this Sublease by giving Sub lessee thirty (30) days written
notice of termination. A notice of termination must be given by Sublessor not
later than thirty (30) days after the event causing the destruction or damage.
ARTICLE VIII. DEFAULT AND TERMINATION
Acts Constituting Breach by Sub lessee
Section 8.01 The following shall constitute a default under and a breach of this
Sublease by Sub lessee:
(a) The nonpayment of rent when due, when the nonpayment continues for ten
(10) days after written notice to pay rent or surrender possession of the
Subleased premises have been given by Sublessor to Sub lessee.
(b) A failure to perform any provision, covenant, or condition of this
Sublease other than one for the payment of rent, when the failure is not cured
within ten (10) days after written notice of the specific failure is given by
Sublessor to Sub lessee.
(c) The breach of this Sublease and abandonment of the Premises before the
expiration of the term of this Sublease.
(d) A receiver is appointed to take possession of all or substantially all
of Sub lessee's property located at the Premises or Sub lessee's interest in
this Sublease, when possession is not restored to Sub lessee within thirty (30)
days.
(e) Sub lessee makes a general assignment for the benefit of creditors.
(f) The execution, attachment or other judicial seizure of substantial or
all of Sub lessee's assets located at the Premises or of Sub lessee's interest
in this Sublease, when the seizure is not discharged within fifteen (15) days;
or
(g) The filing by or against Sub lessee of a petition to have Sub lessee
adjudged a bankrupt or for a petition of reorganization or arrangement under the
Federal Bankruptcy Law (unless, in the case of a petition filed against Sub
lessee, it is not dismissed within sixty (60) days).
Sublessor's Remedies
Section 8.02 If Sub lessee breaches or is in default under this Sublease,
Sublessor, in addition to any other remedies given Sublessor by law or equity,
may:
(a) Continue this Sublease in effect by not terminating Sub lessee's right
to possession of the Hangar and thereby be entitled to enforce all of
Sublessor's rights and remedies under this Sublease including the right to
recover the rent specified in this Sublease as it becomes due under this
Sublease; or
(b) Terminate this Sublease and all rights of Sub lessee under the Sublease
and recover from Sub lessee:
(i) The worth at the time of award of the unpaid rent that had been
earned at the time of termination of the Sublease;
(ii) The worth at the time of award of the amount by which the unpaid
rent that would have been earned after termination of the Sublease until the
time of award exceeds the amount of rental loss that Sub lessee proves could
have been reasonably avoided;
(iii) The worth at the time of the award of amount by the unpaid rent
for the balance of the term after the time exceeds the amount of rental loss
that Sub lessee proves could be reasonably avoided;
(iv) Any other amounts necessary to compensate Sublessor for all
detriment proximately caused by Sub lessee's failure to perform Sub lessee's
obligations under this Sublease; or
(v) In lieu of or in addition to, bringing action for any or all of
the recoveries described in paragraph (b) of this paragraph, bring an action to
recover and gain possession of the Premises in the manner provided by the
California Law of Unlawful Detainer than in effect.
Termination Notice
Section 8.03 No act of Sublessor, including but not limited to Sublessor's entry
of the Premises or effects to relet the Premises, or the giving of Sublessor to
Sub lessee of a notice of default, shall be construed as an election to
terminate this Sublease unless a written notice of Sublessor's election to
terminate this Sublease is given to Sub lessee.
Waiver of Breach
Section 8.04 The waiver of Sublessor of any breach by Sub lessee of any of the
provisions of this Sublease shall not constitute a continuing waiver or a waiver
of any subsequent default or breach by Sub lessee either of the same or of a
different provision of this Sublease.
ARTICLE IX. MISCELLANEOUS PROVISIONS
Notices
Section 9.01 Except as otherwise expressly provided by law, any and all notices
or other communications required are permitted by this Sublease or by law to be
served on or given to either party to this Sublease by the other party shall be
in writing, and shall be deemed duly served and given when personally delivered
to the party to whom it is directed or any managing employee of that party or,
in lieu of personal service, when deposited in the United States mail, first
class postage prepaid, addressed to Sublessor at: 00000 Xxxxxxxxxx Xxxx,
Xxxxxxxx 0, Xxxxxxxx, XX 00000, or to Sub lessee at the address set forth below
his signature at the end of this Sublease. Either party may change its address
for purposes of this paragraph by giving written notice of the change to the
other party in the manner provided in this paragraph.
Inspection by Sublessor
Section 9.02 Sub lessee shall permit Sublessor or Sublessor's agents,
representatives or employees to enter the Hangar at all reasonable times for the
purpose of inspecting the Hangar to determine whether Sub lessee is complying
with the terms of this Sublease and for the purposes of doing other lawful acts
that may be necessary to protect Sublessor's interest in the Hangar under this
Sublease.
Assignment of Sublease
Section 9.03 Sub lessee may sublet all or any portion of the Subleased Premises
or assign all or any part of Sub lessee's interest in this Sublease, provided
that Sub lease first obtains the written consent of Sublessor to do so.
Sublessor shall not unreasonably withhold consent to such an assignment or
subletting. Sublessor's consent to one assignment or subletting shall not be
deemed a consent to any subsequent assignment or subletting. Any assignment or
subletting without the prior written consent of Sublessor and the County of
Riverside shall be void and shall, at the option of Sublessor, terminate this
Sublease.
Binding on Heirs and Successors
Section 9.04 This Sublease shall be binding on and shall inure to the benefit of
the heirs, executors, administrators, successors, and assigns of the parties,
but nothing in this paragraph shall be construed as a consent by Sublessor to
any assignment of this Sublease or any interest therein by Sub lessee.
Time of the Essence
Section 9.05 Time is expressly declared to be of the essence in this Sublease.
Sole and Only Agreement
Section 9.06 This instrument constitutes the sole and only agreement between
Sublessor and Sub lessee respecting the Hangar or the leasing of the Hangar to
Sub lessee, and correctly sets forth the obligations of Sublessor and Sub lessee
to each other as of its date. Any agreements or representations respecting the
Hangar or its leasing by Sublessor to Sub lessee not expressly set forth in this
Sublease are null and void.
Attorneys Fees
Section 9.07 Any litigation that is commenced between the parties to this
Sublease concerning the Hangar, this Sublease, or the rights and duties of
either in relation to the Hangar or the Sublease, the prevailing party in that
litigation shall be entitled, in addition to any other relief granted, to a
reasonable sum as and for its attorneys fees in the litigation, which shall be
determined by the court in that litigation or in a separate action brought for
that purpose.
Executed on August 1, 2007 at Murrieta, California.
SUBLESSOR: French Valley Aviation, Inc.
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
SUBLESSEE: San Diego Airmotive Inc.
By:
