EXHIBIT 10.3
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, December
18, 2000, is made by and between The L.L. Xxxxxxxxxxxxx Company, Inc.
("Sublessor") and Liquidmetal Technologies, 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 00000
Xxxxxxxxxxxx Xxxxx, Xxxx Xxxxxx located in the County of Orange, State of
California and generally described as (describe briefly the nature of the
property) an approximately 25,379 square foot portion of a larger approximately
50,518 square foot office/warehouse building, outlined in Exhibit "A" attached.
3. TERM.
3.1. TERM. The term of this Sublease shall be for Seventy-six
(76) months and twenty five (25) days commencing on February 1, 2001 and ending
on June 25, 2007 unless sooner terminated pursuant to any provision hereof.
3.2. DELAY IN COMMENCEMENT. Sublessor agrees to use its
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 $15,989.00 plus 50.27% of the monthly
triple net/CAM charges for 25800 Commercentre in advance, on the 1st day of each
month of the term hereof. Sublessee shall pay Sublessor upon the "TENDER OF
POSSESSION" (as defined in the Addendum)
$15,936.00 as Base Rent for the first month of the term, subject to the
provisions of Paragraph 13 of the Addendum. Base Rent for any period during the
term hereof which is for less than one month shall be a pro rata portion of the
monthly installment.
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.
5. SECURITY DEPOSIT. Sublessee shall deposit with Sublessor upon Tender
of Possession $17,258.00 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
f said deposit, Sublessee shall within ten days after written demand therefor
forward to Sublessor an amount sufficient to restore said Deposit to the full
amount provided for herein 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 therefore
been applied by Sublessor, shall be returned, without payment of interest 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.
6. USE.
6.1. AGREED USE. The Premises shall be used and occupied only
for sales and distribution of golf equipment, research and development, assembly
and light manufacturing, office and related comparable uses and for no other
purpose.
6.2. COMPLIANCE. To Sublessor's actual knowledge the
improvements on the Premises comply as of the date hereof with all applicable
covenants or restrictions of record and applicable building codes, regulations
and ordinances ("APPLICABLE REQUIREMENTS" as of the date hereof) in effect on
the commencement date. 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.
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,
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(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.
(d) In addition, Sublessor acknowledges that:
(i) Broker has made no representations,
promises or warranties concerning Sublessee's ability
to honor the Sublease or suitability to occupy the
Premises, and
(ii) 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 Security Capital Industrial Trust 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 with respect to the Premises except for the
following paragraphs which are excluded therefrom and/or the following
paragraphs shall not apply to or benefit Sublessee: 40, 41, Addendum One,
Addendum Two, Exhibit 1, and Addendum Three.
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 including the obligations with respect to Sublessor's retrained space are
hereinafter referred to as the "SUBLESSOR'S REMAINING OBLIGATIONS".
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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, Sublessee's obligations under this Sublease, or
Sublessee's activities on the Premises.
7.7. Sublessor represents to Sublessee that, to Sublessor's
actual knowledge, the Master Lease is in full force and effect and that no
default exists on the part of Sublessor or Master Lessor.
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 the 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 obligation xxxxxx 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:
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(a) Such consent shall not release Sublessor of its
obligations or after 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 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.
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10. BROKERS FEE.
10.1. Upon execution hereof by all parties, Sublessor shall
pay to Xxxx Commercial Brokerage, 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 $_____________, per
separate agreement, 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, either to extend the
term of this Sublease, to renew this Sublease, or to purchase the Premises, 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. Any fee due from Sublessor 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.
10.4. 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.] The Addendum to this
Sublease, Exhibit 1 (Master Lease), Exhibit 2 (Schedule of Furniture), and
Exhibit 3 (Location of Demising Wall), are hereby incorporated into this
Sublease by this reference.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
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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: The L.L. Xxxxxxxxxxxxx Company, Inc.
-------------------------
On: By:
---------------------------------- -----------------------------------
Address: By:
----------------------------- -----------------------------------
"Sublessor" (Corporate Seal)
Executed at: Liquidmetal Technologies, Inc.,
------------------------- a California Corporation
On: By:
---------------------------------- -----------------------------------
Address: By:
----------------------------- -----------------------------------
"Sublessor" (Corporate Seal)
Executed at: Security Capital Industrial
------------------------- Trust/Prologis
On: By:
---------------------------------- -----------------------------------
Address: By:
----------------------------- -----------------------------------
"Master Lessor" (Corporate Seal)
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ADDENDUM TO
STANDARD SUBLEASE
DATED DECEMBER 18, 2000
THIS ADDENDUM TO STANDARD SUBLEASE is made by and between THE L.L.
XXXXXXXXXXXXX COMPANY, INC. ("SUBLESSOR") AND LIQUIDMETAL TECHNOLOGIES, INC., A
CALIFORNIA CORPORATION ("SUBLESSEE") as of the date set forth on the first page
of that certain American Industrial Real Estate Association Standard Sublease
(long-form to be used with pre-1998 AIR leases) (the "SUBLEASE") between
Sublessor and Sublessee to which this Addendum is attached and incorporated. The
terms, covenants and conditions set forth herein are intended to and shall have
the same force and effect as if set forth at length in the body of the Sublease.
To the extent that the provisions of this Addendum are inconsistent with any
provisions of the Sublease, the provisions of this Addendum shall supersede and
control.
13.
13.1 DEPOSITS; LETTER OF CREDIT:
(a) Upon mutual execution and delivery of this Sublease by the
parties hereto, Sublessee shall deposit with Xxxx Commercial
Brokerage ("XXXX") the sum of $50,000 (the "DEPOSIT") in
immediately available funds. The Deposit consists of the
following:
Security Deposit $17,258.00
Base Rent (February) $15,989.00
TI deposit $15,989.00
----------
TOTAL $50,000.00
(b) Xxxx shall deposit the Deposit in an interest-bearing
account and shall hold the Deposit in trust for the benefit of
Sublessee. If there is no Tender of Possession on or prior to
February 15, 2000, then Xxxx shall, upon Sublessee's demand
and upon Sublessee's vacation of the Premises, return the
Deposit and any interest earned thereon to Sublessee. If
Sublessee does not elect to demand the return of the Deposit
and does not vacate the Premises on or before February 20,
2000, then, without further action of the parties, Xxxx shall
immediately pay the Base Rent portion of the Deposit (i.e.,
$15,989.00) to Sublessor and such Base Rent shall be deemed
fully earned by Sublessor upon such payment. If there is
Tender of Possession on or prior to February 15, 2000, then,
without further action of the parties, (I) the Deposit shall
become the property of Sublessor, and (ii) Xxxx shall
immediately pay the Deposit and any interest earned thereon to
Sublessor. At no time shall Xxxx have or be deemed to have an
equitable ownership or security interest in the Deposit.
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(c) In addition, upon the Tender of Possession, Sublessee
shall provide to Sublessor a letter of credit (the "LETTER OF
CREDIT") in form and from either Union Bank or another
financial institution satisfactory to Sublessor in Sublessor's
sole and absolute discretion, naming Sublessor as beneficiary,
to secure Sublessee's payment obligations with respect to the
Sublease Improvements (defined below in paragraph 13.2) and
the first month's CAM charges. The Letter of Credit shall be
issued for a period of one year, and shall be in the amount of
$36,546.00 (the sum of $3,299.00 (February CAM charges) and
$33,246.00 (portion of Sublessee's payment towards Sublease
Improvements). Sublessor shall have the right to draw on the
Letter of Credit (i) upon a default by Sublessee under its
payment obligations with respect to the Sublease Improvements
or (ii) in the amounts and at the times set forth below in
paragraph 13.2 (i.e., upon a Funding Shortfall (if any) and
upon Completion of the Sublease Improvements, each as defined
in paragraph 13.2). No such draw under the foregoing clause
(i) shall cure or constitute a waiver by Sublessor of the
relevant event of default, or be deemed to fix or determine
the amounts to which Sublessor is entitled to recover under
the Sublease, or be deemed to limit or waive Sublessor's
rights to pursue any other remedies provided hereunder or
applicable law.
13.2 SUBLEASE IMPROVEMENTS:
(a) Subject to the provisions of the Master Lease and the
Sublease and to the performance by Sublessee of its deposit
and reimbursement obligations set forth below, Sublessor shall
divide the building by locating a demising wall (the "Demising
Wall") as per Exhibit 3 to the Sublease and add restrooms to
the side of the building to be retained by Sublessor
(collectively, the "Sublease Improvements"). Sublessor shall
have direct access to the existing restrooms located in the
Premises until the new restrooms are completed. Sublessor
shall construct the Demising Wall in accordance with
applicable laws and building codes, and pursuant to plans and
specifications approved by Master Lessor and the City of Lake
Forest. Sublessor agrees to construct the Demising Wall as
soon as is reasonably possible after Tender of Possession and
obtaining the foregoing approvals. Warehouse racking shall
remain in the Premises for the term of the Sublease. Sublessee
shall not at any time have any ownership interest in the
Sublease Improvements.
(b) Sublessee has agreed to pay Sublessor, subject to
Sublessor's reimbursement to Sublessee by means of rent
credits as set forth below, $100,000.00 ("Sublessee's
Contribution") towards the Sublease Improvements to be
provided by Sublessor, such payment to be made as follows:
o $16,753 upon Tender of Possession. This sum had been
included as a portion of the Deposit delivered to Xxxx
and shall be paid to Sublessor, along with the balance
of the Deposit, immediately upon Tender of Possession,
and Sublessee shall not object to or interfere with the
payment of same to Sublessor provided the Tender of
Possession has occurred.
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o $25,000.00 immediately upon the later of
(i) February 1, 2000 or (ii) Tender of Possession
and commencement of the Sublease Improvements.
o $25,000.00 immediately upon a cash shortfall (the
"Funding Shortfall") such that the sum(s) previously
released or paid to Sublessor are not sufficient to
allow Sublessor to timely pay for the costs of the
Sublease Improvements as .the same become due;
provided, however, that under no circumstances shall a
Funding Shortfall exist unless Sublessor has obtained
from the contractor(s) or subcontractor(s) requesting
payment commercially appropriate and reasonable payment
requests, including conditional lien releases covering,
the work for which payment is requested together with
unconditional lien releases for all work previously
paid for.
o Sublessor shall be entitled to draw on the Letter of
Credit (i) to the extent and when there is a Funding
Shortfall and (ii) upon completion of the Sublease
Improvements and final inspection and approval of same
by the City of Lake Forest and upon receipt by
Sublessor of unconditional lien releases for all work
previously paid for and conditional lien releases for
the balance of the Sublease Improvements work
("Completion").
13.3 RENT CREDITS: Provided Sublessee is not, at the relevant time,
in material default of its obligations under the Sublease,
Sublessee shall be entitled to recoup Sublessee's Contribution
via a monthly rent credit not to exceed $10,000.00 per month,
commencing on April 1, 2000, and continuing each month
thereafter until such time as Sublessee's Contribution (i.e.,
$100,000.00) has been fully credited by such monthly rent
credits. In addition, a material default by Sublessee of its
monetary obligations under the Sublease, if not cured within
fifteen (15) days of receipt from Sublessor of written notice
to cure such default, shall terminate Sublessor's obligations
to extend any further rent credits to Sublessee, and shall
terminate any further fights, whether legal or equitable,
Sublessee may have with respect to recouping Sublessee's
Contribution or any portion thereof.
13.4 CARPET CREDIT: Sublessor shall pay to Sublessee a carpet
allowance of $4,000.00, which allowance shall be paid upon
receipt of evidence reasonably satisfactory to Sublessor that
Sublessee has used such allowance to install new floor
covering in the Premises and that such floor covering has been
installed. Sublessor may elect to pay such carpet allowance
through a one-time reduction in Rent., to be credited against
Rent for the next full month following the time Sublessor
becomes obligated to pay such carpet allowance.
14. OCCUPANCY/UTILITIES: As used herein and in the Sublease, the term
"Tender of Possession" shall mean delivering possession of the Premises
to Sublessee immediately following mutual execution and delivery of the
Sublease, receipt of insurance binder
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from Sublessee, and receipt of Master Lessor and Bankruptcy Court
approval. Prior to the Tender of Possession, Sublessee shall be
entitled to occupy and use the Premises, subject to the payment of the
February Base Rent from the Deposit at the time and under the
conditions set forth in paragraph 13.1(b) above, and further subject to
Sublessee's indemnification obligations set forth in paragraph 29
below. Sublessor shall at its expense install a sub meter or check
meter so as to permit the parties to allocate utility costs between the
Premises and Sublessor's remaining space; until such installation,
utility costs will be prorated on a 50/SO basis.
15. RENT INCREASE: On July 1, 2002 the monthly rent due shall increase to
$17,203.00, (plus monthly triple net] C.A.M. charges) for the remainder
of the term. The rent due on June 1, 2007 will be $14,582.00 (25 days
rent), because the sublease expires on June 25, 2007.
16. Sublessee understands that Sublessor is not in a position to render any
of the services or perform any of the obligations required of Master
Lessor by the terms of the Master Lease. Therefore, notwithstanding
anything to the contrary in this Sublease, the performance by Sublessor
of its obligations under this Sublease is and shall be conditioned on
performance by the Master Lessor of its corresponding obligations under
the Master Lease, and Sublessor shall not be liable to Sublessee for
any default of the Master Lessor under the Master Lease. Sublessee
shall not have any claim against Sublessor based on Master Lessor's
failure or refusal to comply with any of the provisions of the Master
Lease unless such failure or refusal is a result of Sublessor's willful
act or failure to act, and Sublessor covenants to perform Sublessor's
Remaining Obligations during the term of the Master Lease. Despite the
Lessor's failure or refusal to comply with any of those provisions of
the Master Lease, this Sublease will remain in full force and effect
and Sublessee will pay the base rent and additional rent and all other
charges provided for in this Sublease without any abatement, deduction
or setoff.
17. Whenever the consent of the Master Lessor is required under the Master
Lease, and whenever the Master Lessor fails to perform its obligations
under the Master Lease, in each case to the extent that such consent or
such failure affects or involves the Premises, Sublessor agrees to use
its reasonable good-faith efforts to obtain at Sublessee's sole cost
and expense such consent or performance on behalf of Sublessee.
18. [deleted by pates]
19. If the event the Master Lease is canceled or terminated for any reason,
or involuntarily surrendered by operation of law prior to the
expiration date of this Sublease, Sublessee agrees, at the sole option
of Master Lessor, to attorn to Master Lessor for the balance of the
Term of this Sublease and on the then executory terms of this Sublease.
Such attornment shall be evidenced by an agreement in the form and
substance reasonably satisfactory to Master Lessor. Sublessee shall
execute and deliver such an agreement at any time within ten (10)
business days after request by Master Lessor. Sublessee waives the
provisions of any law now or later in effect that may provide Sublessee
any rights to terminate this Sublease or to surrender possession of the
sublease premises in the event any proceeding is brought by Master
Lessor to terminate the Master Lease.
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20. Under no circumstances shall Sublessor be required to extend the term
of the Master Lease pursuant to any option or extension right contained
in that Master Lease.
21. Sublessee shall carry insurance in the amounts and otherwise in
accordance with the provisions of the Master Lease, except that
Sublessor shall also be named as an additional insured in addition to
Master Lessor, where applicable.
22. Each party to this Sublease will, from time to time as requested by the
other party and not less than ten (10) days' prior written notice,
execute, acknowledge and deliver to the other party, a statement in
writing certifying that the Sublease is unmodified and in full force
and effect (or if there have been modifications, that the Sublease is
in full force and effect as modified and stating the modifications).
Such statement will certify the dates to which base rent, additional
rent and any other charges have been paid, and will also state whether,
to the knowledge of the person signing she certificate, the other party
is in default beyond any applicable grace period provided in this
Sublease in the performance of any of its obligations' under this
Sublease. It is intended that such a statement may be relied on by
others with whom the party requesting that certificate may be dealing.
23. In addition to, and without diminishing, any other general or express
obligations of Sublessee under the Sublease, including the obligation
to perform and abide by the covenants and restrictions set forth in the
Master Lease, as between Sublessee and Sublessor, Sublessee covenants
and agrees not to cause or permit any Hazardous Material (as defined in
the Master Lease) to be brought upon, stored, used, handled, generated,
released or disposes of on, in, under or about the Premises, Building
(as defined in the Master Lease), or any portion thereof, by Sublessee,
its agents, employees, subsublessees, assignees, licensees, contractors
or invitees (collectively, "Sublessee's Parties"), without the prior
written consent of Sublessor, which consent Sublessor may withhold in
its sole and absolute discretion. Upon the expiration or earlier
termination of this Sublease but subject to Sublessor's right to
oversee remediation described below, Sublessee agrees to promptly
remove from the Premises or Building, at its sole cost and expense, any
and all Hazardous Materials, including any equipment or systems
containing Hazardous Materials which are installed, brought upon,
stored, used, generated or released upon, in, under or about the
Premises or the Building, or any portion thereof, by Sublessee or any
of Sublessee's Parties (i.e., Sublessee shall not be responsible for
removing any Hazardous Material on the Premises which existed prior to
Sublessee's entry onto the Premises or which was installed, brought
upon, stored, used, generated or released upon or released by any
person or entity other than the Sublessee's Parties). To the fullest
extent permitted by law, Sublessee agrees to promptly indemnify,
protect, defend and hold harmless Sublessor and Sublessor's partners,
officers, directors, employees, agents, successors and assigns
(collectively, "Sublessor Indemnified Parties") from and against any
and all claims, damages, judgments, suits, causes of action, losses,
liabilities, penalties, fines, expenses and costs (including, without
limitation, clean-up, removal, remediation and restoration costs, sums
paid in settlement of claims, attorneys' fees, consultant fees and
expert fees and court costs) which arise or result from the presence of
Hazardous Materials on, in, under or about the Premises or Building, or
any other portion thereof but only to the extent that they are caused
or knowingly permitted by Sublessee or any of Sublessee's Parties.
Sublessee agrees to promptly notice Sublessor of any release
12
or suspected release of Hazardous Materials at the Premises or Building
of which Sublessee becomes aware of during the Term of this Sublease,
whether caused by Sublessee or any other persons or entities. In the
event of any release of Hazardous Materials caused or knowingly
permitted by Sublessee or any of Sublessee's Parties, Sublessor shall
have the right, but not the obligation, to cause Sublessee to
immediately take all steps Sublessor reasonably deems necessary or
appropriate to remediate such release and prevent any similar future
release. In the event that any act or omission of Sublessee, any
Sublessee Party, or any agent, contractor, employer, affiliate or
invitee of either of the same shall cause or result in any release of
any Hazardous Substance (including, without limitation, the groundwater
and subsurface soils under the Building or surrounding property), the
Building or the environment or contamination of any of the same by any
Hazardous Substance (collectively, a "Sublessee Release"), Sublessor
may require (a) that Sublessor shall exclusively conduct in good faith
all investigatory, scoping and planning activities with respect to such
Sublessee Release; the preparation and negotiation (with the relevant
governmental authorities) of any action plan or remediation plan
required, necessary or convenient with respect to such Sublessee
Release in order to comply with all Applicable Requirements (as defined
in the Master Lease) or to otherwise restore the affected portion of
the Premises (and/or the Building or surrounding property) to its
condition immediately prior to such Sublessee Release, all as
determined in good faith by Sublessor; the selection of all consultants
and contractors to investigate the need for, scope, perform and monitor
any such remediation or abatement of such Sublessee Release; and all
other matters relating to the investigation and remediation of any such
Sublessee Release, or (b) that Sublessee shall perform such of the
activities as described in the preceding clause (a) with respect to the
Sublessee Release in question as Sublessor shall designate, and in all
cases Sublessee shall reimburse Sublessor for all reasonable costs and
expenses from time to time incurred or expended by Sublessor under this
paragraph within ten (10) days of Sublessor's written demand therefor,
or at Sublessor's election bear such costs and expenses directly. The
provisions of this paragraph will survive the expiration or earlier
termination of this Sublease.
24. This Sublease shall be governed by and construed solely pursuant to the
laws of the State of California, without giving effect to choice of law
principles thereunder.
25. Except as otherwise provided in the Master Lease and this Sublease, all
of the covenants, conditions and provisions of this Sublease shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective heirs, personal representatives, successors and
assigns.
26. The words "Sublessor" and "Sublessee" as used herein shall include the
plural as well as the singular. Words used in any gender include other
genders. The paragraph headings of this Sublease are not a part of this
Sublease and shall have no effect upon the construction or
interpretation of any part hereof Time is of the essence with respect
to the performance of every provision of this Sublease.
27. This Sublease constitutes and is intended by the parties to be a final,
complete and exclusive statement of their entire agreement with respect
to the subject matter hereof
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This Sublease supersedes any and all prior and contemporaneous
agreements and understandings of any kind relating to the subject
matter of this Sublease. There are no other agreements, understandings,
representations, warranties, or statements, either oral or in written
form, concerning the subject matter of this Sublease. No alteration,
modification, amendment or interpretation of this Sublease shall be
binding on the parties unless contained in a writing which is signed by
both parties. The provisions of this Sublease shall be considered
separable such that if any provision or part of this Sublease is ever
held to be invalid, void or illegal under any law or ruling, all
remaining provisions of this Sublease shall remain in full force and
effect to the maximum extent permitted by law.
28. Sublessee shall not record this Sublease or a short form memorandum
thereof without the consent of Sublessor. This Sublease may be executed
in one or more counterparts, each of which shall constitute an original
and all of which shall be one and the same agreement.
29. This Sublease is subject to Bankruptcy Court approval and Sublessee
agrees to use reasonable efforts to obtain such approval as soon as
practicable following execution of this Sublease by all parties and
approval thereof by Master Lessor. The Bankruptcy Court shall not be
deemed to have approved this Sublease unless and until the Bankruptcy
Court has determined that any deposits and letters of credit initially
made or issued in connection with this Sublease are not subject to the
claims of Sublessor's pre-petition creditors. If the Bankruptcy Court
does not approve this Sublease, then this Sublease shall terminate,
except that Sublessee shall nonetheless indemnify, defend and hold
harmless Sublessor from and against any and all claims, damages,
judgments, suits, causes of action, losses, liabilities, penalties,
fines, expenses and costs (including reasonable attorneys' fees,
consultant fees and expert fees and court costs) which arise or result
from Sublessee's or its agents', contractors', or representatives'
activities on, in or about the Premises prior to Tender of Possession.
The indemnification provisions in the preceding sentence shall survive
the termination of the Sublease.
30. The furniture in the office as outlined in Exhibit 2 to the Sublease
shall be the property of the Sublessee; however, if, within seven (7)
years of the Commencement Date, Sublessee is evicted or otherwise
vacates the Premises due to a default by Sublessee under this sublease,
such furniture will, without further action of the parties hereto,
become the property of the Sublessor, without any compensation to
Sublessee therefor.
[SIGNATURE PAGE FOLLOWS.]
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AGREED AND ACCEPTED:
SUBLESSOR: THE L.L. XXXXXXXXXXXXX COMPANY, INC.
By: Date:
--------------------------------- ---------------------------------
SUBLESSEE: LIQUIDMETAL TECHNOLOGIES, INC., a California corporation
By: Date:
--------------------------------- ---------------------------------
By its signature below the undersigned agrees to be bound by and act in
accordance with the terms of paragraph 13.1(b) of this Addendum, and the
individual executing on behalf of the undersigned represents and warrants to
Sublessor and Sublessee that such individual is authorized to bind the
undersigned to the provisions of such paragraph 13.1(b).
XXXX COMMERCIAL BROKERAGE, a
-------------------------------
By: Date:
--------------------------------- ---------------------------------
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FURNITURE PANEL INVENTORY
SIZE QTY SIZE QTY
----------- --- --------- -----
PANELS FURNITURE
24" X 42" 4 Conference Chairs (wood) 5
24" x 54" 13 Big Black Chair 1
24" x 66" 11 Reception Chairs 4
24" x 65" W 7 Executive Chairs 4
30" x 42" 9 Manager Desks 6' x 8'8" 15
30" x 54" 17 Book shelf for credenza 1
30" x 66" 6 Grey Desks 5' x 3' 3
30" x 66" W 9 U Desk 5' x 8' 1
Desk Credenzas 5' x 3' 15
36" x 42" 2
36" x 66" 1 Cylinder table 1
36" x 66" W 2 Corner Computer Table 1
Reception Table 1
48' x 30" 5 Round Conference Table 1
48" x 65" 45
ELECTRONICS
60" x 30" 1 Blk Computer Monitor 24" 1
60" x 36" 6
60" x 66" 6 TV 14" 4
TV 21" 4
SHELVES
16" x 36" 11 TV w/cassette 17" 1
Lamps 9 VHS Cassette Players 2
WAREHOUSE RACKING
Racks 18' X 3.5' 52
Orange Beam 8' long 102
Racks (not earthquake approved) 12
Beams (not earthquake approved) 20 prs
16
ADDENDUM TO
STANDARD SUBLEASE
DATED DECEMBER 18, 2000
THIS ADDENDUM TO STANDARD SUBLEASE IS MADE BY AND BETWEEN THE L.L. XXXXXXXXXXXXX
COMPANY, INC., ("SUBLESSOR") AND LIQUIDMETAL TECHNOLOGIES, INC., A CALIFORNIA
CORPORATION ("SUBLESSEE") AS OF THE DATE SET FORTH ON THE FIRST PAGE OF THAT
CERTAIN AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION OF REAL ESTATE STANDARD
SUBLEASE (LONG-FORM TO BE USED WITH PRE-1998 AIR LEASES) (THE "SUBLEASE")
BETWEEN SUBLESSOR AND SUBLESSEE TO WHICH THIS ADDENDUM IS ATTACHED AND
INCORPORATED. THE TERMS, COVENANTS AND CONDITIONS SET FORTH HEREIN ARE INTENDED
TO AND SHALL HAVE THE SAME FORCE AND EFFECT AS IF SET FORTH AT LENGTH IN THE
BODY OF THE SUBLEASE. TO THE EXTENT THAT THE PROVISIONS OF THIS ADDENDUM ARE
INCONSISTENT WITH ANY PROVISIONS OF THE SUBLEASE, THE PROVISIONS OF THIS
ADDENDUM SHALL SUPERSEDE AND CONTROL.
31. As per the Master Lessor's request for an additional $15,000 Security
Deposit to restore the premises to a single tenant building, it is hereby agreed
that the L.L. Xxxxxxxxxxxxx Company, Inc., will provide $5,000 and Liquid Metal
Technologies, Inc., will provide $10,000. Said monies shall be due to Master
Lessor upon tender of possession pursuant to Paragraph 13.1(b) of Addendum to
Standard Sublease dated December 19, 2000. The L.L. Xxxxxxxxxxxxx Company will
credit $10,000 against the monthly rent obligation of Liquidmetal Technologies
as follows:
May 1, 2001 - $2,500
June 1, 2001 - $2,500
July 1, 2001 - $2,500
August 1, 2001 - $2,500
The aforementioned credits shall be in addition to the rent credits described in
Paragraph 13.3 of the Standard Sublease Document.
SUBLESSOR: THE L.L. XXXXXXXXXXXXX COMPANY, INC.
By: Date:
---------------------------------- ---------------------------------
SUBLESSEE: LIQUIDMETAL TECHNOLOGIES, INC.
By: Date:
---------------------------------- ---------------------------------
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