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Exhibit 10.1
STANDARD SUBLEASE
American Industrial Real Estate Association
1. PARTIES. This Sublease, dated, for reference purposes only, September 14,
2000, is made by and between Xxx Pharmaceuticals, Inc., a California
Corporation (herein called "Sublessor"), and Maxsilk Inc., a California
Corporation (herein called "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 situated in the
County of Los Angeles, State of California, commonly known as 0000 Xxxxx
Xxxxx Xxxxxx, Xxxxx Xx Xxxxx, XX 00000 and described as an approximately
14,560 square foot free-standing concrete block building on approximately .70
acres of land.
Said real property, including the land and all improvements thereon, is
hereinafter called the "Premises".
3. TERM
3.1 TERM. The term of this Sublease shall be for Twenty-four (24) months
commencing on December 1, 2000 and ending on November 30, 2002 unless sooner
terminated pursuant to any provision hereof. Please refer to Paragraph 12a --
Right to Extend.
3.2 DELAY IN COMMENCEMENT. Notwithstanding said commencement date, if
for any reason Sublessor cannot deliver possession of the Premises to
Sublessee on said date, Sublessor shall not be subject to any liability
therefore, nor shall such failure affect the validity of this Lease or the
obligations of Sublessee hereunder or extend the term hereof, but in such
case Sublessee shall not be obligated to pay rent until possession of the
Premises is tendered to Sublessee; provided, however, that if Sublessor shall
not have delivered possession of the Premises within sixty (60) days from
said commencement date. Sublessee may, at Sublessee's option, by notice in
writing to Sublessor within ten (10) days thereafter, cancel this Sublease,
in which event the parties shall be discharged from all obligations
thereunder. If Sublessee occupies the Premises prior to said commencement
date, such occupancy shall be subject to all provisions hereof, such
occupancy shall not advance the termination date and Sublessee shall pay rent
for such period at the initial monthly rates set forth below.
4. RENT. Sublessee shall pay to Sublessor as rent for the Premises equal
monthly payments of $7,280.00, in advance, on the 1st day of each month of
the term hereof. Sublessee shall pay Sublessor upon the execution hereof
$7,280.00 as rent for December 1, 2000 -- December 31, 2000. Please refer to
Paragraph 12b -- Rental Increase. Rent for any period during the term hereof
which is for less than one month shall be a prorata portion of the monthly
installment. 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.
5. SECURITY DEPOSIT. Sublessee shall deposit with Sublessor upon execution
hereof $7,280.00 as security for Sublessee's faithful performance of
Sublessee's obligations hereunder. If Sublessee fails to pay rent or other
charges due hereunder, or otherwise defaults with respect to any provision of
this Sublease, Sublessor may use, apply or retain all or any portion of said
deposit for the payment of any rent or other charge in default or for the
payment of any other sum to which Sublessor may become obligated by reason of
Sublessee's default, or to compensate Sublessor for any loss or damage which
Sublessor may suffer thereby. If Sublessor so uses or applies all or any
portion of said deposit, Sublessee shall within ten (10) days after written
demand therefore deposit cash with Sublessor in an amount sufficient to
restore said deposit to the full amount hereinabove stated and Sublessee's
failure to do so shall be a material breach of this Sublease. Sublessor shall
not be required to keep said deposit separate from its general accounts. If
Sublessee performs all of Sublessee's obligations hereunder, said deposit, or
so much thereof as has not theretofore been applied by Sublessor, shall be
returned, without payment of interest or other increment for its use to
Sublessee (or at Sublessor's option, to the last assignee, if any, of
Sublessee's interest hereunder) at the expiration of the term hereof, and
after Sublessee has vacated the Premises. No trust relationship is created
herein between Sublessor and Sublessee with respect to said Security Deposit.
Please refer to Paragraph 12c -- Treatment of Prior Security Deposit.
6. USE.
6.1 Use. The Premises shall be used and occupied only for Warehousing
and distribution of silk flowers, office uses, and all legal uses related
thereto.
6.2 COMPLIANCE WITH LAW.
(a) Sublessee agrees that it accepts the Premises in its "as is"
condition without any representation by Sublessor or Master Lessor regarding
its condition.
(b) Except as provided in paragraph 6.2(a), Sublessee shall, at
Sublessee's expense, comply promptly with all applicable statutes,
ordinances, rules, regulations, orders, restrictions of record, and
requirements in effect during the term or any part of the term hereof
regulating the use by Sublessee of the Premises. Sublessee shall not use or
permit the use of the Premises in any manner that will tend to create waste
or a nuisance or, if there shall be more than one tenant of the building
containing the Premises, which shall tend to disturb such other tenants.
6.3 CONDITION OF PREMISES. Except as provided in paragraph 6.2(a)
Sublessee hereby accepts the Premises in their condition existing as of the
date of the execution hereof, subject to all applicable zoning, municipal,
county and state laws, ordinances, and regulations governing and regulating
the use of the Premises, and accepts this Sublease subject thereto and to all
matters disclosed thereby and by any exhibits attached hereto. Sublessee
acknowledges that neither Sublessor nor Sublessor's agents have made any
representation or warranty as to the suitability of the Premises for the
conduct of Sublessee's business.
7. MASTER LEASE
7.1 Sublessor is the lessee of the Premises by virtue of a lease,
hereinafter referred to as the "Master Lease", a copy of which is attached
hereto marked Exhibit 1, dated April 16, 1990 wherein Art Xxxxx, Inc., a
California Corporation, is the lessor, hereinafter referred to as the "Master
Lessor". This Master Lease has been modified by "Final Settlement Agreement
for Various Leases All Dated April 16, 1990," dated May 25, 2000.
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: Base Tax Year is 2000-2001.
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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 of and 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 of and 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 and all rentals and income arising
therefrom, subject however to terms 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 rents
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 rents 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 rents 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
rents 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 rents 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 10 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 this Sublease, nor the
Master Lessor's consent, shall not be effective unless, within 10 days of the
date hereof, said guarantors sign this Sublease thereby giving guarantors
consent to this Sublease and the terms thereof.
9.3 In the event that Master Lessor does give such consent then:
(a) Such consent will 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 any
one 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 any one 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 nor any one 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 rents 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 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 N/A a
licensed real estate broker, (herein called "Broker"), a fee as set forth in
a separate agreement between Sublessor and Broker, or in the event there is
no separate agreement between Sublessor and Broker, the sum of $ ____________
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 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, or if Broker is the procuring cause of any lease, sublease, or sale
pertaining to the Premises or any adjacent property which Sublessor may own
or in which Sublessor has an interest, then as to any of said transactions
Sublessor 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.
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, by its consent to this Sublease, 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 the Master Lease, to
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 its consent to 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, as to any
extension or renewal; upon the execution of any new lease transaction or the
exercise of a right of first refusal to lease; or at the close of escrow, as
to the exercise of any option to purchase or other sale transaction.
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. The provision of this paragraph shall inure to the benefit of the
Broker named herein who seeks to enforce a right hereunder.
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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.]
a. RIGHT TO EXTEND: Sublessee shall have the right to extend this
Sublease for a period of one (1) year following written notice to
Sublessor on or before September 1, 2002. During this extended
period, Sublessee may terminate the Sublease upon providing
Sublessor with a ninety (90) day advance written notice of intent to
vacate the Premises.
b. RENTAL INCREASES: Should Sublessee exercise its Right to Extend, the
rental rate in Section 4 for that period shall be $7,717.00 per
month beginning December 1, 2002 and continuing for the remainder of
Sublessee's occupancy.
c. TREATMENT OF PRIOR SECURITY DEPOSIT:
Sublessee has deposited with Sublessor a security deposit in
connection with its subleasing of the space located at 0000 Xxxxx
Xxxxx Xxxxxx. Such security deposit will be returned to Sublessee
after Sublessee vacates said space in accordance with the provisions
of the sublease pertaining to 0000 Xxxxx Xxxxx Xxxxxx.
d. PERSONAL GUARANTEE: The performance of the terms and conditions by
Maxsilk, Inc. ("Sublessee") under this Sublease shall be personally
guaranteed by Xxxxx Xx.
e. SUBLEASE GOVERNS: In the event of any conflict between the printed
provisions of the Master Lease and this Sublease, this Sublease shall
govern, as it pertains to this Sublease.
IF THIS SUBLEASE HAS BEEN FILLED IN IT HAS BEEN PREPARED FOR
SUBMISSION TO YOUR ATTORNEY FOR HIS APPROVAL. NO REPRESENTATION OR
RECOMMENDATION IS MADE BY THE REAL ESTATE BROKER OR ITS AGENTS OR
EMPLOYEES AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX
CONSEQUENCES OF THIS SUBLEASE OR THE TRANSACTION RELATING THERETO.
Executed at Xxx Pharmaceuticals, Inc.
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on By Xxx Xxx
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address 0000 Xxxxx Xxxxx Xxxxxx By Xxx Xxx, President
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Xxxxx Xx Xxxxx, XX 00000
---------------------------------- "Sublessor" (Corporate Seal)
Executed at Maxsilk, Inc.
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on By
-------------------------------- -------------------------------
address 0000 Xxxxx Xxxxx Xxxxxx By Xxxxx Xx, President
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Xxxxx Xx Xxxxx, XX 00000
---------------------------------- "Sublessee" (Corporate Seal)
Executed at Art Xxxxx, Inc.
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on By
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address 00000 X. Xxxx Xxxxxx By Art Xxxxx, President
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Xxxxx Xx Xxxxx, XX 00000
---------------------------------- "Master Lessor" (Corporate Seal)
Executed at Xxxxx Xx
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on
-------------------------------- -------------------------------
address 0000 Xxxxx Xxxxx Xxxxxx Xxxxx Xx
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Xxxxx Xx Xxxxx, XX 00000
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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. Xxxxxxxx Xx., X-0, Xxx Xxxxxxx, XX
00000. (000) 000-0000.
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ADDENDUM
This ADDENDUM ("addendum") is made to the Standard Sublease dated as
of September 14, 2000 (collectively, the "Sublease"), by and between XXX
PHARMACEUTICALS, INC., a California corporation ("Sublessor"), and MAXSILK
INC., a California corporation ("Sublessee").
Sublessor and Sublessee hereby agree that notwithstanding anything
contained in the Sublease to the contrary, the provisions set forth below
will be deemed to be a part of the Sublease and shall supersede, to the
extent appropriate, any contrary provision in the Sublease. All references in
the Sublease and in this Addendum shall be construed to mean the Sublease, as
amended and supplemented by this Addendum. All defined terms used in this
Addendum, unless specifically defined in this Addendum, shall have the same
meaning as such terms have in the Sublease.
1. EXTERIOR OF BUILDING. Notwithstanding anything in the Master Lease
or the Sublease to the contrary, Sublessee shall have no right to change the
color of the exterior of the Building without the consent of the Master
Lessor. To the extent Master Lessor consents to such color change, Sublessee
shall be responsible, at its sole cost and expense, for restoring the
exterior of the Building to the original color at the expiration or earlier
termination of the Sublease.
